"I wonder how Jefferies has given a target price of Rs. 520/share on Mamaearh - on the listing day, it was already at 93.5 times EBITDA" -> Need more people like this on LinkedIn!
majboormajdoor
Stealth
10 months ago
We are missing an entire generation of Bears in research. Due to 2 decade low Interest rates. Some bears have burnt themselves, others lost patience and were ridiculed.
It is hard to be a bear.
Royalflush
Stealth
10 months ago
These investment banks are extremely biased. Used to have to read a lot of these reports in the past.
You'll notice that they end up not moving from their original thesis for multiple quarters, until it's already too late
Their research is excellent and deep, but always biased.
Tech8
Stealth
10 months ago
Can you explain what can be unbiased opinion, coz i feel something has to be biased for report to be written with available information and data
Bias here is caused by the potential relationship with the company. If the investment banking div is serving a company, the equity research wing is bound to be biased coz of the relationship with the company
TLDR: Sell rating = bad for relationship
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It was already down to 254 today and then someone pumped it to 317. Huge pump and dump coming, retail investors would get trapped. Someone bought huge blocks in open market at 254-260 range and made a quick 20% in a single day. It shouldn't be more than Rs 20/share based on valuations. The entire concept of IPO is flawed in India, it isn't to raise capital, but to give glorious exits to VCs, Founders, etc. There will be IPOs for Ola, Oyo, Byjus, and until someone teaches Mamaearth a lesson, none of these fraud companies will understand.
Ipo is always a liquidity event first, branding event second and then a capital raising event even globally.
I accept it totally. But what I have seen from the mindset having worked in the startup ecosystem for 4 years, is not to build for sustainability and profitability but to make a quick buck, get to 1-2M ARR and then sell it off for 10-15x revenue multiple. That's why most don't either have a product which addresses a business problem and the failure rate is high compared to startups in Singapore, Western world..
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Corpdaaku
Student
10 months ago
Storytelling is an art and these analysts are taught to engage audience by creating la la land stories to buy stocks. But the valuation of stock can only temporarily move by these reports. What about the execution? No one gives a damn to the product and execution.
Thought this may be the classic quid pro quo with the Investment Banking div, but apparently not!
Wouldn’t be surprised if later some news comes that this guys were paid for this report But doesn’t happen , the analyst will make money now and move on to make money somewhere else
Qwerty2398
Stealth
10 months ago
Lot of "analyst" gave satyam computers "buy" ratings until the day it collapsed. A lot of mutual funds invested a big amount until it collapsed. Only a few mutual funds escaped out days before with insider information.
Analysts are nothing but snake oil salesmen of the financial industry.
Satyams book were cooked , can’t expect analyst to know it all
In this case , investing based on public information is itself a wonder
I'm not an investment expert but when I read about a startup going for IPO and all I see is a way for the early investors to cash out. The valuations IT companies give is beyond my comprehension 😑
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