I agee from current quantitative valuation point of view. RBA is winning in every respect. (Can be observed in the Image I attached.)
My concern is more from qualitative perspective. 200 restaurants in 2 years is a huge liability. Plus, Indonesia!! Although, Indonesia wont take 2 years to resolve. Yet, high uncertainty is what I can observe in India alone.
It could work out. But, my fear is from a safety perspective.
Anything can happen in the next Two years. e.g. High QIP flow which it will definitely need. stock prices might remain the same, yet market cap would go up!!!
You mentioned operating cash flow. There are about the same number of stores of RBA as Sapphire. Thus, they generate same cash flows. RBA is burning cash intensely to do that right now. If you checkout cash reserves, RBA’s reducing quite drastically. In September too, it increased by borrowing. Its commitment requires it to burn further money.
My estimate is, it will do a QIP, people would panic. I might be wrong.
Disc. Invested insignificant amount. Terrified to buy at this price, waiting for further correction(Could take eternity), or change of circumstances.
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