Module 3   Fundamental Analysis (Video Series)Chapter 9

Quick note on Relative Valuation

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9.1 – Relative Valuation

In this video, we will learn about the different techniques of valuation. Let us dive in to learn more.

In the last video of this module, we learn how to build our investing checklist.

We recommend reading this chapter on Varsity to learn more and understand the concepts in-depth.


Key takeaways from this chapter

  1. A stock idea can come from any source.
  2. Circle of competence and General observation is a great way to start.
  3. It is advisable to have a watch list that includes stocks that look interesting.
  4. Once a stock is identified, we should look for sustainable moats.
  5. The due diligence process involves understanding the business, running the checklist to understand its financial performance, and the valuation exercise.
  6. When it comes to an understanding the business, one should be completely thorough with its operation.
  7. The checklist should be improvised as and when the investor gains investment experience.
  8. The DCF method is one of the best techniques to identify the intrinsic value of the business

4 comments

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  1. pravin says:

    All your content are very easy to read and understand.great going.
    where do I study more about option based valuation and when can we expect an upload for the same from your side.

  2. pravin says:

    In dcf valuation when there are high capital expenditures (due expansion),the valuation gets reduced .for ex: for acrysil dcf valuation comes to Rs188 but if i remove the capital expenditures the valuation goes up .is it correct that way (idea being the expansion is going to increase the income) or how do we go about it.Also when the cash flow is negative but we know in future the income is gonna increase ,how do we value those stocks.

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