Discounted Cash Flow Calculation for BSE:540691 using Excess Returns Model Model
The calculations below outline how an intrinsic value for Aditya Birla Capital is arrived at using the Excess Return Model. This approach is used for finance firms where free cash flow is difficult to estimate.
In the Excess Return Model the value of a firm can be written as the sum of capital invested currently in the firm and the present value of excess returns that the firm expects to make in the future.
The model is sensitive to the Return on Equity of the company versus the Cost of Equity, how these are calculated is detailed below the main calculation.
The current share price of
Aditya Birla Capital
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
Aditya Birla Capital's
is considered below, and whether this is a fair price.
Price based on past earnings
Aditya Birla Capital's earnings available for a low price, and how does
this compare to other companies in the same industry?
Aditya Birla Capital's earnings are expected to grow significantly at over 20% yearly.
Aditya Birla Capital's revenue is expected to grow significantly at over 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.
Aditya Birla Capital'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.
Aditya Birla Capital
has a total score of
1/6, see the detailed checks below.
Note: We use GAAP Net Income excluding extraordinary items in all our calculations.
A company's financial position is much like your own financial position,
it includes everything you own
The boxes below represent the relative size of what makes up
Aditya Birla Capital's finances.
The net worth of a company is the difference between its assets and liabilities.
Aditya Birla Capital is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
Aditya Birla Capital's long term commitments exceed its cash and other short term assets.
This treemap shows a more detailed breakdown of
Aditya Birla Capital's finances. If any of them are yellow this
indicates they may be out of proportion and red means they relate to one of the
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
Low level of unsold assets.
Debt is covered by short term assets, assets are 1.6x debt.
Nearly all companies have debt. Debt in itself isn’t
however if the debt is too high, or the company can’t afford to pay the interest
on its debts this may have impacts in the future.
The graphic below shows equity (available funds) and debt, we ideally want to
see the red area (debt) decreasing.
If there is any debt we look at the companies capability to repay it, and
whether the level has increased over the past 5 years.
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. Ajay Srinivasan has been the Chief Executive Officer of Aditya Birla Capital Limited since July 2007. Mr. Srinivasan serves as Chief Executive Officer of Financial Services at Grasim Industries Limited. Mr. Srinivasan serves as Director of Financial Services of Aditya Birla Management Corporation Pvt. Ltd. Mr. Srinivasan serves as the Business Head of Financial Services and Chief Executive Officer of Aditya Birla Financial Services at Aditya Birla Nuvo Limited. Mr. Srinivasan has been the Chief Executive of Financial Services - Aditya Birla Group of Aditya Birla Money Limited since July 2007. Mr. Srinivasan has been the Chief Executive of Financial Services and Director of Corporate Strategy & Business Development for Aditya Birla Management Corporation Ltd., since July 16, 2007. He sets the vision and provides strategic direction and leadership for the Group's financial services business, which covers several verticals such as life insurance, fund management, private equity, wealth management, retail broking, capital markets based lending, corporate financing and general insurance broking. Prior to joining the Aditya Birla Group, Mr. Srinivasan served as the Managing Director of Birla Sun Life Insurance Co Ltd. of Aditya Birla Nuvo Limited. Mr. Srinivasan served as the Chief Executive Officer of Fund Management at Prudential Corporation Asia Limited (Also called as Prudential Corporation Asia) from January 2001 to July 2007. He joined Prudential in 1998 as the Managing Director of Prudential ICICI Asset Management Company, Prudential's Indian fund management joint venture with ICICI Bank. He oversaw a business that spanned ten markets, including Japan. Prior to joining Prudential, he was the Deputy Chief Executive Officer and Chief Investment Officer of the Indian operations of Thread needle Asset Management. He serves as a Director of Aditya Birla Finance Limited. He has been a Director at Aditya Birla Management Corporation Ltd., since July 16, 2007 and serves as a Non-Executive Director of Aditya Birla Sun Life Insurance Company Limited. He serves as a Director of ICICI Prudential Asset Management Company Limited. He serves as a Director of Prudential Asset Management (Singapore) Limited and Prudential Assurance Malaysia Berhad. He serves as an Associate Director of Aditya Birla Sun Life AMC Limited and Aditya Birla Housing Finance Limited. As a member of Prudential Corporation Asia's Board of Directors, Mr. Srinivasan also oversaw the development of Prudential's retirement business in Asia. He served as a Director of Eastspring Investments (Singapore) Limited. He served as Senior Advisor at IndusAge Partners. Mr. Srinivasan's experience in the financial services industry spans over two decades. Mr. Srinivasan holds an MBA from IIM, Ahmedabad and B.A with Honours in Economics from St. Stephens College.
Insufficient data for Ajay to compare compensation growth.
Ajay's remuneration is higher than average for companies of similar size in India.
Management Team Tenure
Average tenure of the
Aditya Birla Capital
management team in years:
The average tenure for the Aditya Birla Capital management team is over 5 years, this suggests they are a seasoned and experienced team.
Chief Executive Officer
Chief Financial Officer
Compliance Officer & Company Secretary
Chief Operating Officer
Chief Compliance & Risk Officer
Chief Marketing Officer
Chief Human Resource Officer
Chief Digital Officer
President of Strategy & Business Development
Head of Analytics & Digital Communications L&D
Board of Directors Tenure
Average tenure and age of the
Aditya Birla Capital
board of directors in years:
The average tenure for the Aditya Birla Capital board of directors is less than 3 years, this suggests a new board.
Board of Directors
Who owns this company?
Recent Insider Trading
No 3 month insider trading information.
Recent Insider Transactions
Max Price (₹)
03. Oct 18
Pilani Investment and Industries Corporation Limited
Aditya Birla Capital Limited provides various financial products and services in India. It offers life insurance products, such as protection, wealth and protection, children’s future, health, retirement, and savings and protection insurance; health; wellness; motor, personal accident cover, and third party legal liability; and travel insurance products. The company also provides financing solutions, such as home loans, loans against property, personal loans, construction loans, lease rental discounting, and commercial property loans; lines of credit, business loans, working capital loans, and supply chain financing solutions for micro, small, and medium enterprises; and loans against shares, mutual funds, and life insurance policy, as well as ESOP and IPO financing, and promoter and margin trade funding services. In addition, it provides financial advisory services; and investment services, such as mutual funds, pension funds, stocks and securities, real estate investment, wealth management, and portfolio management services. Further, the company offers financial and IT enabled services, stock broking, depository services, portfolio management services, research analyst, insurance repository services, mutual fund distribution, commodities broking, asset management, and trustee services. Additionally, it operates MyUniverse.co.in, an online money management platform; and MoneyForLife Planner, an online tool that offers protecting, investing, and financing solutions. The company was formerly known as Aditya Birla Financial Services Limited and changed its name to Aditya Birla Capital Limited in June 2017. Aditya Birla Capital Limited was incorporated in 2007 and is based in Mumbai, India.
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