Yes, it is always a red flag when company is unable to explain it’s competitive advantage and high accounting profits when others in the same region are making losses in the exact same business they are. And, two things as investors we should look for as signals – 1) whether promoter is engaging in building own brand and not of the company, and 2) related party transactions that promoters benefit from substantially.
From above, it is absolutely clear that price may go up / down (who knows) in near term but in the long-term investors will stand to lose.
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