Stocks for the long and short term portfolio

[adityasaraf007]

@ Aditya

have you done your calculation on dec 2014 earning data or on mar 2014 earning numbers...?

Hi Choice100..

NSE provides the trailing 12-month data for P/E, P/B and Div Yield for various indices. These can be obtained from here.

Looking at the values, it seems that NSE makes the adjustment as and when the quarterly results are announced by one of the scrips in the Index. Moreover, the values seem to be adjusted everyday based on the scrip's weightage in the Index.

If someone is interested, they may download the file from here.

 

[adityasaraf007]

India total market cap to India GDP is 77%
Indian stock market is Fair Valued


Total Market Cap / GDP Valuation
< 50% ----------------Significantly Undervalued
50% 75%----------Modestly Undervalued
75% 90% ---------Fair Valued
90% 115% -------- Modestly Overvalued
> 115%----------------Significantly Overvalued

Hi Karthik ji...

How did you arrive at the figure of 77% for India's MarketCap-to-GDP ratio? Is there a reliable source or have you calculated it based on certain assumptions?

As per World Bank's statistics India's GDP as of 2013 was US$ 1.877 trillion... Converting it into Rupees at an Exchange Rate of Rs62/$ (exchange rate as on Dec 2013) means a GDP of around Rs 116 trillion as on 2013... Taking growth of 5.6% p.a. for 14 months (Jan 2014 to Feb 2015), we get close to Rs 123 trillion as on today..

Total market capitalization of companies listed on BSE as on today is Rs 105 trillion... It's available on BSE's homepage under Market Statistics table...

As per my calculations, the figure comes to 105/123=85%...

Obviously, there are lots of unlisted companies, partnerships, proprietorships etc. which are not contributing towards Market Capitilization... (There are some fantastic companies out there which are unlisted)...

Would love to hear about your calculations/assumptions or some other source on which you have relied... Thanks for bringing this up

 

[mvkarthik]

see this link,
http://www. gurufocus. com/stock-market-valuations.php

http://articles. economictimes.indiatimes. com/2014-08-07/news/52556085_1_microsec-capital-ltd-siddharth-sedani-market-cap-gdp

 

[mvkarthik]

For market valuation I am also use nifty pe ratio which is so easy to valuing market. Recently I saw a interview of warren buffett. In the interview he said about market cap to GDP. I really found this so interesting. I just want to share this with traderji members and waiting for their view on this.

 

[dinesh_151]

Dear respected Members,

I am participating in a competition in my organization where we have to choose a stock and provide case study. We are given 3 companies from 3 different sectors (1. Cement company 2. Engineering company and a 3) finance company). Could you please advise which sector I should pick up to choose my company? On the basis of sector's future outlook, I will then pick up a company out of 3 given to us and build my case study further on that company. Please provide your views.

Regards,
Dinesh

 

[mvkarthik]

1 finance company
2 Engineering company
3 Cement company:thumb::thumb:

 

[dinesh_151]

1 finance company
2 Engineering company
3 Cement company:thumb::thumb:

Dear Karthik,

Thanks for your quick response I also had the same view but that was more of a gut feeling. I did not have anything to support my gut and choice.

Could you please throw some light also why you have put the sectors in that order? It will help me to provide support commentary to provide a reason why have I preferred a particular sector above another.

Regards,
Dinesh

 

[mvkarthik]

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[muthutrader]

how to determine discount rate for DCF?

thanks

 

[manowar]

how to determine discount rate for DCF?

thanks

It is the rate of required return or the cost of equity (assuming that you are discounting the FCFE)