What is “fair”? Rather than describe it, let me state the actual number. The median trailing twelve-month (TTM) entry PE ratio for the Nalanda portfolio is 14.9. The median TTM PE for the period from 2005 to 2020 for India’s primary index, Sensex, is 19.7 and for the Midcap Index is 23.8. Thus, we are buying what we think are exceptional businesses at a 25 to 30 percent discount on the index.
