Downgrade: What You Need To Know About The Latest Balaji Amines Limited (NSE:BALAMINES) Forecasts

Today is shaping up negative for Balaji Amines Limited (NSE:BALAMINES) shareholders, with the covering analyst delivering a substantial negative revision to next year's forecasts. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.

Following the downgrade, the current consensus from Balaji Amines' solitary analyst is for revenues of ₹20b in 2025 which - if met - would reflect a notable 17% increase on its sales over the past 12 months. Statutory earnings per share are presumed to jump 66% to ₹94.60. Before this latest update, the analyst had been forecasting revenues of ₹23b and earnings per share (EPS) of ₹98.70 in 2025. It looks like analyst sentiment has fallen somewhat in this update, with a measurable cut to revenue estimates and a small dip in earnings per share numbers as well.

See our latest analysis for Balaji Amines

The average price target climbed 30% to ₹2,831 despite the reduced earnings forecasts, suggesting that this earnings impact could be a positive for the stock, once it passes.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Balaji Amines' revenue growth is expected to slow, with the forecast 13% annualised growth rate until the end of 2025 being well below the historical 22% p.a. growth over the last five years. Compare this to the 313 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 12% per year. Factoring in the forecast slowdown in growth, it looks like Balaji Amines is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing to take away is that the analyst cut their earnings per share estimates, expecting a clear decline in business conditions. Lamentably, they also downgraded their sales forecasts, but the business is still expected to grow at roughly the same rate as the market itself. There was also a nice increase in the price target, with the analyst apparently feeling that the intrinsic value of the business is improving. Overall, given the drastic downgrade to next year's forecasts, we'd be feeling a little more wary of Balaji Amines going forwards.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have analyst estimates for Balaji Amines going out as far as 2026, 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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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.