Just back from Mumbai and I have two things to say, those advertised fold flat seats aren’t exactly flat when you are nearly 6'5", and secondly, those who haven’t been to India need to go at least once. Then they will understand what the Wild West looked like in the mid to late 1800's. Wild, woolly, and tremendous opportunity.
Let me add a third thing, the reason the Indian IT companies trade at such multiples is because... they deserve to. When you can take a sub-10% EBITDA business, through labor arbitrage and sales expansion, by enabling the top of the funnel to be larger due to leveraging an existing, trained, and low cost bench, and make it 20%, huge value is created.
I met with a local company whose top line is growing 50% and his margins are increasing. This is as uncommon today as Hillary Clinton not crying at a campaign stop today. Top line growth and margin expansion is the mother’s milk of financial alchemy.
More to follow.
marty