We all have heard “glass half full, half empty” mindset stories. Recently, something similar happened with the Steel Authority of India (SAIL) valuations. Before that, let’s understand how the business cycle affects valuations. There are two ways to see the value of a company. The market cap of th

1. Area of operation: commercial vs residential vs lease model-Affects Revenue cyclicality & margins 2. Reputation in local brokers-Affects Project Booking Advances & Cash flows 3. Target market: Tier 1 city vs tier 2/3 cities, premium projects vs middle/low income vs retirement projects vs club

In this blogpost we will discuss various angles through which we can derive the potential industry size and understand the runway available for growth of a business within an industry. First thing first - We should never comment "This company has already grown so much/its market cap has already inc

In this Post our focus will be on understanding the issues with extracting right estimates of historical Industry sizes & growth. As an analyst needs to take a judgement of future opportunity size while he analyzes a business it becomes extremely important than first to get the right estimates of cu

If you are given a particular Industry/company to cover what you will do? How are you going to start? What are the things you’ll have to cover to understand the basics of the same? Here are the steps you need to follow to get a quick glimpse of any Industry: Note: Just to be very clear this i

Profits are clustered. ps: (Read More on ROE here - https://www.finnacleshahclasses.com/forum/business-analysis-series/blog-112-primer-on-roe-ek-number-saa-insan-ko-hin-bana-deta-hai-nana-patekar ) All businesses are not equal, some are tremendously profitable and some businesses perpetually

The only rule in investing is there's no permanent rule. Reading this you will truly understand why investing is simple but not easy. 1) Crunching basic number like revenue CAGR and ROCEs is just the start not the END of business analysis. (a) Pick up any decade all businesses that generated stro

In part 2 we understood that a increase in penetration levels, per capita consumptions, organized market share, industry size to GDP % can lead to great growth in an industry and for companies operating within that industry. Let us again present some of the current penetration levels, Organized Vs

Well it's technically true that "Risk hai to Ishq Hai" but it's also true that "Kaisa hai yeh ishq hai Ajaab sa risk hai". It's one of the most important job of a business analyst and an entrepreneur to understand what all can go wrong in a business and what's the probability of that event happening

After selecting an Industry or company the first step you need to do is build your sector repository as this will help you for your research. You can’t randomly open any document and start reading. You need to have a clear idea what you are reading and along with this you need to have a clear ide

As a business analyst its extremely crucial to understand the opportunity size/target Addressable market that's available in front of a company to grow. Everyone wants a big and growing market. Although this term is used directly in the start up space the listed market professional use it in a diffe

While watching the great COSMOS series brilliantly narrated by @neiltyson this clicked us somewhere around the 12th episode of season 1. This set of observations might help you understand what great investors and thinkers like sir charlie munger globally and Prof Sanjay Bakshi in India have been e

As we understood in Part 1 of this series (https://www.finnacleshahclasses.com/forum/business-analysis-series/blog-108-masterclass-series-on-forecasting-industry-size-part-1) that a) Low Penetration ratio b) Low per capita consumption (from here on referred as PCC) c) Low Organized Market Share a

The destination of any business analysis is to forecast the topline (Revenue/GMV/Order Book) and than using revenue numbers derive the bottom-line (EBITDA/EBIT/PAT) & Free cash Flows (FCFF) a business can generate 3/5/10 years down the line. There are broadly two approaches investors & analyst use

Calculating return ratios have been taught to us since eternity. The Difference is some people calculate it, while some use this as a starting point and decode the reason behind movements in the ratios. Ratios are outputs. Business operating parameters like costing, revenue mix, capital structure m

After Knowing characteristics of a good business/industry (please Read Part 1 here before you proceed reading this article) now let us filter out Industries and Companies which fulfills these characteristics. We simply run query on screener where we have inserted 3 filters which are: 1. Sales gro