Safal Niveshak Stock Analysis Excel (Ver.

3
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/r
Step 2 - After creating your account, while you are logged in to Screener.in website, visit this page - https://www.screener.in/e
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 w
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. 3.0". 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"
which you must update manually from the company's annual reports. Don’t forget to make these changes as these numbers are
3. You may update the sheet and add your own analysis, formulae etc. and then upload again to Screener.in site using the Ste
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 (
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 Warning! Excel can be a wond
the past. But it can be a weapon
Analysis Excel (Ver. 3.0) to predict the future! So be ver
are getting into. Here, garbage
garbage ou
www.safalniveshak.com
Basic Company Details
Parameters Details
Company STAR CEMENT LTD
Current Stock Price (Rs) 116 Remember! Focus on decisions
Face Value (Rs) 1.0 for disconfirming evidence
No. of Shares (Crore) 41.9
Market Capitalization (Rs Crore) 4,874

Key Financials - Trend

Please! It's your money. Pleas
Parameters Details
results of this excel cause yo
Sales Growth (9-Year CAGR) #DIV/0! designed this excel to aid your
Profit Before Tax Growth (9-Year CAGR) #DIV/0! alone are responsible for your
Net Profit Growth (8-Year CAGR) #DIV/0! peacefully ever after! I am not
Average Debt/Equity (5-Years, x) 0.8 you to do the hard work by ana
Average Return on Equity (5-Years) 13.3% your own. But I'd rather give yo
of a map, for you can confuse m
Average P/E (5-Years, x) 16.0
lose it all. All the
Latest P/E (x) 16.0
 Warning! Excel can be a wonderful tool to analyze
the past. But it can be a weapon of mass destruction
to predict the future! So be very careful of what you
are getting into. Here, garbage in will always equal
garbage out.

Remember! Focus on decisions, not outcomes. Look

for disconfirming evidence. Calculate. Pray!

Please! It's your money. Please don't blame me if

results of this excel cause you to lose it all! I've
designed this excel to aid your own thinking, but you
alone are responsible for your actions. I want to live
peacefully ever after! I am not a sadist who wants
you to do the hard work by analyzing companies on
your own. But I'd rather give you a compass instead
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
STAR CEMENT LTD
Rs Cr Mar-08 Mar-09 Mar-10 Mar-11 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18
Equity Share Capital - - - - 42 42 42 42 42 42
Reserves - - - - 817 801 879 1,013 1,104 1,434
Borrowings - - - - 830 964 880 940 801 432
Other Liabilities - - - - 288 310 388 471 547 607
Total - - - - 1,978 2,117 2,190 2,466 2,494 2,515

Net Block - - - - 1,130 1,143 1,028 919 863 785

Capital Work in Progress - - - - 129 99 41 49 55 36
Investments - - - - 2 2 2 2 1 1
Other Assets - - - - 717 874 1,119 1,497 1,574 1,693
Total - - - - 1,978 2,117 2,190 2,466 2,494 2,515

Working Capital - - - - 428 564 731 1,026 1,027 1,087

Debtors - - - - 83 125 310 449 138 146
Inventory - - - - 122 155 109 209 161 295
Cash & Bank** 4,735 3,367 3,190 3,393 2,605 3,546 4,618
** 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 - - - - 63 44 79 96 33 33
Inventory Turnover - - - - 4 7 13 8 9 5
Fixed Asset Turnover #DIV/0! #DIV/0! #DIV/0! #DIV/0! 0.4 0.9 1.4 1.9 1.8 2.1
Debt/Equity #DIV/0! #DIV/0! #DIV/0! #DIV/0! 1.0 1.1 1.0 0.9 0.7 0.3
Return on Equity 5% 0% 13% 13% 18% 23%
Return on Capital Employed 4% 5% 12% 11% 15% 21%
 Profit & Loss Account / Income Statement
STAR CEMENT LTD
Rs Cr Mar-08 Mar-09 Mar-10 Mar-11 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Trailing
Sales - - - - 481 1,028 1,430 1,715 1,528 1,615 1,831
% Growth YOY #DIV/0! #DIV/0! #DIV/0! #DIV/0! 114% 39% 20% -11% 6%
Expenses - - - - 362 794 994 1,315 1,119 1,093 1,382
Material Cost (% of Sales) #DIV/0! #DIV/0! #DIV/0! #DIV/0! 20% 16% 15% 21% 23% 16% Check for wide fluctuations in key
Power and Fuel #DIV/0! #DIV/0! #DIV/0! #DIV/0! 26% 16% 12% 13% 13% 13% expense items. For manufacturing firms,
Other Mfr. Exp #DIV/0! #DIV/0! #DIV/0! #DIV/0! 4% 3% 5% 5% 5% 5% check their material costs etc. For
Employee Cost #DIV/0! #DIV/0! #DIV/0! #DIV/0! 8% 7% 6% 6% 8% 7% services firms, look at employee costs.
Selling and Admin Cost #DIV/0! #DIV/0! #DIV/0! #DIV/0! 43% 34% 29% 32% 23% 24%
Operating Profit - - - - 119 234 436 400 408 521 449
Operating Profit Margin #DIV/0! #DIV/0! #DIV/0! #DIV/0! 25% 23% 31% 23% 27% 32% 25%
Other Income - - - - 2 2 1 0 2 4 5
Other Income as % of Sales #DIV/0! #DIV/0! #DIV/0! #DIV/0! 0.4% 0.2% 0.1% 0.0% 0.2% 0.3% 0.3%
Depreciation - - - - 45 157 224 171 118 121 106
Interest - - - - 27 83 87 83 78 52 14
Interest Coverage(Times) #DIV/0! #DIV/0! #DIV/0! #DIV/0! 3 1 2 3 4 8 24
Profit before tax (PBT) - - - - 49 -5 126 145 215 353 335
% Growth YOY #DIV/0! #DIV/0! #DIV/0! #DIV/0! -110% -2734% 15% 48% 64%
PBT Margin #DIV/0! #DIV/0! #DIV/0! #DIV/0! 10% 0% 9% 8% 14% 22% 18%
Tax - - - - 6 -1 5 6 14 16 30
Net profit - - - - 43 -3 121 139 201 336 305
% Growth YOY #DIV/0! #DIV/0! #DIV/0! #DIV/0! -108% -3617% 15% 44% 67%
Net Profit Margin #DIV/0! #DIV/0! #DIV/0! #DIV/0! 9% 0% 8% 8% 13% 21% 17%
EPS - - - - 1.0 -0.1 2.9 3.3 4.8 8.0 7.3
% Growth YOY #DIV/0! #DIV/0! #DIV/0! #DIV/0! -108% -3617% 15% 44% 67%
Price to earning 16.0 16.0
Price - - - - - - - - - 128 116
Dividend Payout 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 28.3% 0.0% 0.0% 12.7%
Market Cap - - - - - - - - - 5,370
Retained Earnings - - - - 43 -3 87 139 201 294
Buffett's $1 Test 7.1

TRENDS: 10 YEARS 7 YEARS 5 YEARS 3 YEARS

Sales Growth #DIV/0! #DIV/0! 27.4% 4.1%
PBT Growth #DIV/0! #DIV/0! 48.4% 40.9%
PBT Margin #DIV/0! #DIV/0! 10.5% 14.8%
Price to Earning 16.0 16.0 16.0 16.0

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.
 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 #DIV/0! #DIV/0! #DIV/0! #DIV/0! 20% 16% 15% 21% 23% 16%
Change in Inventory #DIV/0! #DIV/0! #DIV/0! #DIV/0! 4% 2% -1% 1% 1% 0%
Power and Fuel #DIV/0! #DIV/0! #DIV/0! #DIV/0! 26% 16% 12% 13% 13% 13%
Other Mfr. Exp #DIV/0! #DIV/0! #DIV/0! #DIV/0! 4% 3% 5% 5% 5% 5%
Employee Cost #DIV/0! #DIV/0! #DIV/0! #DIV/0! 8% 7% 6% 6% 8% 7%
Selling and Admin Cost #DIV/0! #DIV/0! #DIV/0! #DIV/0! 43% 34% 29% 32% 23% 24%
Other Expenses #DIV/0! #DIV/0! #DIV/0! #DIV/0! -21% 2% 1% 1% 2% 2%
Operating Profit #DIV/0! #DIV/0! #DIV/0! #DIV/0! 17% 20% 32% 21% 25% 33%
Other Income #DIV/0! #DIV/0! #DIV/0! #DIV/0! 0% 0% 0% 0% 0% 0%
Depreciation #DIV/0! #DIV/0! #DIV/0! #DIV/0! 9% 15% 16% 10% 8% 7%
Interest #DIV/0! #DIV/0! #DIV/0! #DIV/0! 6% 8% 6% 5% 5% 3%
Profit Before Tax #DIV/0! #DIV/0! #DIV/0! #DIV/0! 10% 0% 9% 8% 14% 22%
Tax #DIV/0! #DIV/0! #DIV/0! #DIV/0! 1% 0% 0% 0% 1% 1%
Net Profit #DIV/0! #DIV/0! #DIV/0! #DIV/0! 9% 0% 8% 8% 13% 20%
Dividend Amount #DIV/0! #DIV/0! #DIV/0! #DIV/0! 0% 1% 2% 0% 0% 3%

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 #DIV/0! #DIV/0! #DIV/0! #DIV/0! 2% 2% 2% 2% 2% 2%
Reserves #DIV/0! #DIV/0! #DIV/0! #DIV/0! 41% 38% 40% 41% 44% 57%
Borrowings #DIV/0! #DIV/0! #DIV/0! #DIV/0! 42% 46% 40% 38% 32% 17%
Other Liabilities #DIV/0! #DIV/0! #DIV/0! #DIV/0! 15% 15% 18% 19% 22% 24%
Total Liabilities 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Net Block #DIV/0! #DIV/0! #DIV/0! #DIV/0! 57% 54% 47% 37% 35% 31%
Capital Work in Progress #DIV/0! #DIV/0! #DIV/0! #DIV/0! 7% 5% 2% 2% 2% 1%
Investments #DIV/0! #DIV/0! #DIV/0! #DIV/0! 0% 0% 0% 0% 0% 0%
Other Assets #DIV/0! #DIV/0! #DIV/0! #DIV/0! 36% 41% 51% 61% 63% 67%
Total Assets 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Receivables #DIV/0! #DIV/0! #DIV/0! #DIV/0! 4% 6% 14% 18% 6% 6%
Inventory #DIV/0! #DIV/0! #DIV/0! #DIV/0! 6% 7% 5% 8% 6% 12%
Cash & Bank #DIV/0! #DIV/0! #DIV/0! #DIV/0! 1% 1% 1% 1% 1% 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.
 Cash Flow Statement
STAR CEMENT LTD
Rs Cr Mar-08 Mar-09 Mar-10 Mar-11 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Total
Cash from Operating Activity (CFO) - - - - -74 233 262 97 300 421 1,238
Cash from Investing Activity - - - - -316 -114 -41 -79 -89 -25 -665
Cash from Financing Activity - - - - 392 -132 -210 -14 -218 -393 -576
Net Cash Flow - - - - 2 -14 11 4 -7 2 -2
CFO/Sales #DIV/0! #DIV/0! #DIV/0! #DIV/0! -15% 23% 18% 6% 20% 26%
CFO/Net Profit #DIV/0! #DIV/0! #DIV/0! #DIV/0! -172% -6753% 216% 70% 149% 125%
Capex** 375 315 212 364 565 607 937 1156 1638 1238
FCF -375 -315 -212 -364 -639 -374 -675 -1,059 -1,338 -817 -6,168
Average FCF (3 Years) -1,071
FCF/Sales #DIV/0! #DIV/0! #DIV/0! #DIV/0! -133% -36% -47% -62% -88% -51%
FCF/Net Profit #DIV/0! #DIV/0! #DIV/0! #DIV/0! -1490% 8905% -569% -790% -687% -247%

** 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
 Earnings Power Value (Bruce Greenwald)
Read the book - Value Investing: From Graham to Buffett and Beyond by Bruce Greenwald (EPV is explained
Explanation - Earnings power value (EPV) is a technique for valuing stocks by making an assumption about the sustainability
capital but assuming no further growth. EPV formula = Adjusted Earnings / Cost of Capital

Company Name STAR CEMENT LTD

Latest Year Ended Mar-18

Calculation of Normalized Earnings

(Rs Crore) Mar/14 Mar/15 Mar/16 Mar/17 Mar/18
Sales 1,028 1,430 1,715 1,528 1,615
EBIT 79 214 229 293 405
Less - Adjustment 0 1 1 1 2
EBIT (Adjusted) 78 212 228 291 403
EBIT Margin'(Adjusted) 8% 15% 13% 19% 25%
Tax Rate 28% 4% 4% 6% 5%
Earnings After Tax (Adjusted) 56 204 218 273 384
Depreciation 157 224 171 118 121
Maintenance Capex (See Table Below) 233 662 961 1,766 1,179
Earnings After Tax (Normalized, A) -20 -234 -572 -1,376 -674
Reported Profit After Tax (B) -4 119 134 195 331

EPV Process (as per Greenwald's book, slightly modified) -

1. Start with operating earnings, i.e. EBIT. Adjust any one-time charges. I deduct 0.5% of reported EBIT as this adjustment
2. Apply a tax rate to the adjusted EBIT. I use the actual tax rate calculated from the Income Statement. After reducing this tax,
3. Add back Depreciation
4. Subtract Maintenance Capex
5. After these four steps, you arrive at Normalized Earnings
6. Divide this Normalized Earnings number by the Discount Rate to arrive at EPV. I use 12% discount rate/cost of capital.
7. Note that Greenwald's process as per his book is slightly more detailed than what I have used here

Calculation of Maintenance Capex

(Rs Crore) Mar/14 Mar/15 Mar/16 Mar/17 Mar/18
Fixed Assets (PPE) 1,143 1,028 919 863 785
Net Sales 1,028 1,430 1,715 1,528 1,615
PPE/Sales 1.11 0.72 0.54 0.57 0.49
Change in Sales 547 402 285 -187 87
Total Capex 607 937 1,156 1,638 1,238
Growth Capex 374 275 195 -128 59
Maintenance Capex 233 662 961 1,766 1,179

Calculating Maintenance Capex, as per Greenwald's book -

1. Calculate the Average Gross Property Plant and Equipment (PPE) / Sales ratio over 5-7 years
2. Calculate current year’s increase in sales
3. Multiply PPE/Sales ratio by increase in sales to arrive at Growth Capex
4. Maintenance Capex = Total Capex figure from the cash flow statement minus Growth Capex calculated above
(Bruce Greenwald)
nd by Bruce Greenwald (EPV is explained Page 93 onwards)
ng an assumption about the sustainability of current earnings and the cost of
mula = Adjusted Earnings / Cost of Capital

EPV with Different Cost of Capital

Discount Rate EPV Net Cash** Total EPV Per Share
10% -6,738 4,186 -2,552 -61
12% -5,615 4,186 -1,429 -34
15% -4,492 4,186 -306 -7
Current Market Cap (Rs Crore) 4,874
EPV as % of Market Cap -29%

** Change the "Cash & Bank" number in "Balance Sheet" sheet

(Row #19) so that the correct number automatically reflects here

% of reported EBIT as this adjustment

Income Statement. After reducing this tax, we arrive at Adjusted Earnings After Tax

se 12% discount rate/cost of capital.

I have used here

er 5-7 years

wth Capex calculated above

 Dhandho Intrinsic Value Calculation
Read the book - The Dhandho Investor by Mohnish Pabrai

STAR CEMENT LTD STAR CEMENT LTD

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) 4,618 Year 1-3 15% 0 Excess Cash (Latest)
1 FY18 (1,232) (1,100) Year 4-6 10% 1 FY18
2 FY19 (1,417) (1,130) Year 7-10 5% 2 FY19
3 FY20 (1,630) (1,160) Discount Rate 12% 3 FY20
4 FY21 (1,792) (1,139) 4 FY21
5 FY22 (1,972) (1,119) Last 5-Years' CAGR 5 FY22
6 FY23 (2,169) (1,099) Sales 27% 6 FY23
7 FY24 (2,277) (1,030) PBT 48% 7 FY24
8 FY25 (2,391) (966) FCF 5% 8 FY25
9 FY26 (2,511) (905) 9 FY26
10 FY27 (2,636) (849) 10 FY27
10 -26,363 (8,488) 10
Intrinsic Value (14,367) Intrinsic Value
Current Mkt. Cap. 4,874 Current Mkt. Cap.
Premium/(Discount) to IV -134% 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 th
number. This number is your assumption of FCF the business will earn in a normal year, without capex. Check the history
business while arriving at your assumption, and use your judgment wisely without twisting the model to fit your version of r
Calculation
by Mohnish Pabrai

STAR CEMENT LTD

Dhandho IV - Higher Range
FCF (Rs Cr) PV of FCF (Rs Cr) Assumed FCF Growth
Excess Cash (Latest) 4,618 Year 1-3 20%
(1,286) (1,148) Year 4-6 15%
(1,543) (1,230) Year 7-10 10%
(1,851) (1,318) Discount Rate 12%
(2,129) (1,353)
(2,449) (1,389)
(2,816) (1,427)
(3,097) (1,401)
(3,407) (1,376)
(3,748) (1,352)
(4,123) (1,327)
(61,839) (19,911)
Intrinsic Value (28,613)
Current Mkt. Cap. 4,874
Premium/(Discount) to IV -117%

use a normalized positive FCF as the starting

, without capex. Check the history of this
ng the model to fit your version of reality.
 Ben Graham Formula (Low Range) Ben Graham Formula (High Range
Company Name STAR CEMENT LTD Company Name
Year Ended Mar/18 Year Ended

Avg 5-Yr Net Profit (Rs Crore) 158.9 Avg 5-Yr Net Profit (Rs Crore)
PE Ratio at 0% Growth 8.5 PE Ratio at 0% Growth
Long-Term Growth Rate 25.4 Long-Term Growth Rate

Ben Graham Value (Rs Crore) 9,412 Ben Graham Value (Rs Crore)
Current Market Cap (Rs Crore) 4,874 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)
STAR CEMENT LTD
Mar/18

158.9
8.5
50.7

17,473
4,874

is the growth rate for the next 7-10 years

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 num
resent, we divide this number by today’s AAA corporate bond rate, represented by Y in the formula above.
 Dicounted Cash Flow Valuation
STAR CEMENT LTD

Initial Cash Flow (Rs Cr) (1,071) (24,390)

4,874
Years 1-5 6-10 -500%
FCF Growth Rate 15% 12%
Discount Rate 12%
Terminal Growth Rate 2%

Net Debt Level (Rs Cr) (4,186)

Year FCF Growth Present Value

1 (1,232) 15% (1,100)
2 (1,417) 15% (1,130)
3 (1,630) 15% (1,160)
4 (1,874) 15% (1,191)
5 (2,155) 15% (1,223)
6 (2,414) 12% (1,223)
7 (2,703) 12% (1,223)
8 (3,028) 12% (1,223)
9 (3,391) 12% (1,223)
10 (3,798) 12% (1,223)

Final Calculations
Terminal Year (3,874)
PV of Year 1-10 Cash Flows (11,917)
Terminal Value (12,473)
Total PV of Cash Flows (24,390)
Current Market Cap (Rs Cr) 4,874

Note: See explanation of DCF here

Valuation
D

DCF Value (As calculated in cell B29)

Current Market Cap
DCF as % of Current Mkt Cap
 Expected Returns Model
STAR CEMENT LTD
Particulars Mar/08 Mar/09 Mar/10 Mar/11 Mar/13 Mar/14 Mar/15
Net Profit (Rs Crore) - - - - 43 -4 119
Net Profit Margin #DIV/0! #DIV/0! #DIV/0! #DIV/0! 9% 0% 8%
Return on Equity 5% 0% 13%

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) 1,027
Current P/E (x) 14.7
Exit P/E in the 10th year from now (x, Estimated) 20.0
Esti. Market Cap (10th year from now; Rs Cr) 20,540
Cost of Capital/Discount Rate 12%
Discounted Value (Rs Cr) 6,613
Current Market Cap (Rs Cr) 4,874

Note: See explanation of this model here

el
Mar/16 Mar/17 Mar/18 CAGR (9-Yr) CAGR (5-Yr)
134 195 331 #DIV/0! 50%
8% 13% 20%
13% 18% 23%
 Intrinsic Value Range
STAR CEMENT LTD
Lower Higher Remember! Give importance to a stock's valuations / fair
EPV -1,429 only "after" you have answered in "Yes" to these two ques
Dhandho -14,367 ### (1) Is this business simple to be understood? and (2) Ca
Ben Graham 9,412 17,473 understand this business?
DCF -24,390 Don't try to quantify everything. In stock research, the less
Expected Return 6,613 mathematical you are, the more simple, sensible, and usef
Current Market Cap. 4,874 be your analysis and results. Great analysis is generally "b
the-envelope".

Also, your calculated "fair value" will be proven wrong in

future, so don't invest your savings just because you fall i
with it. Don't look for perfection. It is overrated. Focus
decisions, not outcomes. Look for disconfirming eviden
 importance to a stock's valuations / fair value
ave answered in "Yes" to these two questions -
ess 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
nd 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.
STAR CEMENT LTD
SCREENER.IN
Narration Dec-16 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19
Sales 343 479 429 281 377 527 518 362 416 534
% Growth YOY 10% 10% 21% 29% 10% 1%
Expenses 255 310 270 204 236 383 386 294 295 408
Operating Profit 88 169 159 77 141 144 132 69 122 127
Other Income -0 2 0 1 0 3 0 1 1 3
Depreciation 36 12 30 33 34 24 28 27 26 24
Interest 19 18 16 14 14 9 5 3 3 3
Profit before tax 33 141 113 31 94 114 98 39 94 103
PBT Margin 10% 29% 26% 11% 25% 22% 19% 11% 23% 19%
% Growth YOY 182% -19% -13% 25% 0% -9%
Tax -0 13 3 5 3 5 7 1 10 12
Net profit 32 126 107 26 91 108 90 38 82 90
% Growth YOY 184% -14% -16% 48% -10% -17%
OPM 26% 35% 37% 27% 37% 27% 25% 19% 29% 24%
COMPANY NAME STAR CEMENT LTD
LATEST VERSION 2.10 PLEASE DO NOT MAKE ANY CH
CURRENT VERSION 2.10

META
Number of shares 41.92
Face Value 1
Current Price 116.25
Market Capitalization 4873.54

PROFIT & LOSS

Report Date Mar-08 Mar-09 Mar-10 Mar-11 Mar-13 Mar-14
Sales 480.87 1027.99
Raw Material Cost 94.59 166.11
Change in Inventory 19.31 16.02
Power and Fuel 123.36 161.87
Other Mfr. Exp 17.48 33.5
Employee Cost 39.61 73.41
Selling and admin 205.48 353.85
Other Expenses -98.91 21.39
Other Income 2 1.6
Depreciation 44.77 156.83
Interest 26.82 83.44
Profit before tax 48.98 -4.79
Tax 5.79 -1.34
Net profit 42.91 -4.2
Dividend Amount 10.48

Quarters
Report Date Dec-16 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18
Sales 342.72 479.24 428.67 281 377.43 527.44
Expenses 254.59 309.9 270.04 204.05 236.09 383.01
Other Income -0.49 2 0.39 0.92 0.25 2.83
Depreciation 35.59 12.24 30.31 32.6 33.65 24.12
Interest 18.66 18.44 15.73 14.14 13.71 8.88
Profit before tax 33.39 140.66 112.98 31.13 94.23 114.26
Tax -0.09 12.69 3.27 4.87 2.84 5.43
Net profit 32.22 125.93 107.48 25.76 91.39 107.86
Operating Profit 88.13 169.34 158.63 76.95 141.34 144.43

BALANCE SHEET
Report Date Mar-08 Mar-09 Mar-10 Mar-11 Mar-13 Mar-14
Equity Share Capital 41.92 41.92
Reserves 817.36 800.97
Borrowings 829.77 964.19
Other Liabilities 288.46 309.81
Total 1977.51 2116.89
Net Block 1130.39 1142.62
Capital Work in Progress 128.69 99.23
Investments 1.53 1.53
Other Assets 716.9 873.51
Total 1977.51 2116.89
Receivables 82.73 125.01
Inventory 121.76 155.47
Cash & Bank 25 11.41
No. of Equity Shares 41921392 41921392
New Bonus Shares
Face value 10 10

CASH FLOW:
Report Date Mar-08 Mar-09 Mar-10 Mar-11 Mar-13 Mar-14
Cash from Operating Activity -74.19 232.99
Cash from Investing Activity -315.52 -114.47
Cash from Financing Activity 391.55 -132.11
Net Cash Flow 1.84 -13.59

PRICE:

DERIVED:
Adjusted Equity Shares in Cr - - - - 41.92 41.92
DO NOT MAKE ANY CHANGES TO THIS SHEET

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

1430.43 1715.03 1527.8 1614.53
217.63 363.15 352.39 262.14
-11.92 17.64 12.09 -7.57
172 215.45 191.59 216.04
73.25 81.28 82 77.43
90.76 107.8 118.61 107.36
408.88 541.21 352.6 385.21
19.52 23.87 34.38 37.42
0.8 0.24 2.44 4.39
223.74 171.49 117.91 120.69
87.38 83.37 78.06 52.46
126.13 145.3 214.8 352.59
4.8 5.95 13.9 16.41
118.65 134.04 194.72 330.66
33.54 41.92

Jun-18 Sep-18 Dec-18 Mar-19

517.91 362.27 416.43 534.43
386.22 293.55 294.53 407.58
0.34 0.66 1.05 3.43
28.28 27.12 26.44 23.8
5.44 3.27 2.60 3.07
98.31 38.99 93.91 103.41
6.8 0.81 10.22 11.82
90.32 38.18 82.28 89.78
131.69 68.72 121.9 126.85

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

41.92 41.92 41.92 41.92
 879.38 1013.42 1104.05 1434.43
880.47 939.80 800.72 432.42
387.93 471.1 547.24 606.61
2189.7 2466.24 2493.93 2515.38
1027.97 919.14 863.23 784.74
40.97 48.97 54.87 35.74
1.53 1.53 1.45 1.44
1119.23 1496.6 1574.38 1693.46
2189.7 2466.24 2493.93 2515.38
309.8 448.8 137.78 146.47
109.14 209.16 161.22 294.60
20.31 23.76 20.08 19.78
41921392 41921392 419213920 419228997

10 10 1 1

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

261.72 97.03 300.05 420.62
-40.71 -79.21 -89.4 -25.34
-210.31 -13.99 -218.14 -392.92
10.7 3.83 -7.49 2.35

128.1

41.92 41.92 41.92 41.92

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