, 9 tweets, 11 min read
#TweetStorm - Expensive or deserves to be Expensive ? 1)One thumb rule for screening expensive companies is Market Cap to Sales or Enterprise Value to Sales. A 10x or more is generally expensive unless the company can grow sales rapidly or has extremely high Net Profit Margins.
2)Another way to look at expensive is if the Market Cap is equal to the Total Sales of the Addressable Market Size. This would lead to company having to launch different products in the future.
3)May not be the approach to take a Sell Decision or a Short Sell Decision. Very few companies can command such high valuations. Thumb Rule is just to review the investment thesis and the quality of the business. If doubts on quality , get out.
6)Screen = 9X Sales & Sales of 200 cr and listing down some companies which come up on the screen and some comments. Source screener.in consolidated nos. No Recommendations and Comments. Expensive or Deserve to be Expensive. Which will #Flop or give #Returns?
7)1) #HDFCAMC at 30x Sales and 57 PE for ROCE of 50+. 2)#InfoEdge 20x Sales and 300 PE 3) #AavasFinanciers – 16x Sales and 64 PE 4) #IIFLWealth 16x Sales 75 PE 5) #MCX – 16x Sales and 27 PE 6) #IndianEnergyExchange 14.5 x Sales and 22 PE 7) #IDFC – 14x Sales
8) #P&GHealth – 13x Sales and 90 PE. 9) #Gillette – 12X Sales and 90 PE. 8)10) #BajajFinance 12x Sales and 55 PE 11) #RNAM – 12x Sales and 33 PE 12) #NestleIndia – 11x Sales and 78 PE 13 ) #NESCO – 11x Sales and 22 PE 14) Affle – 11x Sales and 56 PE
15 ) #HindustanUnilever – 11x Sales & 66 PE 9)16) #CDSL – 10x Sales & 17 PE 17) #IndiaMart – 10x Sales & 256 PE 18 ) #GodrejProperties – 10x Sales and 80 PE . 19) #KotakBank – 10x Sales & 43 PE . 20) #Pidilite – 10x Sales & 70 PE. 21 )#Vinati – 9.5 x Sales and 36 PE .
21 ) #Forbes and Co – 9.5x Sales & 147 PE. 22 ) #GruhFinance – 9.2 x Sales & 43 PE. 10)Others at 8x Sales – #Symphony, #Dabur, #Divis, #Page , #AsianPaints, #P&G , #Metropolis, #ICRA .... Would love Comments and maybe look back into this post a few years from today.
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