Praj Industries Limited Recorded A 19% Miss On Revenue: Analysts Are Revisiting Their Models

As you might know, Praj Industries Limited (NSE:PRAJIND) last week released its latest quarterly, and things did not turn out so great for shareholders. It looks like a weak result overall, with both revenues and earnings falling well short of analyst predictions. Revenues of ₹8.3b missed by 19%, and statutory earnings per share of ₹3.83 fell short of forecasts by 7.7%. 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 collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Check out our latest analysis for Praj Industries

Following the latest results, Praj Industries' five analysts are now forecasting revenues of ₹43.5b in 2025. This would be a major 26% improvement in revenue compared to the last 12 months. Per-share earnings are expected to surge 27% to ₹19.33. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹44.9b and earnings per share (EPS) of ₹19.96 in 2025. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a small dip in earnings per share estimates.

The average price target climbed 21% to ₹637despite the reduced earnings forecasts, suggesting that this earnings impact could be a positive for the stock, once it passes. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Praj Industries at ₹746 per share, while the most bearish prices it at ₹576. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that Praj Industries' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 20% growth on an annualised basis. This is compared to a historical growth rate of 30% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 12% annually. So it's pretty clear that, while Praj Industries' revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Praj Industries. They also downgraded Praj Industries' revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Praj Industries going out to 2026, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 2 warning signs for Praj Industries that you need to be mindful 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.