Gravita India Limited Just Recorded A 13% EPS Beat: Here's What Analysts Are Forecasting Next

As you might know, Gravita India Limited (NSE:GRAVITA) just kicked off its latest first-quarter results with some very strong numbers. It was overall a positive result, with revenues beating expectations by 7.5% to hit ₹9.1b. Gravita India reported statutory earnings per share (EPS) ₹9.82, which was a notable 13% above what the analysts had forecast. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Gravita India after the latest results.

Check out our latest analysis for Gravita India

Taking into account the latest results, the consensus forecast from Gravita India's five analysts is for revenues of ₹41.0b in 2025. This reflects a huge 22% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to leap 20% to ₹45.27. Before this earnings report, the analysts had been forecasting revenues of ₹41.1b and earnings per share (EPS) of ₹43.87 in 2025. So the consensus seems to have become somewhat more optimistic on Gravita India's earnings potential following these results.

The consensus price target rose 32% to ₹1,480, suggesting that higher earnings estimates flow through to the stock's valuation as well. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Gravita India at ₹1,750 per share, while the most bearish prices it at ₹641. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

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. The analysts are definitely expecting Gravita India's growth to accelerate, with the forecast 30% annualised growth to the end of 2025 ranking favourably alongside historical growth of 23% per annum 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 takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Gravita India's earnings potential next year. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that in mind, we wouldn't be too quick to come to a conclusion on Gravita India. Long-term earnings power is much more important than next year's profits. We have forecasts for Gravita India going out to 2027, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 4 warning signs for Gravita India (2 shouldn't be ignored) 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com