Earnings Update: Here's Why Analysts Just Lifted Their Aditya Birla Sun Life AMC Limited (NSE:ABSLAMC) Price Target To ₹806

Aditya Birla Sun Life AMC Limited (NSE:ABSLAMC) investors will be delighted, with the company turning in some strong numbers with its latest results. Results were good overall, with revenues beating analyst predictions by 3.2% to hit ₹20b. Statutory earnings per share (EPS) came in at ₹32.18, some 2.0% above whatthe analysts had expected. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Aditya Birla Sun Life AMC after the latest results.

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Taking into account the latest results, the most recent consensus for Aditya Birla Sun Life AMC from eleven analysts is for revenues of ₹21.4b in 2026. If met, it would imply a modest 7.7% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to increase 5.0% to ₹33.86. Before this earnings report, the analysts had been forecasting revenues of ₹20.7b and earnings per share (EPS) of ₹33.20 in 2026. There doesn't appear to have been a major change in sentiment following the results, other than the small lift in revenue estimates.

Check out our latest analysis for Aditya Birla Sun Life AMC

The analysts increased their price target 5.2% to ₹806, perhaps signalling that higher revenues are a strong leading indicator for Aditya Birla Sun Life AMC's valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Aditya Birla Sun Life AMC at ₹985 per share, while the most bearish prices it at ₹670. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Aditya Birla Sun Life AMC shareholders.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Aditya Birla Sun Life AMC's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Aditya Birla Sun Life AMC's revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 7.7% growth on an annualised basis. This is compared to a historical growth rate of 10% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 12% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Aditya Birla Sun Life AMC.

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. Fortunately, they also upgraded their revenue estimates, although our data indicates it is expected to perform worse than 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 Aditya Birla Sun Life AMC analysts - going out to 2028, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 2 warning signs for Aditya Birla Sun Life AMC you should be aware of, and 1 of them is significant.

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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.