Saturday, October 19, 2013

Investment Idea: Sintex - Will it Tank?

In September 2013 (a month ago) Sintex was selling at a market value less than 2 times its annual earnings. If we were to assume that their business would remain stagnant and would continue to deliver their current earnings in perpetuity, that would be akin to a FD that returned 50%.

Here is an 80 year old company, an established brand with a global footprint, and yet it is being valued for bankruptcy.

Such are the ways of the nutty Mr. Market. For the rational value investor, the question here is not whether to buy, but how much to buy.

Sometimes, we are so busy looking for the Buffet, that we miss the Graham

1 comment:

MHolder said...

Great call if you sold a few months later. If you were a buy and hold investor, you would now be holding shares in a company on the verge of bankruptcy.