This works for a Debt provider, interest coverage by x times of EBITDA. Equity investor could expect to benefit only from a sustainable Net Profit .
Offline businesses ,which you named, have real expenses after EBITDA – Interest Cost for leasing at the prime locations, Depreciation Cost to continue maintaining pristine physical outlets. Hence, their NP is erratic while B/S is heavy. In turn, ROE remains anemic. I expect that Nykaa will keep these costs under control and achieve respectable ROE in the long run.
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