30 August Timeline, page-85

Hi Tony,

I read that report. The relationship usually, in my experience, is there is an initial inverse relationship between growth and cash flow.

The new deals interest me though. The Mphasis deal funded from cash-flow, and the possible new machines on cost-plus. This bodes well for cash-flow purposes and is kind of unique.

It is the quantum of projected future ( not current) cash-flows which is the key to value. This can be estimated from financials and forward looking earning/strategy statements by various means. This data is locked in the black box. Without it, it is difficult to find the value under a DCF model using the appropriate risk /reward rating, shown as the Price Earnings ratio based on the stage the business is at and where it projected to go.

Quite simply traders trade the trade on TA, fundamental investors look for out of sync investments (FA) and we are speculating. There is nothing wrong with that. Essentially, individuals have researched this stock from macro and other perspectives and said I think this story worth more than the market is offering. Others here have pointed out that there are uncertain (even fatal) factors driven by the structure be they financial or the succession issues.

In a nut shell, it is the uncertainty that provides the opportunity of success and naturally failure. If your bullish you buy and hold. If you cannot stomach the risk you stay away. Traders will always trade the trade. If it goes well the FA guys will pay for the next holiday, house etc by buying your shares.

I think it is clear were I stand on TSN, but it is exactly the fact that it is risky that provides the opportunity.

Cheers