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the exact format as "Safal Niveshak's Stock Analysis Excel Ver. 4.0". Now onwards, any excel you export for any company on S
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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 3,399 4,250 4,634 4,914 5,282 5,660 5,256 4,792 4,971 4,974
Capital Work in Progress 998 561 358 548 689 182 120 76 206 401
Investments 264 326 1,230 1,534 2,338 2,790 2,649 1,980 2,879 5,803
Other Assets 3,250 4,183 4,395 4,945 4,849 4,394 5,388 6,349 6,599 5,835
Total 7,911 9,321 10,617 11,942 13,157 13,025 13,412 13,198 14,654 17,014
Working Capital -594 -521 -997 -999 -795 -667 -578 974 207 -3,011
Debtors 958 1,022 1,165 1,231 1,419 1,299 1,243 1,251 1,064 980
Inventory 1,330 1,638 2,209 2,231 1,896 1,189 1,399 1,625 2,631 1,710
Cash & Bank** 4,735 3,367 3,190 3,393 2,605 3,546 4,739 5,829
** 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 57 50 37 34 42 46 33 24 19 14
Inventory Turnover 5 5 5 6 7 9 10 12 8 15
Fixed Asset Turnover 1.8 1.7 2.5 2.7 2.4 1.8 2.6 4.0 4.1 5.3
Debt/Equity 0.9 1.0 1.0 1.1 1.4 1.4 0.8 0.4 0.4 0.1
Return on Equity 9% 17% 23% 19% 13% 0% 8% 7% 19% 20%
Return on Capital Employed 9% 14% 19% 15% 11% 4% 11% 14% 17% 27%
Profit & Loss Account / Income Statement
ASHOK LEYLAND 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 6,098 7,407 11,417 13,380 12,481 10,301 13,916 18,937 20,140 26,248 28,969
% Growth YOY 21% 54% 17% -7% -17% 35% 36% 6% 30%
Expenses 5,651 6,663 10,227 12,308 11,670 10,260 13,161 16,492 18,349 23,899 25,821
Material Cost (% of Sales) 73% 74% 73% 72% 71% 70% 72% 72% 73% 66% Check for wide fluctuations in key
Power and Fuel 1% 1% 1% 1% 1% 1% 1% 1% 1% 1% expense items. For manufacturing
Other Mfr. Exp 2% 1% 1% 1% 2% 2% 1% 1% 1% 1% firms, check their material costs etc. For
Employee Cost 9% 9% 8% 8% 9% 10% 9% 7% 7% 7% services firms, look at employee costs.
Selling and Admin Cost 8% 9% 7% 10% 13% 12% 10% 11% 11% 11%
Operating Profit 448 744 1,190 1,072 811 41 756 2,446 1,791 2,349 3,148
Operating Profit Margin 7% 10% 10% 8% 6% 0% 5% 13% 9% 9% 11%
Other Income 91 91 44 201 397 678 493 -888 143 443 128
Other Income as % of Sales 1.5% 1.2% 0.4% 1.5% 3.2% 6.6% 3.5% -4.7% 0.7% 1.7% 0.4%
Depreciation 178 204 267 353 381 377 416 488 518 555 598
Interest 160 102 189 255 377 453 394 248 155 131 71
Interest Coverage(Times) 2 6 5 4 2 1 2 4 9 17 38
Profit before tax (PBT) 200 530 778 665 450 -111 439 822 1,261 2,107 2,606
% Growth YOY 164% 47% -15% -32% -125% -495% 87% 53% 67%
PBT Margin 3% 7% 7% 5% 4% -1% 3% 4% 6% 8% 9%
Tax 18 121 171 124 37 -121 107 437 107 668 660
Net profit 182 408 607 541 413 10 331 385 1,154 1,439 1,946
% Growth YOY 125% 49% -11% -24% -98% 3343% 16% 200% 25%
Net Profit Margin 3% 6% 5% 4% 3% 0% 2% 2% 6% 5% 7%
EPS 0.7 1.5 2.3 2.0 1.6 0.0 1.2 1.4 4.1 4.9 6.6
% Growth YOY 125% 49% -11% -24% -98% 3119% 16% 200% 21%
Price to earning 15.0 18.2 12.2 15.1 14.3 648.3 61.8 79.8 20.8 30.9 13.5
Price 10 28 28 31 22 23 72 108 84 152 90
Dividend Payout 70.0% 47.1% 42.1% 47.0% 36.8% 0.0% 38.3% 69.4% 36.3% 45.5%
Market Cap 2,734 7,450 7,392 8,158 5,922 6,236 20,473 30,747 23,961 44,495
Retained Earnings 55 216 351 287 261 10 204 118 735 784
Buffett's $1 Test 13.8
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
ASHOK LEYLAND 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) -526 1,090 591 1,147 728 556 1,777 1,683 2,155 5,418 14,621
% Growth YoY -307% -46% 94% -37% -24% 219% -5% 28% 151%
Cash from Investing Activity -664 -783 -918 -1,054 -1,165 -111 103 364 -1,477 -3,332 -9,037
Cash from Financing Activity 459 123 -14 -241 417 -449 -1,179 -1,211 -1,372 -1,961 -5,427
Net Cash Flow -731 430 -340 -148 -20 -3 700 836 -694 125 157
CFO/Sales -9% 15% 5% 9% 6% 5% 13% 9% 11% 21%
CFO/Net Profit -289% 267% 97% 212% 176% 5784% 536% 437% 187% 377%
Capex** 315 212 364 565 607 937 1,156 1,638 1,238 824
FCF -841 878 227 582 121 -381 621 45 917 4,594 6,765
Average FCF (3 Years) 1,852
FCF Growth YoY -205% -74% 156% -79% -414% -263% -93% 1938% 401%
FCF/Sales -14% 12% 2% 4% 1% -4% 4% 0% 5% 18%
FCF/Net Profit -442% 207% 36% 103% 28% -1295% 185% 12% 75% 294%
Operating Margin 7.3% 10.0% 10.4% 8.0% 6.5% 0.4% 5.4% 12.9% 8.9%
PBT Margin 3.3% 7.1% 6.8% 5.0% 3.6% -1.1% 3.2% 4.3% 6.3%
Net Margin 3.0% 5.5% 5.3% 4.0% 3.3% 0.1% 2.4% 2.0% 5.7%
Debtor Days 57.3 50.4 37.2 33.6 41.5 46.0 32.6 24.1 19.3
Inventory Turnover 4.6 4.5 5.2 6.0 6.6 8.7 10.0 11.7 7.7
Fixed Asset Turnover 1.8 1.7 2.5 2.7 2.4 1.8 2.6 4.0 4.1
Debt/Equity 0.9 1.0 1.0 1.1 1.4 1.4 0.8 0.4 0.4
Debt/Assets 24.8% 24.5% 24.2% 25.9% 33.1% 36.0% 25.0% 18.3% 14.6%
Interest Coverage (Times) 2.2 6.2 5.1 3.6 2.2 0.8 2.1 4.3 9.1
Return on Equity 8.6% 17.5% 22.9% 18.7% 13.1% 0.3% 8.1% 7.1% 18.9%
Return on Capital Employed 8.9% 13.7% 18.5% 15.3% 11.0% 4.3% 11.2% 13.7% 17.1%
Free Cash Flow (Rs Cr) -841 878 227 582 121 -381 621 45 917
Mar/18
30.3%
67.1%
24.7%
60.2%
151.5%
401.1%
9.0%
8.0%
5.5%
13.6
15.4
5.3
0.1
5.9%
17.1
20.1%
27.4%
4,594
What to look for?
Higher is better, but also look for long term stability and consistency
Higher is better, but also look for long term stability and consistency
Higher is better, but also look for long term stability and consistency
Higher isn't always better, esp. when the company is generating high ROE, which means the management is allocating capital
Higher is better, but also look for long term stability and consistency
Higher is better, but also look for long term stability and consistency
Higher is better, but also look for long term stability and consistency, plus the nature of the industry. Also compare with industry
Higher is better, but also look for long term stability and consistency, plus the nature of the industry. Also compare with industry
Higher is better, but also look for long term stability and consistency, plus the nature of the industry. Also compare with industry
30,000
Revenue Revenue and Pro
4000%
Check for a rising trend. Check for a ris
3500% Compare grow
25,000
3000%
20,000 2500%
2000%
15,000 1500%
1000%
10,000
500%
5,000 0%
-500% Jan/10 Jan/12
- -1000%
Jan/09 Jan/11 Jan/13 Jan/15 Jan/17 Revenue Growth
Net Profit Grow
Management Effectiveness
Mar/09 Mar/10 Mar/11 Mar/12 Mar/13 Mar/14 Mar/15 Mar/16 Mar/17
ROE 9% 17% 23% 19% 13% 0% 8% 7% 19%
ROCE 9% 14% 19% 15% 11% 4% 11% 14% 17%
Cash Flows
Mar/09 Mar/10 Mar/11 Mar/12 Mar/13 Mar/14 Mar/15 Mar/16 Mar/17
Operating Cash Flow -526 1,090 591 1,147 728 556 1,777 1,683 2,155
Free Cash Flow -841 878 227 582 121 -381 621 45 917
%
Capital Allocation Quality
Check for a rising trend and/or consistency.
% Numbers > 20% long term are good. Also check if the company
has zero/marginal debt. Compare with a close competitor Note: Please ignore the dates
% on the X-axis. The figures are
% for/as on the year ending date,
which for most Indian
% companies would be 31st
March of that year
%
%
Jan/09 Jan/11 Jan/13 Jan/15 Jan/17
ROE ROCE
Mar/18
20%
27%
Mar/18
26,248
2,107
1,439
Mar/18
5,418
4,594
Common Size P&L
Rs Cr Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17
Sales 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Raw Material Cost 73% 74% 73% 72% 71% 70% 72% 72% 73% 66%
Change in Inventory 0% 3% 1% 1% -2% -4% 0% 2% 4% -5%
Power and Fuel 1% 1% 1% 1% 1% 1% 1% 1% 1% 1%
Other Mfr. Exp 2% 1% 1% 1% 2% 2% 1% 1% 1% 1%
Employee Cost 9% 9% 8% 8% 9% 10% 9% 7% 7% 7%
Selling and Admin Cost 8% 9% 7% 10% 13% 12% 10% 11% 11% 11%
Other Expenses 0% 0% 0% 2% -4% 1% 3% -2% 1% 0%
Operating Profit 7% 3% 8% 6% 11% 9% 5% 8% 1% 19%
Other Income 1% 1% 0% 1% 3% 7% 4% -5% 1% 2%
Depreciation 3% 3% 2% 3% 3% 4% 3% 3% 3% 2%
Interest 3% 1% 2% 2% 3% 4% 3% 1% 1% 1%
Profit Before Tax 3% 7% 7% 5% 4% -1% 3% 4% 7% 8%
Tax 0% 2% 1% 1% 0% -1% 1% 2% 1% 3%
Net Profit 3% 6% 6% 4% 3% 0% 2% 2% 6% 6%
Dividend Amount 2% 3% 2% 2% 1% 0% 1% 1% 2% 3%
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) 663.7 Avg 5-Yr Net Profit (Rs Crore)
PE Ratio at 0% Growth 8.5 PE Ratio at 0% Growth
Long-Term Growth Rate 14.2 Long-Term Growth Rate
Ben Graham Value (Rs Crore) 24,437 Ben Graham Value (Rs Crore)
Current Market Cap (Rs Crore) 26,288 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
663.7
8.5
28.3
43,233
26,288
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
ASHOK LEYLAND LTD
Final Calculations
Terminal Year 6,696
PV of Year 1-10 Cash Flows 20,599
Terminal Value 21,559
Total PV of Cash Flows 42,159
Current Market Cap (Rs Cr) 26,288
META
Number of shares 293.55
Face Value 1
Current Price 89.55
Market Capitalization 26287.65
Quarters
Report Date Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17
Sales 4622.41 4516.29 6653.74 4257.86 6076.38 7190.66
Expenses 4085.92 4125.88 5923.84 3954.46 5467.23 6619.04
Other Income 38.18 25.78 -287.62 25.84 55.66 303.9
Depreciation 126.11 131.34 139.48 132.13 141.14 145.95
Interest 33.92 45.33 42.3 36.63 41.02 36.78
Profit before tax 414.64 239.52 260.5 160.48 482.65 692.79
Tax 120.23 77.8 -215.66 49.24 148.4 207.93
Net profit 294.41 161.72 476.17 111.24 334.26 484.86
Operating Profit 536.49 390.41 729.9 303.4 609.15 571.62
BALANCE SHEET
Report Date Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14
Equity Share Capital 133.03 133.03 133.03 266.07 266.07 266.07
Reserves 1976.01 2202.55 2523.65 2632.9 2892.39 3007.89
Borrowings 1958.14 2280.44 2568.27 3097.89 4355.43 4690.32
Other Liabilities 3844.08 4704.54 5391.8 5944.79 5643.18 5061.11
Total 7911.26 9320.56 10616.75 11941.65 13157.07 13025.39
Net Block 3399.12 4249.56 4633.79 4913.5 5281.88 5659.87
Capital Work in Progress 998.29 561.47 357.97 548.22 688.93 181.53
Investments 263.56 326.15 1230 1534.48 2337.63 2789.69
Other Assets 3250.29 4183.38 4394.99 4945.45 4848.63 4394.3
Total 7911.26 9320.56 10616.75 11941.65 13157.07 13025.39
Receivables 957.97 1022.06 1164.5 1230.76 1419.41 1299.01
Inventory 1330.02 1638.24 2208.9 2230.62 1896.02 1188.7
Cash & Bank 88.08 518.92 179.53 32.56 13.94 11.69
No. of Equity Shares 1330542992 1.331E+09 1.331E+09 2.661E+09 2.661E+09 2.661E+09
New Bonus Shares 1.33E+09
Face value 1 1 1 1 1 1
CASH FLOW:
Report Date Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14
Cash from Operating Activity -525.58 1090.06 591.38 1147.31 728.3 556.43
Cash from Investing Activity -664.18 -783.17 -917.73 -1054.1 -1164.93 -110.54
Cash from Financing Activity 459.18 123.31 -13.63 -241.12 416.98 -448.64
Net Cash Flow -730.58 430.2 -339.98 -147.91 -19.65 -2.75
DERIVED:
Adjusted Equity Shares in Cr 266.09 266.09 266.09 266.09 266.09 266.09
DO NOT MAKE ANY CHANGES TO THIS SHEET
1 1 1 1
TESTING:
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You can report any formula errors on the worksheet at: screener.feedback@dalal-street.in
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