π Factors to consider for g: Economic Conditions, Industry Growth, Company's Historical Performance, Competitive Position, Market Saturation, Regulatory and Political Environment, Long-Term Strategic Plans, Analyst Consensus.
π Economic Conditions: Consider country's GDP growth rate (e.g., 3%) and use slightly below (e.g., 2.5% to 3%) for valuation.
π± Industry Growth: Reflect higher growth potential (e.g., 4% to 5%) for industries like renewable energy with strong prospects.
π Company's Historical Performance: Analyze past growth rates (e.g., 5%) but be cautious and use a more conservative rate (e.g., 3% to 4%) if growth was influenced by external factors.
π Competitive Position: Strong market presence allows higher growth rate (e.g., 4% to 5%) due to competitive advantage.
π Market Saturation: Mature markets may have lower potential, so consider a more conservative rate (e.g., 2% to 3%).
π Regulatory and Political Environment: Account for potential risks with a slightly lower rate (e.g., 3% to 4%).
π Long-Term Strategic Plans: Moderate ambitious projections (e.g., 5% to 6%) considering scaling challenges.
π Analyst Consensus: Consider industry expert projections (e.g., 3% to 5%) for additional insights.
π‘ Long-term growth rate should not exceed country's long-term GDP rate. Commonly used range: 2% to 4%.
π Thoroughly analyze factors for informed and realistic valuations.
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