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/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. 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"
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. 3.0)
www.safalniveshak.com
Basic Company Details
Parameters
Company
Current Stock Price (Rs)
Face Value (Rs)
No. of Shares (Crore)
Market Capitalization (Rs Crore)
Key Financials - Trend
Parameters
Sales Growth (9-Year CAGR)
Profit Before Tax Growth (9-Year CAGR)
Net Profit Growth (8-Year CAGR)
Average Debt/Equity (5-Years, x)
Average Return on Equity (5-Years)
Average P/E (5-Years, x)
Latest P/E (x)
Warning! Excel can be a wonde
the past. But it can be a we
destruction to predict the future
of what you are getting into. He
always equal garba
Details
STEEL AUTHORITY OF INDIA LTD
85 Remember! Focus on decision
10.0 Look for disconfirming evidenc
413.1
35,295
Please! It's your money. Please
Details
results of this excel cause you
1.1% designed this excel to aid your
-192.6% you alone are responsible for yo
-189.7% live peacefully ever after! I am
0.8 wants you to do the hard wo
-0.4% companies on your own. But I'd
4.8 compass instead of a map, for
map with territory and lose it
-12.1
 Excel can be a wonderful tool to analyze
past. But it can be a weapon of mass
on to predict the future! So be very careful
you are getting into. Here, garbage in will
always equal garbage out.

ber! Focus on decisions, not outcomes.

disconfirming evidence. Calculate. Pray!

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

of this excel cause you to lose it all! I've
d this excel to aid your own thinking, but
are responsible for your actions. I want to
acefully ever after! I am not a sadist who
you to do the hard work by analyzing
es on your own. But I'd rather give you a
ss instead of a map, for you can confuse
ith 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
STEEL AUTHORITY OF INDIA LTD
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 4,130 4,130 4,130 4,130 4,131 4,131 4,131 4,131 4,131 4,131
Reserves 18,933 24,018 29,186 32,939 35,681 36,894 38,536 39,374 35,065 31,879
Borrowings 3,045 7,563 16,511 19,375 16,320 21,597 25,281 29,898 34,980 41,282
Other Liabilities 15,920 19,794 19,761 20,835 21,404 23,000 25,705 28,271 32,536 36,967
Total 42,028 55,505 69,589 77,279 77,535 85,621 93,652 ### ### ###

Net Block 11,571 12,305 13,615 15,059 17,158 16,777 26,771 36,169 45,925 50,285
Capital Work in Progress 2,390 6,550 14,953 22,075 28,049 35,891 33,651 29,196 24,927 23,275
Investments 538 653 669 684 685 718 720 919 1,293 1,396
Other Assets 27,529 35,997 40,351 39,461 31,643 32,235 32,511 35,390 34,567 39,302
Total 42,028 55,505 69,589 77,279 77,535 85,621 93,652 ### ### ###

Working Capital 11,610 16,203 20,591 18,626 10,238 9,235 6,806 7,119 2,031 2,335
Debtors 3,048 3,028 3,494 4,130 4,749 4,424 5,482 3,192 3,143 2,922
Inventory 7,018 10,320 9,193 11,471 13,917 16,192 15,404 17,951 14,904 15,940
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 28 26 31 35 37 36 43 25 30 24
Inventory Turnover 6 4 4 4 3 3 3 3 3 3
Fixed Asset Turnover 3.5 3.5 3.0 2.9 2.7 2.6 1.7 1.3 0.8 0.9
Debt/Equity 0.1 0.3 0.5 0.5 0.4 0.5 0.6 0.7 0.9 1.1
Return on Equity 25% 12% 13% 8% 3% 5% 6% 5% -10% -8%
Return on Capital Employed 17% 4% 5% 5% -1% 7% 5% 6% -5% -2%
 Profit & Loss Account / Income Statement
STEEL AUTHORITY OF INDIA LTD
Rs Cr Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Trailing
Sales 40,001 43,204 40,551 43,307 46,335 44,441 46,643 45,730 38,746 44,160 49,186
% Growth YOY 8% -6% 7% 7% -4% 5% -2% -15% 14%
Expenses 30,803 37,496 34,056 37,696 43,312 40,205 42,755 41,143 41,646 44,339 48,970
Material Cost (% of Sales) 35% 47% 43% 51% 55% 48% 41% 41% 44% 48% Check for wide fluctuations in key
Power and Fuel 7% 7% 8% 8% 10% 11% 11% 12% 14% 12% expense items. For manufacturing
Other Mfr. Exp 11% 11% 11% 8% 8% 9% 10% 11% 11% 10% firms, check their material costs etc. For
Employee Cost 20% 20% 13% 18% 17% 19% 21% 21% 25% 20% services firms, look at employee costs.
Selling and Admin Cost 4% 3% 4% 4% 5% 6% 6% 7% 9% 7%
Operating Profit 9,198 5,708 6,495 5,611 3,023 4,236 3,887 4,588 -2,900 -179 216
Operating Profit Margin 23% 13% 16% 13% 7% 10% 8% 10% -7% 0% 0%
Other Income 1,954 2,585 2,823 1,715 2,141 1,156 2,022 999 595 536 518
Other Income as % of Sales 4.9% 6.0% 7.0% 4.0% 4.6% 2.6% 4.3% 2.2% 1.5% 1.2% 1.1%
Depreciation 1,235 1,288 1,337 1,486 1,567 1,403 1,717 1,773 2,402 2,680 2,871
Interest 251 259 402 475 984 748 968 1,454 2,300 2,528 2,562
Interest Coverage(Times) 40 27 20 12 4 5 4 3 -2 -1 -1
Profit before tax (PBT) 9,665 6,746 7,579 5,366 2,613 3,240 3,225 2,359 -7,008 -4,851 -4,700
% Growth YOY -30% 12% -29% -51% 24% 0% -27% -397% -31%
PBT Margin 24% 16% 19% 12% 6% 7% 7% 5% -18% -11% -10%
Tax 3,932 3,228 3,378 2,290 1,608 1,070 608 266 -2,986 -2,018 -1,793
Net profit 5,733 3,518 4,201 3,076 1,005 2,170 2,616 2,093 -4,022 -2,833 -2,907
% Growth YOY -39% 19% -27% -67% 116% 21% -20% -292% -30%
Net Profit Margin 14% 8% 10% 7% 2% 5% 6% 5% -10% -6% -6%
EPS 13.9 8.5 10.2 7.4 2.4 5.3 6.3 5.1 -9.7 -6.9 -7.0
% Growth YOY -39% 19% -27% -67% 116% 21% -20% -292% -30%
Price to earning 12.3 12.9 22.8 22.8 39.5 11.7 11.3 14.5 -4.6 -9.1 -
Price 170 110 232 170 96 61 71 74 45 63 85
Dividend Payout 20.3% 17.4% 20.2% 20.2% 23.3% 38.1% 31.9% 39.5% 0.0% 0.0%
Market Cap 70,262 45,364 95,730 70,047 39,694 25,399 29,463 30,372 18,443 25,832
Retained Earnings 4,571 2,906 3,353 2,455 771 1,344 1,782 1,267 -4,022 -2,833
Buffett's $1 Test -3.8

TRENDS: 10 YEARS 7 YEARS 5 YEARS 3 YEARS

Sales Growth 1.1% 1.2% -1.0% -1.8%
PBT Growth -192.6% -193.8% -213.2% -214.6%
PBT Margin 6.7% 1.2% -1.9% -8.0%
Price to Earning 13.4 12.3 4.8 0.3

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 35% 47% 43% 51% 55% 48% 41% 41% 44% 48%
Change in Inventory 1% 4% -3% 3% 3% 5% -2% 3% -1% 0%
Power and Fuel 7% 7% 8% 8% 10% 11% 11% 12% 14% 12%
Other Mfr. Exp 11% 11% 11% 8% 8% 9% 10% 11% 11% 10%
Employee Cost 20% 20% 13% 18% 17% 19% 21% 21% 25% 20%
Selling and Admin Cost 4% 3% 4% 4% 5% 6% 6% 7% 9% 7%
Other Expenses 2% 3% 2% 1% 2% 1% 1% 1% 3% 3%
Operating Profit 21% 4% 22% 7% 1% 0% 12% 4% -5% 0%
Other Income 5% 6% 7% 4% 5% 3% 4% 2% 2% 1%
Depreciation 3% 3% 3% 3% 3% 3% 4% 4% 6% 6%
Interest 1% 1% 1% 1% 2% 2% 2% 3% 6% 6%
Profit Before Tax 29% 22% 25% 17% 11% 7% 7% 5% -18% -11%
Tax 10% 7% 8% 5% 3% 2% 1% 1% -8% -5%
Net Profit 19% 14% 17% 11% 8% 5% 6% 5% -10% -6%
Dividend Amount 4% 2% 3% 2% 2% 2% 2% 2% 0% 0%

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 10% 7% 6% 5% 5% 5% 4% 4% 4% 4%
Reserves 45% 43% 42% 43% 46% 43% 41% 39% 33% 28%
Borrowings 7% 14% 24% 25% 21% 25% 27% 29% 33% 36%
Other Liabilities 38% 36% 28% 27% 28% 27% 27% 28% 30% 32%
Total Liabilities 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Net Block 28% 22% 20% 19% 22% 20% 29% 36% 43% 44%
Capital Work in Progress 6% 12% 21% 29% 36% 42% 36% 29% 23% 20%
Investments 1% 1% 1% 1% 1% 1% 1% 1% 1% 1%
Other Assets 66% 65% 58% 51% 41% 38% 35% 35% 32% 34%
Total Assets 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Receivables 7% 5% 5% 5% 6% 5% 6% 3% 3% 3%
Inventory 17% 19% 13% 15% 18% 19% 16% 18% 14% 14%
Cash & Bank 33% 33% 32% 23% 8% 4% 3% 2% 0% 0%
 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
STEEL AUTHORITY OF INDIA LTD
Rs Cr Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Total
Cash from Operating Activity (CFO) 8,378 6,122 4,800 2,157 1,042 2,404 5,883 2,744 3,800 2,125 39,456
Cash from Investing Activity -1,140 -4,405 -8,021 -8,933 3,326 -5,705 -7,192 -5,161 -4,558 -5,439 -47,228
Cash from Financing Activity -3,089 2,704 7,395 1,818 -4,699 3,248 1,247 2,362 743 3,302 15,030
Net Cash Flow 4,150 4,421 4,174 -4,959 -332 -53 -62 -55 -16 -12 7,257
CFO/Sales 21% 14% 12% 5% 2% 5% 13% 6% 10% 5%
CFO/Net Profit 146% 174% 114% 70% 104% 111% 225% 131% -94% -75%
Capex** 375 315 212 364 565 607 937 1156 1638 1238
FCF 8,003 5,806 4,589 1,793 477 1,797 4,946 1,588 2,162 887 32,049
Average FCF (3 Years) 1,546
FCF/Sales 20% 13% 11% 4% 1% 4% 11% 3% 6% 2%
FCF/Net Profit 106% 94% 68% 37% 13% 83% 189% 76% -54% -31%

** 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 P
Explanation - Earnings power value (EPV) is a technique for valuing stocks by making an assumption about the sustainability
of capital but assuming no further growth. EPV formula = Adjusted Earnings / Cost of Capital

Company Name STEEL AUTHORITY OF INDIA LTD

Latest Year Ended Mar-17

Calculation of Normalized Earnings

(Rs Crore) Mar/13 Mar/14 Mar/15 Mar/16 Mar/17
Sales 44,441 46,643 45,730 38,746 44,160
EBIT 3,988 4,192 3,813 (4,707) (2,323)
Less - Adjustment 20 21 19 (24) (12)
EBIT (Adjusted) 3,968 4,171 3,794 (4,684) (2,311)
EBIT Margin'(Adjusted) 9% 9% 8% -12% -5%
Tax Rate 33% 19% 11% 43% 42%
Earnings After Tax (Adjusted) 2,658 3,385 3,366 -2,688 -1,350
Depreciation 1,403 1,717 1,773 2,402 2,680
Maintenance Capex (See Table Below) 2,148 -854 1,898 7,318 -3,165
Earnings After Tax (Normalized, A) 1,913 5,955 3,241 -7,603 4,495
Reported Profit After Tax (B) 2,170 2,616 2,093 -4,021 -2,833

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/13 Mar/14 Mar/15 Mar/16 Mar/17
Fixed Assets (PPE) 16,777 26,771 36,169 45,925 50,285
Net Sales 44,441 46,643 45,730 38,746 44,160
PPE/Sales 0.38 0.57 0.79 1.19 1.14
Change in Sales -1,895 2,202 -912 -6,984 5,414
Total Capex 607 937 1,156 1,638 1,238
Growth Capex -1,541 1,791 -742 -5,680 4,403
Maintenance Capex 2,148 -854 1,898 7,318 -3,165

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)
king an assumption about the sustainability of current earnings and the cost
rmula = Adjusted Earnings / Cost of Capital

EPV with Different Cost of Capital

Discount Rate EPV Net Cash** Total EPV Per Share
10% 44,948 -36,664 8,284 20
12% 37,457 -36,664 793 2
15% 29,965 -36,664 -6,699 -16
Current Market Cap (Rs Crore) 35,295
EPV as % of Market Cap 2%

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

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

5% of reported EBIT as this adjustment

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

use 12% discount rate/cost of capital.

at I have used here

over 5-7 years

owth Capex calculated above

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

STEEL AUTHORITY OF INDIA LTD STEEL AUTHORITY OF INDIA 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) 4,618 Year 1-3 15% 0 Excess Cash (Latest)
1 FY18 1,777 1,587 Year 4-6 10% 1 FY18
2 FY19 2,044 1,630 Year 7-10 5% 2 FY19
3 FY20 2,351 1,673 Discount Rate 12% 3 FY20
4 FY21 2,586 1,643 4 FY21
5 FY22 2,844 1,614 Last 5-Years' CAGR 5 FY22
6 FY23 3,129 1,585 Sales -1% 6 FY23
7 FY24 3,285 1,486 PBT -213% 7 FY24
8 FY25 3,449 1,393 FCF 13% 8 FY25
9 FY26 3,622 1,306 9 FY26
10 FY27 3,803 1,224 10 FY27
10 38,030 12,245 10
Intrinsic Value 32,005 Intrinsic Value
Current Mkt. Cap. 35,295 Current Mkt. Cap.
Premium/(Discount) to IV 10% 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

STEEL AUTHORITY OF INDIA 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%
1,855 1,656 Year 4-6 15%
2,226 1,774 Year 7-10 10%
2,671 1,901 Discount Rate 12%
3,071 1,952
3,532 2,004
4,062 2,058
4,468 2,021
4,915 1,985
5,407 1,950
5,947 1,915
89,208 28,722
Intrinsic Value 52,557
Current Mkt. Cap. 35,295
Premium/(Discount) to IV -33%

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 UTHORITY OF INDIA LTD Company Name
Year Ended Mar/17 Year Ended

Avg 5-Yr Net Profit (Rs Crore) 4.9 Avg 5-Yr Net Profit (Rs Crore)
PE Ratio at 0% Growth 8.5 PE Ratio at 0% Growth
Long-Term Growth Rate (111.5) Long-Term Growth Rate

Ben Graham Value (Rs Crore) (1,048) Ben Graham Value (Rs Crore)
Current Market Cap (Rs Crore) 35,295 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)
UTHORITY OF INDIA LTD
Mar/17

4.9
8.5
(223.0)

(2,137)
35,295

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
STEEL AUTHORITY OF INDIA LTD

Initial Cash Flow (Rs Cr) 1,546 35,185

35,295
Years 1-5 6-10 100%
FCF Growth Rate 15% 12%
Discount Rate 12%
Terminal Growth Rate 2%

Net Debt Level (Rs Cr) 36,664

Year FCF Growth Present Value

1 1,777 15% 1,587
2 2,044 15% 1,630
3 2,351 15% 1,673
4 2,703 15% 1,718
5 3,109 15% 1,764
6 3,482 12% 1,764
7 3,900 12% 1,764
8 4,368 12% 1,764
9 4,892 12% 1,764
10 5,479 12% 1,764

Final Calculations
Terminal Year 5,588
PV of Year 1-10 Cash Flows 17,192
Terminal Value 17,993
Total PV of Cash Flows 35,185
Current Market Cap (Rs Cr) 35,295

Note: See explanation of DCF here

Valuation
DIA LTD

DCF Value (As calculated in cell B29)

Current Market Cap
DCF as % of Current Mkt Cap
 Expected Returns Model
STEEL AUTHORITY OF INDIA LTD
Particulars Mar/08 Mar/09 Mar/10 Mar/11 Mar/12 Mar/13 Mar/14
Net Profit (Rs Crore) 7,537 6,170 6,754 4,905 3,543 2,170 2,616
Net Profit Margin 19% 14% 17% 11% 8% 5% 6%
Return on Equity 25% 12% 13% 8% 3% 5% 6%

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) (8,800)
Current P/E (x) (12.5)
Exit P/E in the 10th year from now (x, Estimated) 20.0
Esti. Market Cap (10th year from now; Rs Cr) ###
Cost of Capital/Discount Rate 12%
Discounted Value (Rs Cr) (56,665)
Current Market Cap (Rs Cr) 35,295

Note: See explanation of this model here

el
D
Mar/15 Mar/16 Mar/17 CAGR (9-Yr) CAGR (5-Yr)
2,093 -4,021 -2,833 -190% -196%
5% -10% -6%
5% -10% -8%
 Intrinsic Value Range
STEEL AUTHORITY OF INDIA LTD
Lower Higher Remember! Give importance to a stock's valuations / fair va
EPV 793 only "after" you have answered in "Yes" to these two questio
Dhandho 32,005 52,557 (1) Is this business simple to be understood? and (2) Can
Ben Graham -1,048 -2,137 understand this business?
DCF 35,185
Don't try to quantify everything. In stock research, the less n
Expected Return -56,665 mathematical you are, the more simple, sensible, and useful
Current Market Cap. 35,295 be your analysis and results. Great analysis is generally "ba
of-the-envelope".

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

future, so don't invest your savings just because you fall in
with it. Don't look for perfection. It is overrated. Focus on
decisions, not outcomes. Look for disconfirming evidenc
 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.
STEEL AUTHORITY OF INDIA LTD
SCREENER.IN
Narration Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Sep-17
Sales 9,493 9,248 8,950 ### 9,238 ### ### ### ### ###
% Growth YOY -3% 21% 26% 12% 25% 21%
Expenses 9,404 ### ### ### 9,059 ### ### ### ### ###
Operating Profit 89 -929 -1,156 -904 180 -53 -43 -264 -94 617
Other Income 207 99 104 185 89 68 70 310 89 49
Depreciation 452 528 530 892 600 666 670 744 695 762
Interest 508 540 599 653 594 603 611 720 588 643
Profit before tax -664 ### -2,181 -2,264 -925 ### -1,254 -1,419 -1,287 -740
PBT Margin -7% -21% -24% -20% -10% -11% -11% -11% -11% -5%
% Growth YOY 39% -34% -43% -37% 39% -41%
Tax -416 -790 -700 -1,079 -390 -521 -459 -648 -486 -201
Net profit -248 ### -1,481 -1,185 -536 -732 -795 -771 -801 -539
% Growth YOY 116% -34% -46% -35% 50% -26%
OPM 1% -10% -13% -8% 2% 0% 0% -2% -1% 5%
COMPANY NAME STEEL AUTHORITY OF INDIA LTD
LATEST VERSION 2.10 PLEASE DO NOT MAKE ANY CHA
CURRENT VERSION 2.10

META
Number of shares 413.05
Face Value 10
Current Price 85.45
Market Capitalization 35295.34

PROFIT & LOSS

Report Date Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13
Sales 40000.96 43204.06 40551.38 43307.36 46335.12 44440.58
Raw Material Cost 13935.27 20206.77 17342.97 22080.62 25563.51 21201.69
Change in Inventory 436.28 1934.53 -1161.01 1352.67 1368.51 2016.09
Power and Fuel 2860.75 3232.74 3413.9 3621.51 4533.71 4907.01
Other Mfr. Exp 4353.43 4764.05 4480.2 3316.14 3643.95 4034.3
Employee Cost 7917.52 8561.14 5416.86 7623.33 7932.05 8637.58
Selling and admin 1478.62 1494.99 1520.42 1934.03 2224.49 2868.2
Other Expenses 693.95 1170.57 720.6 473.02 782.49 572.37
Other Income 1953.73 2585.09 2822.59 1715.01 2140.65 1155.52
Depreciation 1235.48 1287.77 1337.24 1485.8 1567.03 1402.98
Interest 250.94 259.41 402.01 474.77 983.99 747.66
Profit before tax 11468.73 9398.88 10132.03 7194.31 5150.87 3240.66
Tax 3931.95 3228.48 3377.66 2289.57 1608.15 1070.31
Net profit 7536.78 6170.4 6754.37 4904.74 3542.72 2170.35
Dividend Amount 1528.25 1073.9 1363.03 991.3 826.1 826.1

Quarters
Report Date Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16
Sales 9493.11 9247.54 8950.02 11361.21 9238.08 11225.6
Expenses 9404.39 10176.36 10105.75 12265.23 9058.51 11278.18
Other Income 206.87 99.17 103.67 184.96 89.28 68.16
Depreciation 451.84 528.38 530.37 891.76 600.21 665.87
Interest 508.22 540.03 598.96 653.24 594.05 602.76
Profit before tax -664.47 -1898.06 -2181.39 -2264.06 -925.41 -1253.05
Tax -416.29 -790.02 -700.33 -1079.42 -389.89 -521.47
Net profit -248.18 -1108.04 -1481.06 -1184.64 -535.52 -731.58
Operating Profit 88.72 -928.82 -1155.73 -904.02 179.57 -52.58

BALANCE SHEET
Report Date Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13
Equity Share Capital 4130.4 4130.4 4130.4 4130.4 4130.53 4130.53
Reserves 18933.17 24017.82 29186.3 32939.07 35680.79 36894.11
Borrowings 3045.24 7562.83 16511.25 19374.7 16319.5 21596.95
Other Liabilities 15919.61 19794.03 19760.55 20835.15 21404.35 22999.78
Total 42028.42 55505.08 69588.5 77279.32 77535.17 85621.37
Net Block 11571.31 12305.39 13615.28 15058.51 17158.27 16777.4
Capital Work in Progress 2389.55 6549.71 14953.13 22075.31 28049.14 35890.85
Investments 538.2 652.7 668.83 684.14 685.04 718.36
Other Assets 27529.36 35997.28 40351.26 39461.36 31642.72 32234.76
Total 42028.42 55505.08 69588.5 77279.32 77535.17 85621.37
Receivables 3048.12 3027.77 3493.9 4130.27 4748.77 4424.18
Inventory 7018.1 10320.31 9192.67 11470.72 13917.16 16192.02
Cash & Bank 13759.44 18264.67 22436.37 17480.09 6415.7 3850.35
No. of Equity Shares 4130400545 4.13E+09 4.13E+09 4.13E+09 4.131E+09 4.131E+09
New Bonus Shares
Face value 10 10 10 10 10 10

CASH FLOW:
Report Date Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13
Cash from Operating Activity 8378.18 6121.52 4800.48 2157.25 1041.83 2404.48
Cash from Investing Activity -1139.89 -4405.15 -8021.15 -8933.28 3325.6 -5705.13
Cash from Financing Activity -3088.68 2704.42 7395 1817.52 -4699.15 3247.53
Net Cash Flow 4149.61 4420.79 4174.33 -4958.51 -331.72 -53.12

PRICE: 170.11 109.83 231.77 169.59 96.1 61.49

DERIVED:
Adjusted Equity Shares in Cr 413.04 413.04 413.04 413.04 413.05 413.05
DO NOT MAKE ANY CHANGES TO THIS SHEET

Mar-14 Mar-15 Mar-16 Mar-17

46642.56 45730.36 38746.48 44160.29
19271.94 18523.38 17155.23 21125.7
-894.63 1408.12 -540.61 -120.63
5036.65 5585.88 5333.87 5233.93
4607.77 5087.55 4315.88 4346.99
9578.52 9736.35 9715.12 8947.83
2804.25 3150.95 3347.49 3092.92
561.42 466.54 1237.8 1470.99
2021.5 998.59 594.67 535.61
1716.69 1773.28 2402.35 2679.95
967.64 1454.23 2300.45 2527.82
3224.55 2358.91 -7007.5 -4850.86
608.07 266.23 -2986.06 -2017.62
2616.48 2092.68 -4021.44 -2833.24
834.35 826.1

Dec-16 Mar-17 Jun-17 Sep-17

11298.19 12690.54 11579.56 13617.42
11340.95 12954.94 11673.58 13000.69
69.96 309.68 89.31 48.63
669.94 743.93 694.67 762.22
610.83 720.18 587.86 643.47
-1253.57 -1418.83 -1287.24 -740.33
-458.73 -647.53 -485.86 -201.27
-794.84 -771.3 -801.38 -539.06
-42.76 -264.4 -94.02 616.73

Mar-14 Mar-15 Mar-16 Mar-17

 4130.53 4130.53 4130.53 4130.53
38535.82 39374.25 35065.37 31878.53
25281.4 29897.73 34979.79 41282.26
25704.51 28270.96 32536.39 36966.88
93652.26 101673.47 106712.08 114258.2
26770.65 36168.61 45925.07 50284.61
33650.54 29195.82 24927.22 23275.39
720.2 919.07 1292.63 1396.34
32510.87 35389.97 34567.16 39301.86
93652.26 101673.47 106712.08 114258.2
5482.28 3192 3143.49 2921.69
15403.86 17950.57 14903.75 15939.51
2855.95 2305.24 297.96 289.09
4.131E+09 4130525289 4130525289 4130525289

10 10 10 10

Mar-14 Mar-15 Mar-16 Mar-17

5883.09 2744.12 3799.71 2125.03
-7192.12 -5160.5 -4558.17 -5438.67
1246.71 2361.51 742.73 3302.13
-62.32 -54.87 -15.73 -11.51

71.33 73.53 44.65 62.54

413.05 413.05 413.05 413.05

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