NTPC Limited Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

It's been a good week for NTPC Limited (NSE:NTPC) shareholders, because the company has just released its latest quarterly results, and the shares gained 2.8% to ₹318. It looks like a pretty bad result, all things considered. Although revenues of ₹428b were in line with analyst predictions, statutory earnings fell badly short, missing estimates by 23% to hit ₹3.84 per share. 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. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for NTPC

Taking into account the latest results, the consensus forecast from NTPC's 14 analysts is for revenues of ₹1.85t in 2025. This reflects a satisfactory 5.6% improvement in revenue compared to the last 12 months. Per-share earnings are expected to increase 7.0% to ₹21.51. In the lead-up to this report, the analysts had been modelling revenues of ₹1.93t and earnings per share (EPS) of ₹23.25 in 2025. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a small dip in earnings per share estimates.

The average price target climbed 8.6% to ₹337despite the reduced earnings forecasts, suggesting that this earnings impact could be a positive for the stock, once it passes. 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 NTPC at ₹415 per share, while the most bearish prices it at ₹215. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

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. We would highlight that NTPC's revenue growth is expected to slow, with the forecast 4.5% annualised growth rate until the end of 2025 being well below the historical 15% p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 14% 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 NTPC.

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. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse 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 NTPC. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple NTPC analysts - going out to 2026, and you can see them free on our platform here.

Even so, be aware that NTPC is showing 2 warning signs in our investment analysis , and 1 of those is a bit unpleasant...

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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.