Investors in JK Tyre & Industries Limited (NSE:JKTYRE) had a good week, as its shares rose 7.0% to close at ₹572 following the release of its quarterly results. It was a workmanlike result, with revenues of ₹42b coming in 2.3% ahead of expectations, and statutory earnings per share of ₹18.05, in line with analyst appraisals. 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. We’ve gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
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Taking into account the latest results, the current consensus from JK Tyre & Industries’ six analysts is for revenues of ₹175.2b in 2027. This would reflect a decent 10% increase on its revenue over the past 12 months. Per-share earnings are expected to bounce 62% to ₹38.24. Before this earnings report, the analysts had been forecasting revenues of ₹173.2b and earnings per share (EPS) of ₹36.34 in 2027. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
Check out our latest analysis for JK Tyre & Industries
The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 9.6% to ₹547. There’s another way to think about price targets though, and that’s to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values JK Tyre & Industries at ₹650 per share, while the most bearish prices it at ₹400. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The period to the end of 2027 brings more of the same, according to the analysts, with revenue forecast to display 8.3% growth on an annualised basis. That is in line with its 9.2% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 11% per year. So although JK Tyre & Industries is expected to maintain its revenue growth rate, it’s forecast to grow slower than the wider industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards JK Tyre & Industries following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
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 estimates – from multiple JK Tyre & Industries analysts – going out to 2028, and you can see them free on our platform here.
You should always think about risks though. Case in point, we’ve spotted 2 warning signs for JK Tyre & Industries you should be aware of.
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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.
