Analysts Have Been Trimming Their Jyothy Labs Limited (NSE:JYOTHYLAB) Price Target After Its Latest Report

It's shaping up to be a tough period for Jyothy Labs Limited (NSE:JYOTHYLAB), which a week ago released some disappointing interim results that could have a notable impact on how the market views the stock. Jyothy Labs missed analyst forecasts, with revenues of ₹15b and statutory earnings per share (EPS) of ₹2.86, falling short by 4.2% and 4.7% respectively. 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 Jyothy Labs after the latest results.

View our latest analysis for Jyothy Labs

Taking into account the latest results, the current consensus from Jyothy Labs' twelve analysts is for revenues of ₹29.1b in 2025. This would reflect a credible 3.5% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to accumulate 5.9% to ₹10.84. In the lead-up to this report, the analysts had been modelling revenues of ₹30.4b and earnings per share (EPS) of ₹11.41 in 2025. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the small dip in earnings per share expectations.

It'll come as no surprise then, to learn that the analysts have cut their price target 6.2% to ₹558. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Jyothy Labs analyst has a price target of ₹645 per share, while the most pessimistic values it at ₹410. 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. It's pretty clear that there is an expectation that Jyothy Labs' revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 7.1% growth on an annualised basis. This is compared to a historical growth rate of 11% over the past five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 7.1% annually. Factoring in the forecast slowdown in growth, it looks like Jyothy Labs is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Jyothy Labs. They also downgraded their revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Jyothy Labs going out to 2027, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 1 warning sign for Jyothy Labs 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.