Indraprastha Gas Limited (NSE:IGL) Just Reported And Analysts Have Been Cutting Their Estimates

A week ago, Indraprastha Gas Limited (NSE:IGL) came out with a strong set of yearly numbers that could potentially lead to a re-rate of the stock. The company beat expectations with revenues of ₹140b arriving 3.5% ahead of forecasts. Statutory earnings per share (EPS) were ₹28.36, 4.9% ahead of estimates. 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. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Indraprastha Gas

Following the latest results, Indraprastha Gas' 23 analysts are now forecasting revenues of ₹145.5b in 2025. This would be an okay 3.9% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to decrease 5.6% to ₹26.77 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹155.1b and earnings per share (EPS) of ₹29.02 in 2025. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the minor downgrade to earnings per share expectations.

The analysts made no major changes to their price target of ₹462, suggesting the downgrades are not expected to have a long-term impact on Indraprastha Gas' valuation. 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 Indraprastha Gas at ₹540 per share, while the most bearish prices it at ₹350. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Indraprastha Gas shareholders.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Indraprastha Gas' past performance and to peers in the same industry. We would highlight that Indraprastha Gas' revenue growth is expected to slow, with the forecast 3.9% annualised growth rate until the end of 2025 being well below the historical 24% p.a. growth over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue shrink 1.6% per year. So it's clear that despite the slowdown in growth, Indraprastha Gas is still expected to grow meaningfully faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Sadly they also cut their revenue estimates, although at least the company is expected to perform a bit better 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.

With that in mind, we wouldn't be too quick to come to a conclusion on Indraprastha Gas. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Indraprastha Gas going out to 2027, and you can see them free on our platform here..

And what about risks? Every company has them, and we've spotted 3 warning signs for Indraprastha Gas (of which 2 are a bit concerning!) 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.