Sudarshan Chemical Industries Limited Just Beat Revenue Estimates By 7.3%
Last week, you might have seen that Sudarshan Chemical Industries Limited (NSE:SUDARSCHEM) released its second-quarter result to the market. The early response was not positive, with shares down 2.1% to ₹1,054 in the past week. Results overall were respectable, with statutory earnings of ₹2.80 per share roughly in line with what the analysts had forecast. Revenues of ₹27b came in 7.3% ahead of analyst predictions. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the consensus forecast from Sudarshan Chemical Industries' six analysts is for revenues of ₹105.3b in 2027. This reflects an okay 2.4% improvement in revenue compared to the last 12 months. Per-share earnings are expected to soar 229% to ₹36.50. In the lead-up to this report, the analysts had been modelling revenues of ₹104.9b and earnings per share (EPS) of ₹36.57 in 2027. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
See our latest analysis for Sudarshan Chemical Industries
It will come as no surprise then, to learn that the consensus price target is largely unchanged at ₹1,350. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Sudarshan Chemical Industries analyst has a price target of ₹1,491 per share, while the most pessimistic values it at ₹1,029. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that Sudarshan Chemical Industries' revenue growth will slow down substantially, with revenues to the end of 2027 expected to display 4.9% growth on an annualised basis. This is compared to a historical growth rate of 38% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 12% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Sudarshan Chemical Industries.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Sudarshan Chemical Industries' revenue is expected to perform worse than the wider industry. The consensus price target held steady at ₹1,350, 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 Sudarshan Chemical Industries. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Sudarshan Chemical Industries analysts - going out to 2029, and you can see them free on our platform here.
Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Sudarshan Chemical Industries that you should be aware of.
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