One basic query regarding management…
Many investors advocate benefits of professional management like in case of TCS, Infosys where professionals are hired as CEO and CFO and company operations are handled by professional people. Experience and qualifications are cited as key positives for them.
While promoter-managed comapnies are looked down as they may be not much qualified , like Howard returned or IIM alumni etc. But if we see closely, many promoter managed companies have very high personal wealth of promoters in the form of company equity…so when there is skin in the game, there is a better chance of more prudent decision making and strict control of expenses etc. They are less likely to go on inorganic acquisitions than professional managers. So what is more better? Who will create better value for shareholders?
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