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SASI KUMAR SEBI RA

25th May · SEBI-Registered Analyst

Stop chasing tips and start auditing your portfolio.

If a company can’t survive a rigorous fundamental filter, it doesn't belong in your long-term growth bucket. Here is a 13-point "Stress Test" for finding high-quality Indian growth stocks:👇 The Valuation & Efficiency Filter: 1. PEG Ratio: Must be below 1 to ensure you aren't overpaying for growth. 2. PE Multiple: Should be lower than the industry average. 3. Return on Equity (5Yr Avg): 20%+ showing consistent shareholder value. 4. ROCE (5Yr Avg): 15%+ to confirm capital is deployed efficiently. 5. EV/EBITDA: Keep it below 15 to avoid astronomical valuations. The Growth & Operational Strength: 6. Sales Growth (3Yr): 15%+ showing top-line demand. 7. Profit Growth (5Yr): 15%+ proving the business scales profitably. 8. Operating Margin: 15%+ as a buffer against inflation/competition. 9. Price to Sales: Below 5 for a reasonable entry. The Governance & Safety Net: 10. Market Cap: Above ₹500 Cr to filter out extreme micro-cap volatility. 11. Debt/Equity: Below 0.5 - growth should be fueled by internal accruals, not high-interest debt. 12. Promoter Holding: 50%+ ensures management has significant "skin in the game." 13. Pledged Shares: Minimal (<1%) to avoid liquidity risks during market corrections. No system is perfect, management integrity & business model still matters.

#PersonalFinance#FundamentalViews#HiddenGems#PsychologyofMoney#WatchOutFor
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