“Beauty lies in the eyes of the beholder. Same thing applies to valuations.”
Yet there are limits to what market participants, as a whole group, accept to be unwise or flat out wrong.
Triple digit P/Es, High D/E, Promoter Selling (Shivalik) and multiple such aspects.
I have gone through the company and the product is sticky, very sticky, I agree with you there, BUT exuberance is dangerous.
World is very quickly moving towards AI and ML being the norm, real disruption. Yet is anyone willing to pay 50-100xP/E for our top IT companies? Of course not, and it is clear top IT names will enjoy the fruits of this revolution. So, there is a limit to your statement about someone finding something valuable which is considered bad by others. Subjective Preference can not escape reason for long, which is what I fear seems to be the case here.
Hence, it is confusing to see why such big benefit of the doubt for Usha Martin and not for other names who fall in similar trends, demography and industries.
I really like the product, its such an obvious winner, but buying a not so great company at great valuations is better than a great company which is valued this way – 6x EPS growth and 10x valuation growth.
Edited to add this :
Appreciate your comment Hitesh. Been through the threads you mentioned, will do so again.
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