Birla Corporation Limited Just Missed Earnings - But Analysts Have Updated Their Models

Last week, you might have seen that Birla Corporation Limited (NSE:BIRLACORPN) released its first-quarter result to the market. The early response was not positive, with shares down 7.4% to ₹1,319 in the past week. Revenues were in line with forecasts, at ₹25b, although statutory earnings per share came in 14% below what the analysts expected, at ₹15.53 per share. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

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Following the latest results, Birla's 14 analysts are now forecasting revenues of ₹99.6b in 2026. This would be an okay 5.0% improvement in revenue compared to the last 12 months. Per-share earnings are expected to jump 40% to ₹69.49. Before this earnings report, the analysts had been forecasting revenues of ₹99.8b and earnings per share (EPS) of ₹71.28 in 2026. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

Check out our latest analysis for Birla

The consensus price target held steady at ₹1,564, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on Birla, with the most bullish analyst valuing it at ₹1,713 and the most bearish at ₹1,416 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

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 Birla's revenue growth is expected to slow, with the forecast 6.8% annualised growth rate until the end of 2026 being well below the historical 8.7% p.a. growth over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue shrink 0.6% per year. So it's clear that despite the slowdown in growth, Birla is still expected to grow meaningfully faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the plus side, they made no changes to their revenue estimates - and they expect it to perform better than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Birla. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Birla going out to 2028, and you can see them free on our platform here..

And what about risks? Every company has them, and we've spotted 2 warning signs for Birla you should know about.

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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.