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A sample Check List for Performing Company Analysis:

Ask the following questions Informative Aspects: 1. What it produces? 2. What are its products & services? 3. What material does it require to produce the product? 4. Are the products consumables or durables? 5. What is the life of product? 6. Is there any after sales service involved? 7. What key competencies does it require to deliver the services? 8. Who are its suppliers? 9. Who consumes its products/ services? 10. Clients are direct consumers or businesses? 11. Is the government also one of the clients? 12. Where is the companys registered office located? 13. Who are the company promoters? 14. Who all comprise the company top management? 15. What is the employee strength? 16. What is the companys current revenue/ Net profit, Market Capitalization? 17. Is the demand of the company products sustainable? 18. Does the company invest into the research & development? 19. When is the probable origin of the industry? 20. What have been major shifts in the way the industry works? 21. Etc. Business Specific: 1. What is the companys business model? 2. What kind of investments is required to set up a new plant/ business centre? 3. What are the strategic business units (SBUs) of the company? 4. What kind of projects does the company get? 5. How does client pay to the company? Is it hourly, monthly, on delivery, post delivery? 6. Is there any seasonality in the business? Why? 7. Etc.

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Product/ Service Specific: 1. How are the companys product priced vis--vis its competition? 2. How is the quality of companys offerings? 3. Frequency of consumption of the products by the clients? 4. How are the products sold? 5. How is the product better or weaker compared to competitors? 6. Is the company leader or follower? 7. What are its differentiating factors? 8. Does the company import its raw material? If yes, from where? 9. How are the raw material prices? Is there any seasonality in the same 10. What is the shelf life of the product? 11. Where in the value chain is the company established? 12. Etc. Client Perspective: 1. Who are the key clients? 2. How much do they contribute to the companys revenue? 3. What are their bargaining terms? 4. Top, Top 5 and Top 10 client contribution 5. What is dependency on few top clients? 6. What new projects/ deals the company has reported or in negotiations with? 7. Which domain or vertical is the client into? 8. What is the trend expected in this vertical in terms of spending? 9. How critical is your product to the client? Company SWOT Analysis Company 5 Force Model Analysis

* Note that this is a sample list. All the information may not be available for your sector or company. You need to proceed with the information available. You need not follow the exact list. The list is just representative and not exhaustive.

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Guideline for Company Analysis 1. Reading Annual Report a. Start reading the Management and Discussion (M&D) portion of the annual report of the current available annual report. b. Operating Parameters: While reading this, pick up the key operating parameters of the company like no. of employees, no. of plants, service lines, business segments, no. of units produced, plant capacity, etc. c. Financial Statements: Companies generally report 2 types of financial statements viz. Stand Alone and Consolidated. The Consolidated statements include all the subsidiaries in which the company has majority stake. i. Know how much (in %) each of the subsidiaries is contributing to the consolidated revenue. ii. Know Companys revenue and its revenue growth over the years. iii. Know the companys profitability (profit as % of Net Sales) at Gross Profit Level, EBIDTA Level, EBIT Level and PAT Level. iv. Observe and analyze the trends and how the profitability

2. Understand the business: This is most important aspect of being an equity analyst. Unless, you understand the business of the company, you will not be able to give justice to the financial projections. a. Read the companys website thoroughly. b. Visit Investor Cell of each company and read through all the presentations. c. Also, download all the annual reports and read through managements explanations in M&D d. Download last 8 quarter company transcripts and read them line by line. This is most important as this will help you understand the business very well e. Visit the companys media room and read all the articles in last 1 year. Also read some articles in magazines published on the companys history and good and bad days. f. Read about the major events in the history of the company. g. Read publicly available reports on the companys future plans and some material where the management has shared their vision on the industry growth and their vision on their own company. h. See how the company does its business on the ground. i. j. Know the client and clients environment well. Know what inputs are required to manufacture the product, time required, labour required, etc. k. See, how capital intensive the business

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