I disagree with your analysis of 10x in 10 Years. Hence, it is not a value trap today.
Past 10 years were very different for the gold loan companies. Their golden period of growth is in past now. I recommend reading few reports which were released 1-2 years back, they have explained in detail the phases this sector went through. Today, even opening of new branches is regulated and cant be done at a fast pace.
Technology has also improved which has made competition to enter the market much more easily than previous times. This business used to be heavily operational heavy and still it is but technology is making it little easier now.
We shouldn’t throw away the data which we get, this is one important thing we can learn from technical analysts. The data provides that Manappuram is losing market share, growth has slowed down, and on other hand NBFC like IIFL kept growing. Why? One has to figure these things out to understand whether such companies fit in their style of investing.
I don’t know whether it’s a value trap or not but past performance can’t be used to conclude it is not one.
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