How to interpret delay in payment of undisputed taxes and payment of dividends out of debt? Are Reserves and Cash, the same? What’s the role of WACC & ROCE?

www.drvijaymalik.com has a section dedicated to answering queries from readers: “Ask Your Queries”. Over time, many readers have asked their queries related to many aspects of stock analysis and sought clarifications about investing. I have responded to these queries as replies to their comments.

“Q&A” series is an attempt to share the queries & their responses, which have featured on “Ask Your Queries” section, with all the readers. The primary aim of this new feature is to share the knowledge with other readers of the website, who might have similar queries.

The current article in this series provides responses related to the following queries:

  • What should an investor interpret when a company delays the deposit of undisputed statutory dues?
  • Are reserves & surplus and cash & bank balances the same? How should investors correlate them?
  • Why do companies with negative free cash flow pay dividends out of debt?
  • What is the role of weighted average cost of capital (WACC) & return on capital employed (ROCE) in our stock analysis 
Delay in deposit of undisputed statutory dues, Are reserves & surplus and cash & bank balances the same? negative free cash flow pay dividends out of debt? What is the role of weighted average cost of capital (WACC) & return on capital employed (ROCE)



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