Investing

The young child begged constantly for a new toy. His mother informed him that she lacked the funds to make the purchase. He argued, “But you can swipe your card.” She questioned, “Who pays the credit card bills?” He said, “The bank always has money to pay all bills. Many parents struggle with the difficulty of teaching their kids about money. The main takeaway is that resources are few, especially money. Children are unable to understand how a household can run out of money because they have only seen a small number of financial transactions.

We came up with a strategy many years ago when our kids were still little, and it was quite successful. We gave the youngster the opportunity to participate in planning an event with a designated budget and gave them the freedom to make choices. As an illustration, we provided a budget for a birthday celebration. After acknowledging that the budget would not be altered, the youngster could arrange every last detail. The thought of making decisions and in charge of a significant event was appealing to children.

The lessons were priceless. They had to make decisions on each one when choosing their attire, treats like cakes and chocolates, and decorations. Although the child was aware of every move, we as parents nevertheless swiped the card. While begging mama to bake a cake and prepare some goodies, money was saved on packaged meals. Buying another shoe meant less money for the party, or spending on decor meant less money for return gifts. Kids were able to understand how to budget their money and why they couldn’t have it all.

The lesson they learned—and continue to learn—is that having more money does not make the problem go away. It’s important to learn that lesson in life. Even with a sizable budget, choices had to be made over whether to take friends to the movies or a theme park. The kids had to make these decisions, per our insistence. It was intriguing to see how they thought about spending money on both themselves and others, on things versus experiences, on fleeting joys or permanent gifts. They acquired knowledge and progressed into manufacturing.

Soon, this game started to include other family activities like dining out, vacations, and so on. The kids immediately surprised and delighted us by opting to walk all day and eat a packed lunch from home rather than watch films or eat out. When it came to money, they made a decision based on what they felt would be entertaining. As soon as we started traveling, we started renting bikes instead of going on tours, making lavish brunches at home rather than going out to eat, and purchasing museum admission tickets.

Money matters: Parents, teach these 7 important money lessons to your child!

1. Teach your child to save money

Teaching your child the value of money—and, more crucially, the fact that money doesn’t sprout on trees—is one of the most crucial components of parenting. Parents are exclusively responsible for teaching their children about money because neither our schools nor, for that matter, colleges, truly teach much about saving.Soon, this game started to include other family activities like dining out, vacations, and so on. The kids immediately surprised and delighted us by opting to walk all day and eat a packed lunch from home rather than watch films or eat out. When it came to money, they made a decision based on what they felt would be entertaining. Soon, we began providing bicycle rentals at our vacation spots.

2. Do you save money?

When it comes to spending and conserving money responsibly, you have a responsibility as parents to lead by example. This is particularly crucial if you yourself are struggling with a crippling mortgage, car loan, or even credit card debt and don’t want your children to make the same mistakes you made.Teaching your child the value of money—and, more crucially, the fact that money doesn’t sprout on trees—is one of the most crucial components of parenting. Parents are exclusively responsible for teaching their children about money because neither our schools nor, for that matter, colleges, truly teach much about saving.This game soon spread to other family activities like dining out, vacationing, and so on.

3.​Start saving yourself

It’s never truly too late to begin living by your principles. Simply put, you must practise what you preach if you expect your children to recognise the worth of money and only spend it as required. This is crucial because children react to your actions, not to your words.When it comes to spending and conserving money responsibly, you have a responsibility as parents to lead by example. This is particularly crucial if you yourself are struggling with a crippling mortgage, car loan, or even credit card debt and don’t want your children to make the same mistakes you made.Teaching your child the value of money and, more significantly, how to manage it is one of the most crucial components of parenting.

4.Teach them the concept of savings

The simplest way to teach children the value of saving is to keep two separate jars, one for saves and the other for expenses. As a result, encourage your youngster to split all money received from birthdays, finishing chores, or visiting relatives equally between the two jars.
Starting to live what you preach is never really too late. Put another way, the simplest method to teach the value of saving is to keep two separate jars, one for savings and the other for spending. As a result, encourage your youngster to split all money received from birthdays, finishing chores, or visiting relatives equally between the two jars.

5.Teach them how to stick to the budget

When you give your child their monthly allowance, educate them how to budget it so that it lasts the entire month. If they waste their allowance without making a budget for the following days, resist the desire to give them more money.The simplest technique to teach children the value of saving is to keep two separate jars with the labels “savings” and “spending,” respectively. As a result, encourage your child to split any money they receive evenly between the two jars when they receive it for their birthday, for completing chores, or from visiting relatives.
It’s never truly too late to begin living by your principles. To put it simply, if you wish to convey the significance .

6.Make them save for something they REALLY want

You need to encourage your child to save for things they really want, whether it’s the newest game or the action figure they’ve been hankering after for days. By doing this, you are actually teaching children the value of waiting to make a large purchase. They will get the ability to control their impulses later in life if they do this.When you give your child their monthly allowance, educate them how to budget it so that it lasts the entire month. If they waste their allowance without making a budget for the following days, resist the desire to give them more money.The simplest approach to teach people the value of conserving money.

7.Teach them to track their spendings

To help people learn how to save money, it’s also crucial to teach them how to track their spending in writing. Give them a finance journal and instruct them to record their spending. Encourage kids to save bills and receipts as well so that they may cross-check later.You need to encourage your child to save for things they really want, whether it’s the newest game or the action figure they’ve been hankering after for days. By doing this, you are actually teaching children the value of waiting to make a large purchase. They will get the ability to control their impulses later in life if they do this.When you give your child their monthly allowance, educate them how to manage it.

What Is a Blockchain?

A blockchain is a shared distributed database or ledger between computer network nodes. A blockchain serves as an electronic database for storing data in digital form. The most well-known use of blockchain technology is for preserving a secure and decentralised record of transactions in cryptocurrency systems like Bitcoin.

The way the data is organised in a blockchain differs significantly from how it is typically organised. In a blockchain, data is gathered in groups called blocks that each include sets of data. Every additional piece of information that comes after that newly added block is combined into a brand-new block, which is then added to the chain once it is full.

KEY TAKEAWAYS

• A blockchain is a particular kind of shared database that varies from other databases in that it saves data in blocks that are subsequently connected via cryptography.
• A new block is created as each new piece of data arrives. The data is chained together in chronological sequence once the block has been filled with information and is attached to the block before it.
• Blockchain is utilised in the context of Bitcoin in a decentralised manner, ensuring that no one user or group has power but rather that all users collectively maintain control.

How Does a Blockchain Work?

Blockchain aims to make it possible to share and record digital information without editing it. A blockchain serves as the basis for immutable ledgers, or records of transactions that cannot be changed, removed, or destroyed.

The blockchain concept was first put up as a research project in 1991, long before Bitcoin, which was introduced in 2009.

Transaction Process

Attributes of Cryptocurrency

Blockchain Decentralization

Consider a business with a server farm of 10,000 machines that it uses to keep a database with all of its clients’ account information. All of these computers are located in a warehouse that belongs to this corporation, and it has complete authority over each of them as well as the data they hold. But this creates a single point of failure.

This approach aids in creating a clear and precise sequence of events. This prevents any one node in the network from changing the data it contains.

Transparency

Because of the decentralized nature of Bitcoin’s blockchain, all transactions can be transparently viewed by either having a personal node or using blockchain explorers that allow anyone to see transactions occurring live.

As an illustration, exchanges have previously been hacked, and anyone who had Bitcoin stored there lost everything. The stolen Bitcoins are clearly identifiable, despite the hacker’s complete anonymity.

Naturally, the data kept on the Bitcoin blockchain (as well as the majority of others) is encrypted.

Is Blockchain Secure?

Decentralized security and trust are made possible by blockchain technology in a number of ways. To start, new blocks are always chronologically and linearly stored. In other words, they are constantly added to the blockchain’s “end.” It is very difficult to go back and change the contents of a block once it has been added to the blockchain unless a majority of the network has agreed to do so.

When everyone compares their copies to one another, they will notice that this one copy stands out, and the hacker’s version of the chain will be rejected as fraudulent.

The requirement to rewrite every block because their timestamps and hash codes had changed would make such an attack extremely expensive and resource-intensive.

Bitcoin vs. Blockchain

Stuart Haber and W. Scott Stornetta, two researchers interested in implementing a system where document timestamps could not be altered, first proposed the concept of blockchain technology in 1991.

On a blockchain, the Bitcoin protocol is constructed. Bitcoin’s anonymous founder, Satoshi Nakamoto, described the digital currency as “a new electronic cash system that’s fully peer-to-peer, with no trusted third party” in a research paper introducing it.

This could take the shape of transactions, votes in elections, goods inventories, state identifications, deeds to properties, and much more, as was previously said.

Blockchain vs. Banks

Blockchain technology has been hailed as a disruptive force for the financial industry, particularly for the payment and banking processes. Banks and decentralised blockchains, however, are very dissimilar.

How Are Blockchains Used?

More than 10,000 additional cryptocurrency systems are currently active on the blockchain. However, it transpires that using a blockchain to store information about other kinds of transactions is also a secure method.

Walmart, Pfizer, AIG, Siemens, Unilever, and numerous more businesses are just a few that have already adopted blockchain technology.

Banking and Finance

Due to the enormous volume of transactions that banks must settle, even if you do make your deposit within business hours, it may still take one to three days for the transaction to be verified. Blockchain, however, is always active.

Given the scale of the amounts involved, even a little period of time during which the money is in transit can be extremely expensive and risky for banks.

In trading on Thursday, shares of Apollo Hospitals Enterprise Ltd. increased 0.2% to Rs 4210. During the session, it reached a high of Rs 4224 and a low of Rs 4183.05.

The stock’s 200-DMA was at Rs. 4340.61 on the technical indicators, and its 50-DMA was at Rs. 4352.98. A stock is typically in an upward pattern if it trades above both its 50-DMA and 200-DMA. On the other hand, a company is said to be in a bearish trend if it trades between its 50-DMA and 200-DMA, and vice versa.The moving average convergence divergence, or MACD, momentum indicator’s signal line was broken by the company, indicating a bearish bias for the stock. When it comes to traded securities or indices, the MACD is renowned for predicting pattern reversals. The disparity between the 12-day and 26-day exponential moving averages is what determines price. The signal line, a nine-day exponential moving average, is drawn over the MACD to represent “buy” or “sell” chances.

Let us look at the Fundamentals

Profit & Loss

Consolidated Figures in Rs. Crores / View StandalonePRODUCT SEGMENTS

	Mar 2011	Mar 2012	Mar 2013	Mar 2014	Mar 2015	Mar 2016	Mar 2017	Mar 2018	Mar 2019	Mar 2020	Mar 2021	Mar 2022	TTM
Sales +	2,605	3,148	3,769	4,357	5,129	6,150	7,256	8,243	9,617	11,247	10,560	14,663	15,857
Expenses +	2,183	2,631	3,157	3,681	4,392	5,465	6,522	7,442	8,548	9,656	9,420	12,474	13,879
Operating Profit	422	517	612	676	737	684	734	801	1,070	1,591	1,140	2,189	1,978
OPM %	16%	16%	16%	16%	14%	11%	10%	10%	11%	14%	11%	15%	12%
Other Income +	12	22	33	18	47	92	60	24	26	222	103	368	108
Interest	78	89	103	119	118	180	257	295	327	533	449	379	380
Depreciation	95	124	142	168	212	264	314	359	396	620	573	601	623
Profit before tax	261	326	399	407	455	332	222	171	373	660	221	1,578	1,083
Tax %	33%	35%	26%	25%	29%	29%	41%	65%	47%	34%	38%	30%
Net Profit	182	218	303	315	335	235	131	60	200	432	137	1,108	796
EPS in Rs	14.75	16.31	21.88	22.77	24.43	16.99	15.88	8.44	16.96	32.70	10.46	73.42	53.18
Dividend Payout %	25%	25%	25%	25%	24%	35%	38%	59%	35%	18%	29%	16%

Compounded Sales Growth
10 Years:	17%
5 Years:	15%
3 Years:	15%
TTM:	13%

Compounded Profit Growth
10 Years:	14%
5 Years:	45%
3 Years:	62%
TTM:	-13%

Stock Price CAGR
10 Years:	18%
5 Years:	31%
3 Years:	52%
1 Year:	-7%

Return on Equity
10 Years:	8%
5 Years:	8%
3 Years:	10%
Last Year:	17%

Balance Sheet

Consolidated Figures in Rs. Crores / View StandaloneCORPORATE ACTIONS

	Mar 2011	Mar 2012	Mar 2013	Mar 2014	Mar 2015	Mar 2016	Mar 2017	Mar 2018	Mar 2019	Mar 2020	Mar 2021	Mar 2022	Sep 2022
Share Capital +	62	67	70	70	70	70	70	70	70	70	72	72	72
Reserves	1,768	2,401	2,677	2,907	3,102	3,262	3,244	3,182	3,264	3,270	4,531	5,551	5,921
Borrowings +	957	817	1,213	1,344	1,992	2,834	3,125	3,427	3,673	3,596	4,160	4,068	3,998
Other Liabilities +	815	698	854	1,029	1,296	1,195	1,665	1,917	2,159	4,354	2,629	3,493	3,984
Total Liabilities	3,602	3,983	4,814	5,350	6,459	7,360	8,103	8,596	9,166	11,289	11,392	13,184	13,975
Fixed Assets +	1,530	2,011	2,341	2,681	3,244	3,997	4,591	4,773	4,982	7,432	6,778	8,269	8,256
CWIP	361	209	403	491	533	562	347	712	822	236	234	46	548
Investments	502	564	527	322	311	352	406	352	462	434	1,343	780	631
Other Assets +	1,210	1,198	1,543	1,855	2,372	2,448	2,759	2,759	2,901	3,187	3,037	4,090	4,540
Total Assets	3,602	3,983	4,814	5,350	6,459	7,360	8,103	8,596	9,166	11,289	11,392	13,184	13,975

As of 10:15AM on Thursday, shares of Godrej Properties Ltd. were up 1.89 percent to Rs 1075.7. (IST). During the period, the stock’s price ranged between Rs 1053.0 and Rs 1078.7.

The stock’s return on equity (ROE) was 4.06 percent. Around 10:15 AM, there were 1015 shares traded on the counter, with a transaction of Rs 0.99 crore. Godrej Properties Ltd.’s shares recently traded at a 52-week high of Rs. 1704.9 and a 52-week low of Rs. 1005.7.

Developer/FII Holding
Promoters owned 58.42% of the business as of December 31, 2022, while foreign investors owned 27.31% and domestic institutional investors owned 2.61%.

Primary Financials
The company reported consolidated sales of Rs 404.58 crore for the quarter that ended on Dec. 31, 2022, an increase of 9.58% from the previous quarter’s Rs 369.2 crore and 13.35% from the same quarter a year earlier. Net income after taxes for the most recent quarter.

Let us look at the Fundamentals

Profit & Loss

Consolidated Figures in Rs. Crores / View Standalone

	Mar 2011	Mar 2012	Mar 2013	Mar 2014	Mar 2015	Mar 2016	Mar 2017	Mar 2018	Mar 2019	Mar 2020	Mar 2021	Mar 2022	TTM
Sales +	452	770	1,037	1,179	1,843	2,123	1,583	1,604	2,817	2,441	765	1,825	1,937
Expenses +	346	650	751	897	1,586	1,986	1,330	1,819	2,639	2,181	1,214	1,880	1,956
Operating Profit	105	120	286	283	257	137	253	-216	178	260	-449	-56	-19
OPM %	23%	16%	28%	24%	14%	6%	16%	-13%	6%	11%	-59%	-3%	-1%
Other Income +	107	88	10	75	83	146	150	499	419	473	568	761	786
Interest	4	5	3	4	5	41	104	150	234	220	185	167	164
Depreciation	4	4	4	6	10	14	14	16	14	21	20	21	23
Profit before tax	204	199	289	347	326	228	284	117	348	493	-86	516	580
Tax %	30%	35%	32%	32%	28%	30%	27%	26%	27%	44%	-121%	32%
Net Profit	143	129	197	236	236	160	207	87	253	274	-189	351	425
EPS in Rs	7.34	4.92	6.95	8.00	9.58	7.33	9.56	4.01	11.04	10.73	-6.81	12.68	15.10
Dividend Payout %	24%	24%	23%	25%	21%	0%	0%	0%	0%	0%	0%	0%

Compounded Sales Growth
10 Years:	9%
5 Years:	3%
3 Years:	-13%
TTM:	109%

Compounded Profit Growth
10 Years:	15%
5 Years:	11%
3 Years:	15%
TTM:	514%

Stock Price CAGR
10 Years:	16%
5 Years:	8%
3 Years:	20%
1 Year:	-37%

Return on Equity
10 Years:	4%
5 Years:	2%
3 Years:	2%
Last Year:	4%

Balance Sheet

Consolidated Figures in Rs. Crores / View StandaloneCORPORATE ACTIONS

	Mar 2011	Mar 2012	Mar 2013	Mar 2014	Mar 2015	Mar 2016	Mar 2017	Mar 2018	Mar 2019	Mar 2020	Mar 2021	Mar 2022	Sep 2022
Share Capital +	70	78	78	99	100	108	108	108	115	126	139	139	139
Reserves	842	1,365	1,351	1,694	1,747	1,657	1,896	1,102	2,354	4,682	8,181	8,536	8,639
Borrowings +	945	2,087	1,678	2,574	3,486	3,123	3,980	3,703	3,516	3,715	4,593	5,196	5,382
Other Liabilities +	361	1,179	1,572	1,779	2,030	1,691	1,197	3,358	2,107	1,567	3,333	3,932	4,885
Total Liabilities	2,218	4,709	4,679	6,147	7,363	6,578	7,181	8,271	8,092	10,090	16,245	17,804	19,045
Fixed Assets +	46	46	51	64	117	107	102	113	97	113	174	183	188
CWIP	1	19	36	62	73	1	0	71	100	163	229	340	428
Investments	0	0	0	0	0	664	760	1,454	2,637	3,571	5,243	4,883	4,489
Other Assets +	2,170	4,644	4,593	6,021	7,173	5,807	6,319	6,633	5,259	6,243	10,599	12,397	13,940
Total Assets	2,218	4,709	4,679	6,147	7,363	6,578	7,181	8,271	8,092	10,090	16,245	17,804	19,045

The shares of Dhani Services Ltd, formerly known as Indiabulls Ventures Ltd, surged in late-day trade on Monday, continuing their fourth consecutive session of recovery. Sameer Gehlaut will become the company’s non-executive chairman as of March 31, 2023, according to a statement made by the business in an exchange filing. our experts expect a retest at Rs30 then a bull rally in Dhani stock.

Let us look at the Fundamentals

Profit & Loss

Consolidated Figures in Rs. Crores / View StandalonePRODUCT SEGMENTS

	Mar 2011	Mar 2012	Mar 2013	Mar 2014	Mar 2015	Mar 2016	Mar 2017	Mar 2018	Mar 2019	Mar 2020	Mar 2021	Mar 2022	TTM
Sales +	364	195	191	284	398	397	413	980	1,993	2,915	1,347	1,434	830
Expenses +	246	164	122	119	140	162	201	478	750	1,952	963	1,986	1,157
Operating Profit	118	31	69	165	258	236	213	502	1,243	963	384	-551	-327
OPM %	32%	16%	36%	58%	65%	59%	51%	51%	62%	33%	29%	-38%	-39%
Other Income +	-3	2	7	18	10	12	96	15	4	4	9	29	118
Interest	40	28	8	24	61	148	139	224	591	824	518	284	198
Depreciation	18	12	8	5	13	23	24	12	27	116	84	95	101
Profit before tax	57	-7	61	154	194	77	146	281	629	27	-209	-901	-508
Tax %	33%	-48%	-4%	34%	22%	4%	30%	25%	27%	-55%	-10%	4%
Net Profit	38	-10	63	102	151	74	102	210	460	42	-230	-860	-528
EPS in Rs	1.38	-0.37	2.31	3.70	4.86	2.12	2.69	3.99	7.59	0.09	-4.27	-14.42	-8.84
Dividend Payout %	61%	0%	110%	18%	52%	119%	31%	22%	15%	3,836%	0%	0%

Compounded Sales Growth
10 Years:	22%
5 Years:	28%
3 Years:	-10%
TTM:	-39%

Compounded Profit Growth
10 Years:	%
5 Years:	%
3 Years:	%
TTM:	33%

Stock Price CAGR
10 Years:	13%
5 Years:	-34%
3 Years:	-30%
1 Year:	-51%

Return on Equity
10 Years:	0%
5 Years:	-2%
3 Years:	-7%
Last Year:	-17%

Balance Sheet

Consolidated Figures in Rs. Crores / View StandaloneCORPORATE ACTIONS

	Mar 2011	Mar 2012	Mar 2013	Mar 2014	Mar 2015	Mar 2016	Mar 2017	Mar 2018	Mar 2019	Mar 2020	Mar 2021	Mar 2022	Sep 2022
Share Capital +	46	46	46	46	52	59	64	93	113	102	115	121	121
Reserves	198	188	171	171	268	273	385	1,806	6,312	4,925	5,068	4,942	3,971
Borrowings +	198	37	137	368	1,690	2,193	1,519	4,929	8,648	5,410	3,739	2,482	1,369
Other Liabilities +	288	243	191	232	415	196	247	930	942	1,129	1,200	1,079	857
Total Liabilities	730	514	546	818	2,425	2,720	2,215	7,758	16,015	11,566	10,121	8,624	6,318
Fixed Assets +	50	39	32	34	664	660	86	66	118	755	409	537	457
CWIP	0	0	1	0	11	36	8	5	9	6	6	7	0
Investments	48	83	43	32	69	0	163	499	638	634	1,420	588	380
Other Assets +	633	392	470	751	1,680	2,023	1,959	7,188	15,250	10,171	8,286	7,492	5,481
Total Assets	730	514	546	818	2,425	2,720	2,215	7,758	16,015	11,566	10,121	8,624	6,318

A mid-cap business in the chemical sector, GHCL Ltd. has a market value of Rs. 6,071.13 crore. Soda ash (anhydrous sodium carbonate) and sodium bicarbonate (baking soda), two crucial raw materials for the glass and ceramics industries, are manufactured by the chemical company. To supply the raw materials needed to produce soda ash, GHCL also runs lignite mines in the Khadsaliya district of Gujarat. Another product that GHCL produces at a capacity of about 65,000 MTPA is sodium bicarbonate, a vital raw material for industries like baking, medicines, the production of fire extinguishers, cleaning products, etc.

Let us look at the fundamentals

Profit & Loss

Consolidated Figures in Rs. Crores / View StandalonePRODUCT SEGMENTS

	Mar 2011	Mar 2012	Mar 2013	Mar 2014	Mar 2015	Mar 2016	Mar 2017	Mar 2018	Mar 2019	Mar 2020	Mar 2021	Mar 2022	TTM
Sales +	1,568	1,958	2,254	2,201	2,356	2,531	2,784	2,919	3,341	3,305	2,491	3,778	5,301
Expenses +	1,305	1,602	1,847	1,767	1,828	1,901	2,103	2,313	2,582	2,576	1,886	2,797	3,673
Operating Profit	263	356	407	434	528	629	681	607	759	729	605	982	1,628
OPM %	17%	18%	18%	20%	22%	25%	24%	21%	23%	22%	24%	26%	31%
Other Income +	20	9	-50	-26	-15	-3	37	38	16	16	18	58	96
Interest	152	213	179	183	171	165	137	127	127	120	74	64	52
Depreciation	100	106	82	82	85	82	86	110	117	131	111	117	123
Profit before tax	31	46	96	143	257	380	495	407	531	495	437	859	1,549
Tax %	131%	3%	26%	24%	29%	32%	23%	13%	34%	20%	25%	25%
Net Profit	-10	44	71	109	182	258	380	356	351	397	326	647	1,170
EPS in Rs	-0.96	4.45	7.14	10.85	18.19	25.77	38.04	36.58	35.76	41.74	34.32	67.82	122.44
Dividend Payout %	-209%	45%	28%	18%	12%	0%	13%	14%	14%	7%	16%	0%

Compounded Sales Growth
10 Years:	7%
5 Years:	6%
3 Years:	4%
TTM:	64%

Compounded Profit Growth
10 Years:	32%
5 Years:	11%
3 Years:	23%
TTM:	144%

Stock Price CAGR
10 Years:	31%
5 Years:	14%
3 Years:	79%
1 Year:	-2%

Return on Equity
10 Years:	22%
5 Years:	20%
3 Years:	19%
Last Year:	23%

Balance Sheet

Consolidated Figures in Rs. Crores / View StandaloneCORPORATE ACTIONS

	Mar 2011	Mar 2012	Mar 2013	Mar 2014	Mar 2015	Mar 2016	Mar 2017	Mar 2018	Mar 2019	Mar 2020	Mar 2021	Mar 2022	Sep 2022
Share Capital +	100	100	100	100	100	100	99	97	98	95	95	95	96
Reserves	445	382	467	487	670	936	1,247	1,513	1,827	2,054	2,389	2,990	3,502
Borrowings +	1,915	1,795	1,558	1,486	1,324	1,365	1,463	1,322	1,302	1,254	782	788	509
Other Liabilities +	599	689	755	941	758	548	694	695	767	766	712	1,122	703
Total Liabilities	3,060	2,967	2,880	3,014	2,851	2,949	3,504	3,628	3,995	4,169	3,978	4,995	4,810
Fixed Assets +	2,170	2,067	1,875	1,869	1,934	2,049	2,410	2,502	2,591	2,664	2,675	2,474	2,528
CWIP	19	40	32	12	7	37	26	74	117	122	81	213	273
Investments	5	9	5	7	2	15	9	10	12	9	15	17	182
Other Assets +	865	850	967	1,125	909	848	1,059	1,043	1,275	1,375	1,207	2,292	1,827
Total Assets	3,060	2,967	2,880	3,014	2,851	2,949	3,504	3,628	3,995	4,169	3,978	4,995	4,810

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Please seek the advice of a licenced financial adviser if you are unsure if investing is appropriate for you or which investments are suitable for you.

Any conversation about purchasing shares will eventually bring up the price-to-earnings ratio, or P/E ratio. Therefore, what is it and what can it tell us about certain shares, their rivals, and the markets they operate in?

Keep in mind that you run the risk of losing money when you invest. Investment returns can be both positive and negative, and you could not get your money back. You should get financial counsel if you are unclear of the best decision for your specific situation.

What is a P/E ratio?

The P/E ratio is derived by dividing a company’s share price by its profits (net profit) per share. (EPS).

It quantifies the premium that investors are prepared to pay over a company’s present earnings, which reflects the premium that investors are willing to pay over a company’s expected future earnings growth.

Technology companies, meanwhile, have faced major valuation downgrades as US stock markets reach bear market territory, with Tesla currently trading on a P/E ratio of 54. The parent company of Facebook, Meta, too had a similar fate, with its P/E ratio falling from 18 to 9 last year.

Delving deeper

There are two distinct P/E ratio types:

• The “trailing” or “historic” P/E ratio is based on actual EPS for the previous financial year or the previous twelve months (also known as trailing 12 month earnings).
• The predicted EPS for the following fiscal year supplied by the company and/or analysts form the basis of the forward P/E ratio.

Or, to put it another way, it would require investors to generate enough money over the course of five years to recoup their initial investment. Investor expectations for minimal earnings growth are implied by this.

A low P/E ratio may signify that investors think there is a high danger that the company won’t reach profits projections. P/E ratios may represent investors’ perceptions of the risk associated with investing in the company.

How to use P/E ratios to value shares

A P/E ratio is relative, which means that it is only useful when compared to the company’s (publicly listed) rivals and the larger stock market.

Let’s examine the various P/E ratios for “growth” and “value” stocks.

1. What are typical P/E ratios for growth shares?

Investors are willing to pay a premium price for these shares in relation to their existing earnings because they anticipate a strong rate of earnings growth.

Four of the biggest US technology businesses currently have the following trailing P/E ratios:

Share/index	P/E ratio	Forecast EPS growth (per annum)
Netflix	31	22%
Apple	27	6%
Meta (Facebook)	24	19%
Alphabet	23	20%
Nasdaq 100	25	n/a

With a P/E ratio of 31, Netflix has the highest ratio among the firms in this group and the Nasdaq 100. However, although selling on significantly lower P/E ratios than Meta and Alphabet, its projected earnings growth is comparable to those companies’.

The company’s EPS also decreased by more than 11% in 2022, which raises the historic P/E ratio; however, the forecasted profits recovery will result in a decline in the forward P/E ratio, lowering it.

The company’s share price and, consequently, the P/E ratio have suffered because its earnings were below forecasts and because of worries about macroeconomic headwinds.

2. What are typical P/E ratios for ‘value’ shares?

In contrast to the growth shares that predominate on the Nasdaq, the FTSE has a higher percentage of value shares. Many of the FTSE firms work in established sectors including mining, energy, finance, and industrial items.

Observe the trailing P/E ratios of a few FTSE 100 companies:

Share/index	P/E ratio	Forecast EPS growth (per annum)
Tesco	21	5%
Sainsbury’s	11	-1%
HSBC	9	22%
NatWest	8	10%
FTSE 100	14	n/a

There is less of an association between the P/E ratio and earnings growth, despite expected earnings growth being marginally lower than the group of four US equities we examined.

The high dividend yield of these FTSE businesses, which ranges from 4 to 5%, is a measure of the income owners will receive relative to the present share price. If demand for the share increases as a result of investors seeking for income, this could potentially have a favourable effect on the share price.

Tesco has a much bigger market share than Sainsbury’s, but selling at a somewhat lower dividend yield, which might assist it to continue making money despite the present cost-of-living crunch. Due of Tesco’s superior fundamentals over Sainsbury’s, investors may be tempted to pay more for Tesco stock.

Why have P/E ratios fallen recently?

Share prices and P/E ratios are significantly influenced by investor sentiment. Over the past 18 months, concerns about high inflation, increasing interest rates, and geopolitical unpredictability have had a negative impact on valuations.

But throughout the same time span, the P/E ratio of the FTSE 100 has remained stable at roughly 13 to 15, largely because it has a bigger percentage of value companies. Investors frequently convert from growth to value shares during a recession because the latter are more resilient due to their more defensive attributes.

What are the limitations of the P/E ratio?

When considering an investment, investors should also take other financial indicators like profit margin, dividend yield, cash flow, and net debt into account.

It’s also important to consider the following P/E ratio restrictions:

• The P/E ratio can be significantly impacted by various EPS measurements, such as trailing or forward EPS, or adjusted EPS to take one-off things out. Additionally, EPS is a snapshot at a specific moment and might not be an accurate representation of average earnings.
• The funding structure of a corporation is not sufficiently reflected by the EPS. Due to interest payments, a business with more debt could have lower EPS. If the money is put into the business, however, debt may actually increase future earnings growth.
• Forward P/E ratios are less reliable if a firm doesn’t achieve its EPS projections.

Should you buy shares with a low P/E ratio?

It’s easy to consider businesses with a high P/E ratio to be “overvalued.” However, if that business generates large earnings growth, which raises the share price, then its greater valuation is justified.

Similar to this, a business with a low P/E ratio may have potential share price appreciation if it has faster-than-anticipated earnings growth. Or its dividend yield may draw in investors, driving up the price of the stock as a result of the increased demand for dividend-paying stocks.

The company may, however, be selling at a low P/E ratio for good reason, such as because it is experiencing financial difficulties or is in a sector that is cyclical and is going to experience a downturn.

Equity Share Meaning

One of the most popular ways for people to invest in the stock market is through equity shares. Equity shares are popular among investors who want to profit from the historically strong returns that equities have provided.

The BSE Sensex Index experienced compounded yearly growth of 11.12% within the same time period. This suggests that a 5,000 INR investment in the BSE Sensex in 2011 would have been worth 14,350 INR in 2020.

What Is A Share?

A share represents a portion of ownership in a business. The initial capital needed to start a business is provided by partners or investors who also own the business. The company needs more financing as it expands. The business has a number of options for raising funds, including engaging new investors, adding partners, and taking out business loans.

Issuing shares, also referred to as going public or conducting an initial public offering, is the most typical and favoured method of raising cash for businesses (IPO). Investors are given the option to trade these shares on major exchanges including the Bombay Stock Exchange and the National Stock Exchange (NSE) (BSE).

As a shareholder, the investor is also eligible to share in the company’s growth and success. The corporation issuing the shares makes sure that profits are distributed as dividends to all shareholders.

Types of Shareholding

Preference and equity shares can be broadly divided into two categories.

Preference Shares

A person who has preference shares has the following preferred rights:

• Get dividends at a certain rate. A dividend is the sum that is delivered to shareholders when a company records profits and extends the same. This is often determined from net profits after necessary expenses have been subtracted.

• Get the funds back in the event that the business fails. It is possible to dissolve a business by winding it up. When a business closes, it ceases operations and liquidates its assets to settle its debts with creditors, business partners, and shareholders.

Compared to equity shareholders, preference shareholders have less voting rights and may only vote on issues that directly affect their rights.

Equity Shares

Equity shares, often called ordinary shares, include all shares that are not preferred shares.

You have a claim to any earnings distributed to equity shareholders in the form of dividend payments. It is significant to highlight that a company’s management has the authority to determine whether:

1. It wants to put the money back into the company for expansion or growth; alternatively
2. Dividends are payments made to shareholders from a company’s profits.

Some businesses do not release any dividends at all. Additionally, even if a company has declared dividends in the past, there is no guarantee that it will do so in the future.

Benefits of Investing in Equity Shares

Equity share investing has some advantages. They consist of:

Potential to Earn a High Income

When you invest in equity shares, your earning potential is doubled:

1. Capital appreciation due to the increase in stock price. 

A share that you paid less for may become more in demand while the supply is still constrained, giving you the chance to make money.

Since most investors anticipate growth in the pharmaceutical industry, there is a surge in demand for the company’s stock after a year, and the stock price rises to INR 150. This presents you with the chance to gain capital appreciation at a 50% rate within a year.

2. Regular income if the company declares dividends.

Shareholders have the right to receive profits that the firm chooses to distribute as a dividend. Your recurring income may increase if you have investments in companies that pay dividends on a yearly basis.

Protection Against Inflation

A product that cost 50 INR in 2010 will cost substantially more in 2020. Money depreciates over time, increasing the amount needed to purchase the same goods and services. Inflation is the name of this occurrence.

If you store your money in a savings account, you might not always be able to beat inflation rates. To maintain their purchasing power, many investors choose financial products that generate larger returns, such stock shares.

As a result, investing in stocks gives you a chance to beat inflation rates and keep the value of your investments constant.

Diversification Across Assets

Asset classes like equity, bonds, real estate, and commodities, among others, can be used to group the various investment possibilities that are accessible. These asset types are divided based on the possible return, the risk to the capital, and the tax consequences.

The earnings on your investment could, however, decrease if the central bank cuts interest rates. You can experience a decline in returns if all of your funds are in fixed deposits.

It is therefore wise to invest in a variety of asset classes so that poor performance in one does not affect your overall results. Even if fixed deposit interest decreases but the value of the equities you own increases, you can still make a profit.

Risks of Investing in Equity Shares

Even if you don’t lose all you invested, you can still find yourself in a situation where a business’s share never reaches the price you paid for it, whether because of company performance or general market attitude. As an investor, you take on these risks in the pursuit of increased profits and wealth accumulation.

The following are the most typical dangers connected with purchasing equity shares:

Capital Loss

Demand and supply for a share affect its market price. Most investors would want to invest in a firm and try to buy its shares if they believe it will perform well in the future.

As a result, there will be more sellers than purchasers in the market for the aforementioned stock, which will cause the supply to outweigh the demand and cause a decline in the company’s market price.

On the other hand, if the announcement of the policy change causes investors to have doubts about the company’s future, demand may decline, which would cause the share price to drop to, say, INR 75. You will experience a loss of INR 2,500 if you sell your shares at that time.

Volatility

The market price of a share may change over a specific time period, which is known as volatility.

Stock prices can quickly become volatile since the market price of a share is based on how investors feel about it generally and is impacted by a variety of outside influences, including social, political, and macroeconomic considerations.

But, if the stock price is extremely volatile, you run the danger of purchasing a stock at a high price, which will raise your profit price. The same holds true for investors selling highly volatile stocks.

They don’t promise you won’t lose money, but they significantly lower the risk compared to investing in one company’s equity share.

The IPO-way

A corporation announces an initial public offering, or IPO, when it issues its first batch of shares. As an investor, you can submit an application for an IPO via your net banking account or submit bids on stock markets for the company’s shares.

The National Stock Exchange launched the market index NIFTY. It is a compound term made up of National Stock Exchange and Fifty, which was created by NSE on April 21, 1996. As the flagship of NSE and a benchmark-based index, NIFTY 50 highlights the top 50 equity stocks traded on the stock market out of a total of 1600 stocks.

These stocks cover 12 different economic sectors in India, including: consumer goods, energy, metals, pharmaceuticals, telecommunications, cement and its products, automobiles, pesticides and fertilizers, entertainment and media, financial services, information technology, and consumer goods.

One of the two national benchmarks, along with SENSEX, a creation of the Bombay Stock Exchange, is NIFTY. India Index Services is the owner.

Eligibility Criteria for NIFTY Index Listing?

The NIFTY Index is updated every six months and takes a stock’s success during that time into account. The list may include or exclude new/old stocks in accordance with this performance and provided that a business and its stock meet all the eligibility requirements stated above. Four weeks prior to reconstitution, the companies in issue are notified via notice if any new additions or eliminations are made.

In addition to a regular schedule, reconstitution can also be done when a business implements a plan of action for events like suspension, spin-off, merger, and forced delisting.

In addition to these, NIFTY share market is required to screen businesses periodically for compliance with portfolio concentration rules for index funds and ETFs.

What is the full form of NIFTY?

The National Stock Exchange FIFTY is how NIFTY is formally referred to. Nifty 50, Nifty basic, and Nifty CNX are additional names for it. It serves as a big company benchmark index on the NSE (National Stock Exchange) of India. There are fifty stock markets there, spanning 23 different industries.A group of experts at the NSE Indices Limited oversee the NIFTY share indicator. It established an Index Advisory Committee to provide knowledge and direction on significant matters pertaining to equity indices.

The market capitalization and float-adjusted methods are used to calculate the NIFTY 50 benchmarks. In this technique, the index level represents the total market value of the stocks included in the index during a given base period.

How is NIFTY for Share Market Calculated?

A group of experts at the NSE Indices Limited oversee the NIFTY share indicator. It established an Index Advisory Committee to provide knowledge and direction on significant matters pertaining to equity indices.

The market capitalization and float-adjusted methods are used to calculate the NIFTY 50 benchmarks. In this technique, the index level represents the total market value of the stocks included in the index during a given base period. A NIFTY 50 index’s base period falls on November 3, 1995, at which time the index’s base value is set at 1000 and its base capital is Rs. 2.06 trillion.

The following is the price index calculation formula:

Index value is determined by dividing the current market value by (Base Market Capital * 1000).