Discounted Cash Flow Calculation for BSE:500493 using 2 Stage Free Cash Flow to Equity Model
The calculations below outline how an intrinsic value for
is arrived at by discounting future cash flows to their present value using the 2 stage method.
We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.
BSE:500493 DCF 1st Stage: Next 10 year cash flow forecast
The current share price of
is above its future cash flow value.
Often investors are willing to pay a
for a company that has a high dividend or the potential for future growth.
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for
it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing
when they are out of season, or how much your home is worth.
The amount the stock market is willing to pay for
is considered below, and whether this is a fair price.
Price based on past earnings
Bharat Forge's earnings available for a low price, and how does
this compare to other companies in the same industry?
Bharat Forge's earnings are expected to grow by 17% yearly, however this is not considered high growth (20% yearly).
Bharat Forge's revenue is expected to grow by 10.4% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can
be gauged below. We look back 3 years and see if they were any good at
predicting what actually occurred. We also show the highest and lowest estimates
looking forward to see if there is a wide range.
Bharat Forge's performance over the past 5 years by checking for:
Has earnings increased in past 5 years? (1 check)
Has the earnings growth in the last year exceeded that of the
industry? (1 check)
Is the recent earnings growth over the last year higher than the average annual growth over the
past 5 years? (1 check)
Is the Return on Equity (ROE) higher than 20%? (1 check)
Is the Return on Assets (ROA) above industry average? (1 check)
Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent
earnings report. Some checks require at least 3 or 5 years worth of data.
has a total score of
2/6, see the detailed checks below.
Note: We use GAAP Net Income excluding extraordinary items in all our calculations.
Management is one of the most important areas of a company. We look at
unreasonable CEO compensation, how long the team and board of directors have
been around for and insider trading.
Dr. Babasaheb Neelkanth Kalyani, also known as Baba, B.E. (Mech.) (Hons.), M.S. (MIT) has been the Managing Director of Bharat Forge Limited since 1993 and has been its Chairman of the Board since August 1997. Dr. Kalyani was a Director of SKF AB since April 28, 2011 until March 2018. He has 46 years of experience. He began his career with Bharat Forge Limited on April 1, 1972. He serves as the Chairman of the Board and Director for Kalyani Steels Ltd. and BF Utilities Ltd. He serves as Group Chairman of Kalyani Group Pvt. Ltd. He serves as Chairman of the Board at Kalyani Carpenter Special Steels Ltd. and Automotive Axles Ltd. He serves as the Chairman of the Board of a number of other companies in Kalyani Group. He served as the Chairman of the Board of Hikal Limited until August 2008. He served as the Chairman of the Board of BF Investment Ltd. until May 12, 2015. He served as the Chairman of the Board of Bosch Chassis Systems India Ltd., until July 16, 2005. He serves as a Director at Bharat Forge Hong Kong Ltd. He serves as a Director of Nandi Infrastructure Corridor Enterprises, Kalyani Carpenter Metal Centres and Merritor HVS (India). He serves as a Director of Kenersys Gmbh. He serves as a Non-Executive Director of Hikal Limited. He serves as a Non Executive Director of Kalyani Carpenter Special Steels Ltd. and Kalyani Lemmerz Ltd. and SKF USA Inc. since 2011. He served as an Outside Director of Hitachi, Ltd. since June 22, 2016 until June, 2018. He has been a Member of the Board of Directors/Trustee of UTI Trustee Company Pvt. Ltd. since January 13, 2006. He served as a Non-Executive Director of Ugar Sugar Works Ltd. from January 1986 to March 19, 2010. He is the Founding Chairman of the Governing Board of the Indian Institute of Management, Indore and Chairman of Pratham Pune Education Foundation. Dr. Kalyani served as the Chairman of American Society of Metals, Pune Chapter. He is a Member of the CII National Council. He is also a Member of the World Economic Forum, Switzerland. He is Member of various Government Committees viz. National Manufacturing Competitiveness Council, Board of Trade, Development Council for Automobiles & Allied Industries and Consultative Group of Higher & Technical Education. He serves as Director of Automotive Axles Ltd. He has represented the Confederation of Indian Industry on its various regional committees. Along with his many accomplishments, his contributions to the Indian Industry is recognized through awards that he has received from FIE Foundation in 1991. Dr. Kalyani is the recipient of the Prestigious National Press Award, 1995. He got his major achievements include Global Entrepreneur of the year’ award by JMCCI. in 2006, Ernst & Young Entrepreneur of the year - Manufacturing in 2005 and Chief Executive Officer of the Year - Business Standard in 2004. Dr. Kalyani holds a B.E. (Mech) from Birla Institute of Technology, Pilani, Rajasthan & a Master of Science from the Massachusetts Institute of Technology, USA.
Baba's compensation has increased by more than 20% in the past year.
Baba's remuneration is higher than average for companies of similar size in India.
Management Team Tenure
Average tenure and age of the
management team in years:
The average tenure for the Bharat Forge management team is over 5 years, this suggests they are a seasoned and experienced team.
Chairman & MD
CFO & Executive Director
CTO & Executive Director
Compliance Officer & Company Secretary
Deputy MD & Executive Director
Senior VP of F.M.D & Executive Director
President of Corporate Affairs & Infrastucture
Executive VP & Director of Engineering
President & CEO of Defense Products
Board of Directors Tenure
Average tenure and age of the
board of directors in years:
The average tenure for the Bharat Forge board of directors is over 10 years, this suggests they are a seasoned and experienced board.
Stocks such as Bharat Forge and Marksans Pharma are considered to be high growth in terms of how much they’re expected to earn and return to shareholders, according to the market. … BSE:500493 Future Profit Jun 2nd 18 Marksans Pharma Limited (BSE:524404) Marksans Pharma Limited, together with its subsidiaries, researches, develops, manufactures, and markets and distributes pharmaceutical products in North America, Europe, the United Kingdom, Australia, New Zealand, and internationally. … BSE:517569 Future Profit Jun 2nd 18 For more financially robust companies with high growth potential to enhance your portfolio, explore this interactive list of fast growing companies.
500493’s forecasted bottom line growth is an optimistic double-digit 22.71%, driven by the underlying double-digit sales growth of 44.03% over the next few years. … 500114’s forecasted bottom line growth is an optimistic double-digit 24.58%, driven by the underlying double-digit sales growth of 41.24% over the next few years. … 532830’s forecasted bottom line growth is an optimistic double-digit 23.00%, driven by the underlying 50.89% sales growth over the next few years.
Bharat Forge Limited manufactures and sells forged components in India and internationally. The company operates in Forgings and Others segments. It offers automotive components, including crankshafts, connecting rods, emission after treatment, fuel injection systems, chassis, and transmission and driveline; power generation components for thermal, hydro, and wind energy. The company also provides oil and gas forging products, which include subsea, surface, and drilling components; rail products, such as engine and bogie components, turbochargers, and power electronics; and marine products comprising crankshafts, connecting rods, and propeller shafts. In addition, it offers various components for aviation sector, which comprise fan blades, compressors and turbine, aero structure, and gear components; construction and mining products, including machined crankshafts, front spindles, and tracklinks; and electric power-train products, such as full powertrain solutions, systems and sub systems, and parts for powertrain. Further, the company provides design engineering and product development solutions. It serves clients in automotive, power, oil and gas, construction and mining, rail, marine, and aerospace industries. Bharat Forge Limited was founded in 1961 and is headquartered in Pune, India.
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