Reverse DCF
What growth does the market imply for RAINBOW?
Working backwards from the current price to find the FCF growth assumption baked in.
aggressive
13.8% implied annual FCF growth
The market is pricing in above-average growth. Achievable for a high-quality business but leaves limited margin for error — any slowdown could hurt the price.
Current Price
₹1,254
Historical Growth
9.5%
FCF Yield
2.68%
Price / FCF
37.3x
Plain English
To justify today's price of $1253.50, RAINBOW.NS needs to grow its free cash flow at 13.8% per year for the next 10 years. That is 4.2% faster than its historical growth rate of 9.5%. This is optimistic but not impossible for a high-quality business. The stock leaves little room for error — any slowdown could hurt the price.
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Growth Scenarios
What the stock is worth at different growth assumptions
| Scenario | FCF Growth | Implied IV | MoS vs Price |
|---|---|---|---|
| Half implied | 6.9% | ₹688 | -45.1% |
| Historical | 9.5% | ₹869 | -30.7% |
| GDP rate | 10.0% | ₹905 | -27.8% |
| Implied | 13.8% | ₹1,250 | -0.3% |
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Run Full Analysis →This is an analytical tool, not investment advice. Implied growth is a mathematical inversion of the DCF model and depends on WACC and terminal growth assumptions. YieldIQ is not registered with SEBI as an investment adviser.