What if the future prospects is GOOD But the operating history is not Good. Like in next 5 year E-Commerce Sector is supposed to perform Good. Maybe Education industry and Defense will also performing Good. But if you invest in A company which don’t have good operating history. Then what?
Say you want to invest in E-Commerce in India. (If you are VC and PE then only but they never think about it. But still) which company you choose? Flipkart, Amazon or Shopclues?
Let’s take an example of IBM. The company with big history. They survive after many bear and bull market. The Business is tried and tested.
MacDonald. When there was questions about future growth, they successfully handle it. In India, HDFCBANK, INFOSYS, CIPLA are good examples.
If the company is having long operating history the possibility if success in Future is also High.
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