We’re back with the final book of numbers for the fiscal 2010-11—the Q4 Report, or the quarterly report card of some of the top Indian companies’ results. Flip through the pages and read the stories that numbers have to tell. Run your finger down the price-earning (P-E) multiple column of public sector banks and then flip over the page and do the same for private sector banks. The higher numbers on Page 8 compared with the previous talk about the investor unease at government control and overall ennui in state-run banking. Look at net margins, return on equity and growth numbers in agro and agro based sectors and then look at those that have been liberalized like most manufacturing and services and you see the story of two Indias play out. One that remains tethered to the past and one that is racing towards getting India into to the ranks of a developed country.
Also See | The Q report (PDF)
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The next set of Q Reports may show the pressure of inflation and a tightening interest rate cycle. The smoke signals for the next four quarters are worrying. However, this is not a signal to move out of equity—zero equity in the portfolio is no longer an option for India targeting wealth creation. Tough times just mean more work for direct equity investors and prudence for those who access equity through funds. Thank you for mailing your suggestions on this new initiative from Mint and I look forward to your feedback on the additional data or analysis you want to see in the Q Series, Season 2.
Stay in the money.
The book has been indexed in industry-wise format. The industry classification has been done on the basis of core activities of the company, which have major contribution to the turnover of the company. If at least 50% of the company’s turnover comes from the activity, it has been classified under that head. The stocks have been picked on the basis of market capitalization and companies with highest market capitalization have found their place in detailed result analysis table. The other important stocks have been put in sector statistics table, which are also being picked on the basis of market capitalization and arranged alphabetically. The columns of sector statistics have three basic types of analytical components—earnings, valuations and returns. For earnings, price-earnings multliples and earnings per share are taken, price-to-book value ratio for valuations and return on equity for returns.
We have considered companies which came out with results till 20 May. Some companies have opted to publish audited results within 60 days from the end of quarter and these results were not available for analysis.