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Kajaria Ceramics Limited Just Recorded A 7.1% EPS Beat: Here's What Analysts Are Forecasting Next
Kajaria Ceramics Limited (NSE:KAJARIACER) just released its second-quarter report and things are looking bullish. The company beat expectations with revenues of ₹15b arriving 3.6% ahead of forecasts. Statutory earnings per share (EPS) were ₹11.99, 7.1% 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.
Following the latest results, Kajaria Ceramics' 26 analysts are now forecasting revenues of ₹58.0b in 2027. This would be a meaningful 8.6% improvement in revenue compared to the last 12 months. Per-share earnings are expected to grow 15% to ₹44.03. Before this earnings report, the analysts had been forecasting revenues of ₹56.2b and earnings per share (EPS) of ₹40.45 in 2027. It looks like there's been a modest increase in sentiment following the latest results, withthe analysts becoming a bit more optimistic in their predictions for both revenues and earnings.
View our latest analysis for Kajaria Ceramics
Althoughthe analysts have upgraded their earnings estimates, there was no change to the consensus price target of ₹1,401, suggesting that the forecast performance does not have a long term impact on the company's valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Kajaria Ceramics analyst has a price target of ₹1,701 per share, while the most pessimistic values it at ₹1,041. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
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. It's clear from the latest estimates that Kajaria Ceramics' rate of growth is expected to accelerate meaningfully, with the forecast 18% annualised revenue growth to the end of 2027 noticeably faster than its historical growth of 6.2% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 14% annually. Kajaria Ceramics is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Kajaria Ceramics' earnings potential next year. There was also an upgrade to revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as 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 Kajaria Ceramics. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Kajaria Ceramics analysts - going out to 2029, and you can see them free on our platform here.
You still need to take note of risks, for example - Kajaria Ceramics has 1 warning sign we think you should be aware of.
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