Need To Know: Analysts Are Much More Bullish On Safari Industries (India) Limited (NSE:SAFARI)

Safari Industries (India) Limited (NSE:SAFARI) shareholders will have a reason to smile today, with the analysts making substantial upgrades to this year's forecasts. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects.

Following the upgrade, the most recent consensus for Safari Industries (India) from its twin analysts is for revenues of ₹12b in 2023 which, if met, would be a meaningful 19% increase on its sales over the past 12 months. Per-share earnings are expected to surge 57% to ₹40.90. Before this latest update, the analysts had been forecasting revenues of ₹10b and earnings per share (EPS) of ₹32.50 in 2023. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

View our latest analysis for Safari Industries (India)

It will come as no surprise to learn that the analysts have increased their price target for Safari Industries (India) 22% to ₹2,196 on the back of these upgrades. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Safari Industries (India), with the most bullish analyst valuing it at ₹2,455 and the most bearish at ₹1,631 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that Safari Industries (India)'s revenue growth is expected to slow, with the forecast 41% annualised growth rate until the end of 2023 being well below the historical 82% growth over the last year. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 14% per year. Even after the forecast slowdown in growth, it seems obvious that Safari Industries (India) is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts upgraded their earnings per share estimates for this year, expecting improving business conditions. Fortunately, analysts also upgraded their revenue estimates, and our data indicates sales are expected to perform better than the wider market. Given that the consensus looks almost universally bullish, with a substantial increase to forecasts and a higher price target, Safari Industries (India) could be worth investigating further.

Analysts are definitely bullish on Safari Industries (India), but no company is perfect. Indeed, you should know that there are several potential concerns to be aware of, including concerns around earnings quality. You can learn more, and discover the 2 other flags we've identified, for free on our platform here.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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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.