GMR Power And Urban Infra Limited (NSE:GMRP&UI) Analysts Are Reducing Their Forecasts For This Year

The latest analyst coverage could presage a bad day for GMR Power And Urban Infra Limited (NSE:GMRP&UI), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. Both revenue and earnings per share (EPS) forecasts went under the knife, suggesting analysts have soured majorly on the business.

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After the downgrade, the dual analysts covering GMR Power And Urban Infra are now predicting revenues of ₹65b in 2026. If met, this would reflect a satisfactory 2.5% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to surge 121% to ₹10.00. Before this latest update, the analysts had been forecasting revenues of ₹66b and earnings per share (EPS) of ₹12.25 in 2026. So there's definitely been a decline in analyst sentiment in the latest consensus numbers, noting the considerable drop in EPS forecasts.

View our latest analysis for GMR Power And Urban Infra

The consensus price target held steady at ₹175, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's pretty clear that there is an expectation that GMR Power And Urban Infra's revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 3.3% growth on an annualised basis. This is compared to a historical growth rate of 9.6% over the past three years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 13% per year. Factoring in the forecast slowdown in growth, it seems obvious that GMR Power And Urban Infra is also expected to grow slower than other industry participants.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for GMR Power And Urban Infra. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data indicates that GMR Power And Urban Infra's revenues are expected to grow slower than the wider market. We're also surprised to see that the price target went unchanged. Still, deteriorating business conditions (assuming accurate forecasts!) can be a leading indicator for the stock price, so we wouldn't blame investors for being more cautious on GMR Power And Urban Infra after the downgrade.

There might be good reason for analyst bearishness towards GMR Power And Urban Infra, like its declining profit margins. For more information, you can click here to discover this and the 2 other risks we've identified.

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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.