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Investor Codex is a structured investing education platform built around
mental models and timeless principles — not tips, not noise.

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6 schools of investing principles & frameworks at investorcodex.com

12/08/2026

Between FY2020 and FY2022, Tata Motors traded at an unusually low multiple of its operating cash flow — the kind of number that looks like a bargain at first glance.

(Reference to Tata Motors is for case study illustration purposes only and should not be taken as an investment recommendation.)

Underneath, Jaguar Land Rover — a large share of Tata Motors' revenue — was posting sustained losses through the same period. A low multiple assumes the earnings or cash flow behind it are stable or growing. When they're shrinking instead, the same low number stops meaning undervalued and starts meaning something closer to accurately priced for decline.

A cheap number on a business with deteriorating earnings power isn't a bargain. It's the market pricing in a real problem before the word "cheap" catches up to it.

Next time a multiple looks unusually low, check what's happening to the number underneath it.

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11/08/2026

In FY2021, Bharti Airtel's debt load rose sharply, following a 2019 Supreme Court ruling on long-pending dues — even as its market value moved on a separate path.

(Reference to Bharti Airtel is for case study illustration purposes only and should not be taken as an investment recommendation.)

Market value only prices a company's shares. It says nothing about what a buyer would also have to take on — debt included, cash set aside. That combined number is enterprise value: market value, plus debt, minus cash. It's the closer estimate of what owning the whole business would actually cost.

Two businesses can carry the exact same market value and completely different obligations. Ignoring that gap means comparing them as if their debts don't exist.

Next time you compare two companies by price alone, ask what each one owes.

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10/08/2026

HDFC Bank traded near 3.4 times book value in FY2022. Bank of Baroda traded near 0.5 times — same number, applied to two very different banks.

A number near 1× means the market is paying what a company's books say it's worth. Above 1× is a premium. Below 1× is a discount. HDFC Bank commanded a premium of 3.4x. Bank of Baroda did not.

(Reference to HDFC Bank and Bank of Baroda is for case study illustration purposes only and should not be taken as an investment recommendation.)

Here's what that number alone never tells you: it isn't really pricing what a company owns today. It's pricing what the market expects that company to keep earning from what it owns, year after year. A company that reliably turns its assets into strong profit earns the premium. A company the market doubts does not.

Next time a valuation number looks cheap or expensive to you, the real question isn't the number — it's what the market believes about the business behind it.

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08/08/2026

Graham asked a simple question: What is this business worth if it never grows?

That answer — not the growth story — is the floor.

Earnings Power Value strips away all assumptions about growth. It normalises what the business earns sustainably today. It capitalises those earnings at the cost of capital. The result is the value of the proven present.

If growth arrives on top of that floor — it is a bonus. If it doesn't — you are still not paying for what did not exist.

The same principle has been applied in Indian markets with discipline: pay for a certain present. Evaluate growth as an upside, not as the core assumption.

The Coal India case — used here for educational purposes only — illustrates EPV logic in practice: consistent earnings, meaningful yield, low PE, the core question being whether proven earning power trades at a discount to its capitalised value.

Know the floor before you assess the ceiling.

Case studies presented for educational purposes only. Not a recommendation or investment advice.

To learn the investing principles, frameworks and mental models used by the world's greatest investors — enrol via the link in first comment

07/08/2026

The most dangerous time to rely on a PE ratio is when there are no earnings to calculate one.

Yet the stock still has a price.

When earnings are absent, the PE ratio is silent. Something else must supply the framework — and that something else is almost always a narrative.

The Paytm IPO case — used here for educational purposes only — illustrates this. At the time of listing in November 2021, the company reported net losses. A trailing PE was not calculable. The IPO was priced at ₹2,150 per share. Investors who bought were not buying earnings — they were buying a story about when earnings would arrive, at what scale, and at what margin.

A PE tells you the price of earnings. When earnings are absent, the price is a bet. Know what you are betting on.

Case studies presented here are for educational purposes only. Not a recommendation or investment advice.

To learn the investing principles, frameworks and mental models used by the world's greatest investors — enrol via the link in first comment.

06/08/2026

Two investors. Same PE ratio. Same index.

One says: this is cheap. One says: this is expensive.

They are both right. They are just reading different contexts.

The PE ratio does not come with its context attached. You have to supply it.

The Nifty IT case — for educational purposes only — shows this clearly across three distinct periods. In March 2020, a compressed multiple was driven by fear, not fundamental deterioration. In late 2021, elevated multiples were supported by genuine earnings visibility from the WFH boom. By 2022 to 2023, the same compressed multiple reflected rising interest rates and demand pressure — a fundamentally different driver.

Same index. Similar numbers. Entirely different meaning.

Context is not decoration. It is the analysis.

Case studies presented here are for educational purposes only. Not a recommendation or investment advice.

To learn the investing principles, frameworks and mental models used by the world's greatest investors — enrol via the link in first comment.

05/08/2026

A stock is at a 10-year PE low. It looks cheaper than it has ever been.

This is one of the most reliable ways to lose money in equity investing.

The anchoring trap: the brain compares the current PE to the PE it remembers. It classifies the difference as an opportunity. It does not ask whether the business that produced the old PE is the same business being priced today.

The Yes Bank case — used here for educational purposes only — illustrates this exactly. From 2017 to 2020, the PE compressed at almost every level. Each step down looked like a better entry point. Each was describing a different state of business deterioration.

The anchor was real. The business it described was not.

Before asking "is this cheap vs its history?" — ask why the multiple compressed. Has the business changed? The answer determines everything else.

Case studies presented here are for educational purposes only. Not a recommendation or investment advice.

To learn the investing principles, frameworks and mental models used by the world's greatest investors — enrol via the link in first comment.

04/08/2026

The PE ratio on your screener is looking backward. But you are buying next year's earnings — not last year's.

There are two different questions inside the PE ratio: → Trailing PE: what multiple is the market paying on earnings that already happened? → Forward PE: what multiple is the market paying on earnings that have not happened yet?

These are not the same question. They carry different evidence. Different reliability. Different risk.

In the Zomato case — used here for educational purposes only — in FY2022 there were net losses. No trailing PE was calculable. Every investor who bought was making a forward PE bet: the belief that profitability would arrive, at sufficient scale, within a believable timeframe.

Naming that assumption is the first step to examining it honestly.

Case studies presented here are for educational purposes only. Not a recommendation or investment advice.

To learn the investing principles, frameworks and mental models used by the world's greatest investors — enrol via the link in first comment.

03/08/2026

Most investors look at the PE ratio first. Very few ask what question it is actually answering.

The PE ratio tells you one thing: the multiple the market is currently paying per rupee of earnings. At roughly 85×, the market is pricing in a long runway of premium growth. At 12×, it is pricing in stability or concern.

The number is not the answer. It is the beginning of the question.

The relevant follow-up: what assumption does this multiple contain — and is that assumption reasonable?

A PE ratio is a starting point for analysis. Every investor who treats it as a conclusion has skipped the work.

Case studies presented here are for educational purposes only. Not a recommendation or investment advice.

To learn the investing principles, frameworks and mental models used by the world's greatest investors — enrol via the link in first comment.

01/08/2026

Four frameworks. One conclusion.

Business quality assessment.
Income statement literacy.
Free cash flow evaluation.
The QGLP pre-buy checklist.

Two voices said the same thing across different decades and different markets:

"A checklist prevents the most capable people from making the most preventable errors." — Charlie Munger

"Before I commit capital, I run every investment through QGLP. Quality first." — Ramdeo Agrawal

Across markets, across cultures, the principle holds:
Discipline before capital. Process before price.

For educational purposes only. Not investment advice.

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