PERSONAL FINANCIAL PLANNING

ASSIGNMENT - 2

Submitted to: Prof. Edwin L. Castelino

Submitted by:
Group - 4
ANIL KUMAR REDDY M

ANKIT DOKANIA

ELANCHEZHIYAN M

PRADHEEP R A

RAJAT JAIN
Distribution of the total investment among different comapnies

Company Percentage of Investment

Titan Industries
Bhushan Steels
Sun Tv Networks
Prism Cements
ITC Ltd
CPCL
Pidilite
LIC Housing Finance Ltd
UCO Bank
IFCI

Titan Industries:
 MAR 10 MAR 09 MAR 08
Sales 4776.4 3848.74 3012.64
PAT 250.32 158.96 150.27
ROE 39.25 32.20 44.48
ROCE 45.51 36.61 39.65
Asset turnover 7.89 6.82 5.77
ratio
PE ratio 34.15 22.86 32.70
EPS 53.9 34.11 32.49
Operating margin 9.33 8.93 8.69
%
Debt-Equity ratio 0.19 0.44 0.66

INVSETMENT RATIONALE

 Its sales and PAT are growing year on year.

 The consumer’s confidence level about the company has been growing.

 It is the market leader in the watch and the jewellery industry. It is the first company to move
on the organized Eye-ware retail store.

 Number of retail stores of jewellery and the eye-ware are increasing.

 Year on year they are introducing different watches to different segments of people.

 As we can see from the below graph the growth percentage of the stock value of the Titan
Industries is far away from the Nifty’s growth percentage.

Share holding pattern:

 Indian Promoters
Banks Fin. Inst. and
Insurance
FII's
Private Corporate Bodies
Others
General public

Bhushan Steels:
MAR 10 MAR 09 MAR 08
Sales 5611.27 4943.25 4152.3
PAT 845.8 421.3 423.73
ROE 28.23 23.02 29.84
ROCE 10.68 9.32 11.46
Asset turnover 1.71 1.74 1.65
ratio
PE ratio 8.62 4.03 6.67
EPS 194.91 98.78 99.35
Operating margin 25.84 21.93 19.98
%
Debt-Equity ratio 3.23 3.77 3.16

Investment Rationale:

 Bhushan Steel has extended its presence in the steel value chain with the commissioning of its 1.9mn
tonnes HR steel capacity at Orissa. 
 Bhushan Steel is now India’s 3rd largest Secondary Steel Producer company.
 It is the largest manufacturer of auto-grade steel. And India has the huge potential of the
automobile industry and due to this reason, this company is also expanding.
 Its 3 manufacturing units pocessess the location advantage. One Manufacturing unit is near to
the sea port. And the remaining two are near to the automobile manufacturer companies.
 It is spending Rs. 260bln to expand its capacity to 12 mln tonnes.
 By using the Backward integration concept, this company is arranging all its rawmaterails and
by this it is reducing its costs.
  Recently it acquired 60% stake in the Australian exploration company, Bowen Energy. From
this cooking coal is supplied to the Orissa plant. By this they are reducing their cost.
 Year on year the sales are also increasing and even the operating margin % is also increasing.

Share holding pattern of Bhushan cements:

Foreign
Domestic
Corporate holding
Promoters
Public & others
SUN networks:
MAR 10 MAR 09 MAR 08
Sales 1395.01 1008.2 861.06
PAT 567.38 437.11 366.98
ROE 29.80 26.79 27.59
ROCE 45.57 41.06 43.14
Asset turnover 1 1 1.24
ratio
PE ratio 32.57 15.61 33.41
EPS 13.15 10.67 8.89
Operating margin 79.82 76.76 72.22
%
Debt-Equity ratio 0 0 0

Investment Rationale:

 Sun TV Network has started a wholly owned subsidiary, `Sun TV Network Europe in United Kingdom
to broadcast and distribute its channels in UK and Europe.
 The Indian media and entertainment industry is one of the largest markets in the world having potential
of becoming USD 200 billion industry by 2015.

 In this, television has the biggest share of all, is estimated to generate revenue USD13.11 billion by
2011. Media companies like Sun TV Network have huge potential to expand itself.
 Sun networks plans to restructure its distribution business, by doing this it is going to perform
well in the coming years.
 Year on year the sales of this company are increasing. Its EPS and operating margin % are
also increasing.
Share holding pattern of Sun Tv Networks:

Indian Promoters
Banks Fin. Inst. and
Insurance
FII's
Private Corporate bodies
NRI's/OCB's/Foreign
Others
Others
General Public

PRISM Cements:
MAR 10 MAR 09 MAR 08
Sales 2837.98 647.35 876.34
PAT 251.05 96.23 241.63
ROE 27.41 20.06 46.96
ROCE 31.2 32.34 62.18
Asset turnover 2.38 1.38 1.51
ratio
PE ratio 12.16 5.74 4.24
EPS 4.63 3.96 7.93
Operating margin 17.78 27.23 38.58
%
Debt-Equity ratio 0.44 0 0

Investment Rationale:

 Company has planned to expand its cement production to10 million tonnes by 2011.
 Even the cement prices are increasing, so its profits are increasing.
 It is a cash rich company and have very less debt company.
 The company enjoys cost competitiveness due to modern plant, lower overheads, operational
efficiencies and logistics management.
Share holding pattern of prism

% Share Holding
0

18.43 Foreign (Promoter &

Group)
Indian (Promoter &
Group)
6.7
Non Promoter (Institution)
Non Promoter (Non-
Institution)

74.87

ITC Limited:
MAR 10 MAR 09 MAR 08
Sales 18153.19 15611.92 13920.76
PAT 4061 3263.59 3120.1
ROE 29.33 25.42 27.88
ROCE 43.65 37.38 40.44
Asset turnover 2.34 2.39 2.67
ratio
PE ratio 29.30 23.04 26.87
EPS 8.98 8.02 7.68
Operating margin 33.02 32.84 31.57
%
Debt-Equity ratio 0.01 0.02 0.02
Investment rationale

• As ITC’s non-cigarette portfolio is growing faster than its cigarette business, the company’s
dependence on the cigarette business is declining. However, this is not to say that the cigarette
business is stagnant

• It is investing heavily to ramp up its distribution and logistics channels to supply their goods
as fast as possible without any delay. Although it is investing heavily in this distribution, but
in the future the company enjoys so many benefits.

• Aggressive marketing strategies are used to sell their products as soon as possible. They
invest more on the advertising also.

• Attractively priced compared to its peers. The company’s policy to pay regular dividends to
its shareholders makes its shares even more attractive.

• Year on year the sales and the PAT are increasing.

Share holding pattern of ITC

Other companies
ForeignOcb
Financial institutions
NBanksMutualFunds
ForeignInstitutions
GeneralPublic
ForeignNRI
Others
ForeignIndustries
CPCL:

MAR 10 MAR 09 MAR 08

Sales 25025.79 32162.9 28153.49
PAT 603.22 -397.28 1122.95
ROE 18.48 -12.16 36.80
ROCE ROCE (%) 13.52 -7 36.91
Asset turnover 5.49 7.1 6. 58
ratio
PE ratio 7.67 0 3.86
EPS 38.49 0 72.48
Operating margin 3.53 1.21 7.31
%
Debt-Equity ratio 0.86 0.61 0.7

Investment Rationale:

• Largest refinery in Southern India accounts for 6% of India’s total refining capacity
• The company operates only in one segment i.e. refining. So, no losses from any other
segment are affecting its profit
• No subsidy burden as it is a standalone refinery.
• Gross refining margins (GRMs) to remain strong due to strong global crude oil prices
Share holding pattern of CPCL:

Promoters
FinancialInstitutions
GeneralPublic
OtherCompanies
ForeignInstitutions
NBanksMutualFunds
Others
ForeignNRI

Pidilite:
MAR 10 MAR 09 MAR 08
Sales 1929.74 1761.12 1535.31
PAT 289.12 146.38 188.35
ROE 34.58 21.31 33.41
ROCE 27.26 16.57 27.22
Asset turnover 2.55 2.61 2.83
ratio
PE ratio 20.94 15.41 18.61
EPS 5.46 5.48 7.14
Operating margin 20.58 13.96 17.08
%
Debt-Equity ratio 0.59 0.77 0.57

INVESMENT RATIONALE:

• The Company has dominant position in the domestic sealants and adhesive market in India
with its brand Fevicol. The company has been ranked amongst top 25 brands recognized in
India. So, by this we can say that it has strong brand image.
• The company sales have increased on the back of strong brand building efforts, introduction
of new products and various acquisitions. With dominant market share for its products we
expect the company to continue to grow in the coming years.
• The Company has started expanding its range of adhesives and sealants used for building
construction and interior decoration. The range which was so far mostly focused on making
furniture has now been expanded to include adhesives for fixing tiles, marble, granite, etc. on
various surfaces, adhesives for fixing wall papers and adhesive for laying wooden floors.
• The company plans to launch different products in different segments.
 • The Company reported better operating profit margins at the end of Q1FY10, mainly due to a
reduction in prices of raw material
• Pidilite Industries is also growing its international presence through acquisitions and setting
up manufacturing and marketing facilities abroad. The company has 13 overseas subsidiaries
• It maintains good relation with the clients and maintains a good distribution network.
• We can see the from the below graph, percentage of growth of stock value of Pedilite is very
high compared to the Nifty growth.
• And Year on year the sales of the company are increasing and even the PAT is also
increasing, by seeing all these we are suggesting this company.

Share holding pattern of pidilite

Promoters
FinancialInstitutions
GeneralPublic
OtherCompanies
ForeignInstitutions
NBanksMutualFunds
Others
ForeignNRI
LIC Housing finance Limited:
MAR 10 MAR 09 MAR 08
Sales 3466.36 2883.23 2168.51
PAT 662.18 531.62 387.19
ROE 23.56 26.15 22.94
ROCE 10.07 11.01 10.12
PE ratio 12.98 3.72 6.38
EPS 67.16 60.34 43.85
Operating margin 95.73 94.64 92.65
%
Debt-Equity ratio 10.7 11.26 10.87

Investment Rationale

• It is the second largest retail housing company in Indian after HDFC.

• It is expanding its business by starting more number of branches
• Robust recovery mechanism
• Strong risk measurement practice
• We can see from the below graph the percentage of growth of the stock value of LIC Housing
is far away from the percentage of nifty growth.
• And year on year its sales are increasing and its operating margin percentage is also
increasing, and it is even increasing its network.
Share holding pattern of LIC Housing finance Ltd

Promoters
FinancialInstitutions
GeneralPublic
OtherCompanies
ForeignInstitutions
NBanksMutualFunds
Others
ForeignNRI

UCO Bank:
MAR 10 MAR 09 MAR 08
Sales 9526.32 8121.38 6508.56
PAT 1012.19 557.71 412.16
ROE 31.60 21.13 17.55
PE ratio 3.13 2.41 7.40
EPS 18.03 9.97 4.99
Operating margin 9.34 7.52 3.57
%
Debt-Equity ratio 34.21 36.11 32.16

Investment Rationale:

 Year on year its profits and sales are increasing.

 Its EPS is also increasing.
 A growth of 21.13 per cent in global business
 Its operating margin % is also increasing.
 It gives Services in Agriculture, Industry, Trade & Commerce, Service Sector, Infrastructure
Sector
 Shareholding Pattern On 30.06.2010

Others General public

0% 17%
NRI's/OCB's/Foreign Others
0%
Private Corporate Bodies
4%
FII's
4% Indian Promoters
64%
Banks Fin. Inst. and Insurance
11%

IFCI LTD:
MAR 10 MAR 09 MAR 08
Sales 1656.24 1373.18 1910.05
PAT 670.94 657.15 1020.57
ROE 22.43 25.70 75.04
ROCE 13.46 13.99 21.74
PE ratio 5.58 2.29 3.70
EPS 8.93 8.42 11.89
Operating margin 93.25 123.55 144.08
%
Debt-Equity ratio 3.53 3.4 7.42

Investment Rationale:

 IFCI is one of the oldest NBFC involved in activities like Project finance, financial services,
Non project specific assistance nodal agency for SDF and corporate advisory services.
 They have cleaned their entire NPA, now the book is carrying standard loans of Rs. 7000 cr
backed by equal amount of borrowings.
 Going further the government proposal of giving fresh banking licenses to FIs / NBFC’s
could be positive news for the company. IFCI is looking to enter commercial banking.
 The main trigger for the stock could be the process of inducting a strategic investors, which
would invest fresh funds and unlock the value of the company. This will add on to the
premium to the current stock price.

Shareholders Pattern as on 30.06.1010

Banks Fin. Inst.

and Insurance
30% FII's
39% Private Corporate
Bodies
NRI's/OCB's/Foreig
n Others
Others
16% General public
0%
14%
1%