Linde India Limited (NSE:LINDEINDIA) Analysts Just Trimmed Their Revenue Forecasts By 11%

Today is shaping up negative for Linde India Limited (NSE:LINDEINDIA) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.

After this downgrade, Linde India's two analysts are now forecasting revenues of ₹33b in 2025. This would be a major 22% improvement in sales compared to the last 12 months. Statutory earnings per share are presumed to surge 23% to ₹64.72. Prior to this update, the analysts had been forecasting revenues of ₹37b and earnings per share (EPS) of ₹70.36 in 2025. It looks like analyst sentiment has fallen somewhat in this update, with a measurable cut to revenue estimates and a minor downgrade to earnings per share numbers as well.

View our latest analysis for Linde India

The average price target climbed 8.0% to ₹8,541 despite the reduced earnings forecasts, suggesting that this earnings impact could be a positive for the stock, once it passes.

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 Linde India's rate of growth is expected to accelerate meaningfully, with the forecast 22% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 13% p.a. over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 12% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Linde India to grow faster than the wider industry.

The Bottom Line

The biggest issue in the new estimates is that analysts have reduced their earnings per share estimates, suggesting business headwinds lay ahead for Linde India. While analysts did downgrade their revenue estimates, these forecasts still imply revenues will perform better than the wider market. There was also a nice increase in the price target, with analysts apparently feeling that the intrinsic value of the business is improving. Given the stark change in sentiment, we'd understand if investors became more cautious on Linde India after today.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. We have analyst estimates for Linde India going out as far as 2027, and you can see them free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are downgrading their estimates. So you may also wish to search this free list of stocks with high insider ownership.

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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.