Reverse DCF
What growth does the market imply for RICOAUTO?
Working backwards from the current price to find the FCF growth assumption baked in.
very aggressive
24.5% implied annual FCF growth
The market is pricing in exceptional growth that only a handful of companies sustain for a decade. For context, this company has historically grown at 3.5%. High execution risk.
Current Price
₹116
Historical Growth
3.5%
FCF Yield
2.04%
Price / FCF
49.0x
Plain English
To justify today's price of $116.08, RICOAUTO.NS needs to grow its free cash flow at 24.5% per year for the next 10 years. That is 21.0% faster than its historical growth rate of 3.5%. At its historical growth rate, the stock cannot justify its current price within a 20-year horizon. The market is pricing in a step-change in performance.
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Growth Scenarios
What the stock is worth at different growth assumptions
| Scenario | FCF Growth | Implied IV | MoS vs Price |
|---|---|---|---|
| Historical | 3.5% | ₹0 | -100.0% |
| GDP rate | 10.0% | ₹4 | -96.3% |
| Half implied | 12.2% | ₹15 | -87.4% |
| Implied | 24.5% | ₹116 | +0.1% |
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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.