eMudhra Limited Just Missed Earnings And Its Revenue Numbers Were Weaker Than Expected

Shareholders might have noticed that eMudhra Limited (NSE:EMUDHRA) filed its first-quarter result this time last week. The early response was not positive, with shares down 4.9% to ₹864 in the past week. Revenues were ₹924m, 14% below analyst expectations, although losses didn't appear to worsen significantly, with a statutory per-share loss of ₹9.50 being in line with what the analyst anticipated. Following the result, the analyst has 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 gathered the latest post-earnings forecasts to see what estimate suggests is in store for next year.

View our latest analysis for eMudhra

After the latest results, the lone analyst covering eMudhra are now predicting revenues of ₹4.75b in 2025. If met, this would reflect a sizeable 23% improvement in revenue compared to the last 12 months. Per-share earnings are expected to leap 36% to ₹13.00. Yet prior to the latest earnings, the analyst had been anticipated revenues of ₹5.20b and earnings per share (EPS) of ₹14.70 in 2025. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a substantial drop in earnings per share estimates.

The average price target climbed 11% to ₹925despite the reduced earnings forecasts, suggesting that this earnings impact could be a positive for the stock, once it passes.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that eMudhra's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 31% growth on an annualised basis. This is compared to a historical growth rate of 40% over the past year. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 14% annually. So it's pretty clear that, while eMudhra's 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 analyst reduced their earnings per share estimates, suggesting business headwinds could lay ahead for eMudhra. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analyst believes the intrinsic value of the business is likely to improve over time.

With that in mind, we wouldn't be too quick to come to a conclusion on eMudhra. Long-term earnings power is much more important than next year's profits. At least one analyst has provided forecasts out to 2026, which can be seen for free on our platform here.

And what about risks? Every company has them, and we've spotted 1 warning sign for eMudhra you should know about.

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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.

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