Any business which grows Sales fast should also have it’s Cash Flow’s growing at same or similar growth rate. For context CF Growth is 6% whereas PAT growth is 40%. If the company wants to keep growing at 40% the the remaining has to be debt funded/ equity dilution which would reduce RoE. If the working capital situation worsens / there is write-off. The stock will keep on hitting lower circuits till it’s just worth it’s current market assets. But this is worst case scenario and company’s avoid this at all costs/
Every Investor has unique perspective. My perspective is sustainability of business with reasonable growth. My style does not rely on 100m dash rather I focus more on marathon runs.
All the Best.
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