Price to sales went high for a brief period of time- similar to Zoom, Paytm, Netflix, Moderna etc- doesn’t mean that’s the valuations it would get.
Need to compare EV/EBITDA, PE, EV/CFO with other pharma companies listed on NSE and BSE.
EV of sequent = 2500 crores.
FY 22 EBITDA (before earning collapse) = 109 crores.
EV/EBITDA = 24 (this is before earnings collapse that happened in last 3 quarters).
In comparison, EV/EBITDA of Aarti drugs = 14, EV/EBITDA of Granules = 9,
EV/EBITDA of Jubilant pharmanova = 9
Hence, it is trading 2.5 times more expensive than these small-mid pharma/API cos.
Is the management quality much better than other companies, and growth much higher, that market is giving such high valuations?
That’s my question.
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