Earnings Update: Here's Why Analysts Just Lifted Their R R Kabel Limited (NSE:RRKABEL) Price Target To ₹1,927

Last week saw the newest yearly earnings release from R R Kabel Limited (NSE:RRKABEL), an important milestone in the company's journey to build a stronger business. Revenues of ₹67b were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at ₹26.57, missing estimates by 3.5%. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See our latest analysis for R R Kabel

Taking into account the latest results, the consensus forecast from R R Kabel's ten analysts is for revenues of ₹79.4b in 2025. This reflects a decent 19% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to jump 42% to ₹37.46. Before this earnings report, the analysts had been forecasting revenues of ₹79.5b and earnings per share (EPS) of ₹37.81 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The consensus price target rose 7.2% to ₹1,927despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of R R Kabel's earnings by assigning a price premium. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic R R Kabel analyst has a price target of ₹2,200 per share, while the most pessimistic values it at ₹1,578. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the R R Kabel's past performance and to peers in the same industry. The period to the end of 2025 brings more of the same, according to the analysts, with revenue forecast to display 19% growth on an annualised basis. That is in line with its 24% annual growth over the past three years. Juxtapose this against our data, which suggests that other companies (with analyst coverage) in the industry are forecast to see their revenues grow 19% per year. It's clear that while R R Kabel's revenue growth is expected to continue on its current trajectory, it's only expected to grow in line with the industry itself.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as 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.

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 estimates - from multiple R R Kabel analysts - going out to 2027, 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 1 warning sign for R R Kabel 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.