PE, Book Value and Rate of growth of Nifty


Do you realize that presently Nifty PE is at 25.50 and Price/BookValue ratio stands at 3.2; what does it really means is that should this ratio is maintained it will translate in to nearly 1% rise in value of index that is Nifty every month and will keep compounding. In this light one should be invested fully at this point because considering the interest rates scenario, inflation, gold prices, corporate tax and state of Indian economy the PE and P/BV ratios are not likely to deteriorate any further.

Krishna Khandewlal

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