In today’s briefing:
- PTC India Financial Services Ltd- Governance Turmoil Resurfaces
- Investors Are Less Interested in Companies that Generate Little Cash Despite Shareholder Returns
PTC India Financial Services Ltd- Governance Turmoil Resurfaces
- PTC India Financial Services (PTCIF IN) faced a mass exit of Independent directors recently.
- The IDs flagged compromising independence and constrained in upholding the highest standards of corporate governance as their reasons.
- This once again brings back the governance issues under limelight, a situation the company is already familiar with.
Investors Are Less Interested in Companies that Generate Little Cash Despite Shareholder Returns
- The shift toward management that creates value through dialogue with overseas investors is evident in the relationship between foreign shareholding ratios, capital profitability, and stock price valuations.
- There is significant correlation between cash reserves and ROA. ROA, which reflects the cash flow returns generated by a business, is considered to be closely related to stock price valuation.
- Companies with high cash generation capabilities and large amounts of cash on hand are expected to invest in generating more cash flow and return cash to shareholders.
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