Jindal Steel Limited Just Beat Revenue Estimates By 12%
Investors in Jindal Steel Limited (NSE:JINDALSTEL) had a good week, as its shares rose 3.1% to close at ₹1,066 following the release of its first-quarter results. Jindal Steel beat revenue forecasts by a solid 12% to hit ₹155b. Statutory earnings per share came in at ₹33.16, in line with expectations. 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. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Jindal Steel after the latest results.
Taking into account the latest results, the current consensus from Jindal Steel's 30 analysts is for revenues of ₹688.1b in 2027. This would reflect a sizeable 22% increase on its revenue over the past 12 months. Per-share earnings are expected to surge 113% to ₹56.77. In the lead-up to this report, the analysts had been modelling revenues of ₹684.8b and earnings per share (EPS) of ₹66.31 in 2027. So there's definitely been a decline in sentiment after the latest results, noting the real cut to new EPS forecasts.
See our latest analysis for Jindal Steel
The consensus price target held steady at ₹1,231, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic Jindal Steel analyst has a price target of ₹1,410 per share, while the most pessimistic values it at ₹590. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's clear from the latest estimates that Jindal Steel's rate of growth is expected to accelerate meaningfully, with the forecast 30% annualised revenue growth to the end of 2027 noticeably faster than its historical growth of 0.7% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 20% annually. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Jindal Steel to grow 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. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster 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.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Jindal Steel going out to 2029, and you can see them free on our platform here..
It might also be worth considering whether Jindal Steel's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.
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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.