Stock Analysis

Chambal Fertilisers and Chemicals Limited Just Beat Earnings Expectations: Here's What Analysts Think Will Happen Next

NSEI:CHAMBLFERT
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As you might know, Chambal Fertilisers and Chemicals Limited (NSE:CHAMBLFERT) just kicked off its latest first-quarter results with some very strong numbers. Chambal Fertilisers and Chemicals delivered a significant beat to revenue and earnings per share (EPS) expectations, hitting ₹49b-12% above indicated-and₹11.19-70% above forecasts- respectively 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. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Chambal Fertilisers and Chemicals

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NSEI:CHAMBLFERT Earnings and Revenue Growth August 10th 2024

Taking into account the latest results, the most recent consensus for Chambal Fertilisers and Chemicals from twin analysts is for revenues of ₹193.3b in 2025. If met, it would imply a meaningful 12% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to climb 18% to ₹40.95. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹192.8b and earnings per share (EPS) of ₹40.25 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.

The consensus price target rose 32% to ₹564despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of Chambal Fertilisers and Chemicals' earnings by assigning a price premium.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Chambal Fertilisers and Chemicals' past performance and to peers in the same industry. The period to the end of 2025 brings more of the same, according to the analysts, with revenue forecast to display 16% growth on an annualised basis. That is in line with its 15% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 12% per year. So although Chambal Fertilisers and Chemicals is expected to maintain its revenue growth rate, it's definitely expected to grow faster than 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. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that in mind, we wouldn't be too quick to come to a conclusion on Chambal Fertilisers and Chemicals. Long-term earnings power is much more important than next year's profits. At least one analyst has provided forecasts out to 2027, which can be seen for free on our platform here.

However, before you get too enthused, we've discovered 3 warning signs for Chambal Fertilisers and Chemicals that 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.