Long Term : FVD Model | Methodology |
---|---|

F :
Fundamentals |
For last 10 years' annual data, below ratios/parameters are analyzed forConsistency, Trend and Growth rate :
ROCE ROE ROIC Revenue Growth Profit Margins Company Size The final score is compared with the score of all the other listed stocks and given a relative rating out of 10. Good = Relative Score >= 6 Average = Relative Score >= 4 and <6 Bad = Relative Score < 4 |

V : Valuation |
Three ratios are considered for current valuation of the company:
1. EV to EBIDTA 2. EV to Sales 3. Price to Sales Last 10 years' median value for all 3 ratios is assumed to be the fair value of the company. Basis this assumption, the present fair value is calculated by all 3 ratios. The median of these 3 ratios is compared with all the other listed stocks and given a relative rating out of 10. Good = Relative Score >= 6 Average = Relative Score >= 4 and <6 Bad = Relative Score < 4 |

D : Debt |
Average Debt/Equity ratio of the last 3 years is considered for calculating this Rating
For Banking industry,
Good = Ratio less than 13 Average = Ratio between 13 and 15 Bad = Ratio greater than 15 For all non-Banking industries,
Good = Ratio less than 0.4 Average = Ratio between 0.4 and 0.6 Bad = Ratio greater than 0.6 |

Short Term - QPP Model | Methodology |
---|---|

Q : Quarterly Earnings Trend |
1Qtr and 4Qtr growth in Revenue, Operating Profit and NetIncome are considered for this rating.
The growth rate score are assigned as under: If ratio's 1Q growth is +ve, then 1. If -ve, then -1. If ratio's 4Q growth is +ve, then 1.If -ve, then -1. Growth Score= Sum of all the above scores for Revenue, Operating Profit and Net Income. Interpretation Good = Growth Score >=4 Neutral = Growth Score between 0 and 4 Bad = Growth Score less than 0 |

P : Price Momentum |
1 Month Sharpe Ratio is considered for this Rating :
If greater than 2, then Good If between 0 and 2, then Neutral If less than 0, then Bad |

P : Pledged Shares |
Current Pledged Shares are considered for this rating:
If less than 25% ,then Good If between 25% and 50%, then Neutral If greater than 50%,then Bad. |