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I did not want to clutter the main thread so sharing my thoughts here in general (not specific to the comapny) about below post @ IamAnshul.
The market’s reaction to a one-time tax demand might seem disproportionate, but investors often look beyond just the immediate financial impact. Here’s a more nuanced way to analyze the situation:
1. Profitability & Cash Flow Impact
- Even if the tax demand is small relative to market cap, it directly hits net profit, especially if the company has weak cash flows or high leverage.
- Recurring tax disputes can signal future earnings volatility, making investors wary.
2. Net Worth & Balance Sheet Health
- A ₹190 crore demand may seem minor, but if the company’s net worth is only, say, ₹1,000 crore, it’s a material hit (~20%).
- If the company is already leveraged, additional liabilities could strain its financial flexibility.
3. Aggressive Accounting Policies
- The tax dispute might reflect deeper issues like revenue recognition, deferred tax adjustments, or unsustainable tax avoidance strategies.
- Investors punish companies with questionable accounting more severely because opacity increases risk premiums.
4. Sentiment & Trust
- Even if ₹125 crore was provisioned, the remaining ₹65 crore (and potential penalties/interest) raises questions about management’s ability to foresee liabilities.
- Repeated regulatory skirmishes erode confidence in governance, leading to derating.
5. Broader Context
- Was the stock overvalued before the drop? If growth assumptions were shaky, even a small negative trigger can cause a sharp correction.
- Sector-wide trends (e.g., regulatory scrutiny on taxes) could amplify the sell-off.
Bottom Line
The market isn’t reacting just to the ₹190 crore tax bill—it’s pricing in:
- Uncertainty (Will more demands follow?),
- Quality of earnings (Are profits inflated by aggressive accounting?), and
- Risk of governance lapses.
A 10% drop might seem excessive, but if the event changes the long-term risk-reward calculus, the repricing could be rational. Always dig deeper into why the tax demand arose—it’s rarely just about the number.
Please note that above points are listed only to enhance thinking about how to evaluate a particular event. It is general in nature and not specific to the company in question.
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WHere can i get the commodity prices (current and historic) of commodities like Steel, Cotton etc? Sorry if I am asking this again / already asked in this thread.
@aspireinvestor This will provide you the list..
https://in.investing.com/commodities
And you can search here by name for a better chart view..
Let me know if I misunderstood your question.
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I was going through OkPlay P&L statement observed that their taxes are abnormal. Any rational behind this?
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If company is showing uneven tax paying %.like 74%, 34%,102%.
What are the causes and effect of it?
Or
Company is manipulating balance sheet?
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I wanted to understand the reason behind the sudden optimism in the market following President Trump’s announcement of a 90 day ‘pause’ in reciprocal tariffs. While it is possible that the tariffs may be eased after this period, there’s also a risk they could be reimposed. Wouldn’t this add to the overall uncertainty rather than reduce it?
Market anticipates macro events more quickly and responds before the event. This is why there is " Buy on rumours and sell on News". In the Tarrif case, the market already knows Tarrif is coming and don’t know about the %. And the clarity came last week and reacted accordingly. Now the Market already price in the announced tarrif rates, Unless there’s a increased rates apart from the announced and retaliation tarrif from other countries, there’s less chance of correcting more. There might be range bound action rather than steep correction.
Disc: all are my understandings, there is a high probability of going wrong aswell.
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Hello Respected members, please guide - other than newspapers & tv channels(et,moneycontrol,ndtv etc) which are major websites/apps (paid or free) on which i can read articles & analysis mainly foccused on stock market & listed companies & which are worth to look at
Thanks