Earnings Miss: SRF Limited Missed EPS By 14% And Analysts Are Revising Their Forecasts

SRF Limited (NSE:SRF) last week reported its latest quarterly results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. Statutory earnings per share of ₹8.51 unfortunately missed expectations by 14%, although it was encouraging to see revenues of ₹35b exceed expectations by 3.5%. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. 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 SRF

Taking into account the latest results, the consensus forecast from SRF's 26 analysts is for revenues of ₹149.2b in 2025. This reflects a meaningful 13% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to soar 30% to ₹54.00. In the lead-up to this report, the analysts had been modelling revenues of ₹150.0b and earnings per share (EPS) of ₹56.26 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

The consensus price target held steady at ₹2,369, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values SRF at ₹2,796 per share, while the most bearish prices it at ₹1,605. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We can infer from the latest estimates that forecasts expect a continuation of SRF'shistorical trends, as the 17% annualised revenue growth to the end of 2025 is roughly in line with the 16% annual growth over the past five years. Compare this with the broader industry, which analyst estimates (in aggregate) suggest will see revenues grow 11% annually. So although SRF is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for SRF. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at ₹2,369, with the latest estimates not enough to have an impact on their price targets.

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 SRF going out to 2027, and you can see them free on our platform here.

Even so, be aware that SRF is showing 2 warning signs in our investment analysis , you should know about...

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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.

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