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Players in an Oligopoly Should Have Financials Like This
Dec 7, 2018


Talking about Oligopolies, I believe the strength of the business should be reflected in the financials.

Companies in an oligopoly should not indulge in a pricing war like in the case of telecom industry (few players but intense competition).

The market should allow companies to command above average margins and return ratios.

Tanushree's latest recommendation certainly has the financial strength to qualify in this regard.

And since the industry is regulated, the competition among the companies is not intense.

The company, in last fifteen years, has earned an average return on capital employed of 51%.

That's incredible!

It has also maintained a robust dividend pay-out.

With minimum capital requirement, this company has, what I call, a very strong asset light business model.

With the recent correction, this makes for an excellent safe stock recommendation.

Data Source: Ace Equity

This Chart Of The Day was published in The 5 Minute WrapUp - Remember That Infinite Return Business? This One Could Be Even Better!

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