# The company is expected to report better revenue and earnings compared to March 2021 quarter primarily due to up elections and economy opening up.
# I am expecting the company to do a revenue of at least 250 crores and 75 crores of operating profit.
# Based on this assumption TVTN is expected to close the year with the following financial performance:
Revenue: 938 crores (ATH)
OP: 272 crores (ATH)
PBT: 270 crores (ATH)
Tax @ 26% = 70 crores (ATH)
NP: 200 crores (ATH)
EPS @ 6 crores equity shares = 33.3, (ATH)
EPS growth: 50%, 5 yr CAGR of 15%
10 year CAGR profit growth = 35%,
Market price in april 2012 ~ 60.
# Valuation: @ cmp of ~ 410, the stock is valued at 12.3 times current year earnings and a pre tax yield of roughly 11%
# if the earnings are valued at modest 15 times and cash equiv per share of 100 added, the target that can be aimed at is 500 + 100 = 600 /-
# So a conservative target of 600 can be aimed for in next 3 months if there is no major geopolitical shock.
# Ideally a company which does 50% growth in earnings in a year can also get valued @ 30 times earnings in buoyant market conditions. If such ideal scenario plays out the stock can even reach levels of ~1000 in next 1 year time frame.
# Also ideally the stock price performs inline with profit growth over long term. Hence a 35% cagr in stock price from 60 levels ( april 2012) gives a target price of 1200.
Downside: Considering the kind of performance the company is doing, it is highly unlikely that the stock will fall below 10 times earnings. Hence there seems a max possible downside of 330.so for 80/- kind of risk, there is a potential to make 2.5 times risk in modest case and even 8 times in case of blue sky scenario.
On chart also the stock recently bottomed out @ 357 and the structure appears bullish:
All time high of the stock = 557.95 (16th mar 2018)