Broker Revenue Forecasts For Balkrishna Industries Limited (NSE:BALKRISIND) Are Surging Higher

Shareholders in Balkrishna Industries Limited (NSE:BALKRISIND) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. The revenue forecast for this year has experienced a facelift, with the analysts now much more optimistic on its sales pipeline. The stock price has risen 9.2% to ₹2,127 over the past week, suggesting investors are becoming more optimistic. It will be interesting to see if this latest upgrade is enough to kickstart further buying interest in the stock.

After the upgrade, the six analysts covering Balkrishna Industries are now predicting revenues of ₹102b in 2023. If met, this would reflect a substantial 23% improvement in sales compared to the last 12 months. Per-share earnings are expected to expand 11% to ₹82.35. Previously, the analysts had been modelling revenues of ₹89b and earnings per share (EPS) of ₹83.13 in 2023. There's clearly been a surge in bullishness around the company's sales pipeline, even if there's no real change in earnings per share forecasts.

Check out our latest analysis for Balkrishna Industries

It may not be a surprise to see that the analysts have reconfirmed their price target of ₹2,257, implying that the uplift in sales is not expected to greatly contribute to Balkrishna Industries's valuation in the near term. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Balkrishna Industries, with the most bullish analyst valuing it at ₹3,069 and the most bearish at ₹1,692 per share. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. The analysts are definitely expecting Balkrishna Industries' growth to accelerate, with the forecast 23% annualised growth to the end of 2023 ranking favourably alongside historical growth of 14% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 15% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Balkrishna Industries to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with analysts reconfirming that earnings per share are expected to continue performing in line with their prior expectations. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. Seeing the dramatic upgrade to this year's forecasts, it might be time to take another look at Balkrishna Industries.

These earnings upgrades look like a sterling endorsement, but before diving in - you should know that we've spotted 2 potential risk with Balkrishna Industries, including concerns around earnings quality. You can learn more, and discover the 1 other risk we've identified, for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.