Step 4 of 8

Growth Analysis & Sustainability

Is step mein hum dekhte hain ki company ka business kitni tezi se aur kitne sustainable tarike se grow kar raha hai. Consistent 15–20% Revenue aur EPS CAGR dene wali companies hi long-term multi-bagger banti hain.

~300 Stocks Step 3 ke baad
~120 Survive Growth filter ke baad
15–20% CAGR Compounding Target
Growth ka sabse bada trap: Ek saal ka 50% jump aksar base effect, one-time contract ya accounting manipulation se aa sakta hai. Hamesha 3-year aur 5-year CAGR check karein jo ek poora business cycle reflect karta hai.
Sales Growth (Revenue CAGR — 3Y & 5Y)
Top-Line Growth Engine
Step 4.1
1. Ye kya hai? (What is it?)

CAGR (Compound Annual Growth Rate) batata hai ki pichle 3 ya 5 saalon mein company ki sales har saal average kitne percent ki dar se badhi.

Organic Growth vs Acquisition Growth:
• Organic Growth: Company apne existing products aur customers se market share jeet rahi hai — ye sabse high quality growth hai!
• Acquisition-Driven Growth: Company naye businesses kharid kar artificial sales badha rahi hai — aksar debt ya dilution ke saath.

2. Asli Indian Example

Pidilite (Fevicol) vs Cyclical Commodity: Pidilite ne pichle 10+ saalon mein consistently 12–15% organic sales CAGR deliver kiya hai kyunki unke products har ghar aur industry mein use hote hain.

Doosri taraf, ek sugar ya metal company ek saal 60% grow karti hai aur agle saal 30% gir jaati hai. Hamesha steady aur predictable compounders ko prefer karein.

3. Screener mein kaise dekhein?
Screener.in Query:
Sales growth 3Years > 12 AND Sales growth 5Years > 10
4. Ideal Range
5Y Sales CAGR > 15%: Fast Compounder 5Y Sales CAGR 10% – 15%: Steady Quality 5Y Sales CAGR 6% – 10%: Moderate 5Y Sales CAGR < 5%: Stagnant Growth
EPS Growth (Earnings Per Share Growth)
Per-Share Profitability Growth
Step 4.2
1. Ye kya hai? (What is it?)

EPS = Net Profit ÷ Total Number of Shares

Aap ek shareholder hain, isliye aapke liye sabse zaruri hai ki per-share profit badh raha hai ya nahi.

• EPS Growth > Sales Growth: Operating Leverage! Company ki efficiency badh rahi hai aur profit margin expand ho raha hai.
• EPS Growth < Sales Growth: Margin squeeze ya equity dilution ka signal!

4. Ideal Range
EPS 5Y CAGR > 15%: Wealth Creator EPS 5Y CAGR 12% – 15%: Solid EPS Growth Negative: Profit Decay
Step 4 Growth Screener Query
Screener.in — Step 4 Growth Master Query
Market Capitalization > 500 AND Debt to equity < 1 AND Return on capital employed > 15 AND Sales growth 5Years > 10 AND Profit growth 5Years > 12