Discounted Cash Flow Calculation for NSEI:BEML 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.
NSEI:BEML 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
BEML's earnings available for a low price, and how does
this compare to other companies in the same industry?
BEML's earnings are expected to grow significantly at over 20% yearly.
Unable to determine if BEML is high growth as no revenue estimate data is available.
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.
BEML'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
3/6, 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.
TENURE AS CEO
Mr. Deepak Kumar Hota has been the Chairman and Managing Director of BEML Limited since July 1, 2016. Mr. Hota served as Director of Human Resources and Director of BEML Limited since July 1, 2013 until July 1, 2016. Shri. Hota has over three decades of professional experience in HR and Business and served in various capacities in Hindustan Petroleum Corporation Limited including Chief Executive Officer of HPCL Bio-fuels. Prior to joining BEML, he was heading the Natural Gas Division, HPCL, Mumbai. Shri. Hota has graduated in Economics Hons., from St. Stephens College and Post Graduation in HR from XLRI.
Deepak's compensation has been consistent with company performance over the past year.
Deepak's remuneration is lower than average for companies of similar size in India.
Management Team Tenure
Average tenure of the
management team in years:
The tenure for the BEML management team is about average.
Chairman & MD
Compliance Officer & Company Secretary
Director of Mining & Construction Business and Director
Director of Defence Business & Director
Director of Finance & Director
Assistant General Manager of Corporate Communications
Chief General Manager of (Def)
Chief General Manager of R&D - KGF Complex
Chief General Manager of R&D - Bangalore Complex
Director of Rail & Metro Business and Director
Board of Directors Tenure
Average tenure of the
board of directors in years:
The average tenure for the BEML board of directors is less than 3 years, this suggests a new board.
Board of Directors
Chairman & MD
Director of Mining & Construction Business and Director
BEML Limited (NSE:BEML) Might Not Be A Great Investment
Specifically, we're going to calculate its Return On Capital Employed (ROCE), in the hopes of getting some insight into the business. … Understanding Return On Capital Employed (ROCE). … ROCE is a measure of a company's yearly pre-tax profit (its return), relative to the capital employed in the business.
Did You Miss BEML's Impressive 271% Share Price Gain?
Indeed, the share price is up an impressive 271% in that time. … One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS). … In fact, the BEML stock price is 21% lower in the last three years.
Consider This Before Buying BEML Limited (NSE:BEML) For The 1.0% Dividend
Dividends can be underrated but they form a large part of investment returns, playing an important role in compounding returns in the long run. … Historically, BEML Limited (NSE:BEML) has paid dividends to shareholders, and these days it yields 1.0%. … Let's dig deeper into whether BEML should have a place in your portfolio.
How Much Did BEML Limited's (NSE:BEML) CEO Pocket Last Year?
Deepak Hota became the CEO of BEML Limited (NSE:BEML) in 2016. … This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. … How Does Deepak Hota's Compensation Compare With Similar Sized Companies?
What Kind Of Investor Owns Most Of BEML Limited (NSE:BEML)?
Generally speaking, as a company grows, institutions will increase their ownership. … Conversely, insiders often decrease their ownership over time. … We can zoom in on the different ownership groups, to learn more about BEML
Should You Be Concerned About BEML Limited's (NSE:BEML) Historical Volatility?
If you're interested in BEML Limited (NSE:BEML), then you might want to consider its beta (a measure of share price volatility) in order to understand how the stock could impact your portfolio. … Beta is a widely used metric to measure a stock's exposure to market risk (volatility). … Any stock with a beta of greater than one is considered more volatile than the market, while those with a beta below one are either less volatile or poorly correlated with the market.
and want a simplistic look at the return on BEML Limited (NSE:BEML) stock. … To understand BEML’s capital returns we will look at a useful metric called return on capital employed. … What is Return on Capital Employed (ROCE)?
Despite Its High P/E Ratio, Is BEML Limited (NSE:BEML) Still Undervalued?
This article is written for those who want to get better at using price to earnings ratios (P/E ratios). … We'll show how you can use BEML Limited's (NSE:BEML) P/E ratio to inform your assessment of the investment opportunity. … Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS)
Based On Its ROE, Is BEML Limited (NSE:BEML) A High Quality Stock?
While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. … Our data shows BEML has a return on equity of 5.9% for the last year. … Return on Equity = Net Profit ÷ Shareholders' Equity
BEML Limited provides products and services to the mining and construction, rail and metro, and defense and aerospace sectors in India. The company offers mining machinery for opencast and underground mines; dozers, hydraulic excavators, backhoe loaders, front end loaders, and motor graders; hydraulic pumps and cylinders, hydro-pneumatic suspensions, and control valves; transmission, axle, and bevel gear powerline systems; diesel engines and generator sets; backhoe dredgers and dredger spares; and dump trucks, pipe layers, tire handlers, and water sprinklers. It also provides passenger coaches, electrical multiple units, inspection cars, track laying equipment, rail buses, spoil disposal units, treasury vans, rail coaches, wagons, track vehicles, metro cars, and utility vehicles. In addition, the company offers armored recovery and repair vehicles, mine ploughs, and surface mine clearance systems; BMP transmission and final drives, BMP refurbishing products, assembly hydrogas suspension units, and transmission products; wagons and milrail coaches, and ejectors and air cleaners; aircraft towing tractors, ground handling and ground support equipment, crash fire tenders, aircraft weapon loaders, jigs and fixtures, and gears; and mobility vehicles, all-terrain vehicles, command post vehicles, pinaka launchers, pontoon bridge systems, bridge systems, heavy recovery vehicles, and trailers, as well as snow cutters and aircraft weapon loading trolleys. BEML Limited also exports its products to approximately 68 countries worldwide. The company was formerly known as Bharat Earth Movers Limited. BEML Limited was founded in 1964 and is based in Bengaluru, India.
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