Thanks Rajesh. For new businesses, I’m counting on the metric What is the growth strategy? That should cover growth via new products, new geographies, new product lineup, new target customer segment.
Regarding your point on Valuation, it is still something I’m evolving in my head. I know methods like DCF exist, and I used to use them in the past, but just couldn’t find enough accuracy to proceed with them. What my thinking regarding valuation is: Based on the thinking that ‘prices will always return to mean in the long run’, I compare the current PE to the historical PE
Why 30? Nifty history PE for last 10 years has been around 22, so 30 is just a comfort number based on that. I’m not too strict about it though. I have invested in Indian Hotels which trades at a 70+ PE and historically has always done so.
| Subscribe To Our Free Newsletter |
