Coforge shares rise 2% as Nuvama, other brokerages say concerns around Chairman's resignation are overdone

Coforge shares experienced a 2% increase on Thursday, as brokerages reaffirmed their positive outlook for the stock, stating that concerns over Chairman Om Prakash Bhatt's resignation following an internal audit were overstated. Coforge's shares reached Rs 1,878 apiece on the NSE on Thursday morning, marking a rise after the stock had plummeted over 5% the previous day due to the announcement of Bhatt's resignation.

The internal audit discovered some concerns regarding the board's handling and presentation of the Board Evaluation Report (BER), which included undisclosed material information related to Bhatt's performance. Following the audit, the board discussed its concerns with Bhatt, who provided a response. The board is still evaluating his explanation and has not yet made a final decision on the matter.

Bhatt resigned from the board with immediate effect, stating that he had carefully considered the issues and that his resignation was appropriate. Nuvama, a brokerage firm, highlighted that Bhatt's tenure was ending as the renewal was not approved by shareholders in the recent Annual General Meeting (AGM). Nuvama emphasized that there was no impact on the company's business or financials, maintaining a 'Buy' recommendation on the stock with a target price of Rs 2,350 apiece, suggesting a potential upside of more than 27%.