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IMPORTANT INSTRUCTIONS
1. Ensure that the company whose data you are downloading has numbers at least starting from FY08 (March 2008). This is be
from, say, FY10, you will see incorrect data for FY08 and FY09 (which will be of Hero Motocorp on whose financials I have crea
2. All financial data of your chosen company will be automatically updated in the sheet you download, except "Cash and Bank"
figures, which you must update manually from the company's annual reports. Don’t forget to make these changes as these num
3. You may update the sheet and add your own analysis, formulae etc. and then upload again to Screener.in site using the Step
"Data Sheet" because this will cause errors in your future downloads.
4. DON’T touch any cell except the black ones, where you are required to update the numbers manually from Annual Reports (j
the growth assumptions etc.
4. I have added Comments and Instructions wherever necessary so as to explain the concepts. Read those carefully before wo
5. This sheet is not a replacement of the work required to read annual reports as part of the analysis process. So please do tha
some discrepancy in numbers (though rare), but you will know this only when you read annual reports.
6. I could not find a bug/errors in this spreadsheet, but if you notice some, please email me at - vishal@safalniveshak.com - and
7. I will keep on updating the sheet from time to time and will update the same on the website. I invite you to share your feedba
together.
8. This excel won't work for banking and financial services companies.
Conclusion
Never Forget
Buffett Checklist - Read, Remember, Follow!
Source - Buffettology by Mary Buffett & David Clark
Explanation
Seek out companies that have no or less competition, either due to a patent or brand name or similar intangible that
makes the product unique. Such companies will typically have high gross and operating profit margins because of their
unique niche. However, don't just go on margins as high margins may simply highlight companies within industries with
traditionally high margins. Thus, look for companies with gross, operating and net profit margins above industry norms.
Also look for strong growth in earnings and high return on equity in the past.
Try to invest in industries where you possess some specialized knowledge (where you work) or can more effectively
judge a company, its industry, and its competitive environment (simple products you consume). While it is difficult to
construct a quantitative filter, you should be able to identify areas of interest. You should "only" consider analyzing
those companies that operate in areas that you can clearly grasp - your circle of competence. Of course you can
increase the size of the circle, but only over time by learning about new industries. More important than the size of the
circle is to know its boundaries.
Seeks out companies with conservative financing, which equates to a simple, safe balance sheet. Such companies
tend to have strong cash flows, with little need for long-term debt. Look for low debt to equity or low debt-burden ratios.
Also seek companies that have history of consistently generating positive free cash flows.
Rising earnings serve as a good catalyst for stock prices. So seek companies with strong, consistent, and expanding
earnings (profits). Seek companies with 5/10 year earnings per share growth greater than 25% (along with safe
balance sheets). To help indicate that earnings growth is still strong, look for companies where the last 3-years
earnings growth rate is higher than the last 10-years growth rate. More important than the rate of growth is the
consistency in such growth. So exclude companies with volatile earnings growth in the past, even if the "average"
growth has been high.
Like you should stock to your circle of competence, a company should invest its capital only in those businesses within
its circle of competence. This is a difficult factor to screen for on a quantitative level. Before investing in a company,
look at the company’s past pattern of acquisitions and new directions. They should fit within the primary range of
operations for the firm. Be cautious of companies that have been very aggressive in acquisitions in the past.
Buffett prefers that firms reinvest their earnings within the company, provided that profitable opportunities exist. When
companies have excess cash flow, Buffett favours shareholder-enhancing maneuvers such as share buybacks. While
we do not screen for this factor, a follow-up examination of a company would reveal if it has a share buyback plan in
place.
Seek companies where earnings have risen as retained earnings (earnings after paying dividends) have been
employed profitably. A great way to screen for such companies is by looking at those that have had consistent
earnings and strong return on equity in the past.
Consider it a positive sign when a company is able to earn above-average (better than competitors) returns on equity
without employing much debt. Average return on equity for Indian companies over the last 10 years is approximately
16%. Thus, seek companies that earn at least this much (16%) or more than this. Again, consistency is the key here.
That's what is called "pricing power". Companies with moat (as seen from other screening metrics as suggested above
(like high ROE, high grow margins, low debt etc.) are able to adjust prices to inflation without the risk of losing
significant volume sales.
Companies that consistently need capital to grow their sales and profits are like bank savings account, and thus bad
for an investor's long term portfolio. Seek companies that don't need high capital investments consistently. Retained
earnings must first go toward maintaining current operations at competitive levels, so the lower the amount needed to
maintain current operations, the better. Here, more than just an absolute assessment, a comparison against
competitors will help a lot. Seek companies that consistently generate positive and rising free cash flows.
Sensible investing is always about using “folly and discipline” - the discipline to identify excellent businesses, and wait
for the folly of the market to drive down the value of these businesses to attractive levels. You will have little trouble
understanding this philosophy. However, its successful implementation is dependent upon your dedication to learn and
follow the principles, and apply them to pick stocks successfully.
Net Block 1,914 1,812 1,855 1,920 2,355 2,660 2,448 2,026 2,002 1,878
Capital Work in Progress 22 42 70 42 294 144 255 52 42 56
Investments 1,423 3,445 4,211 4,473 6,059 8,448 8,985 11,067 15,477 18,895
Other Assets 2,672 1,835 3,043 4,731 3,968 4,203 4,415 4,223 4,285 4,515
Total 6,031 7,134 9,179 11,165 12,676 15,454 16,103 17,368 21,806 25,344
Working Capital 49 -1,221 -981 -202 -527 -1,025 -481 993 455 -283
Debtors 281 239 339 402 734 796 717 718 953 1,492
Inventory 372 458 576 704 644 641 814 719 728 743
Cash & Bank** 935 2,757 3,278 2,790 6,393 2,085 6,351 6,558
** Manually enter this number; Convert to Rs Crore if not already done in the Annual Reports; Use Cash+Bank+Current Investments from Consolidated Balance Sheet in Annual Reports
Debtor Days 12 8 8 7 13 14 12 12 16 22
Inventory Turnover 23 25 29 28 31 31 27 31 30 34
Fixed Asset Turnover 4.4 6.4 8.9 10.2 8.5 7.6 8.8 11.2 10.9 13.4
Debt/Equity 0.9 0.5 0.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Return on Equity 29% 58% 71% 48% 37% 31% 25% 29% 23% 21%
Return on Capital Employed 24% 56% 86% 64% 52% 45% 36% 40% 31% 29%
Profit & Loss Account / Income Statement
BAJAJ AUTO LTD
Rs Cr Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Trailing
Sales 8,446 11,543 16,429 19,595 20,042 20,158 21,614 22,587 21,767 25,165 29,614
% Growth YOY 37% 42% 19% 2% 1% 7% 4% -4% 16%
Expenses 7,811 9,576 13,287 15,963 16,456 16,068 17,742 17,816 17,365 20,410 24,495
Material Cost (% of Sales) 76% 71% 72% 73% 72% 69% 69% 66% 67% 69% Check for wide fluctuations in key
Power and Fuel 1% 1% 1% 1% 1% 1% 1% 1% 0% 0% expense items. For manufacturing
Other Mfr. Exp 2% 1% 1% 1% 1% 3% 3% 3% 3% 2% firms, check their material costs etc. For
Employee Cost 6% 5% 3% 3% 3% 3% 4% 4% 5% 4% services firms, look at employee costs.
Selling and Admin Cost 6% 4% 4% 4% 4% 3% 3% 4% 3% 3%
Operating Profit 635 1,967 3,142 3,631 3,586 4,090 3,872 4,771 4,401 4,755 5,119
Operating Profit Margin 8% 17% 19% 19% 18% 20% 18% 21% 20% 19% 17%
Other Income 324 459 1,406 502 797 682 425 1,199 1,473 1,471 1,845
Other Income as % of Sales 3.8% 4.0% 8.6% 2.6% 4.0% 3.4% 2.0% 5.3% 6.8% 5.8% 6.2%
Depreciation 131 137 124 147 168 181 267 307 307 315 293
Interest 22 7 2 23 1 1 6 1 1 1 4
Interest Coverage(Times) 38 339 1,851 175 3,542 5,599 621 5,393 3,976 4,512 1,486
Profit before tax (PBT) 807 2,282 4,421 3,964 4,214 4,590 4,023 5,662 5,565 5,909 6,666
% Growth YOY 183% 94% -10% 6% 9% -12% 41% -2% 6%
PBT Margin 10% 20% 27% 20% 21% 23% 19% 25% 26% 23% 23%
Tax 286 701 1,006 1,020 1,229 1,420 1,271 1,618 1,508 1,714 1,972
Net profit 521 1,581 3,415 2,944 2,985 3,170 2,752 4,044 4,057 4,195 4,695
% Growth YOY 204% 116% -14% 1% 6% -13% 47% 0% 3%
Net Profit Margin 6% 14% 21% 15% 15% 16% 13% 18% 19% 17% 16%
EPS 18.0 54.6 118.0 101.7 103.2 109.5 95.1 139.8 140.2 145.0 162.2
% Growth YOY 204% 116% -14% 1% 6% -13% 47% 0% 3%
Price to earning 17.6 18.9 12.3 16.2 17.1 18.4 21.4 17.7 20.2 19.5 18.6
Price 318 1,034 1,448 1,651 1,765 2,013 2,035 2,474 2,833 2,833 3,024
Dividend Payout 59.4% 36.2% 33.5% 42.7% 41.6% 42.8% 47.8% 39.2% 39.0% 41.2%
Market Cap 9,191 29,918 41,887 47,761 51,069 58,239 58,872 71,599 81,984 81,981
Retained Earnings 211 1,008 2,271 1,687 1,744 1,813 1,436 2,459 2,474 2,469
Buffett's $1 Test 4.1
Check for long term vs short term trends here. Check if the growth over
past 3 or 5 years has slowed down / improved compared to long term (7
to 10 years) growth numbers.
Cash Flow Statement
BAJAJ AUTO LTD
Rs Cr Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Total
Cash from Operating Activity (CFO) 329 2,564 1,639 3,246 2,218 3,502 2,114 3,690 3,267 4,328 26,897
% Growth YoY 680% -36% 98% -32% 58% -40% 75% -11% 32%
Cash from Investing Activity -173 -1,935 -627 -850 -1,394 -2,072 -380 -68 -3,610 -1,954 -13,063
Cash from Financing Activity -84 -664 -871 -1,462 -1,445 -1,496 -1,644 -3,384 -190 -1,885 -13,126
Net Cash Flow 71 -35 141 934 -621 -66 90 238 -532 488 708
CFO/Sales 4% 22% 10% 17% 11% 17% 10% 16% 15% 17%
CFO/Net Profit 63% 162% 48% 110% 74% 110% 77% 91% 81% 103%
Capex** 393 117 202 109 508 220 270 265 199 183
FCF -64 2,447 1,437 3,137 1,710 3,282 1,844 3,425 3,068 4,145 24,431
Average FCF (3 Years) 3,546
FCF Growth YoY -3905% -41% 118% -45% 92% -44% 86% -10% 35%
FCF/Sales -1% 21% 9% 16% 9% 16% 9% 15% 14% 16%
FCF/Net Profit -12% 153% 42% 103% 55% 97% 61% 84% 75% 98%
Operating Margin 7.5% 17.0% 19.1% 18.5% 17.9% 20.3% 17.9% 21.1% 20.2%
PBT Margin 9.6% 19.8% 26.9% 20.2% 21.0% 22.8% 18.6% 25.1% 25.6%
Net Margin 6.2% 13.7% 20.8% 15.0% 14.9% 15.7% 12.7% 17.9% 18.6%
Debtor Days 12.1 7.5 7.5 7.5 13.4 14.4 12.1 11.6 16.0
Inventory Turnover 22.7 25.2 28.5 27.8 31.1 31.4 26.5 31.4 29.9
Fixed Asset Turnover 4.4 6.4 8.9 10.2 8.5 7.6 8.8 11.2 10.9
Debt/Equity 0.9 0.5 0.1 0.0 0.0 0.0 0.0 0.0 0.0
Debt/Assets 26.5% 19.1% 3.8% 1.3% 0.9% 0.4% 0.7% 0.7% 0.5%
Interest Coverage (Times) 37.9 339.1 1,850.9 174.9 3,542.0 5,598.5 620.9 5,393.3 3,976.2
Return on Equity 28.7% 58.2% 71.0% 48.4% 37.0% 31.2% 24.8% 28.8% 22.7%
Return on Capital Employed 24.3% 56.1% 85.8% 64.0% 51.5% 44.9% 36.0% 40.1% 31.0%
Free Cash Flow (Rs Cr) -64 2,447 1,437 3,137 1,710 3,282 1,844 3,425 3,068
Mar/18
15.6%
6.2%
3.4%
9.1%
32.5%
35.1%
18.9%
23.5%
16.7%
21.6
33.9
13.4
0.0
0.5%
4,511.9
20.5%
28.8%
4,145
Common Size P&L
Rs Cr Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18
Sales 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Raw Material Cost 76% 71% 72% 73% 72% 69% 69% 66% 67% 69%
Change in Inventory 0% 0% 1% 0% 0% 0% 0% 0% 0% 0%
Power and Fuel 1% 1% 1% 1% 1% 1% 1% 1% 0% 0%
Other Mfr. Exp 2% 1% 1% 1% 1% 3% 3% 3% 3% 2%
Employee Cost 6% 5% 3% 3% 3% 3% 4% 4% 5% 4%
Selling and Admin Cost 6% 4% 4% 4% 4% 3% 3% 4% 3% 3%
Other Expenses 2% 1% 1% 1% 1% 1% 2% 1% 2% 2%
Operating Profit 8% 16% 18% 18% 18% 20% 17% 22% 20% 19%
Other Income 4% 4% 9% 3% 4% 3% 2% 5% 7% 6%
Depreciation 2% 1% 1% 1% 1% 1% 1% 1% 1% 1%
Interest 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
Profit Before Tax 10% 20% 27% 20% 21% 23% 19% 25% 26% 24%
Tax 3% 6% 6% 5% 6% 7% 6% 7% 7% 7%
Net Profit 6% 14% 21% 16% 16% 17% 14% 18% 19% 17%
Dividend Amount 4% 5% 7% 7% 6% 7% 7% 7% 7% 7%
Revenue Growth
-
Jan/09 Jan/11 Jan/13 Jan/15 Jan/17 Net Profit Growth
Management Effectiveness
Mar/09 Mar/10 Mar/11 Mar/12 Mar/13 Mar/14 Mar/15 Mar/16 Mar/17 Mar/18
ROE 29% 58% 71% 48% 37% 31% 25% 29% 23% 21%
ROCE 24% 56% 86% 64% 52% 45% 36% 40% 31% 29%
META
Number of shares 28.94
Face Value 10
Current Price 3023.8
Market Capitalization 87498.8
Quarters
Report Date Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17
Sales 6054.52 5066.89 4897.32 5442.37 6579.91 6387.64
Expenses 4760.06 4022.88 3992.38 4504.44 5282.44 5138.73
Other Income 421.66 371.39 355.06 338.52 379.08 270.11
Depreciation 76.95 77.17 75.7 75.26 76.97 74.68
Interest 0.68 0.26 0.24 0.24 0.47 0.3
Profit before tax 1638.49 1337.97 1184.06 1200.95 1599.11 1444.04
Tax 437.77 361.15 321.82 364.2 405.53 430.9
Net profit 1200.72 976.82 862.25 836.74 1193.58 1013.16
Operating Profit 1294.46 1044.01 904.94 937.93 1297.47 1248.91
BALANCE SHEET
Report Date Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14
Equity Share Capital 144.68 144.68 289.37 289.37 289.37 289.37
Reserves 1668.11 2572.25 4517.85 5792.35 7775.93 9877.89
Borrowings 1595.36 1361.03 347.44 150.47 115.58 59.19
Other Liabilities 2622.89 3056.35 4024.09 4933.23 4494.85 5227.7
Total 6031.04 7134.31 9178.75 11165.42 12675.73 15454.15
Net Block 1913.61 1812.33 1855.21 1920.03 2355.41 2659.62
Capital Work in Progress 22.06 41.52 69.86 41.65 293.55 144.06
Investments 1423.19 3445.23 4210.92 4472.78 6058.92 8447.77
Other Assets 2672.18 1835.23 3042.76 4730.96 3967.85 4202.7
Total 6031.04 7134.31 9178.75 11165.42 12675.73 15454.15
Receivables 280.94 238.52 338.74 401.93 734.33 796.21
Inventory 371.76 458.39 576.25 703.61 643.96 641.21
Cash & Bank 142.64 107.3 247.54 1659.84 566.51 500.9
No. of Equity Shares 144683510 144683510 289367020 289367020 289367020 289367000
New Bonus Shares 144683510
Face value 10 10 10 10 10 10
CASH FLOW:
Report Date Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14
Cash from Operating Activity 328.68 2564.08 1639.37 3246.27 2218.3 3501.71
Cash from Investing Activity -173.01 -1935.04 -627.03 -849.78 -1394.43 -2072.26
Cash from Financing Activity -84.27 -664.38 -870.93 -1462.36 -1444.69 -1495.69
Net Cash Flow 71.4 -35.34 141.41 934.13 -620.82 -66.24
DERIVED:
Adjusted Equity Shares in Cr 28.94 28.94 28.94 28.94 28.94 28.94
DO NOT MAKE ANY CHANGES TO THIS SHEET
10 10 10 10
P.S. In case of companies earning negative FCF, where this model will not work, you must use a normalized positive FCF as
starting number. This number is your assumption of FCF the business will earn in a normal year, without capex. Check the his
this business while arriving at your assumption, and use your judgment wisely without twisting the model to fit your version of
Calculation
by Mohnish Pabrai
Avg 5-Yr Net Profit (Rs Crore) 3,643.5 Avg 5-Yr Net Profit (Rs Crore)
PE Ratio at 0% Growth 8.5 PE Ratio at 0% Growth
Long-Term Growth Rate 3.5 Long-Term Growth Rate
Ben Graham Value (Rs Crore) 56,622 Ben Graham Value (Rs Crore)
Current Market Cap (Rs Crore) 87,499 Current Market Cap (Rs Crore)
EXPLANATION
Ben Graham's Original Formula: Value = EPS x (8.5 + 2G)
Here, EPS is the trailing 12 month EPS, 8.5 is the P/E ratio of a stock with 0% growth and g is the growth rate for the next 7-10
3,643.5
8.5
7.0
82,274
87,499
e of around 1962 when Graham was publicizing his works, the risk free interest rate was 4.4% but to adjust to the present, we divide this nu
e present, we divide this number by today’s AAA corporate bond rate, represented by Y in the formula above.
Dicounted Cash Flow Valuation
BAJAJ AUTO LTD
Final Calculations
Terminal Year 12,821
PV of Year 1-10 Cash Flows 39,442
Terminal Value 41,280
Total PV of Cash Flows 80,722
Current Market Cap (Rs Cr) 87,499
TESTING:
This is a testing feature currently.
You can report any formula errors on the worksheet at: screener.feedback@dalal-street.in
… do ANYTHING.
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