Name Anshul Jain

Enrollment Number 21BSPHH01C0158

Project on Valuation and Financial Statement Analysis & Forecasting of TCS
Section A
Submitted to Bhanu Sireesha Ma'am
Date 11/28/2022
s & Forecasting of TCS

m
 National
DCF Valuation

Profit & Loss Account (in Cr)

Particulars 2018 A 2019 A 2020 A 2021 A
INCOME
Revenue From Operations 11,614.91 150,774.00 161,541.00 167,311.00
Total Revenue 11,614.91 150,774.00 161,541.00 167,311.00
EXPENSES
Cost Of Materials Consumed 17.33 89.00 92.00 86.00
Consumption of stores & spares 270.30 608.47 565.28 416.55
Changes In Inventories -38.48 -22.71 -25.03 -18.49
Employee Benefit Expenses 1,046.42 78,246.00 85,952.00 91,814.00
Power and electricity 99.20 198.00 924.00 637.00
Depreciation And Amortisation Expenses 256.04 2,056.00 3,529.00 4,065.00
Other Expenses 1,507.48 26,441.00 26,983.00 24,355.00
Total Expenses 3,158.29 107,615.76 118,020.25 121,355.06
Profit/Loss Before Tax 8,456.62 43,158.24 43,520.75 45,955.94
Total Tax Expenses 2,373.34 10,001.00 9,801.00 11,198.00
Profit/Loss For The Period 6,083.28 33,157.24 33,719.75 34,757.94
EARNINGS PER SHARE
Basic EPS (Rs.) 12.03 83.00 86.00 87.00
Diluted EPS (Rs.) 12.03 83.00 86.00 87.00
DIVIDEND AND DIVIDEND PERCENTAGE
Equity Share Dividend 30.00 73.00 38.00 43.00
Tax On Dividend 6.64 27.86 16.59 0.00

Balance Sheet (in Cr)

Particulars 2018 A 2019 A 2020 A 2021 A
EQUITIES AND LIABILITIES
Equity Share Capital 80.08 375.00 375.00 370.00
Reserves and Surplus 84,937.00 89,071.00 83,751.00 86,063.00
Total Shareholders Funds 85017.08 89446.00 84126.00 86433.00
NON-CURRENT LIABILITIES
Long Term Provisions 2938.00 2960.00 9090.00 9496.00
Total Non-Current Liabilities 2938.00 2960.00 9090.00 9496.00
Minority Interest 402.00 453.00 623.00 675.00
CURRENT LIABILITIES
Short Term Borrowings 181.00 0.00 0.00 0.00
Trade Payables 5,094.00 6,292.00 6,740.00 7,860.00
Other Current Liabilities 12,313.00 15,553.00 20,027.00 24,901.00
Short Term Provisions 240.00 239.00 293.00 1,394.00
Total Current Liabilities 17828.00 22084.00 27060.00 34155.00
Total Capital And Liabilities 106185.08 114943.00 120899.00 130759.00
ASSETS
NON-CURRENT ASSETS
Fixed Assets 11,506.00 11,553.00 20,124.00 20,149.00
Deferred Tax Assets [Net] 3,449.00 2,656.00 2,828.00 3,931.00
Non-Current Investments 301.00 239.00 216.00 213.00
Long Term Loans And Advances 1,975.00 60.00 29.00 29.00
Other Non-Current Assets 7,841.00 8,304.00 7,465.00 7,157.00
Total Non-Current Assets 25072.00 22812.00 30662.00 31479.00
CURRENT ASSETS
Current Investments 35,707.00 29,091.00 26,140.00 29,160.00
Inventories 26.00 10.00 5.00 8.00
Trade Receivables 24,943.00 27,346.00 30,532.00 30,079.00
Cash And Cash Equivalents 7,161.00 12,848.00 9,666.00 9,329.00
Short Term Loans And Advances 3,205.00 8,029.00 8,475.00 11,472.00
OtherCurrentAssets 10,182.00 14,807.00 15,419.00 19,232.00
Total Current Assets 81224.00 92131.00 90237.00 99280.00
Total Assets 106296.00 114943.00 120899.00 130759.00
Check 0 1 1 1

Fixed Asset Schedule

2018 A 2019 A 2020 A 2021 A
Opening Balance 11762.04 11506.00 11553.00 20124.00
Add: CapEx 0.00 2103.00 12100.00 4090.00
Less: Depreciation 256.04 2056.00 3529.00 4065.00
Closing Balance 11506.00 11553.00 20124.00 20149.00

Calculation of Net Working Capital

2018 A 2019 A 2020 A 2021 A
Inventories 26.00 10.00 5.00 8.00
Add: Accounts Receivables 24943.00 27346.00 30532.00 30079.00
Less: Accounts Payables 5094.00 6292.00 6740.00 7860.00
Total (Net Working Capital) 19875.00 21064.00 23797.00 22227.00
Changes to Net working Capital 1189.00 2733.00 -1570.00
National
DCF Valuation

Loss Account (in Cr)

2022 A 2023 E 2024 E 2025 E 2026 E 2027 E NOTE: (ASSUM
1) ALL the text colou
195,772.00 795,730.56 3,234,308.88 13,146,100.57 53,433,350.60 217,184,019.02 are not to be touche
2) All the cells in whi
195,772.00 795,730.56 3,234,308.88 13,146,100.57 53,433,350.60 217,184,019.02 companies annual re
3) The Data of Profit
Gillette Annual repor
79.00 568.06 2,308.90 9,384.72 38,144.93 155,043.04 4) This model only w
439.51 5,656.28 22,990.40 93,446.26 379,819.61 1,543,806.40
18.54 -578.39 -2,350.93 -9,555.54 -38,839.23 -157,865.06
107,554.00 356,372.21 1,448,502.62 5,887,551.83 23,930,413.38 97,267,030.74
784.00 3,721.76 15,127.39 61,486.47 249,916.54 1,015,805.26
4,604.00 3,879.75 42,266.03 171,793.59 698,268.43 2,838,166.48
29,980.00 122,685.15 498,663.37 2,026,856.15 8,238,314.84 33,485,272.91
143,459.05 492,304.82 2,027,507.79 8,240,963.48 33,496,038.51 136,147,259.78
52,312.95 303,425.74 1,206,801.09 4,905,137.09 19,937,312.09 81,036,759.25
13,238.00 74,903.83 297,911.51 1,210,884.57 4,921,734.73 20,004,774.50
39,074.95 228,521.91 908,889.57 3,694,252.52 15,015,577.36 61,031,984.75

104.00
104.00

16.00
0.00

alance Sheet (in Cr)

2022 A 2023 A 2024 A 2025 A 2026 A 2027 A

366.00 32.59 32.59 32.59 32.59 32.59

88,773.00 317,294.91 1,226,184.48 4,920,437.00 19,936,014.36 80,967,999.11
89139.00 317327.50 1226217.07 4920469.59 19936046.95 80968031.70

8727.00 68462.63 278271.69 1131056.98 4597269.27 18685959.36

8727.00 68462.63 278271.69 1131056.98 4597269.27 18685959.36
707.00

0.00
 8,045.00 69.31 281.73 1,145.13 4,654.45 18,918.38
32,895.00 255,284.64 1,037,624.34 4,217,505.01 17,142,377.91 69,676,531.39
1,411.00 6,302.37 25,616.49 104,120.23 423,204.79 1,720,148.86
42351.00 261656.33 1063522.56 4322770.37 17570237.15 71415598.62
140924.00 647446.46 2568011.32 10374296.94 42103553.37 171069589.67

20,716.00 225,680.08 917,294.28 3,728,414.11 15,154,429.80 61,596,361.30

3,708.00 15,071.46 61,259.10 248,992.40 1,012,049.04 4,113,552.21
223.00
311.00 27,433.52 111,505.67 453,223.49 1,842,162.22 7,487,611.95
8,246.00 137,066.91 557,119.15 2,264,454.22 9,204,050.70 37,410,581.60
33204.00 405251.97 1647178.20 6695084.22 27212691.75 110608107.05

30,262.00
20.00 228.72 929.65 3,778.63 15,358.55 62,426.03
34,074.00 457,020.23 1,857,594.36 7,550,337.10 30,688,933.73 124,737,563.57
18,221.00 144,889.16 588,913.28 2,393,683.93 9,729,314.94 39,545,559.05
6,445.00 76,890.11 312,525.86 1,270,285.73 5,163,175.38 20,986,128.83
19,288.00 204,305.14 830,414.15 3,375,283.07 13,719,101.15 55,762,356.12
108310.00 883333.36 3590377.31 14593368.46 59315883.75 241094033.60
141514.00 1288585.33 5237555.51 21288452.68 86528575.50 351702140.65

xed Asset Schedule

2022 A 2023 A 2024 A 2025 A 2026 A 2027 A
20149.00 20716.00 225680.08 917294.28 3728414.11 15154429.80
5171.00 208843.83 733880.23 2982913.42 12124284.12 49280097.99
4604.00 3879.75 42266.03 171793.59 698268.43 2838166.48
20716.00 225680.08 917294.28 3728414.11 15154429.80 61596361.30

on of Net Working Capital

2022 A 2023 A 2024 A 2025 A 2026 A 2027 A
20.00 228.72 929.65 3778.63 15358.55 62426.03
34074.00 457020.23 1857594.36 7550337.10 30688933.73 124737563.57
8045.00 69.31 281.73 1145.13 4654.45 18918.38
26049.00 457179.64 1858242.28 7552970.60 30699637.83 124781071.22
3822.00 431130.64 1401062.64 5694728.33 23146667.23 94081433.39
NOTE: (ASSUMPTIONS FOR THE REPORT)
1) ALL the text colour coded in orange and calculations in Bold text
are not to be touched
2) All the cells in white fill needs to be changed according the
companies annual report
3) The Data of Profit and loss A/c, Balance Sheet are taken from
Gillette Annual reports
4) This model only works on Debt free companies
 TATA Consultancy Services
P&L Calculations/Assumptions
Particulars 2018 A 2019 A 2020 A 2021 A 2022 A 2023 E 2024 E 2025 E
INCOME
Revenue From Operations ### 7.14% 3.57% 17.01% ### ### ###
EXPENSES
Cost Of Materials Consumed 0.15% 0.06% 0.06% 0.05% 0.04% 0.07% 0.07% 0.07%
Purchase Of Stock-In Trade 2.33% 0.40% 0.35% 0.25% 0.22% 0.71% 0.71% 0.71%
Changes In Inventories -0.33% -0.02% -0.02% -0.01% 0.01% -0.07% -0.07% -0.07%
Employee Benefit Expenses 9.01% 51.90% 53.21% 54.88% 54.94% 44.79% 44.79% 44.79%
Finance Costs 0.85% 0.13% 0.57% 0.38% 0.40% 0.47% 0.47% 0.47%
Depreciation And Amortisation Expenses 2.18% 17.87% 30.55% 20.20% 22.85% 18.73% 18.73% 18.73%
Other Expenses 12.98% 17.54% 16.70% 14.56% 15.31% 15.42% 15.42% 15.42%
Total Tax Expenses 28.06% 23.17% 22.52% 24.37% 25.31% 24.69% 24.69% 24.69%

BALANCE SHEET Calculation/Assumptions

Particulars 2018 A 2019 A 2020 A 2021 A 2022 A 2023 E 2024 E 2025 E

NON-CURRENT LIABILITIES
Long Term Provisions 25.30% 1.96% 5.63% 5.68% 4.46% 8.60% 8.60% 8.60%
CURRENT LIABILITIES
Trade Payables 160.08 15.23 15.23 17.15 15.00 44.54 44.54 44.54
Other Current Liabilities ### 10.32% 12.40% 14.88% 16.80% 32.08% 32.08% 32.08%
Short Term Provisions 2.07% 0.16% 0.18% 0.83% 0.72% 0.79% 0.79% 0.79%
ASSETS
NON-CURRENT ASSETS
Fixed Asset 99.06% 7.66% 12.46% 12.04% 10.58% 28.36% 28.36% 28.36%
Deferred Tax Assets [Net] 29.69% 1.76% 1.75% 2.35% 1.89% 1.89% 1.89% 1.89%
Long Term Loans And Advances 17.00% 0.04% 0.02% 0.02% 0.16% 3.45% 3.45% 3.45%
Other Non-Current Assets 67.51% 5.51% 4.62% 4.28% 4.21% 17.23% 17.23% 17.23%
CURRENT ASSETS
Inventories 547.61 41.01 19.84 33.95 92.41 146.96 146.96 146.96
Trade Receivables 783.84 66.20 68.99 65.62 63.53 209.63 209.63 209.63
Cash And Cash Equivalents 61.65% 8.52% 5.98% 5.58% 9.31% 18.21% 18.21% 18.21%
Short Term Loans And Advances 27.59% 5.33% 5.25% 6.86% 3.29% 9.66% 9.66% 9.66%
OtherCurrentAssets 87.66% 9.82% 9.54% 11.49% 9.85% 25.68% 25.68% 25.68%
2026 E 2027 E NOTE: (ASSUMPTIONS FOR THE REPORT)
1) ALL the text colour coded in blue and calculations in Bold text
### ### are not to be touched
2) All the cells in white fill needs to be changed according the
companies annual report
0.07% 0.07% 3) The Data of Profit and loss A/c, Balance Sheet are taken from
0.71% 0.71% Gillette Annual reports
4) This model only works on Debt free companies
-0.07% -0.07%
44.79% 44.79%
0.47% 0.47%
18.73% 18.73%
15.42% 15.42%
24.69% 24.69%

2026 E 2027 E

8.60% 8.60%

44.54 44.54
32.08% 32.08%
0.79% 0.79%

28.36% 28.36%
1.89% 1.89%
3.45% 3.45%
17.23% 17.23%

146.96 146.96
209.63 209.63
18.21% 18.21%
9.66% 9.66%
25.68% 25.68%
Annual Report Link
https://www.moneycontrol.com/annual-report/tataconsultancyservices/directors-report/TCS

Dividend related link

https://www.moneycontrol.com/company-facts/tataconsultancyservices/dividends/TCS
 Calculation of WACC
Cost of Equity 8.43%
Cost of Debt Debt Free
Wacc 8.43%
Growth Rate (Country's Growth Rate) 6.00%
Tax 28.69%
(Since Company is Debt Free considering Cost of Equity as
WACC)

Calculation of Free Cash Flows

2023 E 2024 E 2025 E 2026 E
EBIT 303,425.74 ### ### ###
ADD: Depreciation & Amortization 3879.75 42266.03 ### ###
Less: CapEX 208843.83 ### ### ###
Less: Changes in Net working Capital 431130.64 ### ### ###
Free Cash Flow -332668.98 ### ### ###
Terminal Value
Total Cash Flow -332668.98 ### ### ###

Enterprise Value -1785458401.86

Add:Cash 39545559.05
Less: Debt 0.00
Equity Value -1745912842.81
No.of.shares (in Cr) 3.26
Intrinsic Value -535556086.75
Market Price 5055.30
Overvalued

According to the DDM model it is suggested to SELL the stock as it is overva

 2027 E
###
###
###
###
###
###
###

he stock as it is overvalued
 Dividend Discount Model
Model Input Historical Dividend
Company #REF! Year Amount
Cost of Capital CAPM 2016 20
Dividend Annual 2017 10
Valuation Period 5 2018 23
2019 25
Stock Market Satistics 2020 49
BETA 0.41 2021 36
Market Premium 2.18% 2022 36
Risk-Free Rate 7% Growth Rate

Calculation Dividend Frequency Annual

Dividend Growth Rate 26% No.of.Cash Flows 5.00
Share Price (As on today) 5,424 Cost of Capital 7.90%
Ke (Cost of Equity) 7.90% Economy Growth Rate 6%

According to the DDM model it is suggested to BUY the stock as it is underval

iscount Model
Dividend Cash Flow Calculation
Growth Rate Period Cash Flow Terminal Value TotslCashflows
1 45.49 45.49
-0.50 2 57.48 57.48
1.30 3 72.63 72.63
0.09 4 91.78 91.78
0.96 5 115.98 6,476.47 6,592.44
-0.27
0.00 Stock Value 6,002.39
26% Current Market Price 5,055.30

Result Undervalued

tock as it is undervalued