Sterlite Technologies Limited

“STL is India's largest OFC manufacturer operating in a structurally growing market, but the stock has been bid to 554x trailing earnings and 56x EV/EBITDA following a 748% one-year rally — fully pricing in, and then some, a single hyperscaler contract that the company has never demonstrated the margin discipline to translate into durable shareholder value. With ROCE at 8% (below WACC), net debt of ₹18B, a history of value-destructive capital allocation, and no margin of safety whatsoever, the risk of permanent capital loss from current prices is high even if the OFC demand cycle continues. This is a AVOID at current prices; existing holders should sell into the momentum.”