Safal Niveshak Stock Analysis Excel (Ver. 4.

www.safalniveshak.com

HOW TO USE THIS SPREADSHEET

Step 1 - This spreadsheet works only on Screener.in. The first step is to create a free account here - https://www.screener.in/re
Step 2 - After creating your account, while you are logged in to Screener.in website, visit this page - https://www.screener.in/ex
Step 3 - Visit the home page of Screener.in and choose a company of your choice. Once you do that, you will see details of you
financial statement table called "Quarterly Results" and click on "View Consolidated". Now, all data you see for this company wi

Step 4 - Scroll back to the top of the page, and you will see a button "Export to Excel" on the right side. Click the button and the
the exact format as "Safal Niveshak's Stock Analysis Excel Ver. 4.0". Now onwards, any excel you export for any company on S
Step 5 - Email me your love and testimonial for helping you with this excel. :-)

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.

Note: All data is sourced from Screener.in

 Safal Niveshak Stock
Analysis Excel (Ver. 4.0)
www.safalniveshak.com
Basic Company Details
Parameters
Company
Current Stock Price (Rs)
Face Value (Rs)
No. of Shares (Crore)
Market Capitalization (Rs Crore)
Warning! Excel can be a wonder
a deadly weapon if you wish to
careful of what you are getting
garbage out. And if you need the
a given stock, you mu
Details
DR REDDYS LABORATORIES LTD
2,656 Remember! Focus on decisions
5.0 evidence
16.6
44,103

Key Financials - Trend

Parameters Details
Sales Growth (9-Year CAGR) 8.5% Please! It's your money. Please
cause you to lose it all! I've desi
Profit Before Tax Growth (9-Year CAGR) -208.3% but you alone are responsible f
Net Profit Growth (8-Year CAGR) -200.4% ever after! I am not a sadist w
Average Debt/Equity (5-Years, x) 0.4 analyzing companies on your
instead of a map, for you can c
Average Return on Equity (5-Years) 16.6%
A
Average P/E (5-Years, x) 29.3
Latest P/E (x) 25.5
 Excel can be a wonderful tool to analyze the past. But it can be
y weapon if you wish to use it to predict the future! So be very
of what you are getting into. Here, garbage in will always equal
out. And if you need the excel to tell you what you must do with
a given stock, you must not use this tool anyways.

er! Focus on decisions, not outcomes. Look for disconfirming

evidence. Calculate. Pray!

It's your money. Please don't blame me if results of this excel

u to lose it all! I've designed this excel to aid your own thinking,
alone are responsible for your actions. I want to live peacefully
fter! I am not a sadist who wants you to do the hard work by
ng companies on your own. But I'd rather give you a compass
of a map, for you can confuse map with territory and lose it all.
All the best!
 Buffett Checklist - Read, Remember, Follow!
Source - Buffettology by Mary Buffett & David Clark
Parameter

Consumer monopoly or commodity?

Understand how business works

Is the company conservatively financed?

Are earnings strong and do they show an

upward trend?

Does the company stick with what it

knows?

Has the company been buying back its

shares?

Have retained earnings been invested

well?

Is the company’s return on equity above

average?

Is the company free to adjust prices to

inflation?
Does the company need to constantly
reinvest in capital?

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.

Focus on decisions, not outcomes. Look for disconfirming evidence.

 Balance Sheet
DR REDDYS LABORATORIES LTD
Rs Cr Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18
Equity Share Capital 84 84 85 85 85 85 85 85 83 83
Reserves 3,442 3,692 3,947 4,904 6,284 7,780 9,768 12,485 12,179 12,489
Borrowings 1,998 1,484 2,371 3,234 3,682 4,477 4,314 3,352 4,919 5,071
Other Liabilities 1,844 2,139 2,586 3,213 3,436 3,687 4,446 4,462 4,636 4,901
Total 7,368 7,400 8,989 11,436 13,487 16,030 18,613 20,384 21,817 22,544

Net Block 2,927 2,352 3,386 3,412 4,051 4,641 5,377 6,563 6,931 6,968
Capital Work in Progress 430 762 575 709 565 639 529 772 3,325 3,471
Investments 52 358 1 208 197 1,067 2,248 3,833 2,110 2,298
Other Assets 3,959 3,928 5,027 7,108 8,674 9,683 10,460 9,216 9,452 9,808
Total 7,368 7,400 8,989 11,436 13,487 16,030 18,613 20,384 21,817 22,544

Working Capital 2,115 1,788 2,441 3,895 5,238 5,996 6,013 4,754 4,816 4,906
Debtors 1,441 1,160 1,761 2,537 3,180 3,325 4,101 4,125 3,799 4,053
Inventory 1,325 1,339 1,599 1,943 2,171 2,419 2,570 2,558 2,853 2,909
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 77 60 86 94 98 90 100 97 98 104

Inventory Turnover 5 5 5 5 5 6 6 6 5 5
Fixed Asset Turnover 2.3 3.0 2.2 2.9 2.9 2.9 2.8 2.4 2.0 2.0
Debt/Equity 0.6 0.4 0.6 0.6 0.6 0.6 0.4 0.3 0.4 0.4
Return on Equity -26% 9% 25% 26% 24% 25% 24% 17% 10% 7%
Return on Capital Employed -10% 12% 19% 23% 23% 22% 21% 18% 9% 8%
 Profit & Loss Account / Income Statement
DR REDDYS LABORATORIES 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 6,862 7,031 7,435 9,815 11,833 13,415 15,023 15,568 14,196 14,281 14,973
% Growth YOY 2% 6% 32% 21% 13% 12% 4% -9% 1%
Expenses 5,559 5,602 5,874 7,390 9,167 10,165 11,530 11,983 11,724 11,930 12,076
Material Cost (% of Sales) 30% 29% 30% 27% 31% 27% 26% 25% 27% 29% Check for wide fluctuations in key
Power and Fuel 2% 2% 2% 2% 3% 2% 2% 2% 2% 2% expense items. For manufacturing
Other Mfr. Exp 10% 8% 6% 7% 5% 8% 7% 7% 6% 6% firms, check their material costs etc. For
Employee Cost 14% 17% 17% 16% 16% 18% 20% 20% 22% 23% services firms, look at employee costs.
Selling and Admin Cost 22% 21% 23% 22% 21% 21% 21% 19% 23% 21%
Operating Profit 1,303 1,429 1,561 2,425 2,665 3,251 3,494 3,585 2,472 2,351 2,896
Operating Profit Margin 19% 20% 21% 25% 23% 24% 23% 23% 17% 16% 19%
Other Income -1,353 -359 52 12 150 170 274 295 172 155 326
Other Income as % of Sales -19.7% -5.1% 0.7% 0.1% 1.3% 1.3% 1.8% 1.9% 1.2% 1.1% 2.2%
Depreciation 498 413 398 518 550 648 760 939 1,027 1,077 1,124
Interest 108 39 32 114 100 127 108 83 63 79 82
Interest Coverage(Times) -5 17 38 17 23 22 28 36 26 18 26
Profit before tax (PBT) -656 618 1,183 1,804 2,165 2,646 2,900 2,859 1,554 1,350 2,016
% Growth YOY -194% 91% 53% 20% 22% 10% -1% -46% -13%
PBT Margin -10% 9% 16% 18% 18% 20% 19% 18% 11% 9% 13%
Tax 261 267 184 504 638 683 563 751 297 438 284
Net profit -917 352 999 1,301 1,527 1,963 2,336 2,108 1,257 912 1,732
% Growth YOY -138% 184% 30% 17% 29% 19% -10% -40% -27%
Net Profit Margin -13% 5% 13% 13% 13% 15% 16% 14% 9% 6% 12%
EPS -54.4 20.8 59.0 76.7 89.9 115.4 137.1 123.5 75.9 55.0 104.3
% Growth YOY -138% 183% 30% 17% 28% 19% -10% -39% -28%
Price to earning -9.8 59.2 27.9 22.9 21.2 22.6 26.1 24.8 34.8 38.4 25.5
Price 531 1,233 1,646 1,754 1,910 2,603 3,581 3,070 2,643 2,111 2,656
Dividend Payout 0.0% 54.0% 19.1% 17.9% 16.7% 15.6% 14.6% 16.0% 25.7% 35.1%
Market Cap 8,944 20,814 27,852 29,742 32,442 44,275 61,016 52,373 43,804 35,017
Retained Earnings -917 162 809 1,068 1,272 1,657 1,996 1,770 935 592
Buffett's $1 Test 2.8

TRENDS: 10 YEARS 7 YEARS 5 YEARS 3 YEARS

Sales Growth 8.5% 9.8% 3.8% -1.7%
PBT Growth -208.3% 1.9% -9.0% -22.5%
PBT Margin 13.0% 16.4% 15.6% 12.9%
Price to Earning 26.8 27.3 29.3 32.7

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
DR REDDYS LABORATORIES 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) 588 1,315 755 1,613 1,378 1,970 2,524 3,263 2,144 1,803 17,352
% Growth YoY 124% -43% 113% -15% 43% 28% 29% -34% -16%
Cash from Investing Activity -505 -686 -885 -971 -1,437 -1,604 -2,370 -1,610 -1,890 -1,483 -13,438
Cash from Financing Activity -265 -532 45 389 -157 -24 -433 -1,700 -369 -444 -3,491
Net Cash Flow -182 98 -85 1,031 -216 342 -280 -47 -114 -124 423
CFO/Sales 9% 19% 10% 16% 12% 15% 17% 21% 15% 13%
CFO/Net Profit -64% 374% 76% 124% 90% 100% 108% 155% 171% 198%
Capex** 315 212 364 565 607 937 1,156 1,638 1,238 824
FCF 273 1,103 391 1,048 771 1,033 1,368 1,625 906 979 9,496
Average FCF (3 Years) 1,170
FCF Growth YoY 305% -65% 168% -26% 34% 32% 19% -44% 8%
FCF/Sales 4% 16% 5% 11% 7% 8% 9% 10% 6% 7%
FCF/Net Profit -30% 314% 39% 81% 50% 53% 59% 76% 70% 103%

** Manually enter this number;

Convert to Rs Crore if not already
done in the Annual Reports; Use
"Capital expenditure" number
shown under "Cash Flow from
Investing Activities" segment of
Consolidated Cash Flow Statement
available in the Annual Reports
 Key Ratios
DR REDDYS LABORATORIES LTD
Mar/09 Mar/10 Mar/11 Mar/12 Mar/13 Mar/14 Mar/15 Mar/16 Mar/17
Sales Growth 2.5% 5.7% 32.0% 20.6% 13.4% 12.0% 3.6% -8.8%
PBT Growth -194.2% 91.3% 52.6% 20.0% 22.2% 9.6% -1.4% -45.7%
Net Profit Growth -138.3% 184.2% 30.2% 17.4% 28.6% 19.0% -9.8% -40.4%
Dividend Growth 80.4% 0.2% 22.5% 9.2% 20.3% 11.2% 0.1% -2.8%
Operating Cash Flow Growth 123.8% -42.6% 113.5% -14.6% 42.9% 28.1% 29.3% -34.3%
Free Cash Flow Growth 304.8% -64.5% 167.7% -26.4% 34.0% 32.4% 18.8% -44.2%

Operating Margin 19.0% 20.3% 21.0% 24.7% 22.5% 24.2% 23.3% 23.0% 17.4%
PBT Margin -9.6% 8.8% 15.9% 18.4% 18.3% 19.7% 19.3% 18.4% 10.9%
Net Margin -13.4% 5.0% 13.4% 13.3% 12.9% 14.6% 15.6% 13.5% 8.9%

Debtor Days 76.6 60.2 86.5 94.3 98.1 90.5 99.6 96.7 97.7
Inventory Turnover 5.2 5.2 4.6 5.1 5.5 5.5 5.8 6.1 5.0
Fixed Asset Turnover 2.3 3.0 2.2 2.9 2.9 2.9 2.8 2.4 2.0
Debt/Equity 0.6 0.4 0.6 0.6 0.6 0.6 0.4 0.3 0.4
Debt/Assets 27.1% 20.1% 26.4% 28.3% 27.3% 27.9% 23.2% 16.4% 22.5%
Interest Coverage (Times) -5.1 17.1 37.6 16.8 22.6 21.9 27.8 35.6 25.5
Return on Equity -26.0% 9.3% 24.8% 26.1% 24.0% 25.0% 23.7% 16.8% 10.3%
Return on Capital Employed -9.9% 12.5% 19.0% 23.3% 22.5% 22.5% 21.2% 18.5% 9.4%
Free Cash Flow (Rs Cr) 273 1,103 391 1,048 771 1,033 1,368 1,625 906
Mar/18
0.6%
-13.1%
-27.4%
0.1%
-15.9%
8.0%

16.5%
9.5%
6.4%

103.6
4.9
2.0
0.4
22.5%
18.1
7.3%
8.1%
979
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

Lower/reducing is better. Compare with industry peer(s)

Higher/rising is better. Compare with industry peer(s)
Higher/rising is better. Compare with industry peer(s)
Nil / lower than 0.5 / reducing is better
Lower is better
Look for number > 5
Look for number > 20%. Also check if the debt is low/nil. Compare with industry peer(s)
Look for number > 20%. Also check if the debt is low/nil. Compare with industry peer(s)
Look for positive and rising numbers. If the company consistently generates negative FCF over say 10 years, avoid it.
30% Profit Margin Capital Alloc
30%
Check for a rising trend and
20% 20% Numbers > 20% long term a
has zero/marginal debt. Com
10%
10%
0%
0%
Jan/09 Jan/11 Jan/13 Jan/15 Jan/17 -10%Jan/09 Jan/11 Jan
-10% Check for a rising trend and/or consistency. -20%
Compare with a close competitor
-20% -30%

Operating Margin PBT Margin

Net Margin ROE

18,000
Revenue Revenue and Pro
250%
Check for a rising trend. Check for a ris
16,000 200% Compare grow
14,000 150%
12,000 100%
10,000 50%
8,000 0%
-50% Jan/10 Jan/12
6,000
-100%
4,000
-150%
2,000 -200%
- -250%
Jan/09 Jan/11 Jan/13 Jan/15 Jan/17 Revenue Growth
Net Profit Grow

4,000 Profit Over Time Operating and

3,500 Check
Check for a rising trend. for positive numbe
3,000 3,000 which are rising over tim
2,000 2,500
2,000
1,000
1,500
- 1,000
-1,000 Jan/09 Jan/11 Jan/13 Jan/15 Jan/17
500
-2,000 -
Jan/09 Jan/11 Ja

PBT Net Profit Operating Cash Flo

Data for Charts (Please don't touch any number below)
Margins
Mar/09 Mar/10 Mar/11 Mar/12 Mar/13 Mar/14 Mar/15 Mar/16 Mar/17
Operating Margin 19% 20% 21% 25% 23% 24% 23% 23% 17%
PBT Margin -10% 9% 16% 18% 18% 20% 19% 18% 11%
Net Margin -13% 5% 13% 13% 13% 15% 16% 14% 9%

Management Effectiveness
Mar/09 Mar/10 Mar/11 Mar/12 Mar/13 Mar/14 Mar/15 Mar/16 Mar/17
ROE -26% 9% 25% 26% 24% 25% 24% 17% 10%
ROCE -10% 12% 19% 23% 23% 22% 21% 18% 9%

Revenue & Profit Growth

Mar/10 Mar/11 Mar/12 Mar/13 Mar/14 Mar/15 Mar/16 Mar/17 Mar/18
Revenue Growth 2% 6% 32% 21% 13% 12% 4% -9% 1%
PBT Growth -194% 91% 53% 20% 22% 10% -1% -46% -13%
Net Profit Growth -138% 184% 30% 17% 29% 19% -10% -40% -27%

Revenue & Profit

Mar/09 Mar/10 Mar/11 Mar/12 Mar/13 Mar/14 Mar/15 Mar/16 Mar/17
Revenue 6,862 7,031 7,435 9,815 11,833 13,415 15,023 15,568 14,196
PBT -656 618 1,183 1,804 2,165 2,646 2,900 2,859 1,554
Net Profit -917 352 999 1,301 1,527 1,963 2,336 2,108 1,257

Cash Flows
Mar/09 Mar/10 Mar/11 Mar/12 Mar/13 Mar/14 Mar/15 Mar/16 Mar/17
Operating Cash Flow 588 1,315 755 1,613 1,378 1,970 2,524 3,263 2,144
Free Cash Flow 273 1,103 391 1,048 771 1,033 1,368 1,625 906
%
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
%Jan/09 Jan/11 Jan/13 Jan/15 Jan/17 companies would be 31st
March of that year
%
%

ROE ROCE

% Revenue and Profit Growth (YoY)

Check for a rising trend and/or low volatility.
% Compare growth rates with a close competitor.
%
%
%
%
% Jan/10 Jan/12 Jan/14 Jan/16 Jan/18
%
%
%
%
Revenue Growth PBT Growth
Net Profit Growth

Operating and Free Cash Flow

0 Check for positive numbers and
0 which are rising over time.
0
0
0
0
0
-
Jan/09 Jan/11 Jan/13 Jan/15 Jan/17

Operating Cash Flow Free Cash Flow

Mar/18
16%
9%
6%

Mar/18
7%
8%

Mar/18
14,281
1,350
912

Mar/18
1,803
979
 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 30% 29% 30% 27% 31% 27% 26% 25% 27% 29%
Change in Inventory 2% 0% 2% 2% 1% 2% 0% 1% 1% 0%
Power and Fuel 2% 2% 2% 2% 3% 2% 2% 2% 2% 2%
Other Mfr. Exp 10% 8% 6% 7% 5% 8% 7% 7% 6% 6%
Employee Cost 14% 17% 17% 16% 16% 18% 20% 20% 22% 23%
Selling and Admin Cost 22% 21% 23% 22% 21% 21% 21% 19% 23% 21%
Other Expenses 5% 2% 2% 2% 2% 2% 2% 5% 3% 3%
Operating Profit 15% 21% 17% 22% 20% 19% 23% 22% 16% 16%
Other Income -20% -5% 1% 0% 1% 1% 2% 2% 1% 1%
Depreciation 7% 6% 5% 5% 5% 5% 5% 6% 7% 8%
Interest 2% 1% 0% 1% 1% 1% 1% 1% 0% 1%
Profit Before Tax -10% 9% 16% 18% 18% 20% 19% 18% 11% 9%
Tax 4% 4% 2% 5% 5% 5% 4% 5% 2% 3%
Net Profit -13% 5% 13% 13% 13% 15% 16% 14% 9% 7%
Dividend Amount 2% 3% 3% 2% 2% 2% 2% 2% 2% 2%

Common Size Balance Sheet

Rs Cr Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17
Equity Share Capital 1% 1% 1% 1% 1% 1% 0% 0% 0% 0%
Reserves 47% 50% 44% 43% 47% 49% 52% 61% 56% 55%
Borrowings 27% 20% 26% 28% 27% 28% 23% 16% 23% 22%
Other Liabilities 25% 29% 29% 28% 25% 23% 24% 22% 21% 22%
Total Liabilities 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Net Block 40% 32% 38% 30% 30% 29% 29% 32% 32% 31%
Capital Work in Progress 6% 10% 6% 6% 4% 4% 3% 4% 15% 15%
Investments 1% 5% 0% 2% 1% 7% 12% 19% 10% 10%
Other Assets 54% 53% 56% 62% 64% 60% 56% 45% 43% 44%
Total Assets 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Receivables 20% 16% 20% 22% 24% 21% 22% 20% 17% 18%
Inventory 18% 18% 18% 17% 16% 15% 14% 13% 13% 13%
Cash & Bank 8% 9% 6% 14% 15% 14% 10% 2% 2% 1%
 A common-size financial statement is displays line
items as a percentage of one selected or common
figure. Creating common-size financial statements
makes it easier to analyze a company over time and
compare it with its peers. Using common-size
financial statements helps investors spot trends that
a raw financial statement may not uncover.
 Dhandho Intrinsic Value Calculation
Read the book - The Dhandho Investor by Mohnish Pabrai

DR REDDYS LABORATORIES LTD DR REDDYS LABORATORIES LT

Dhandho IV - Lower Range Dhandho IV - Higher Range
Year FCF (Rs Cr) PV of FCF (Rs Cr) Assumed FCF Growth Year
0 Excess Cash (Latest) 5,829 Year 1-3 15% 0 Excess Cash (Latest)
1 FY18 1,345 1,201 Year 4-6 10% 1 FY18
2 FY19 1,547 1,233 Year 7-10 5% 2 FY19
3 FY20 1,779 1,267 Discount Rate 12% 3 FY20
4 FY21 1,957 1,244 4 FY21
5 FY22 2,153 1,222 Last 5-Years' CAGR 5 FY22
6 FY23 2,368 1,200 Sales 4% 6 FY23
7 FY24 2,487 1,125 PBT -9% 7 FY24
8 FY25 2,611 1,055 FCF 5% 8 FY25
9 FY26 2,742 989 9 FY26
10 FY27 2,879 927 10 FY27
10 28,787 9,269 10
Intrinsic Value 26,559 Intrinsic Value
Current Mkt. Cap. 44,103 Current Mkt. Cap.
Premium/(Discount) to IV 66% Premium/(Discount) to IV

Note: See explanation of this model here

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

DR REDDYS LABORATORIES LTD

Dhandho IV - Higher Range
FCF (Rs Cr) PV of FCF (Rs Cr) Assumed FCF Growth
Excess Cash (Latest) 5,829 Year 1-3 20%
1,404 1,254 Year 4-6 15%
1,685 1,343 Year 7-10 10%
2,022 1,439 Discount Rate 12%
2,325 1,478
2,674 1,517
3,075 1,558
3,382 1,530
3,720 1,503
4,092 1,476
4,502 1,449
67,525 21,741
Intrinsic Value 42,116
Current Mkt. Cap. 44,103
Premium/(Discount) to IV 5%

ust use a normalized positive FCF as the

al year, without capex. Check the history of
sting the model to fit your version of reality.
 Ben Graham Formula (Low Range) Ben Graham Formula (High Range)
Company Name YS LABORATORIES LTD Company Name
Year Ended Mar/18 Year Ended

Avg 5-Yr Net Profit (Rs Crore) 1,715.4 Avg 5-Yr Net Profit (Rs Crore)
PE Ratio at 0% Growth 8.5 PE Ratio at 0% Growth
Long-Term Growth Rate (4.9) Long-Term Growth Rate

Ben Graham Value (Rs Crore) (2,204) Ben Graham Value (Rs Crore)
Current Market Cap (Rs Crore) 44,103 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

Ben Graham's Revised Formula: Value = [EPS x (8.5 + 2G) x 4.4] / Y

Here, 4.4 is what Graham determined to be his minimum required rate of return. At the time of around 1962 when Graham was

Note: I have used Graham's original formula in the above calculations

m Formula (High Range)
YS LABORATORIES LTD
Mar/18

1,715.4
8.5
(9.8)

(18,988)
44,103

g is the growth rate for the next 7-10 years

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
DR REDDYS LABORATORIES LTD

Initial Cash Flow (Rs Cr) 1,170 26,633

44,103
Years 1-5 6-10 60%
FCF Growth Rate 15% 12%
Discount Rate 12%
Terminal Growth Rate 2%

Net Debt Level (Rs Cr) (757)

Year FCF Growth Present Value

1 1,345 15% 1,201
2 1,547 15% 1,233
3 1,779 15% 1,267
4 2,046 15% 1,300
5 2,353 15% 1,335
6 2,636 12% 1,335
7 2,952 12% 1,335
8 3,306 12% 1,335
9 3,703 12% 1,335
10 4,147 12% 1,335

Final Calculations
Terminal Year 4,230
PV of Year 1-10 Cash Flows 13,013
Terminal Value 13,620
Total PV of Cash Flows 26,633
Current Market Cap (Rs Cr) 44,103

Note: See explanation of DCF here

 Valuation
RIES LTD

DCF Value (As calculated in cell B29)

Current Market Cap
DCF as % of Current Mkt Cap
 Expected Returns Model
DR REDDYS LABORATORIES LTD
Particulars Mar/09 Mar/10 Mar/11 Mar/12 Mar/13 Mar/14 Mar/15
Net Profit (Rs Crore) -917 352 999 1,301 1,527 1,963 2,336
Net Profit Margin -13% 5% 13% 13% 13% 15% 16%
Return on Equity -26% 9% 25% 26% 24% 25% 24%

Calculations (Enter values only in black cells)

Estimated CAGR in Net Profit over next 10 years 12%
Estimated Net Profit after 10 years (Rs Cr) 2,941
Current P/E (x) 46.6
Exit P/E in the 10th year from now (x, Estimated) 20.0
Esti. Market Cap (10th year from now; Rs Cr) 58,812
Cost of Capital/Discount Rate 12%
Discounted Value (Rs Cr) 18,936
Current Market Cap (Rs Cr) 44,103

Note: See explanation of this model here

el
D
Mar/16 Mar/17 Mar/18 CAGR (9-Yr) CAGR (5-Yr)
2,131 1,292 947 -200% -9%
14% 9% 7%
17% 10% 7%
 Intrinsic Value Range
DR REDDYS LABORATORIES LTD
Lower Higher Remember! Give importance to a stock's valuations / fair v
Dhandho 26,559 42,116 only "after" you have answered in "Yes" to these two quest
Ben Graham -2,204 ### (1) Is this business simple to be understood? and (2) Ca
DCF 26,633 understand this business?
Expected Return 18,936
Don't try to quantify everything. In stock research, the less
Current Market Cap. 44,103 mathematical you are, the more simple, sensible, and usefu
be your analysis and results. Great analysis is generally "b
of-the-envelope".
Explanation: Considering the above
range, we can say that Hero Moto's IV Also, your calculated "fair value" will be proven wrong in
range is between Rs 55,000 crore to Rs future, so don't invest your savings just because you fall in
95,000 crore. It's a big range, but that's with it. Don't look for perfection. It is overrated. Focus o
fine (who is looking for precision?). Now, decisions, not outcomes. Look for disconfirming eviden
if the current market cap is within this IV
range, it makes the stock
reasonably/attractively priced. If the
current market cap is higher then the
higher value of the range, it makes it
overpriced. But remember, these are just
numbers!
 importance to a stock's valuations / fair value
ave answered in "Yes" to these two questions -
ness simple to be understood? and (2) Can I
understand this business?

fy everything. In stock research, the less non-

are, the more simple, sensible, and useful will
and results. Great analysis is generally "back-
of-the-envelope".

lated "fair value" will be proven wrong in the

vest your savings just because you fall in love
ook for perfection. It is overrated. Focus on
outcomes. Look for disconfirming evidence.
DR REDDYS LABORATORIES LTD
SCREENER.IN
Narration Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18
Sales 3,616 3,723 3,612 3,333 3,560 3,834 3,554 3,737 3,818 3,865
% Growth YOY -2% 3% -2% 12% 7% 1%
Expenses 2,989 2,859 3,021 3,010 2,890 3,041 2,990 2,968 3,058 3,060
Operating Profit 627 865 591 323 669 793 564 769 759 805
Other Income 44 40 21 38 32 43 45 50 128 102
Depreciation 262 267 254 259 270 272 276 279 279 290
Interest 13 16 20 22 22 17 18 20 21 24
Profit before tax 396 622 337 81 409 547 314 521 588 593
PBT Margin 11% 17% 9% 2% 11% 14% 9% 14% 15% 15%
% Growth YOY 3% -12% -7% 547% 44% 8%
Tax 96 139 10 24 112 253 49 53 81 101
Net profit 309 492 338 67 305 303 272 476 518 500
% Growth YOY -1% -39% -19% 615% 70% 65%
OPM 17% 23% 16% 10% 19% 21% 16% 21% 20% 21%
COMPANY NAME DR REDDYS LABORATORIES LTD
LATEST VERSION 2.10 PLEASE DO NOT MAKE ANY CHA
CURRENT VERSION 2.10

META
Number of shares 16.61
Face Value 5
Current Price 2655.85
Market Capitalization 44103.27

PROFIT & LOSS

Report Date Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14
Sales 6861.9 7031 7435.2 9814.5 11832.6 13415.3
Raw Material Cost 2035.8 2037 2193.9 2667.5 3622.3 3580.5
Change in Inventory 134.1 -24.7 164.5 152.6 168.5 319.6
Power and Fuel 122.7 141.5 183.3 225.9 335.4 319.9
Other Mfr. Exp 706 591.1 478.2 695.2 649.8 1028
Employee Cost 971.6 1163.4 1278 1591.2 1928.7 2475.4
Selling and admin 1515.2 1477.6 1731.6 2138.4 2531.7 2801.4
Other Expenses 341.9 166.5 173.8 224.2 267.9 278.9
Other Income -1353.3 -359.3 52.3 11.9 149.9 169.7
Depreciation 497.7 413.1 398.1 518.1 550.2 647.5
Interest 108.2 38.5 32.3 114.1 100.3 126.7
Profit before tax -656.4 618.3 1182.8 1804.4 2164.7 2646.3
Tax 260.8 266.8 183.9 503.5 637.9 683.1
Net profit -917.2 351.5 998.9 1300.9 1526.8 1963.2
Dividend Amount 105.25 189.9 190.35 233.2 254.7 306.36

Quarters
Report Date Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17
Sales 3616.3 3723.2 3611.9 3333.2 3559.8 3834.1
Expenses 2989.3 2858.7 3021.4 3010 2890.4 3041.4
Other Income 43.8 40.3 20.5 38 31.6 43
Depreciation 262.2 266.5 254.3 259.2 270.2 271.5
Interest 12.6 16.4 19.6 21.5 22.3 17.2
Profit before tax 396 621.9 337.1 80.5 408.5 547
Tax 95.6 138.5 9.7 23.7 112.3 252.8
Net profit 308.9 492.3 337.6 66.6 305.4 302.7
Operating Profit 627 864.5 590.5 323.2 669.4 792.7

BALANCE SHEET
Report Date Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14
Equity Share Capital 84.2 84.4 84.6 84.8 84.9 85.1
Reserves 3441.9 3692.4 3947.3 4904.2 6284.2 7780.1
Borrowings 1997.6 1484 2370.7 3233.9 3682.2 4477
Other Liabilities 1844.3 2139.2 2585.9 3213 3435.9 3687.4
Total 7368 7400 8988.5 11435.9 13487.2 16029.6
Net Block 2927 2352.2 3385.5 3411.7 4050.6 4640.8
Capital Work in Progress 429.6 762.2 575.2 708.5 565.3 638.8
Investments 52.3 358 0.9 207.9 197 1066.8
Other Assets 3959.1 3927.6 5026.9 7107.8 8674.3 9683.2
Total 7368 7400 8988.5 11435.9 13487.2 16029.6
Receivables 1440.6 1159.9 1761.1 2536.8 3180.4 3325.3
Inventory 1325 1339.4 1599.2 1943.3 2170.7 2418.8
Cash & Bank 562.3 660 575.1 1606.1 2017.1 2300.6
No. of Equity Shares 168468977 168845585 169252932 169560546 169836675 170108870
New Bonus Shares
Face value 5 5 5 5 5 5

CASH FLOW:
Report Date Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14
Cash from Operating Activity 587.7 1315 755.4 1612.6 1377.9 1969.7
Cash from Investing Activity -505 -685.6 -884.8 -970.7 -1436.9 -1603.5
Cash from Financing Activity -265.1 -531.7 44.5 389.1 -156.8 -24.2
Net Cash Flow -182.4 97.7 -84.9 1031 -215.8 342

PRICE: 530.888889 1232.7167 1645.5974 1754.0725 1910.16 2602.7553

DERIVED:
Adjusted Equity Shares in Cr 16.85 16.88 16.93 16.96 16.98 17.01
DO NOT MAKE ANY CHANGES TO THIS SHEET

Mar-15 Mar-16 Mar-17 Mar-18

15023.3 15568.3 14196.1 14281
3842.2 3854.2 3819.8 4081
55.8 95.7 123.3 41.5
339.1 315.2 330.1 329.3
1038.6 1027.7 852.1 911.3
2944.6 3117.4 3106.8 3214.9
3108.3 3007 3287.1 2941.3
312.7 757.2 451.3 493.5
274.1 295 171.5 155.2
759.9 938.9 1026.6 1077.2
108.2 82.6 63.4 78.8
2899.6 2858.8 1553.7 1350.4
563.2 751.1 296.5 438
2336.4 2130.6 1292.1 946.8
340.8 341.2 331.6 332

Mar-18 Jun-18 Sep-18 Dec-18

3553.9 3736.5 3817.5 3864.6
2990.3 2967.7 3058.2 3060
44.9 50.4 128.2 102.3
276.3 278.7 278.6 290.3
17.8 19.5 20.8 24.1
314.4 521 588.1 592.5
49.2 53.2 80.7 101.1
272.1 476.1 518.3 500.3
563.6 768.8 759.3 804.6

Mar-15 Mar-16 Mar-17 Mar-18

 85.2 85.3 82.9 83
9767.9 12484.5 12179.2 12488.6
4314.1 3352.1 4918.5 5071.4
4446.1 4462.2 4635.9 4901.3
18613.3 20384.1 21816.5 22544.3
5377 6563 6930.7 6968
529 772.2 3324.5 3470.5
2247.8 3833.1 2109.7 2298.3
10459.5 9215.8 9451.6 9807.5
18613.3 20384.1 21816.5 22544.3
4101.2 4125 3798.6 4052.7
2569.9 2557.9 2852.8 2908.9
1872.4 492.1 386.5 263.8
170381170 170607853 165741913 165911107

5 5 5 5

Mar-15 Mar-16 Mar-17 Mar-18

2523.5 3262.6 2144.4 1803
-2369.8 -1609.9 -1889.6 -1482.6
-433.2 -1700.1 -369.1 -444
-279.5 -47.4 -114.3 -123.6

3581.1275 3069.77105 2642.88421 2110.60476

17.04 17.06 16.57 16.59

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