Earnings Beat: Bharat Forge Limited Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

A week ago, Bharat Forge Limited (NSE:BHARATFORG) came out with a strong set of second-quarter numbers that could potentially lead to a re-rate of the stock. The company beat forecasts, with revenue of ₹40b, some 7.6% above estimates, and statutory earnings per share (EPS) coming in at ₹6.26, 22% ahead of expectations. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

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Taking into account the latest results, the consensus forecast from Bharat Forge's 22 analysts is for revenues of ₹163.1b in 2026. This reflects an okay 6.8% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to expand 20% to ₹26.94. Before this earnings report, the analysts had been forecasting revenues of ₹159.6b and earnings per share (EPS) of ₹26.02 in 2026. It looks like there's been a modest increase in sentiment following the latest results, withthe analysts becoming a bit more optimistic in their predictions for both revenues and earnings.

View our latest analysis for Bharat Forge

It will come as no surprise to learn that the analysts have increased their price target for Bharat Forge 8.5% to ₹1,244on the back of these upgrades. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Bharat Forge at ₹1,561 per share, while the most bearish prices it at ₹911. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Bharat Forge's past performance and to peers in the same industry. We would highlight that Bharat Forge's revenue growth is expected to slow, with the forecast 14% annualised growth rate until the end of 2026 being well below the historical 18% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 9.5% per year. So it's pretty clear that, while Bharat Forge's revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Bharat Forge following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Bharat Forge analysts - going out to 2028, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 2 warning signs for Bharat Forge you should be aware of.

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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.