Earnings Beat: Gravita India Limited Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

A week ago, Gravita India Limited (NSE:GRAVITA) came out with a strong set of quarterly numbers that could potentially lead to a re-rate of the stock. Results were good overall, with revenues beating analyst predictions by 3.4% to hit ₹10b. Statutory earnings per share (EPS) came in at ₹13.18, some 6.9% above whatthe analysts had expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

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Taking into account the latest results, the current consensus from Gravita India's eight analysts is for revenues of ₹46.2b in 2026. This would reflect a decent 12% increase on its revenue over the past 12 months. Per-share earnings are expected to accumulate 7.3% to ₹53.40. Before this earnings report, the analysts had been forecasting revenues of ₹47.2b and earnings per share (EPS) of ₹54.92 in 2026. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a minor downgrade to earnings per share estimates.

Check out our latest analysis for Gravita India

Despite the cuts to forecast earnings, there was no real change to the ₹2,409 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Gravita India analyst has a price target of ₹3,067 per share, while the most pessimistic values it at ₹2,150. 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. It's clear from the latest estimates that Gravita India's rate of growth is expected to accelerate meaningfully, with the forecast 26% annualised revenue growth to the end of 2026 noticeably faster than its historical growth of 21% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 11% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Gravita India is expected to grow much faster than its industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Gravita India. They also downgraded Gravita India's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. The consensus price target held steady at ₹2,409, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Gravita India going out to 2028, and you can see them free on our platform here.

You still need to take note of risks, for example - Gravita India has 2 warning signs (and 1 which is a bit unpleasant) we think 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.