Fundamental Analysis & Valuation
6 terms
Relative Valuation
Fundamental Analysis & Valuation
₹ crore
Valuing a company by comparing its multiples with those of similar companies or with its own history.
Implied Value = Peer Group Median Multiple x Company's Corresponding Financial Metric
Return on Assets
Fundamental Analysis & Valuation
%
Net profit as a percentage of total assets, measuring how much profit the asset base generates regardless of funding.
ROA = Net Profit / Average Total Assets x 100
Return on Capital Employed
Fundamental Analysis & Valuation
%
Operating profit as a percentage of the total capital, both equity and debt, used to generate it.
ROCE = Operating Profit (EBIT) / (Shareholders' Equity + Total Debt) x 100
Return on Equity
Fundamental Analysis & Valuation
%
Net profit expressed as a percentage of shareholders' equity, measuring what the business earns on the owners' capital.
ROE = Net Profit Attributable to Shareholders / Average Shareholders' Equity x 100
Return on Invested Capital
Fundamental Analysis & Valuation
%
After-tax operating profit as a percentage of the capital actually invested in operations, excluding surplus cash.
ROIC = Net Operating Profit After Tax / (Total Debt + Equity - Cash) x 100
Revenue Growth
Fundamental Analysis & Valuation
%
The rate at which a company's sales increase from one period to the next.
Revenue Growth = (Current Period Revenue - Prior Period Revenue) / Prior Period Revenue x 100