Arvind Limited Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

It's been a good week for Arvind Limited (NSE:ARVIND) shareholders, because the company has just released its latest second-quarter results, and the shares gained 3.5% to ₹331. It looks like a credible result overall - although revenues of ₹24b were in line with what the analysts predicted, Arvind surprised by delivering a statutory profit of ₹3.94 per share, a notable 15% above 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 Arvind's five analysts is for revenues of ₹90.8b in 2026. This reflects a reasonable 4.5% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to reduce 8.2% to ₹14.40 in the same period. In the lead-up to this report, the analysts had been modelling revenues of ₹90.3b and earnings per share (EPS) of ₹14.96 in 2026. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a minor downgrade to their earnings per share forecasts.

See our latest analysis for Arvind

It might be a surprise to learn that the consensus price target was broadly unchanged at ₹407, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. 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. The most optimistic Arvind analyst has a price target of ₹442 per share, while the most pessimistic values it at ₹331. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Arvind is an easy business to forecast or the the analysts are all using similar assumptions.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's clear from the latest estimates that Arvind's rate of growth is expected to accelerate meaningfully, with the forecast 9.2% annualised revenue growth to the end of 2026 noticeably faster than its historical growth of 7.2% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 13% per year. So it's clear that despite the acceleration in growth, Arvind is expected to grow meaningfully slower than the industry average.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Arvind. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Arvind's revenue is expected to perform worse than the wider industry. The consensus price target held steady at ₹407, with the latest estimates not enough to have an impact on their price targets.

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 Arvind going out to 2028, and you can see them free on our platform here.

You still need to take note of risks, for example - Arvind has 1 warning sign we think 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.