Hi Mudit, below is my views on valuations:
Valuation
A: Bear Case
Assumptions:
- Revenue growth of 15% vs Management Guidance of 20%
- EBITDA margins Contracting to 20% vs Management Guidance of 25%
- Valuation of Mcap/EBITDA of 15 times
B: Base Case
Assumptions:
- Revenue growth of 20% as per Management Guidance
- EBITDA margins of 25% as per Management Guidance
- Valuation of Mcap/EBITDA of 22 times (Kims Trades @ 22)
C: Bull Case
Assumptions:
- Revenue growth of 20% as per Management Guidance
- EBITDA margins of 28% because of Op Leverage
- Valuation of Mcap/EBITDA of 30 times (Max Trades @ 40)
What I think is bull case may pan out in next three years. But I want to still wait and watch (may buy small quantity 1%) 2-3 quarters as Q4 and Q1 will be seasonally low and Mr. Market may give us opportunity to add further.
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