29 Apr

The FMCG Valuation Puzzle

Disclaimer: These notes are purely for the purpose of financial analysis and education. These are not to be construed as recommendation to either buy or sell any asset class or security.
The FMCG Valuation Puzzle
In the last 12 months, Hindustan Unilever’s profits have been Rs 5069 crore. The company’s market cap is now north of Rs 300,000 crore, giving it a trailing P/E ratio of more than 60.

14 Apr

Oil Creates A Dilemma – 2

Disclaimer: These notes are purely for the purpose of financial analysis and education. These are not to be construed as recommendation to either buy or sell any asset class or security.
You could also download this note from here
In November, we had written a note on Oil Prices creating a Dilemma for the Indian Government.

17 Mar

The divergence in PSU vs Private Bank Valuations

The market capitalization of the top 15 PSU banks as on March 16 2018, is nearly 30% of that of the top 15 private banks. Ex-SBI – the next 14 PSU banks  trade at a market cap of Rs 1.75 lakh crore, which is lesser than ICICI Bank & Kotak Bank, and about 40% of the market cap of HDFC Bank.

24 Feb

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FinShiksha Analysis Notes – The Vakrangee Saga

Disclaimer: These notes are purely for the purpose of financial analysis and education. These are not to be construed as recommendation to either buy or sell any asset class or security.
You can also download this post here
 
The Vakrangee Saga
The stock of Vakrangee has been in the news recently due to its volatile price movements. The stock has fallen from a high of above Rs 500 to below Rs 200 as we write this. This was a Rs 50000 crore market capitalization company, before this fall.

05 Oct

Book Recommendations – for Aspiring Financial Analysts

For an MBA student planning to build a career in Finance, general understanding of finance, financial statements, businesses and valuation are core areas where work is needed. In this line, a lot of worldly wisdom is available in the form of books that are remarkable for learning. We have carefully curated a list of books we believe you should go through, in order to broaden your perspective about financial analysis and business valuations.

22 Aug

RBI Monetary Policy Review – Aug 2017

We conducted a short webinar on the major points around the RBI Monetary Policy review in Aug 2017. Here is the video for the same.

05 May

Industry Analysis – The Telecom Sector Story – Part 2

Last week we sent you the discussions on telecom sector. In case you want to go through that again – last week’s discussion can be accessed here – http://www.finshiksha.com/industry-analysis-the-telecom-sector-story-part-1/
Continuing our discussion on the Telecom Sector and its analysis – we are now going to look at some data, and use this for our understanding of the sector.

27 Apr

Industry Analysis – The Telecom Sector Story – Part 1

The Telecom Sector Analysis
The telecom sector has been in news off late, for a variety of reasons, either the entry of a large player disrupting the current competition scenario, or the merger to two other major players in the markets to create the largest telecom entity in India. It’s a sector which has been evaluated a bit, and let us note down all that is not so good with the sector.

The sector is hypercompetitive – thereby always creating a pricing pressure on players.

02 Mar

Budget 2017 – A Short Review

We recently conducted a short webinar (30 minutes) on the major announcements in Budget 2017, and its implications. The webinar discusses about what was good and what was not in this budget, and where was the major focus of this budget.

21 Dec

Demonetization – A boon or bane – Video

We recently conducted a webinar covering the topic -Demonetization – A Boon or Bane? In this webinar, we took an objective look at what are the costs and benefits of the demonetization exercise. What can we expect with respect to the economy and sectors in the near future, and how will the economy shape itself in the next year or so.

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29 Apr

The FMCG Valuation Puzzle

Disclaimer: These notes are purely for the purpose of financial analysis and education. These are not to be construed as recommendation to either buy or sell any asset class or security.
The FMCG Valuation Puzzle
In the last 12 months, Hindustan Unilever’s profits have been Rs 5069 crore. The company’s market cap is now north of Rs 300,000 crore, giving it a trailing P/E ratio of more than 60.

14 Apr

Oil Creates A Dilemma – 2

Disclaimer: These notes are purely for the purpose of financial analysis and education. These are not to be construed as recommendation to either buy or sell any asset class or security.
You could also download this note from here
In November, we had written a note on Oil Prices creating a Dilemma for the Indian Government.

17 Mar

The divergence in PSU vs Private Bank Valuations

The market capitalization of the top 15 PSU banks as on March 16 2018, is nearly 30% of that of the top 15 private banks. Ex-SBI – the next 14 PSU banks  trade at a market cap of Rs 1.75 lakh crore, which is lesser than ICICI Bank & Kotak Bank, and about 40% of the market cap of HDFC Bank.

24 Feb

  • By admin
  • In FSA
  • Comments 3

FinShiksha Analysis Notes – The Vakrangee Saga

Disclaimer: These notes are purely for the purpose of financial analysis and education. These are not to be construed as recommendation to either buy or sell any asset class or security.
You can also download this post here
 
The Vakrangee Saga
The stock of Vakrangee has been in the news recently due to its volatile price movements. The stock has fallen from a high of above Rs 500 to below Rs 200 as we write this. This was a Rs 50000 crore market capitalization company, before this fall.

07 Nov

Oil Prices create a dilemma!

Interesting times! The consensus world view was that oil’s golden run is over, and suddenly oil starts to surprise everyone! Now what are the ramifications if it rises another 10% from here. Indian government is going to be in a slight spot of bother, since that would result in them having to weigh economic and political decisions against each other. I think there are 3 broad possibilities we see playing out
1) The government allows the oil prices jump to be passed on to the end consumer.

05 May

Industry Analysis – The Telecom Sector Story – Part 2

Last week we sent you the discussions on telecom sector. In case you want to go through that again – last week’s discussion can be accessed here – http://www.finshiksha.com/industry-analysis-the-telecom-sector-story-part-1/
Continuing our discussion on the Telecom Sector and its analysis – we are now going to look at some data, and use this for our understanding of the sector.

27 Apr

Industry Analysis – The Telecom Sector Story – Part 1

The Telecom Sector Analysis
The telecom sector has been in news off late, for a variety of reasons, either the entry of a large player disrupting the current competition scenario, or the merger to two other major players in the markets to create the largest telecom entity in India. It’s a sector which has been evaluated a bit, and let us note down all that is not so good with the sector.

The sector is hypercompetitive – thereby always creating a pricing pressure on players.

05 Sep

Corporate Governance and Analysis: Lessons from the Welspun fiasco

We are reviewing an article on the web for this discussion. For more details, please read this
Recently, Welspun India was involved in a controversy, as one of their customers, Target, broke ties with them citing that they were being supplied inferior quality terry towels by Welspun, instead of those made by premium Egyptian cotton. Apparently, the towels were being labelled as being made with Egyptian cotton, but were using inferior grades of cotton.

25 Aug

Valuation – Where NPV fails

Most valuation techniques use some form of present value calculations, and are extensions of the NPV analysis. For example, both DCF and DDM draw from the NPV philosophy. However, there are some areas, where this may not work.
One of the major issues with NPV analysis is that the decision point is “Now or Never”. So if you are evaluating a project, and the NPV is negative, we are taught to discard the project, or not invest in it.

31 Jul

Interest Coverage Ratio – and mistakes we make while using it

Interest coverage ratio is a ratio that analysts use in order to evaluate the capability of a firm to repay debts and service the interest associated with those debts. It is calculated by dividing your EBIT by the Interest paid by the firms. Usually a ratio of 3 or more is considered comfortable, since your pre interest profits cover your interest liability by 3 times or more.

05 Oct

Book Recommendations – for Aspiring Financial Analysts

For an MBA student planning to build a career in Finance, general understanding of finance, financial statements, businesses and valuation are core areas where work is needed. In this line, a lot of worldly wisdom is available in the form of books that are remarkable for learning. We have carefully curated a list of books we believe you should go through, in order to broaden your perspective about financial analysis and business valuations.

02 Mar

How to make Effective use of Summer Internship in Finance

We conducted a short webinar discussing what are the things that students could do in order to maximize the value they get from their summer internship in Finance. The video of the webinar can be found here.

20 Jun

Webinar on What Financial Services Companies Expect from students

We conducted a webinar on the topic of  “What does the Financial Services Industry Expect from students“. This was attended by students from IIM Sambalpur, Vizag, Sirmaur, and Bodhgaya. You can access the video here.

19 Feb

Session on How to use Summer Internships Effectively – at JBIMS

FinShiksha recently conducted a short talk on “How to use the Summer Internships effectively” for the students of Jamnalal Bajaj Institute of Management Studies. The session outlined the importance of how students can maximize the learning during their summer internships. We thank students at JBIMS for hosting us. These sessions are also being planned in other institutes.

14 Nov

Financial Modeling vs Equity Valuation – The difference

How do we differentiate between financial modeling and valuation? Under common parlance, both these terms are used interchangeably, but a careful analysis would show the difference. It is necessary for someone trying to learn the two to understand the difference between the two.
Valuation of a company is a way to find out its intrinsic value. There are various ways we can analyse a firm, and we usually end up using Excel to speed up the process.

26 Dec

Investment Banks – What do they do?

One of the most coveted areas that students want to work for in the financial services domain is Investment Banking, or I-Banking as it is popularly known as. So what all does an I-Bank really do?
In this post we take a brief look at the major segments in an I-Bank. 
Not all investment banks conduct all the tasks highlighted on the right. A boutique investment bank may just assist in a few of the tasks. A full service investment bank on the other hand would deal with all the tasks.

14 Apr

Oil Creates A Dilemma – 2

Disclaimer: These notes are purely for the purpose of financial analysis and education. These are not to be construed as recommendation to either buy or sell any asset class or security.
You could also download this note from here
In November, we had written a note on Oil Prices creating a Dilemma for the Indian Government.

07 Nov

Oil Prices create a dilemma!

Interesting times! The consensus world view was that oil’s golden run is over, and suddenly oil starts to surprise everyone! Now what are the ramifications if it rises another 10% from here. Indian government is going to be in a slight spot of bother, since that would result in them having to weigh economic and political decisions against each other. I think there are 3 broad possibilities we see playing out
1) The government allows the oil prices jump to be passed on to the end consumer.

22 Aug

RBI Monetary Policy Review – Aug 2017

We conducted a short webinar on the major points around the RBI Monetary Policy review in Aug 2017. Here is the video for the same.

02 Mar

Budget 2017 – A Short Review

We recently conducted a short webinar (30 minutes) on the major announcements in Budget 2017, and its implications. The webinar discusses about what was good and what was not in this budget, and where was the major focus of this budget.

21 Dec

Demonetization – A boon or bane – Video

We recently conducted a webinar covering the topic -Demonetization – A Boon or Bane? In this webinar, we took an objective look at what are the costs and benefits of the demonetization exercise. What can we expect with respect to the economy and sectors in the near future, and how will the economy shape itself in the next year or so.

28 Jun

What is wrong with the argument in this article?

This note reviews an article that appeared in the ET a few days ago.
Refer to the mentioned article here. Try and find out if there is something wrong with the argument in this article?
We outline what is wrong with the argument this article uses about the overvaluation on Indian markets. This is a classic case of incorrect usage of real and nominal numbers.

25 Jun

Balance of Payments Scenario – India

We conducted a session on the Balance of Payments Scenario in India, and points to watch out for in the near future. The video can be accessed here.

24 Jun

India’s total trade with Euro Region in 2015-16

A chart to show trade India does with EU. The top 10 countries we import from and export to are shown. Looks like currency impact may not be huge.

22 Jun

Why India should focus on boosting manufacturing of electronic goods?

We all love the latest versions of electronic goods. For long, India has been an importer of electronic goods. Most of the manufacturing that happens in electronic goods such as televisions, refrigerators, washing machines and others is largely assembling. Major companies selling in India usually import most components. In fact, electronics imports in India are the 3rd largest import in terms of bill value.

24 May

Should we blame Raghuram Rajan for his stance on interest rates?

Off late there has been a lot of clamour around Raghuram Rajan, and the extension of his term as the RBI governor. Now the broad charge that has been led against him is that he has allowed interest rates to remain too high for too long. He should have focused on WPI and not on CPI, and reduced interest rates since all global economies have done so.
Such simplistic analysis very obviously misses the macro factors that affect the decision making of any central bank.