Safari Industries (India) Limited Just Missed EPS By 13%: Here's What Analysts Think Will Happen Next
Safari Industries (India) Limited (NSE:SAFARI) just released its latest quarterly report and things are not looking great. Safari Industries (India) missed earnings this time around, with ₹5.8b revenue coming in 2.3% below what the analysts had modelled. Statutory earnings per share (EPS) of ₹7.54 also fell short of expectations by 13%. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
Taking into account the latest results, the consensus forecast from Safari Industries (India)'s nine analysts is for revenues of ₹23.3b in 2027. This reflects a credible 7.7% improvement in revenue compared to the last 12 months. Per-share earnings are expected to rise 3.5% to ₹32.73. Before this earnings report, the analysts had been forecasting revenues of ₹23.4b and earnings per share (EPS) of ₹38.68 in 2027. So there's definitely been a decline in sentiment after the latest results, noting the real cut to new EPS forecasts.
View our latest analysis for Safari Industries (India)
It might be a surprise to learn that the consensus price target was broadly unchanged at ₹1,978, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Safari Industries (India) at ₹2,310 per share, while the most bearish prices it at ₹1,687. 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 Safari Industries (India) shareholders.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's pretty clear that there is an expectation that Safari Industries (India)'s revenue growth will slow down substantially, with revenues to the end of 2027 expected to display 16% growth on an annualised basis. This is compared to a historical growth rate of 22% over the past five years. Compare this to the 401 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 14% per year. So it's pretty clear that, while Safari Industries (India)'s revenue growth is expected to slow, it's expected to grow roughly in line with the 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. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at ₹1,978, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on Safari Industries (India). Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Safari Industries (India) analysts - going out to 2029, and you can see them free on our platform here.
You should always think about risks though. Case in point, we've spotted 1 warning sign for Safari Industries (India) you should be aware of.
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