Investors debate Oriana Power valuation after eighty nine percent crash

Market pulse

From the investor's mind

The tech sector is undergoing a massive structural shift as the immense capital expenditure required for artificial intelligence outgrows corporate balance sheets. Tech investor Tar points out that tech giants can no longer rely solely on their internal cash flows to fund these soaring AI infrastructure demands. Instead, the industry is entering a new phase where companies will increasingly depend on external equity and debt issuance to bankroll their AI ambitions. This transition highlights the unprecedented scale of the AI buildout, signaling to investors that future growth in the sector will come with higher leverage and potential share dilution.

Word in the street

Oriana Power Ltd

Oriana Power, carrying a market cap of about 3,739 crore, has plummeted 89.48 percent over the past year, sparking intense debate among investors. Many are puzzled by this cheap valuation given the company's strong growth over the last three years. However, active discussions reveal skepticism around how Oriana will recognize revenue from selling a special purpose vehicle, which some argue is merely book profits. Furthermore, others worry about a transition from high return on equity businesses to lower return on equity battery storage, fearing massive capital expenditure could outpace revenue and yield negative returns over ten years.

Yesterday's big moves

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Warren Buffett