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/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. 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"
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
a deadly weapon if you wish
Analysis Excel (Ver. 4.0) careful of what you are gettin
garbage out. And if you need th
given stock, you m
www.safalniveshak.com
Basic Company Details
Parameters Details
Company RELIANCE INDUSTRIES LTD
Current Stock Price (Rs) 2,128 Remember! Focus on decision
Face Value (Rs) 10.0 evidenc
No. of Shares (Crore) 658.6
Market Capitalization (Rs Crore) 1,401,678

Key Financials - Trend

Parameters Details
Sales Growth (9-Year CAGR) 9.4% Please! It's your money. Plea
cause you to lose it all! I've des
Profit Before Tax Growth (9-Year CAGR) 9.3% but you alone are responsible
Net Profit Growth (8-Year CAGR) 8.2% ever after! I am not a sadist
Average Debt/Equity (5-Years, x) 0.8 analyzing companies on you
instead of a map, for you can co
Average Return on Equity (5-Years) 11.1%
Average P/E (5-Years, x) 17.0
Latest P/E (x) 32.6
 Warning! Excel can be a wonderful tool to analyze the past. But it can be
a deadly weapon if you wish to use it to predict the future! So be very
careful of what you are getting into. Here, garbage in will always equal
garbage 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.

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
RELIANCE INDUSTRIES LTD
Rs Cr Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20
Equity Share Capital 2,981 2,979 2,936 2,940 2,943 2,948 2,959 5,922 5,926 6,339
Reserves 151,112 166,466 179,094 195,730 215,539 228,600 260,746 287,569 381,184 446,991
Borrowings 84,152 92,447 107,219 138,761 168,251 194,714 217,475 239,843 307,714 355,133
Other Liabilities 69,274 65,299 73,108 91,412 117,753 172,735 225,622 277,939 302,806 354,552
Total 307,519 327,191 362,357 428,843 504,486 598,997 706,802 811,273 997,630 1,163,015

Net Block 158,100 138,814 133,487 141,417 156,458 184,910 198,526 403,885 398,374 532,658
Capital Work in Progress 28,174 25,363 49,952 91,494 166,462 228,697 324,837 187,022 179,463 109,106
Investments 21,596 38,596 42,848 60,602 76,451 84,015 82,899 82,862 235,635 276,767
Other Assets 99,649 124,418 136,070 135,330 105,115 101,375 100,540 137,504 184,158 244,484
Total 307,519 327,191 362,357 428,843 504,486 598,997 706,802 811,273 997,630 1,163,015

Working Capital 30,375 59,119 62,962 43,918 -12,638 -71,360 -125,082 -140,435 -118,648 -110,068
Debtors 15,696 16,939 9,750 9,411 5,315 4,465 8,177 17,555 30,089 19,656
Inventory 38,520 46,692 54,601 56,720 53,248 46,486 48,951 60,837 67,561 73,903
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 22 17 9 8 5 6 10 16 19 12
Inventory Turnover 7 8 7 8 7 6 6 6 8 8
Fixed Asset Turnover 1.7 2.6 3.0 3.1 2.4 1.5 1.5 1.0 1.4 1.1
Debt/Equity 0.5 0.5 0.6 0.7 0.8 0.8 0.8 0.8 0.8 0.8
Return on Equity 13% 12% 11% 11% 11% 13% 11% 12% 10% 9%
Return on Capital Employed 11% 11% 10% 10% 9% 10% 9% 11% 10% 9%
 Profit & Loss Account / Income Statement
RELIANCE INDUSTRIES LTD
Rs Cr Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Trailing
Sales 265,050 357,677 395,957 433,521 374,372 272,583 303,954 390,823 568,337 595,887 527,226
% Growth YOY 35% 11% 9% -14% -27% 12% 29% 45% 5%
Expenses 226,427 323,169 362,912 398,722 337,008 230,845 257,647 326,508 484,087 507,413 443,568
Material Cost (% of Sales) 79% 84% 85% 84% 78% 68% 72% 71% 70% 69% Check for wide fluctuations in key
Power and Fuel 1% 1% 2% 3% 4% 4% 4% 4% 3% 3% expense items. For manufacturing firms,
Other Mfr. Exp 3% 2% 2% 2% 2% 3% 3% 2% 2% 2% check their material costs etc. For
Employee Cost 1% 1% 1% 1% 2% 3% 3% 2% 2% 2% services firms, look at employee costs.
Selling and Admin Cost 3% 2% 3% 2% 3% 7% 6% 7% 9% 11%
Operating Profit 38,623 34,508 33,045 34,799 37,364 41,738 46,307 64,315 84,250 88,474 83,658
Operating Profit Margin 15% 10% 8% 8% 10% 15% 15% 16% 15% 15% 16%
Other Income 1,964 6,194 7,867 9,001 8,613 12,255 9,222 9,869 8,406 9,362 16,243
Other Income as % of Sales 0.7% 1.7% 2.0% 2.1% 2.3% 4.5% 3.0% 2.5% 1.5% 1.6% 3.1%
Depreciation 14,121 12,401 11,232 11,201 11,547 11,565 11,646 16,706 20,934 22,203 23,500
Interest 2,411 2,893 3,463 3,836 3,316 3,691 3,849 8,052 16,495 22,027 23,653
Interest Coverage(Times) 11 10 9 8 10 11 11 7 4 3 3
Profit before tax (PBT) 24,055 25,408 26,217 28,763 31,114 38,737 40,034 49,426 55,227 53,606 52,748
% Growth YOY 6% 3% 10% 8% 25% 3% 23% 12% -3%
PBT Margin 9% 7% 7% 7% 8% 14% 13% 13% 10% 9% 10%
Tax 4,783 5,691 5,331 6,215 7,474 8,876 10,201 13,346 15,390 13,726 9,761
Net profit 19,272 19,717 20,886 22,548 23,640 29,861 29,833 36,080 39,837 39,880 42,987
% Growth YOY 2% 6% 8% 5% 26% 0% 21% 10% 0%
Net Profit Margin 7% 6% 5% 5% 6% 11% 10% 9% 7% 7% 8%
EPS 27.6 28.3 30.3 32.7 34.2 43.2 43.0 53.4 58.9 59.0 65.3
% Growth YOY 2% 7% 8% 5% 26% 0% 24% 10% 0%
Price to earning 18.8 13.2 12.6 14.1 11.9 12.0 15.2 16.4 22.9 18.7 32.6
Price 520 372 383 461 409 518 654 874 1,350 1,103 2,128
Dividend Payout 12.4% 12.8% 12.7% 12.4% 12.5% 10.4% 10.9% 9.8% 9.7% 10.5%
Market Cap 362,868 259,436 263,679 317,857 282,407 357,876 453,788 590,839 913,080 746,034
Retained Earnings 16,890 17,186 18,243 19,748 20,688 26,754 26,586 32,526 35,961 35,705
Buffett's $1 Test 1.5

TRENDS: 10 YEARS 7 YEARS 5 YEARS 3 YEARS

Sales Growth 9.4% 6.0% 9.7% 25.2%
PBT Growth 9.3% 10.8% 11.5% 10.2%
PBT Margin 9.6% 10.5% 11.7% 10.5%
Price to Earning 15.6 15.9 17.0 19.3

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.
 Cash Flow Statement
RELIANCE INDUSTRIES LTD
Rs Cr Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Total
Cash from Operating Activity (CFO) 33,338 24,483 36,918 43,261 34,374 38,134 49,550 71,459 42,346 98,074 471,937
% Growth YoY -27% 51% 17% -21% 11% 30% 44% -41% 132%
Cash from Investing Activity -32,040 -6,301 -27,601 -73,070 -64,706 -36,186 -66,201 -68,192 -94,507 -75,694 -544,498
Cash from Financing Activity 14,950 -7,590 408 13,713 8,444 -3,210 8,617 -2,001 55,906 -2,541 86,696
Net Cash Flow 16,248 10,592 9,725 -16,096 -21,888 -1,262 -8,034 1,266 3,745 19,839 14,135
CFO/Sales 13% 7% 9% 10% 9% 14% 16% 18% 7% 16%
CFO/Net Profit 173% 124% 177% 192% 145% 128% 166% 198% 106% 246%
Capex** 315 212 364 565 607 937 1,156 1,638 1,238 824
FCF 33,023 24,271 36,554 42,696 33,767 37,197 48,394 69,821 41,108 97,250 464,081
Average FCF (3 Years) 69,393
FCF Growth YoY -27% 51% 17% -21% 10% 30% 44% -41% 137%
FCF/Sales 12% 7% 9% 10% 9% 14% 16% 18% 7% 16%
FCF/Net Profit 171% 123% 175% 190% 143% 125% 162% 194% 104% 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
 Key Ratios
RELIANCE INDUSTRIES LTD
Mar/11 Mar/12 Mar/13 Mar/14 Mar/15 Mar/16 Mar/17 Mar/18
Sales Growth 34.9% 10.7% 9.5% -13.6% -27.2% 11.5% 28.6%
PBT Growth 5.6% 3.2% 9.7% 8.2% 24.5% 3.3% 23.5%
Net Profit Growth 2.3% 5.9% 8.0% 4.8% 26.3% -0.1% 20.9%
Dividend Growth 6.2% 4.4% 5.7% 5.4% 5.2% 5.2% 9.2%
Operating Cash Flow Growth -26.6% 50.8% 17.2% -20.5% 10.9% 29.9% 44.2%
Free Cash Flow Growth -26.5% 50.6% 16.8% -20.9% 10.2% 30.1% 44.3%

Operating Margin 14.6% 9.6% 8.3% 8.0% 10.0% 15.3% 15.2% 16.5%
PBT Margin 9.1% 7.1% 6.6% 6.6% 8.3% 14.2% 13.2% 12.6%
Net Margin 7.3% 5.5% 5.3% 5.2% 6.3% 11.0% 9.8% 9.2%

Debtor Days 21.6 17.3 9.0 7.9 5.2 6.0 9.8 16.4
Inventory Turnover 6.9 7.7 7.3 7.6 7.0 5.9 6.2 6.4
Fixed Asset Turnover 1.7 2.6 3.0 3.1 2.4 1.5 1.5 1.0
Debt/Equity 0.5 0.5 0.6 0.7 0.8 0.8 0.8 0.8
Debt/Assets 27.4% 28.3% 29.6% 32.4% 33.4% 32.5% 30.8% 29.6%
Interest Coverage (Times) 11.0 9.8 8.6 8.5 10.4 11.5 11.4 7.1
Return on Equity 12.5% 11.6% 11.5% 11.3% 10.8% 12.9% 11.3% 12.3%
Return on Capital Employed 11.1% 10.8% 10.3% 9.7% 8.9% 10.0% 9.1% 10.8%
Free Cash Flow (Rs Cr) 33,023 24,271 36,554 42,696 33,767 37,197 48,394 69,821
Mar/19 Mar/20
45.4% 4.8%
11.7% -2.9%
10.4% 0.1%
8.4% 7.0%
-40.7% 131.6%
-41.1% 136.6%

14.8% 14.8%
9.7% 9.0%
7.0% 6.7%

19.3 12.0
8.4 8.1
1.4 1.1
0.8 0.8
30.8% 30.5%
4.3 3.4
10.3% 8.8%
10.3% 9.4%
41,108 97,250
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.
20% Profit Margin Capital Allo
14%
Check for a rising trend an
12% Numbers > 20% long term
15% 10% has zero/marginal debt. C
8%
10%
6%
5% 4%
Check for a rising trend and/or consistency.
Compare with a close competitor
2%
0% 0%
Jan/11 Jan/13 Jan/15 Jan/17 Jan/19 Jan/11 Jan/13 J

Operating Margin PBT Margin

Net Margin ROE

700,000
Revenue Revenue and Pr
50%
Check for a rising trend. Check for a r
600,000 40% Compare gro
30%
500,000
20%
400,000 10%
300,000 0%
200,000 -10% Jan/12 Jan/14
-20%
100,000
-30%
- -40%
Jan/11 Jan/13 Jan/15 Jan/17 Jan/19
Revenue Grow
Net Profit Gro

60,000 Profit Over Time Operating and

120,000 Check
Check for a rising trend. for positive numb
50,000 100,000 which are rising over tim

40,000 80,000
30,000 60,000
20,000 40,000
10,000 20,000
- -
Jan/11 Jan/13 Jan/15 Jan/17 Jan/19 Jan/11 Jan/13

PBT Net Profit Operating Cash F

Data for Charts (Please don't touch any number below)
Margins
Mar/11 Mar/12 Mar/13 Mar/14 Mar/15 Mar/16 Mar/17 Mar/18 Mar/19
Operating Margin 15% 10% 8% 8% 10% 15% 15% 16% 15%
PBT Margin 9% 7% 7% 7% 8% 14% 13% 13% 10%
Net Margin 7% 6% 5% 5% 6% 11% 10% 9% 7%

Management Effectiveness
Mar/11 Mar/12 Mar/13 Mar/14 Mar/15 Mar/16 Mar/17 Mar/18 Mar/19
ROE 13% 12% 11% 11% 11% 13% 11% 12% 10%
ROCE 11% 11% 10% 10% 9% 10% 9% 11% 10%

Revenue & Profit Growth

Mar/12 Mar/13 Mar/14 Mar/15 Mar/16 Mar/17 Mar/18 Mar/19 Mar/20
Revenue Growth 35% 11% 9% -14% -27% 12% 29% 45% 5%
PBT Growth 6% 3% 10% 8% 25% 3% 23% 12% -3%
Net Profit Growth 2% 6% 8% 5% 26% 0% 21% 10% 0%

Revenue & Profit

Mar/11 Mar/12 Mar/13 Mar/14 Mar/15 Mar/16 Mar/17 Mar/18 Mar/19
Revenue 265,050 357,677 395,957 433,521 374,372 272,583 303,954 390,823 568,337
PBT 24,055 25,408 26,217 28,763 31,114 38,737 40,034 49,426 55,227
Net Profit 19,272 19,717 20,886 22,548 23,640 29,861 29,833 36,080 39,837

Cash Flows
Mar/11 Mar/12 Mar/13 Mar/14 Mar/15 Mar/16 Mar/17 Mar/18 Mar/19
Operating Cash Flow 33,338 24,483 36,918 43,261 34,374 38,134 49,550 71,459 42,346
Free Cash Flow 33,023 24,271 36,554 42,696 33,767 37,197 48,394 69,821 41,108
%
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
companies would be 31st
% March of that year
%
%
Jan/11 Jan/13 Jan/15 Jan/17 Jan/19

ROE ROCE

Revenue and Profit Growth (YoY)

Check for a rising trend and/or low volatility.
Compare growth rates with a close competitor.

Jan/12 Jan/14 Jan/16 Jan/18 Jan/20

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

Jan/11 Jan/13 Jan/15 Jan/17 Jan/19

Operating Cash Flow Free Cash Flow

 Mar/20
15%
9%
7%

Mar/20
9%
9%

Mar/20
595,887
53,606
39,880

Mar/20
98,074
97,250
 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 79% 84% 85% 84% 78% 68% 72% 71% 70% 69%
Change in Inventory 2% 1% 1% 0% 0% -1% 2% 2% 1% 1%
Power and Fuel 1% 1% 2% 3% 4% 4% 4% 4% 3% 3%
Other Mfr. Exp 3% 2% 2% 2% 2% 3% 3% 2% 2% 2%
Employee Cost 1% 1% 1% 1% 2% 3% 3% 2% 2% 2%
Selling and Admin Cost 3% 2% 3% 2% 3% 7% 6% 7% 9% 11%
Other Expenses 0% 0% 0% 0% 1% -1% -1% -1% 0% 0%
Operating Profit 11% 8% 6% 8% 11% 17% 12% 12% 13% 13%
Other Income 1% 2% 2% 2% 2% 4% 3% 3% 1% 2%
Depreciation 5% 3% 3% 3% 3% 4% 4% 4% 4% 4%
Interest 1% 1% 1% 1% 1% 1% 1% 2% 3% 4%
Profit Before Tax 9% 7% 7% 7% 8% 14% 13% 13% 10% 9%
Tax 2% 2% 1% 1% 2% 3% 3% 3% 3% 2%
Net Profit 7% 6% 5% 5% 6% 11% 10% 9% 7% 7%
Dividend Amount 1% 1% 1% 1% 1% 1% 1% 1% 1% 1%

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% 0% 0% 1% 1% 1%
Reserves 49% 51% 49% 46% 43% 38% 37% 35% 38% 38%
Borrowings 27% 28% 30% 32% 33% 33% 31% 30% 31% 31%
Other Liabilities 23% 20% 20% 21% 23% 29% 32% 34% 30% 30%
Total Liabilities 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Net Block 51% 42% 37% 33% 31% 31% 28% 50% 40% 46%
Capital Work in Progress 9% 8% 14% 21% 33% 38% 46% 23% 18% 9%
Investments 7% 12% 12% 14% 15% 14% 12% 10% 24% 24%
Other Assets 32% 38% 38% 32% 21% 17% 14% 17% 18% 21%
Total Assets 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Receivables 5% 5% 3% 2% 1% 1% 1% 2% 3% 2%
Inventory 13% 14% 15% 13% 11% 8% 7% 7% 7% 6%
Cash & Bank 10% 12% 14% 9% 2% 2% 0% 1% 1% 3%
 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

RELIANCE INDUSTRIES LTD RELIANCE INDUSTRIES 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) 5,829 Year 1-3 15% 0 Excess Cash (Latest)
1 FY18 79,802 71,252 Year 4-6 10% 1 FY18
2 FY19 91,772 73,160 Year 7-10 5% 2 FY19
3 FY20 105,538 75,120 Discount Rate 12% 3 FY20
4 FY21 116,092 73,778 4 FY21
5 FY22 127,701 72,461 Last 5-Years' CAGR 5 FY22
6 FY23 140,471 71,167 Sales 10% 6 FY23
7 FY24 147,495 66,719 PBT 11% 7 FY24
8 FY25 154,869 62,549 FCF 24% 8 FY25
9 FY26 162,613 58,640 9 FY26
10 FY27 170,743 54,975 10 FY27
10 1,707,435 549,748 10
Intrinsic Value 1,235,398 Intrinsic Value
Current Mkt. Cap. 1,401,678 Current Mkt. Cap.
Premium/(Discount) to IV 13% 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

RELIANCE INDUSTRIES 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%
83,272 74,350 Year 4-6 15%
99,926 79,660 Year 7-10 10%
119,911 85,350 Discount Rate 12%
137,898 87,636
158,582 89,984
182,370 92,394
200,607 90,744
220,667 89,124
242,734 87,532
267,007 85,969
4,005,111 1,289,539
Intrinsic Value 2,158,112
Current Mkt. Cap. 1,401,678
Premium/(Discount) to IV -35%

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 IANCE INDUSTRIES LTD Company Name
Year Ended Mar/20 Year Ended

Avg 5-Yr Net Profit (Rs Crore) 35,098.2 Avg 5-Yr Net Profit (Rs Crore)
PE Ratio at 0% Growth 8.5 PE Ratio at 0% Growth
Long-Term Growth Rate 5.5 Long-Term Growth Rate

Ben Graham Value (Rs Crore) 685,299 Ben Graham Value (Rs Crore)
Current Market Cap (Rs Crore) 1,401,678 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)
IANCE INDUSTRIES LTD
Mar/20

35,098.2
8.5
11.0

1,072,264
1,401,678

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
RELIANCE INDUSTRIES LTD

Initial Cash Flow (Rs Cr) 69,393 1,579,672

1,401,678
Years 1-5 6-10 113%
FCF Growth Rate 15% 12%
Discount Rate 12%
Terminal Growth Rate 2%

Net Debt Level (Rs Cr) 349,304

Year FCF Growth Present Value

1 79,802 15% 71,252
2 91,772 15% 73,160
3 105,538 15% 75,120
4 121,369 15% 77,132
5 139,574 15% 79,198
6 156,323 12% 79,198
7 175,082 12% 79,198
8 196,091 12% 79,198
9 219,622 12% 79,198
10 245,977 12% 79,198

Final Calculations
Terminal Year 250,897
PV of Year 1-10 Cash Flows 771,852
Terminal Value 807,820
Total PV of Cash Flows 1,579,672
Current Market Cap (Rs Cr) 1,401,678

Note: See explanation of DCF here

aluation
TD

DCF Value (As calculated in cell B29)

Current Market Cap
DCF as % of Current Mkt Cap
 Expected Returns Model
RELIANCE INDUSTRIES LTD
Particulars Mar/11 Mar/12 Mar/13 Mar/14 Mar/15 Mar/16
Net Profit (Rs Crore) 19,294 19,724 20,879 22,493 23,566 29,745
Net Profit Margin 7% 6% 5% 5% 6% 11%
Return on Equity 13% 12% 11% 11% 11% 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) 122,228
Current P/E (x) 35.6
Exit P/E in the 10th year from now (x, Estimated) 20.0
Esti. Market Cap (10th year from now; Rs Cr) 2,444,551
Cost of Capital/Discount Rate 12%
Discounted Value (Rs Cr) 787,080
Current Market Cap (Rs Cr) 1,401,678

Note: See explanation of this model here

Model
LTD
Mar/17 Mar/18 Mar/19 Mar/20 CAGR (9-Yr) CAGR (5-Yr)
29,901 36,075 39,588 39,354 8% 11%
10% 9% 7% 7%
11% 12% 10% 9%
 Intrinsic Value Range
RELIANCE INDUSTRIES LTD
Lower Higher Remember! Give importance to a stock's valuation
Dhandho 1,235,398 2,158,112 only "after" you have answered in "Yes" to these tw
Ben Graham 685,299 1,072,264 (1) Is this business simple to be understood? an
DCF 1,579,672 understand this business?
Expected Return 787,080
Don't try to quantify everything. In stock research,
Current Market Cap. 1,401,678 mathematical you are, the more simple, sensible, a
be your analysis and results. Great analysis is gene
the-envelope".
Explanation: Considering the above range, we Also, your calculated "fair value" will be proven w
can say that Hero Moto's IV range is between future, so don't invest your savings just because yo
Rs 55,000 crore to Rs 95,000 crore. It's a big with it. Don't look for perfection. It is overrated.
range, but that's fine (who is looking for decisions, not outcomes. Look for disconfirming
precision?). Now, 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 -
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.
RELIANCE INDUSTRIES LTD
SCREENER.IN
Narration Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Jun-20
Sales 116,915 128,756 143,323 156,898 139,590 157,980 149,302 153,179 136,492 88,253
% Growth YOY 19% 23% 4% -2% -2% -44%
Expenses 98,446 108,095 122,215 135,581 118,437 136,365 127,150 130,553 114,487 71,378
Operating Profit 18,469 20,661 21,108 21,317 21,153 21,615 22,152 22,626 22,005 16,875
Other Income 2,203 1,788 1,251 2,484 2,894 2,871 3,668 3,285 -386 9,676
Depreciation 4,852 5,173 5,229 5,237 5,295 5,011 5,315 5,545 6,332 6,308
Interest 2,566 3,550 3,932 4,119 4,894 5,109 5,450 5,404 6,064 6,735
Profit before tax 13,254 13,726 13,198 14,445 13,858 14,366 15,055 14,962 9,223 13,508
PBT Margin 11% 11% 9% 9% 10% 9% 10% 10% 7% 15%
% Growth YOY 5% 5% 14% 4% -33% -6%
Tax 3,787 4,241 3,649 4,069 3,431 4,225 3,703 3,121 2,677 260
Net profit 9,438 9,459 9,516 10,251 10,362 10,104 11,262 11,640 6,348 13,233
% Growth YOY 10% 7% 18% 14% -39% 31%
OPM 16% 16% 15% 14% 15% 14% 15% 15% 16% 19%
COMPANY NAME RELIANCE INDUSTRIES LTD
LATEST VERSION 2.10 PLEASE DO NOT MAKE ANY CH
CURRENT VERSION 2.10

META
Number of shares 658.62
Face Value 10
Current Price 2128.2
Market Capitalization 1401678.24

PROFIT & LOSS

Report Date Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16
Sales 265050 357677 395957 433521 374372 272583
Raw Material Cost 208,882.00 ### ### ### ### ###
Change in Inventory 4,458.00 2,844.00 4,954.00 560.00 -1,483.00 -2,560.00
Power and Fuel 2834 4740 7993 10855 13261 10741
Other Mfr. Exp 7647 7165 7218 7954 8914 8272
Employee Cost 3324 3955 5179 5572 6262 7407
Selling and admin 7698 8198 10180 10681 12548 18808
Other Expenses 500 920 92 638 1977 -3197
Other Income 1964 6194 7867 9001 8613 12255
Depreciation 14121 12401 11232 11201 11547 11565
Interest 2411 2893 3463 3836 3316 3691
Profit before tax 24055 25408 26217 28763 31114 38737
Tax 4783 5691 5331 6215 7474 8876
Net profit 19294 19724 20879 22493 23566 29745
Dividend Amount 2384.8 2532.15 2642.4 2793 2943 3095.4

Quarters
Report Date Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19
Sales 116915 128756 143323 156898 139590 157980
Expenses 98446 108095 122215 135581 118437 136365
Other Income 2203 1788 1251 2484 2894 2871
Depreciation 4852 5173 5229 5237 5295 5011
Interest 2,566.00 3,550.00 3,932.00 4,119.00 4,894.00 5,109.00
Profit before tax 13254 13726 13198 14445 13858 14366
Tax 3787 4241 3649 4069 3431 4225
Net profit 9438 9459 9516 10251 10362 10104
Operating Profit 18469 20661 21108 21317 21153 21615

BALANCE SHEET
Report Date Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16
Equity Share Capital 2981 2979 2936 2940 2943 2948
Reserves 151112 166466 179094 195730 215539 228600
Borrowings 84,152.00 92,447.00 ### ### ### ###
Other Liabilities 69274 65299 73108 91412 117753 172735
Total 307519 327191 362357 428843 504486 598997
Net Block 158100 138814 133487 141417 156458 184910
Capital Work in Progress 28174 25363 49952 91494 166462 228697
Investments 21596 38,596.00 42848 60602 76451 84015
Other Assets 99649 124418 136070 135330 105115 101375
Total 307519 327191 362357 428843 504486 598997
Receivables 15696 16939 9750 9411 5315 4465
Inventory 38,520.00 46,692.00 54,601.00 56,720.00 53,248.00 46,486.00
Cash & Bank 30139 40731 50456 37984 12545 11028
No. of Equity Shares 2981019381 2.979E+09 2.936E+09 2.94E+09 2.943E+09 2.948E+09
New Bonus Shares
Face value 10 10 10 10 10 10

CASH FLOW:
Report Date Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16
Cash from Operating Activity 33338 24483 36918 43261 34374 38134
Cash from Investing Activity -32040 -6301 -27601 -73070 -64706 -36186
Cash from Financing Activity 14950 -7590 408 13713 8444 -3210
Net Cash Flow 16248 10592 9725 -16096 -21888 -1262

PRICE: 519.63 371.78 382.82 461.01 409.12 517.7

DERIVED:
Adjusted Equity Shares in Cr 698.32 697.82 688.78 689.48 690.28 691.28
DO NOT MAKE ANY CHANGES TO THIS SHEET

Mar-17 Mar-18 Mar-19 Mar-20

303954 390823 568337 595887
### 276,076.00 399,167.00 410,288.00
5,218.00 8,610.00 4,680.00 5,048.00
11251 14569 17029 15098
9909 9691 12198 11434
8388 9523 12488 14075
18520 29111 50221 63644
-2721 -3852 -2336 -2078
9222 9869 8406 9362
11646 16706 20934 22203
3849 8052 16,495.00 22,027.00
40034 49426 55227 53606
10201 13346 15390 13726
29901 36075 39588 39354
3254.9 3553.2 3851.9 4120.35

Sep-19 Dec-19 Mar-20 Jun-20

149302 153179 136492 88253
127150 130553 114487 71378
3668 3285 -386 9676
5315 5545 6332 6308
5,450.00 5,404.00 6,064.00 6,735.00
15055 14962 9223 13508
3703 3121 2677 260
11262 11640 6348 13233
22152 22626 22005 16875

Mar-17 Mar-18 Mar-19 Mar-20

 2959 5922 5926 6339
260746 287569 381184 446991
### 239,843.00 307,714.00 355,133.00
225622 277939 302806 354552
706802 811273 997630 1163015
198526 403885 398374 532658
324837 187022 179463 109106
82899 82862 235635 276767
100540 137504 184158 244484
706802 811273 997630 1163015
8177 17555 30089 19656
48,951.00 60,837.00 67,561.00 73,903.00
3023 4255 11081 30920
2.959E+09 5921826196 5925868997 6338693823
### ###
10 10 10 10

Mar-17 Mar-18 Mar-19 Mar-20

49550 71459 42346 98074
-66201 -68192 -94507 -75694
8617 -2001 55906 -2541
-8034 1266 3745 19839

654.25 874.41 1350.45 1103.29

693.60 675.70 676.13 676.19

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