Hi Gaurav,
What you need to get is the debtor list of the company. Then you need to
find which of these are related party/sister concerns/companies run by
friends/family of promoters. that information is almost impossible to get
most of the times. that is one of the reason for opaqueness of the industry
and why it is so closed.
Once you have the information u then need to know other details like
payment terms, who are end customers of these companies etc to really
understand what is the actual sales.
The second risk is you will rely on inventory valuation given by company.
Auditors don’t audit the value of diamonds used :).
Having said that this is still one of the better companies in the industry.
I know this since i had approached them multiple times to avail banking
facilities from my erstwhile org :).
PS- they had a loss making retail venture. not sure whats happened of that.
but u can check.
Overall, my comment: Too many variables where we dont get information or
wont have information. Hence its a miss for me.
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