VN Corporate VN Research & Consulting VN Sourcing Practice IndiaNotes
 Like us on facebook  Follow us on twitter  Follow us on LinkedIn  IndiaNotes on Google Plus  IndiaNotes on Pinterest  IndiaNotes on Stumbleupon  Subscribe to our feeds

lanterns

Stocks  A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z
Search
Feedback
You are here : IndiaNotes >> Market Action >> Technical

What is the fair value of the Sensex?

Manu Jain | 30 Jul, 2012  | Follow Author | Add to my Favourites 


Going by FY14E numbers, what is the fair value of the Sensex?

Code

STOCK

CMP

Weight

ROCE

Weighted ROCE

500875

I T C LTD

254.4

9.76

46.8

 

4.56768

500325

RELIANCE

720.4

9.09

7.6

 

0.69084

500180

HDFC BANK LT

584.25

7.71

22.7

ROE

1.75017

532174

ICICI BANK L

928.2

7.5

17.2

ROE

1.29

500209

INFOSYS LTD

2,148.85

7.35

29.4

 

2.1609

500010

HOUSING DEVE

673.6

7.01

30.9

ROE

2.16609

500510

LARSEN & TOU

1,319.95

5.1

13.7

 

0.6987

532540

TCS LTD.

1,225.75

5.04

39.6

 

1.99584

500312

ONG CORP LTD

277.4

4.16

19.3

 

0.80288

500112

STATE BANK O

1,941.20

3.65

15

ROE

0.5475

500696

HIND UNI LT

464.7

3.52

83.8

 

2.94976

532454

BHARTI ARTL

307

2.86

12.3

 

0.35178

500570

TATA MOTORS

212.8

2.83

24.8

 

0.70184

500520

MAHINDRA & M

687.65

2.22

28.8

 

0.63936

500470

TATA STL

399.3

1.9

11.4

 

0.2166

524715

SUN PHARMACE

630.35

1.83

22.2

 

0.40626

532555

NTPC LTD

153.05

1.77

8.9

 

0.15753

532977

BAJAJ AUTO

1,582.05

1.6

59.2

 

0.9472

533278

COAL INDIA

353.7

1.57

44.8

 

0.70336

500124

DR.REDDY'S L

1,621.10

1.45

20.2

 

0.2929

507685

WIPRO LTD.

334.25

1.44

21.8

 

0.31392

500182

HEROMOTOCO

2,006.85

1.4

43.6

 

0.6104

500103

BHEL

208.25

1.25

20.7

 

0.25875

532155

GAIL INDIA

344.7

1.23

18.5

 

0.22755

500087

CIPLA LTD.

326.55

1.19

18.5

 

0.22015

532286

JINDAL STEEL

394.6

1.16

14.9

 

0.17284

532500

MARUTISUZUK

1,110.65

1.12

21.4

 

0.23968

500440

HINDALCO IN

117.45

1.11

8

 

0.0888

500400

TATA POWER

94.6

1.1

5.4

 

0.0594

500900

STERLITE IN

100.9

1.07

12.2

 

0.13054

ROCE=FY14E

ROE=FY14E

TOTAL

26.35922

Source:BSE,Brokerage Reports

 

 

 

 

Value of the sensex

V=100*(E/I)*SQRT((R+G)/(I+F))

E

EPS of the sensex in FY14E

=1437

(Source:Microsec Research)

I

RFR

 

8.11

 

 

 

R=1*SQRT(ROCE/I)

 

1.803

 

 

 

100*(E/I)

 

17719

 

 

 

G=Earnings Growth

 

14

(Assumed)

 

F=WPI

 

 

7.6

 

 

 

SQRT((R+G)/(I+F))

 

1.003

 

 

 

Value of the sensex

 

17771

 

 

 


Note : Manu Jain has assumed an earnings growth of 14% for the Sensex 30 companies going into FY14E
For Banks instead of ROCE's , ROE's have been taken               
Data as on 27th July 2012 (CMP And Weightage)                   
Source of Formula for V: Vectorvest 

Disclaimer: The author has taken due care and caution to compile and analyze the data. The recommendations are his/her personal views. He/she shall not accept any liability whatsoever arising from the use of any of the above content.

Sources have been mentioned at relevant places in the article. In spite of this, the author does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information.

The Author or his Family Members May be holding Positions in some of the stocks listed above.They May or May not do so at a Future Date.



About Manu Jain

Manu Jain is a Market/Investment Analyst based in Delhi. He can be contacted at manujain1232003@yahoo.co.in or his blog http://talkmanujain.blogspot.com/


For more information please write in to editor@indianotes.com


Disclaimer: The author has taken due care and caution to compile and analyse the data. The opinions expressed above are only the views of the author, and not a recommendation to buy or sell. Neither the author nor IndiaNotes.com accept any liability whatsoever arising from the use of any of the above contents.


Technical Calls

What are technical calls?

Other Articles


Have a question?

Sanjay Chhabria
Equity Analyst and Investment Consultant - xxx



[X] Amazon Deals