Most Important Ratios – my take

Putting above perspectives in practical sense for one company in which I have recently invested: Andhra Paper

1. DE ratio – currently at 0. Company reduced it from 1.4 in 2014 till 0 in 2023.
2. Promotor holding of 72%
3. Pledged percentage of 0%
4. FCF to invested capital CAGRs, last 3 years have been phenomenal. 5 years have effect of COVID lockdown in which all paper companies suffered hugely.
   
5. Reinvestment Rate of 52% from debt + equity perspective and 92% from equity perspective. This is extremely high. This means company is investing 52% / 92% of its earnings into business.
6. ROIIC of 83% and 46% from debt + equity and from equity perspective respectively. This is again extremely high. Whatever company is reinvesting in the company, its generating a return of 83% / 46%.
7. Value compounding rate of the company 43% which is again very high. Company is expected to grow its earnings by 43% in future.
8. Price CAGR is only 6% which is very low in comparison with 43% which suggests its currently undervalued.

Please note:

1. I am invested in this company so my views may be biased.
2. This is not a buy / sell recommendation.