Maggi fiasco has jolted the brand value akka reputation of the Nestle without any shadow of doubt. Now Nestle is in the mode of damage control, calling their most influential Shivani hedge to do the same from Sri Lanka . In Spite of public outrage and removal of the product from the shelves. There is one guy in the market by the name of Raamdeo Agrawal of motilal oswal ,who is positive on the valuation of the stock,giving an answer to the journalist question on Nestle’s stock price, He stated that, quote `Nestle's reputation, worldwide, is at least 100 times more than government of India itself. Nestle bonds in Europe trade at negative yield. Government of India bonds trade at 7-8% yield. This is the kind of reputational gap` . Though he is right in the context of valuation of the bonds in Europe between two,but...
So now the question which strikes the viewers/readers mind is that does comparing a company and a government of a country, right parameter to judge the value of the company’s stock price. I personally didn't found any link on what he said. True#NESTLE has a company with reputation and being SWISS shows the national character of honesty and diligence. But how does it justify the lower reputation of the government. There is no comparison between company’s value and a countries value!! I, not a supporter of either of them !
Though he is the joint MD of MoFSL he must be right, somewhat, about company’s Share price and Emotional people will keep abusing Raamdeo and will not get anything in life while intelligent ones are making use of his wise comments and making good money by investing in Nestle.
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Hey !! Speak your heart below ....