Stock Valuation of Top Indian Stocks

SL Name Current Price (Rs.) Intrinsic Value (Rs.) Valuation Grading
Price Fundamentals Profitability Price Growth (10Y) Overall
1 TATA CONSULTANCY SERVICES (TCS) 2262 781 41 / 100 93 / 100 100 / 100 100 / 100 84 / 100
2 RELIANCE INDUSTRIES (RIL) 1054 337 41 / 100 63 / 100 71 / 100 6 / 100 45 / 100
3 INFOSYS 1004 378 54 / 10 74 / 100 100 / 100 80 / 100 77 / 100
4 ITC LIMITED 227 66.44 53 / 100 96 / 100 99 / 100 100 / 100 83 / 100
5 ONGC 202 467 54 / 100 74 / 100 100 / 100 12 / 100 60 /100
6 HINDUSTAN UNILEVER LTD. (HUL) 817 143 29 / 100 92 / 100 100 / 100 100 / 100 80 / 100
7 COAL INDIA (CIL) 288 133 53 /100 68 /100 100 / 100 2 / 100 56 / 100

* Updated in December’2016

Want to learn the process of stock valuation?

Stocks whose overall rating is above 94/100 can be considered a good buy. I present to you the stock valuation of few top BSE stocks. I have broken the overall valuation of stocks between (1) Price Valuation, (2) Business Fundamentals & (3) Profitability.

A highly profitable company which has strong business fundamentals is considered good for investing. But it is equally important for investors to judge stocks based on its price valuation.

Explanation:

TCS

Current Price
In terms of current market price of TCS, it scores a grading of only 41 of 100. It means that stock is currently trading at very expensive price levels.

Over all Business Fundamentals
In terms of business fundamentals of TCS, it scores a grading of 93 of 100. It means that TCS has one of the best business prospects in the industry.

Business Fundamentals – Profitability
In terms of profitability of TCS, it scores a grading of 100 of 100. It means that TCS’s profitability as compared to other companies in Indian market is very high. It enjoys the competitive edge.

Technical Analysis – Price Groth over 10 Years
In terms of price growth of TCS in last 10 years, it scores a grading of 100 of 100. It means that market price of TCS stocks has grown at a faster rate compared to the risk free rate and standard risk premium.

Overall Grading of TCS
In terms of overall grading of TCS, it scores 84 out of 100. By all means the rating is very good. But as a rule of thumb, stocks which earns grading of 94+ shall be considered as a good buy.

How I use this worksheet

This worksheet works like a litmus testing machine for me. Whenever a stock comes to my attention, the first thing I do is to take a note of it in my phone. Every 15 days, I make sure that I have at least 3 stocks worth an analysis. At the end of fifteenth day, I open my stock analysis worksheet and analyze these stocks.

The idea is to judge the stocks based on its pricing, business fundamentals & price history. Stock which fares well overall (94+/100), becomes a good buy. As per my experience in last several years, there will be not many stocks which will earn 94+ grade. But I do not get dishearten. I keep saving my money till the buy opportunity comes. At other times SIP in mutual funds works best for me.