Investors in Birlasoft Limited (NSE:BSOFT) had a good week, as its shares rose 6.3% to close at ₹323 following the release of its quarterly results. Birlasoft reported ₹14b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of ₹5.65 beat expectations, being 3.6% higher than what the analysts expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Birlasoft after the latest results.
Following the latest results, Birlasoft's 14 analysts are now forecasting revenues of ₹56.7b in 2027. This would be a modest 2.9% improvement in revenue compared to the last 12 months. Per-share earnings are expected to rise 4.1% to ₹22.94. Yet prior to the latest earnings, the analysts had been anticipated revenues of ₹55.9b and earnings per share (EPS) of ₹22.45 in 2027. So the consensus seems to have become somewhat more optimistic on Birlasoft's earnings potential following these results.
View our latest analysis for Birlasoft
The consensus price target rose 6.1% to ₹349, suggesting that higher earnings estimates flow through to the stock's valuation as well. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Birlasoft at ₹420 per share, while the most bearish prices it at ₹255. 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.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Birlasoft's past performance and to peers in the same industry. We can infer from the latest estimates that forecasts expect a continuation of Birlasoft'shistorical trends, as the 5.8% annualised revenue growth to the end of 2027 is roughly in line with the 5.6% annual growth over the past five years. Compare this with the broader industry (in aggregate), which analyst estimates suggest will see revenues grow 11% annually. So it's pretty clear that Birlasoft is expected to grow slower than similar companies in the same 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 Birlasoft following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Birlasoft's revenue is expected to perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
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 Birlasoft 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 Birlasoft you should be aware of.
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