Earnings Miss: India Pesticides Limited Missed EPS By 9.3% And Analysts Are Revising Their Forecasts

As you might know, India Pesticides Limited (NSE:IPL) recently reported its full-year numbers. Revenues of ₹7.3b were in line with forecasts, although statutory earnings per share (EPS) came in below expectations at ₹13.78, missing estimates by 9.3%. Earnings are an important time for investors, as they can track a company's performance, look at what the analyst is 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 estimate suggests is in store for next year.

View our latest analysis for India Pesticides

Taking into account the latest results, the consensus forecast from India Pesticides' lone analyst is for revenues of ₹8.55b in 2023, which would reflect a solid 17% improvement in sales compared to the last 12 months. Per-share earnings are expected to ascend 14% to ₹15.70. Yet prior to the latest earnings, the analyst had been anticipated revenues of ₹8.53b and earnings per share (EPS) of ₹16.90 in 2023. The analyst seem to have become a little more negative on the business after the latest results, given the small dip in their earnings per share numbers for next year.

The consensus price target held steady at ₹375, with the analyst seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future.

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. We can infer from the latest estimates that forecasts expect a continuation of India Pesticides'historical trends, as the 17% annualised revenue growth to the end of 2023 is roughly in line with the 21% annual revenue growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 12% annually. So although India Pesticides is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analyst downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting sales are tracking in line with expectations - and our data suggests that revenues are expected to grow faster 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.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have analyst estimates for India Pesticides going out as far as 2024, and you can see them free on our platform here.

It is also worth noting that we have found 3 warning signs for India Pesticides (1 makes us a bit uncomfortable!) that you need to take into consideration.

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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.