Let’s suppose a company sales growth is growing at 10 % and profit growth is 10% where as it’s stock price CAGR is growing at 40 % how do we draw conculsion about that stock. I just pasted one random example but what I am trying to understand is when company sales and profits are growing at 10% but it’s stock price is growing at 4 times than it’s profit growth. is there any relativity between all these three parameters or should I look at these independently.
Starlink can not give same bandwidth. We are used to such high data consumption, no one will go back to low data speeds. Also Starlink will have latency issues (Light coming from a satellite vs from tower nearby). It is good for connecting far-flung and sparsely populated areas like mountain, north-east where cost of tower infrastructure is too high per consumer.
PE has two sides.
Highe PE is generally considered only due to price increasing beyond logical limit.
But there is a denominator too. High PE is also due to temporary decrease in earnings due to many temporary reasons. So We first needs to find out if high PE is due to increase in price or due to decrease in earnings. And if its due to decrease in earnings, then we have to analyse if its temporary decrease or business model is crumbling. With this understanding, can you verify whether above High PE are pertaining to which reasons?
Pardon the naive question, doesn’t ICICI direct and other similar brokerages offer bonds? Trying to understand the need for sites like IndiaBonds
ICRA Rating update 29 Dec ’23:
The ratings derive comfort from the backward integration achieved at KFIL‘s manufacturing plant through coke oven plant and captive power generation, which leads to substantial cost savings. The cost structure would further improve once the captive iron oremines become operational.
ICRA expects ISMT’s healthy credit metrics to sustain in FY2024 on the back of its focus on value added/high margin products, debottlenecking activities and various cost and efficiency optimisation measures to be undertaken by the company (including setting up a solar power plant to reduce power cost). Going forward, the consolidated performance of KFIL is likely to be driven by improving operating and financial parameters of ISMT.
Besides, in September 2023, KFIL acquired a 100% stake in Oliver Engineering Private Limited (OEPL) for ~Rs. 112 crore (debt funded). OEPL manufactures simple castings with a capacity of 28,000 MTPA in Punjab. Being in the similar line of business, OEPL’s acquisition provides KFIL entry into the North India market in the castings segment
KFIL has substantial capex plans (at the consolidated level) of Rs. 600-800 crore per annum over the next two years towards installation of pulverised coal injection, capacity expansion, solar power project, setting up of alloy steel plant, debottlenecking, and other cost saving projects, which would keep its debt levels elevated. Along with high debt repayments of around Rs. 300 crore per annum in FY2024 and FY2025, these would keep its free cash flows under check
Also in recent times the contract tenure has been extending as per the concalls of many companies so revenue will be thin. A $100mn contract of 5 years earlier is now of 7 years so there won’t be quick uptick in revenue as before.
This video helped me understand the the partnership better…it is a bit long but worth the time.
Disciplined execution to respectable ROCE across the cycle.
Through C-heavy route, production is only 4% sugar equivalent – volumes will be hardly anything to compensate for losses of sugar/ ethanol companies. C Heavy prices will have to be increased further by 10 to 15% and even then the losses will not be compensated – this is simple maths. Instead govt has increase prices of maize based ethanol – now sugar mills will move from cane to maize and cereal prices will shoot up… biggest losers are farmers…
Sugar mills have already cancelled their expansion plans for ethanol. the owners (i have spoken to a few) will prefer to dividend out profits (or through buyback as Balrampur and Dhampur Sugar have done) and invest elsewhere. As far as current capacities are concerned they will try to optimise between sugar and ethanol and increase margins.
Ethanol plants in Maharashtra also shut…
Only way forward for ethanol supplies to increase is govt backed co-op mills will set up ethanol plants – and probably make losses and then shut down !!
