Brokers Are Upgrading Their Views On Central Depository Services (India) Limited (NSE:CDSL) With These New Forecasts

Celebrations may be in order for Central Depository Services (India) Limited (NSE:CDSL) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with analysts modelling a real improvement in business performance.

After this upgrade, Central Depository Services (India)'s four analysts are now forecasting revenues of ₹4.8b in 2022. This would be an okay 7.6% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to shoot up 22% to ₹25.44. Before this latest update, the analysts had been forecasting revenues of ₹4.0b and earnings per share (EPS) of ₹22.58 in 2022. There has definitely been an improvement in perception recently, with the analysts substantially increasing both their earnings and revenue estimates.

See our latest analysis for Central Depository Services (India)

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that Central Depository Services (India)'s revenue growth is expected to slow, with the forecast 10% annualised growth rate until the end of 2022 being well below the historical 19% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 7.6% annually. So it's pretty clear that, while Central Depository Services (India)'s revenue growth is expected to slow, it's still expected to grow faster than the industry itself.

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. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. The clear improvement in sentiment should be enough to get most shareholders feeling more optimistic about Central Depository Services (India)'s future.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Central Depository Services (India) analysts - going out to 2024, and you can see them 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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