Godrej Consumer Products Limited (NSE:GODREJCP) Just Reported, And Analysts Assigned A ₹1,060 Price Target
Godrej Consumer Products Limited (NSE:GODREJCP) came out with its second-quarter results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. It looks like the results were a bit of a negative overall. While revenues of ₹44b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 3.6% to hit ₹5.11 per share. 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've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
After the latest results, the 34 analysts covering Godrej Consumer Products are now predicting revenues of ₹176.4b in 2027. If met, this would reflect a satisfactory 6.7% improvement in revenue compared to the last 12 months. Per-share earnings are expected to climb 16% to ₹22.48. Before this earnings report, the analysts had been forecasting revenues of ₹174.6b and earnings per share (EPS) of ₹23.17 in 2027. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.
View our latest analysis for Godrej Consumer Products
The average price target fell 7.4% to ₹1,060, with reduced earnings forecasts clearly tied to a lower valuation estimate. 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. There are some variant perceptions on Godrej Consumer Products, with the most bullish analyst valuing it at ₹1,400 and the most bearish at ₹747 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
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 Godrej Consumer Products' rate of growth is expected to accelerate meaningfully, with the forecast 14% annualised revenue growth to the end of 2027 noticeably faster than its historical growth of 5.5% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 7.9% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Godrej Consumer Products 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. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Godrej Consumer Products' future valuation.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for Godrej Consumer Products going out to 2029, and you can see them free on our platform here.
Before you take the next step you should know about the 1 warning sign for Godrej Consumer Products that we have uncovered.
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