Free cash flow is not the same as free cash
Free cash flow is cash flow left over after meeting expenses and capex
Free cash if not needed is a drag on RoE
I don’t know what Bajaj doesn’t with their cash but hero invests part of it in liquid funds and short term bonds. They only earn 7% which has a corporate tax on top
Better to pay that out to shareholders if its not needed by dividends or buybacks and focus on the business. It’ll increase roe and the management can focus on business rather than how to use that money
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