Course OutlineChapterTopicsRecommended Study Time(Hours)

Equity Research - An IntroductionOverview:What is equity research? Goal of an equity research analyst.Market Participants: The research providers and the research users.Types of Research:Buy side research and Sell side research.Role of an Analyst:How do analysts go about research?, Front end and back end research, equity research as a cost and revenue center.Concept of Alpha:Importance of alpha in equity research.Key Terms used in Equity Markets, Stocks Classification.2

Understanding Financial StatementsAnnual Report Overview:Understanding key sections of an Annual report.Profit & Loss Statement, Balance Sheet, Cash Flow Statement.4

Analysis of the EconomyIntroduction:Stages of the qualitative analysis process - EIC framework.Economic Cycles:How valuation of a company gets affected by economic activities?Key Economic Factors:GDP, Industrial Production, Inflation, Unemployment, Business and consumer confidence and Oil prices.Stock Indices:Different benchmark indices across the globe, How do share prices and stock indices move? How are stock indices interlinked?2

Analysis of the IndustryProcess:Identifying sub-sectors, Key revenue drivers, Key concerns.Specific Industry Analysis:Oil & Gas, IT, Telecom, Banking and Autos.2.5

Analysis of the CompanyProcess:Analyzing the business, Revenue drivers, competitors, Management team.Case Study:A detailed analysis of Shiv Vani Industries.1.5

Ratio AnalysisProfitability Ratios:Profit Margins - Gross margin, EBITDA margin, Net Profit margin.Return Ratios:Return on Equity (ROE), Return on Common Equity (ROCE), Return on Total Capital (RTC) and Return on Assets (ROA).Liquidity Ratios:Current ratio, Quick ratio and Cash ratio.Activity Ratios:Account receivables turnover & Days of receivables, Inventory turnover & Days of inventory, Account payables turnover & Days of payables.Solvency Ratios:Debt-to-Equity ratio, Interest coverage ratio and Financial leverage.Valuation Ratios:Price to Earnings (P/E) ratio, P/E re-rating and de-rating, PEG ratio, EV/EBITDA, Price to Book Value (P/BV) ratio.Case Study:Pantaloons vs. Titan Industries.4.5

ValuationConcept:Definition and need for Valuations.Methods:DCF, Relative Valuation.Case Study:A detailed exercise of valuation using DCF for Titan Industries.6

Report WritingTypes of reports, Format,Dos and Dontss of report writing.3

TOTAL RECOMMENDED LEARNING HOURS25.5