Steel Authority of India Limited Beat Analyst Estimates: See What The Consensus Is Forecasting For This Year

The yearly results for Steel Authority of India Limited (NSE:SAIL) were released last week, making it a good time to revisit its performance. Revenues were ₹1.1t, approximately in line with whatthe analysts expected, although statutory earnings per share (EPS) crushed expectations, coming in at ₹7.42, an impressive 30% ahead of estimates. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Steel Authority of India

Taking into account the latest results, the consensus forecast from Steel Authority of India's 17 analysts is for revenues of ₹1.10t in 2025. This reflects a satisfactory 3.1% improvement in revenue compared to the last 12 months. Per-share earnings are expected to surge 31% to ₹9.76. Before this earnings report, the analysts had been forecasting revenues of ₹1.10t and earnings per share (EPS) of ₹9.73 in 2025. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.

With the analysts reconfirming their revenue and earnings forecasts, it's surprising to see that the price target rose 15% to ₹125. It looks as though they previously had some doubts over whether the business would live up to their expectations. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Steel Authority of India analyst has a price target of ₹200 per share, while the most pessimistic values it at ₹85.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Steel Authority of India's past performance and to peers in the same industry. It's pretty clear that there is an expectation that Steel Authority of India's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 3.1% growth on an annualised basis. This is compared to a historical growth rate of 14% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 9.4% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Steel Authority of India.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Steel Authority of India's revenue is expected to perform worse 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.

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 forecasts for Steel Authority of India going out to 2027, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 2 warning signs for Steel Authority of India you should be aware of, and 1 of them is concerning.

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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.