Not so fast. The tenfold leap is actually a Coca-Cola bounce, with sufficient fizz only for the quarter in question. For, it can be traced directly to Tata Teas sale of its Glaceau stake to The Coca-Cola Co for $1.2 billion, a one-off. The company had acquired the stake in Glaceau for $677 million. Also, it has not been easy going for the firm either. The company has fought a stiff battle with interest costs, visible in floundering performance for several years after the Tetley acquisition, though it did not wreck the balance sheet as sceptics had feared. Credit its market success. The flow of earnings from operations has been strong enough, and the company has already retired $325 million of debt. According to analysts, the surprisingly good debt-to-equity ratio can become even better if the firm rids itself of more debt by cashing in on some of its Tata group holdings, though such financial decisions depend on several factors. All in all, the company has come good on its Tetley purchase, and is financially well placed to make further overseas acquisitions. The overall lesson for investors, clearly, is that they must exercise independent judgment on LBOs by the logic relevant to the case at hand, rather than fall for sweeping scepticism.