It’s extremely hard to comment on valuations. As it would require to predict the future.
But we can break down the future into three possible scenarios:
- QoQ growth goes negative but YoY retains: Stock will go for time correction
- QoQ and YoY both go negative: Depending on management commentary, the stock will go for derating or correction.
- General market correction (high chances in the small-cap): Stock will go for correction along with the market.
Chances of #1 and #2 are low as management has stated in concall that they are confident of achieving 14 to 15% revenue growth on a QoQ basis for the next five years (the market is trusting this statement for now). The PE of 90 might look expensive but if they are able to grow at the same pace then earnings will compensate for the increase in price.
My personal advice is you may take a position at this moment only if you have extra funds to average it in the future.
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