Fact Finder, The 🇮🇳 Profile picture
Oct 21, 2022 9 tweets 8 min read Read on X
#MustRead #NIFTY #CostOfCapital
How Does #Rising #InterestRates/ #CostOfCapital/#DiscountingRate Impact Stock #Valuations. A STUDY of large Cap INDIAN Stocks
A long THEAD, pls stay with me...Exercise Shows a #StockWise Impact of Higher Discounting Rates & Implied Long Term Growth
Exercise based on Div Discounting Model (DDM) for Current GSEC vs 8.5% GSEC (Every Justification for it to be 9%).
Starting with #Reliance
Tab 1: Stk px implies 14% CAGR LT Growth (8yr + 8yr) @ 7.45% GSEC
Tab 2: Same Growth (14% CAGR) @ 8.55% GSEC
=>18% Lower Fair Value(Rs2062)
Higher Global Interest Rates to counter Inflation => lower Growth. Past 11yrs, High Growth & Low Interest Rate Environment, RIL growth: Revenues ($ linked) at 9.2% CAGR & EPS at 9% CAGR over FY11-22... So Assuming EPS growth @ 14% CAGR in prev tweet is AGGRESSIVE
Same Exercise, with 8.55% GSEC & say 12% LT Growth rate => 28% Lower Fair Value of Rs1791

Separately Reliance has been portrayed as India's Alibaba or Tencent or a combo. See how their Valuations have crashed (Premium to Discount) despite higher ROEs.
#TCS: Exercise using Div Discounting Model (DDM) for Current GSEC vs 100bps higher (8.55%) GSEC (Every Justification for it to be 9%).
Tab 1: Stk px implies 13.7% CAGR LT Growth (10yr + 8yr) @ 7.45% GSEC
Tab 2: Same Growth (12% CAGR) @ 8.55% GSEC
=>20% Lower Fair Value (Rs2519)
#INFY: Exercise using Div Discounting Model (DDM) for Current GSEC vs 100bps higher (8.55%) GSEC (Every Justification for it to be 9%).
Tab 1: Stk px implies 13.5% CAGR LT Growth (10yr + 8yr) @ 7.45% GSEC
Tab 2: Same Growth (13.5% CAGR), 8.55% GSEC
=>18% Lower Fair Val (Rs1228)
Accenture (22.7x Fwd PE) has Grown 2x the Revenue Growth rate of TCS (25.4x Fwd) & INFY (23.7x) with best Margin Stability.
Until Dec-21 Correction of ACN commenced, its PE traded at a premium to TCS/INFY. Now its at a discount. Either ACN Rallies or TCS/INFY de-rate Further.
#AsianPaints: Div Discounting Model (DDM) for Current GSEC vs 100bps higher (8.55%) GSEC (Every Justification for it to be 9%).
Tab 1: Stk px implies 21.5% CAGR LT Growth (10yr + 10yr) @ 7.45% GSEC
Tab 2: Same Growth (21.5% CAGR) @ 8.55% GSEC
=>26% Lower Value (Rs2274)
Continuing on #AsianPaints. Its Long Term Rev & EPS growth is 12% and 11.7% Respectively. Assuming generous 15% Long Term Growth (10yrs + 10yrs) at 8.55% GSEC, its fair value can be Rs1201/sh (or 61% lower). RECALL, there is NO assumption here of Market Share loss to new Entrants

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More from @TheFactFindr

Jul 4
FACT CHECKING INDIAN ARMY …. On the #AgniveerScheme #Agnipath #Agniveers

A THREAD 🧵
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INDIAN ARMY is making it sound that they paid 98.39 lakhs

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Let’s Check the Facts …. GOVT till date has ONLY paid Rs39,000 … Rest is all INSURANCE Image
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12 other key take always below Image
2. Modi's image is not the marketing USP anymore. ✅
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People are asking WHY DID #INR to fall so sharply on FRIDAY to 83.64/USD?

A quick 🧵 explaining why …#RBI Image
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Oct 1, 2023
#NRI #Remittances will not only #COLLAPSE but they could reverse

A quick thread with implications for the #INR Image
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Today the US Rates are
1) 4.7% on the US 10yr
2) Investment Grade US bonds offer $6.5%
3) MBS Securities offer $7% at-least
4) US High Yield Bonds are offering $8-9% pa

Compared to that FCNR deposits are at just 5.5-5.8%
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May 29, 2023
#Genius #MasterStroke 81,000 Cr LOSS/yr

CANNOT MAKE THIS SHIT UP!

Govt Introduces a #POLICY estm to SAVE Rs 36,000 Cr/Yr in #Forex

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#Thread on A #MasterStroke
#Modinomics decided in 2020/21 to Introduce the 20% #Ethanol Blending (Petrol) Policy.

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Link to the document niti.gov.in/sites/default/… Image
BUT AT WHAT COST ?

FIRST: Every litre of Ethanol, Govt India will lose Rs15-20 in Tax Collections since:
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👉Cost of Procurement of ETHANOL is Rs65/Lt

👉Difference is Rs20/lt is LOSS IN TAX REVENUE

1020cr Ethanol = 20400cr in Tax Losses/Yr ImageImage
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#SHOCKING #CRICKET

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Has NOT PUBLISHED its #ANNUAL #REPORT post FY17.

BUT that is NOT the Shocking Part, Read the #Thread

#CRICKET is a #RELIGION in India & #TRANSPARENCY should be Foremost Image
As per the FY17 Annual Report, @BCCI paid an INTEREST Cost of Rs115 Cr (400% YoY) while it’s INTEREST Income of Rs171 Cr (Fell 2% YoY).

BUT WHY were they paying 171Cr of Interest Costs when they had a CASH BALANCE of 3770 Cr (3560 Cr in FY16) ? ImageImage
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