True. I’ve complained on this forum of vague number provided in concalls before. I hope Dua learns that number uttered, even in the most hypothetical scenarios, will be quoted back.
800cr. did seem like surreal and actually got my heart racing due to the below calculation:
If we look at it from an annual asset turn perspective where capex this year, gives revenue next year, these are the numbers we get:
Assets: 800 (this year) + ~200 (existing 210 - 12 intangible assets ) = ~1000 cr. This will be in FY24-25
Revenue in 25-26 from above at 1.5x asset turn = 1000 X 1.5 = 1500 cr.
Assume, PAT margin is 15% (24% now - 9% debt interest assumed) = 1500 * 0.15 = 225 cr.
EPS = 225 /1.45 = 155 Rs/ share
PE (in todays price) = 1818 (CMP) / 155 = ~11.7
Now these are quite conservative assumptions. It does not assume capex will give returns within the same year. PAT is assumed low. No new CAPEX and returns in FY25-26.
I have not accounted for mounting depreciation but the point is that the dream of these numbers go my heart rate up and that does not happen often.
With the 800cr. assumption gone, let’s see where this goes. Will have better idea in H2.
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