- Capital Expenditure = CFI (Cash flow from investing activities)
- CFF (Cash Flow from financing activities) = dividend to shareholders and repayment of Debt
- SG to capex =Sales Growth over last 10 years/proportion of CFO used as Capital Expenditure.
- If inventory turnover is very low ( < 2) then it means capital intensive
- Combination of low net profit margin and low fixed asset turnover will always require large capex
Author Ashish Doneriya
LastMod January 11, 2019