🚨 Negatives (Short-Term Perception Risk)
Abrupt CEO + ED Exit
– In banking, sudden exits without succession planning raise red flags.
– Markets hate surprises—especially in a sector that runs on trust.
Internal Rift with the Board
– Shows lack of alignment at the top. Even a ₹1.5 crore dispute indicates breakdown of communication or trust.
– Raises concern whether the transformation drive (tech, digital, profitability) will lose momentum.
No Immediate Replacement
– Delay in naming a credible successor may spook some investors.
In 2017, a behavioral economics study in rural Bangladesh posed a simple choice to poor participants:
Would you prefer $6 now or $18 after three months?
Surprisingly, 70% chose the $6 — a guaranteed but far smaller reward.
The researchers were puzzled. Why would someone reject a 200% return in just 90 days?
The answer lies in something deeper than numbers — and it reveals a psychological pattern that dominates even the modern stock market.
Logistics Sector Growth: Expected CAGR of 9.3%, with premium warehousing (Grade A) growing at 15%. Demand is rising due to e-commerce, consumption, infrastructure build-out, and government initiatives like Gati Shakti and the National Logistics Policy.
Multimodal Logistics Push: Driven by Dedicated Freight Corridors (DFCs), port-rail-road connectivity, and cost efficiency, India is seeing a shift to integrated logistics platforms. MLL is building multimodal capabilities to meet demand.
E-commerce & Quick Commerce: Hyperlocal delivery is booming, especially in Tier 2/3 cities. Quick commerce alone accounts for 65% of e-grocery orders, up from 13% in 2022. This trend is reshaping warehousing, last-mile delivery, and tech investment.
Digital Transformation: Indian logistics is embracing AI, IoT, drones, AR, real-time tracking, and digital twins. Tech is now key to operational efficiency and customer experience.
Imagine you're sitting in a packed theater. Suddenly, smoke starts seeping in from the back. Maybe it's a minor issue, or maybe there's a fire — no one knows yet. But instinct kicks in. Some people rush for the exits. Others freeze. A few even shout warnings. The calm dissolves into chaos.
This scene perfectly captures what happens in the stock market when a company or sector experiences a major negative event — whether macro (like a global crisis) or micro (like a governance issue, regulatory overhang, or earnings collapse).
The geometric (non-linear) relationship between Return on Equity (ROE) and Price-to-Book Value (PBV) is deeply tied to the long-term compounding of earnings and value creation.
The reason PBV expands geometrically with ROE is:
A higher ROE allows the company to compound book value faster
That higher compounding justifies a higher multiple today, because:
Future earnings are much larger
Market discounts future cash flows; higher ROE implies better reinvestment opportunities
A 30% ROE business can double book value in ~2.5 years, while a 10% ROE business takes ~7 years
This difference in earnings growth and reinvestment efficiency leads to an exponential divergence in intrinsic value over 5, 10, 15 years — hence, the PBV market assigns also diverges non-linearly.
1. Always go against tide. Buy when others are selling and sell when others are buying. 2. If you believe in the growth prospects o...
