Bank stock jumps 5% after Tikri Partners bought 2.2% stake in the company via bulk deal
When markets run hot, it’s easy to get swept up in the momentum. Stocks rising day after day can create a false sense of security - until reality catches up. That’s when understanding a company’s true worth can make all the difference between staying safe and taking a painful hit.
Take Voltas (NSE:VOLT) Limited, for example. On 14 September 2024, it was trading around INR 1,921 per share. For many investors, the rally looked promising. But beneath the surface, there were signs the stock was overstretched. Those who had checked the fair value at that time would’ve seen it stood at just INR 1,231 - a clear red flag indicating the stock was overvalued by 35.9%.
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Fast forward to 1 February 2025, and the stock hit its fair value. In a matter of months, it lost over a third of its market value. But for investors who acted early - either by exiting their long positions or going short in the derivatives market - this drop didn’t bring panic. It brought profits or timely protection.
This is where knowing a stock’s fair value becomes a game-changer. It’s not about timing the market perfectly. It’s about making informed decisions before the crowd catches on.
The fair value feature on InvestingPro makes this entire process effortless. No spreadsheets. No assumptions. No guesswork. Just a highly precise, automated valuation powered by multiple financial models that assess a company’s fundamentals and market outlook. Whether a stock is overvalued or undervalued, the fair value metric provides a concrete status, giving investors a crucial edge in managing risk.
What’s often missed in investing is knowing when not to be invested. And that’s exactly where fair value insights shine. When used right, they can act as an early warning system - helping investors cut losses early or even profit from a decline in highly overvalued stocks.
If you’ve ever held onto a stock too long, only to see its value erode day by day, you already know how costly those decisions can be. With tools like InvestingPro’s fair value, such scenarios can often be avoided.
And right now, with up to 45% off on InvestingPro subscriptions for a limited time, it’s an opportune moment to upgrade your analysis and gain access to valuation tools used by serious investors worldwide.
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