Rajratan Global Wire Limited Just Beat Revenue By 13%: Here's What Analysts Think Will Happen Next

Investors in Rajratan Global Wire Limited (NSE:RAJRATAN) had a good week, as its shares rose 8.4% to close at ₹890 following the release of its first-quarter results. It was a mildly positive result, with revenues exceeding expectations at ₹2.5b, while statutory earnings per share (EPS) of ₹24.49 were in line with analyst forecasts. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for Rajratan Global Wire

Following the latest results, Rajratan Global Wire's dual analysts are now forecasting revenues of ₹10.7b in 2023. This would be a decent 11% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to accumulate 5.3% to ₹28.40. In the lead-up to this report, the analysts had been modelling revenues of ₹10.7b and earnings per share (EPS) of ₹28.40 in 2023. 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 15% to ₹880despite there being no meaningful change to earnings estimates. It could be that the analystsare reflecting the predictability of Rajratan Global Wire's earnings by assigning a price premium.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Rajratan Global Wire's revenue growth is expected to slow, with the forecast 15% annualised growth rate until the end of 2023 being well below the historical 21% p.a. growth over the last five years. Juxtapose this against the other companies in the industry with analyst coverage, which are forecast to grow their revenues (in aggregate) 0.7% per year. Even after the forecast slowdown in growth, it seems obvious that Rajratan Global Wire is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. 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. 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 Rajratan Global Wire. Long-term earnings power is much more important than next year's profits. We have analyst estimates for Rajratan Global Wire going out as far as 2024, and you can see them free on our platform here.

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 1 warning sign with Rajratan Global Wire , and understanding this should be part of your investment process.

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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.