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Operating margins

A high operating margin suggests that the company is capable of staying profitable. The third filter we applied to get the Profit 100 list is all about that

A high operating margin suggests that the company is capable of staying profitable. The third filter we applied to get the Profit 100 list is all about that

In our search for the most profitable companies, the next logical step was to weed out companies that reported sub-par current operating margins. Hence, all companies that saw operating margins below 10 per cent mark were eliminated.

The objective behind this step is to give priority to current margins. A high historic margin is meaningless if a company is struggling with sub-par margins today. For instance, Jubilant Foodworks has enjoyed a high historic margin of close to 14 per cent. Today, the company struggles to earn margins of even 10 per cent. It is to remove such cases that we introduced this filter. The table below lists out the companies that have reported below 10 per cent margins.

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