Con Calls is very important to understand if this margins’s are sustainable or they are a one off element. As there seems to be a good correction right now, market is seeing these margins as unsustainable. Same was seen with the likes of Divis Labs, & Dr Lal Path Labs as record profits saw good correction because margins were peaking out & were unsustainable.
Although, cross cycle valuations seems reasonable as the company has healthy fundamentals with execellent roce & margins profile. Management commentary would be very great to listen to provided they share the con calls details.
Although without complete data, it will be difficult to state that margins are at peak right now, however, valuation definitely is not at peak at this moment.
Disc - Invested & Biased.
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