Earnings Update: Here's Why Analysts Just Lifted Their Marico Limited (NSE:MARICO) Price Target To ₹696

Marico Limited (NSE:MARICO) shareholders are probably feeling a little disappointed, since its shares fell 3.7% to ₹649 in the week after its latest first-quarter results. It was a credible result overall, with revenues of ₹26b and statutory earnings per share of ₹3.59 both in line with analyst estimates, showing that Marico is executing in line with 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Marico after the latest results.

View our latest analysis for Marico

Taking into account the latest results, the most recent consensus for Marico from 39 analysts is for revenues of ₹106.5b in 2025. If met, it would imply a meaningful 8.5% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to increase 8.5% to ₹12.73. In the lead-up to this report, the analysts had been modelling revenues of ₹106.7b and earnings per share (EPS) of ₹12.69 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

With the analysts reconfirming their revenue and earnings forecasts, it's surprising to see that the price target rose 9.7% to ₹696. It looks as though they previously had some doubts over whether the business would live up to their expectations. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Marico, with the most bullish analyst valuing it at ₹801 and the most bearish at ₹460 per share. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

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. The analysts are definitely expecting Marico's growth to accelerate, with the forecast 11% annualised growth to the end of 2025 ranking favourably alongside historical growth of 7.2% per annum over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 10% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Marico is expected to grow at about the same rate as the wider industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall 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 forecasts for Marico going out to 2027, and you can see them free on our platform here.

It is also worth noting that we have found 1 warning sign for Marico that you need to take into consideration.

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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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