I came across stock chart of TVS Motor Co.
Stock grew from 33 odd levels to 555 in last 5 years… whooping 1500%+ returns
Now I tried analysing it fundamentally as most people may to find the secret of such a phenomenal rise !!
So I checked balance sheets … only last 5 years (Data only till 2016 i supppose)
Does any fundamental analyst find anything really very noteworthy or if I have missed any point ?
Also I looked into their cash flows (as cash matters the most for me )
I noticed that in 5 years from 2012 to 2016, company had negative net cash flow , operating profit being almost double is only something to cheer about
So, after seeing all this, really curious to find out what has taken this stock so high… Pros say stock price follows fundamentals… but where are they… If some one can better analyse and reply, I shall really start believing in fundamentals…
Same case more or less goes with ‘Eicher Motors’ wud analyse in next post maybe…
Awaiting any meaningful explanation for TVS story… Thanx
You have to see cash flow from Operations. Net cash flow will not tell any thing. If company parks all the money in investment then net cash flow will be always negative.
It is very expensive stock. P/E is 51. but debt is very less. Debt equity Ratio is only 0.45. Less debt shows that the growth of company is from cash flow generated not due to investment or debt.
This shows good discipline in management.
If you look at EBITDA growth of 25.8% is always very good. EPS growth is at 24.2%. It means company is able to maintain the growth momentum consistently.
If you want to invest look at Debt/ Equity ratio. Less than 1 is good.
A company with bad management.
At a time when world is moving away from Coal this group is investing heavily in Australia Coal Mines.
I request you watch the video by Zerodha - “Stock picking techniques - Insights from cash flow statements with Karthik Rangappa” available in YouTube. That’s fantastic video for newbies like us to better understand the cash flow statement and exactly what it tells us about the management(‘Insight’). Also agrees with haribabu, in fundamental analysis numbers can be misleading sometimes but try to interact with the numbers and try to talk with them they will reveal lots of inner information about the company (learned from Mr. Anil Lamba’s book “Romancing the balance sheet”).
Good arguments… But I think there r several cos… having better fundas than tvs but not been mkt fav… Shall try getting these unfortunate ones… Then lets see if one of these cud b next potential multibagger
Amararaja Batteries is one such company with good Fundamentals.No Debt. but it is trading in a range.
Hi can you please tell which application you are using to get the information. With screenshot you attached
@ hari… U use stockedge app… Kindly correct if not right
Yes I’m using stockedge for EOD analysis. Also for upcoming events, dividend ex dates.