The valuation -

DEFINITIVE GUIDE

EBITDA
AsimpeExpan
ever
 -

oh of EBITDA

Sales xxx Topline >

-

(-) COGS (xx) -> Exp related

--

XXX
to mfg of
Gross profit product.
↳-
SIA x)
EBITDA XX
X

↳ Before Interest,
Earnings
Tax, Depreciation & Amortization
 EBITDA Through
of
Net
-
Profit

Net
Profit -xxx

4)
-
Tax -X
profit before Tax XX
x

(t) terest #
EBIT XXX

(Heration -

*x
EBITDA
 I

WhYDA?mprance
-
is
BITDA cash
operating profits
which its
free
means
from
-

impact of:

~ capital structure (Interests

~fixed Assets (Depreciation)

Let's understand in Depth

 WhYDA? -
-

Importance

-
Two companies are not comparable

if one is making higher profits

due to
low interest loans / No loans.

if is
-
similarly, one
company
due to
making higher profits
lower depreciation (engged

creations
-permanager
 I
WhyDA? Amprance

- Since EBITDA is before Interest &

Depreciation.
-

It shows profits due to

"True business operations &

Efficiency"
Desi Munata
Language-Kamkaji
-

-
That's why EBITDA is useful to

compare businesses
 -
EBITDA
-
EBITDA is used to de
inesses (EVEBITDA)

-
BITDA is used in o
Analysis (CFO/EBITDA)

- is
EBITDA used to compare
-

in same sector
enco,
 -

what is AdEBITDA?
 ->
AdITDA
-
Because EBITDA represent
"cash
operating profits"
-
All the companies are desperate
to declare themselves BITDA the

1
-
 ->
AdITDA
What is Adjusted EBITDA?
-
It is
earnings before InterestB
Tax, Depreciation, and I

Sing
Esops, litigation Exps, cond eps,

Rent, Good will impairment, forex

losses, etc.
 ->
AdITDA

take
let's a practical example of

&

->
 ->
AdITDA
- It is unfair to compare Net

profit of DMART 3 Reliance Smart

-
Because hashigher
Deprecation (as they own all the
stores)
-
Because smar t
has higher

But (as they don't own

any stores

IBRDA isn't sufficient

Therefore, merely
 ->
AdITDA
-
we need to use EBITDAR-
Earnings
before tutt, Tax, Depreciation & Rent.
to have fair comparison of
earnings
tromness
efficiency -

-Here adjusted
AR EBITDA.
is

Ifyou
-

i
wan't me to cover
-x

;
ut
EDA
me

↳ed
 -

DA
WhyAdiu is
allowed?

-Because
Reporting EBITDA is
mandatory by Regulation
neither

nor by GAAP (Accounting standards)

adjustment in
EBITDA
Therefore, any
doesn't bother Regulators or Auditors.

isn't
EBITDA part of financial statement
you
something! learned

REPOST - To help others ↑

SAVE
- For future Reference.

sorry etic
handwriting