1)While studying the stock,studying the peer competition is very important.Also make a chart between high price and earning comparisons.1)THe company should deserve investment under stringent conditions.1)Keep an investment journal to record your desicions and finding the error in it while developing your thinking.1)DCF calculation in page 65 dhandho investors,kelly formula 721)Check value investors holding in market sites.1)Select a exceptional stock ideas,generally good ideas are rare when gets an oppurtunity bet heavily then zero it down to the best idea, then studying it inside out, also willing to discard the old idea and repeat the process till finding the stock.1)See the optocircuit safal niveshak bookmark2)Company's ability to service its debt.1)If the earnings were not properly stated; if the balance sheet revealed a poor current position, or the funded debt was growing too rapidly; if the physical plant was not properly maintained; if dangerous new competition was threatening, or if the company was losing ground in the industry; if the management was deteriorating or was likely to change for the worse; if there was reason to fear for the future of the industry as a wholeany of these defects or some other one might be sufficient to condemn the issue from the standpoint of the cautious investor.1) create excel sheets which is the pulse of he human body.2)Get a 360 degree view.A buyer view of a stock and a sellers of the stock,spotting the black swans3)The investment checklist perfection,avoiding biases a charlie mungers approach.4)A total business outlook.3)Make percentage balance sheet and percentage income statement.4)The proper determination of the company through the cash flow statement.5)Major consideration should be given to the economic goodwill, economic value of the enterprise. 6)Check altman z scores use the safal niveshak pdf.7)Create a critical path analysis for planning your project with windows project.8)Use windows note to make notes.9)While calculating PE twelve months trailing PE should be caculated to find the market emotional quotient.10)Crosscheck formula with asian paints excel.11)The 12 lessons of making you a better investor in safal niveshak should be read.and the a business model containing the nook and corner of the business should be built upon the checklists given in the 12th lessons.It should contain a minimum of written 30 pages.12)FOR VALUE INVESTING INTERVIEWS watch the you tube channel of Manual Ideas and Value conferences.13)Split up the ratios and understand the formulaes,what drives a formulae up. 14)Use the liquidation analysis framework for selecting stocks from Manual of ideas notes.15)Make 2 columns and write down to differentiate .Understand what you know and don't mix what you know with speculation.16)Anchor a valuation on what you know rather than on speculation 17)Return to fundamentals; prices gravitate to fundamentals (but that can take some time.18)Valuation, in turn, is a matter of translating one's knowledge of the business model and its execution into a price for the business. One observes factories, mines, farmers ?elds, inventories, customers, suppliers, sales and purchase prices, and the many transactions in which a business engages. What to make of it? 18)Consider various scenarios of possible outcome while preparing the research report. 19)You could screen stocks based on high ROCE and ROE and good sales growth to run the screeners before evaluation of firms.20)Make a rating scale(1-10) for selecting already screened stocks by giving appropriate weightage for each point in the selection criteria based on quantitative and qualitative factors.21) We ? nd the following proxies for management ability to be par- ticularly instructive: return on capital employed, growth of capital employed (per share), the margin pro? le, asset turnover, and capital expenditure trends. 22)We prefer to focus on return on capital employed, which we calculate as operating income divided by the capital actually employed in running the business. The latter may be approximated as property, plant, and equipment plus current non?nancial assets minus current non?nancial liabilities. Common-sense adjustments should be made to this formula to arrive at the true amount of capital employed in the business. For example, if a business requires a certain amount of cash to be on hand, then the estimated amount should be considered capital employed. On the other hand, if a business owns real estate not used in running the core business, the estimated value of such real estate should be excluded from capital employed. This is analogous to the concept of enterprise value, which many investors rigidly calculate as equity market value plus net debt. However, enterprise value requires common-sense adjustments, for instance, when a large amount of cash on hand is de facto restricted because it represents seasonally high customer deposits or prepayments. When we attempt to relate return on capital to the skill level of management, the analysis improves if we not only account for the absolute return but also consider the following: How does the return on capital employed compare to the average return of similar companies? How does the return compare to the historical return of the company, with particular attention to the period prior to the tenure of current management? How has the gap between the returns of the company and those of comparable trended over time?23) To incorporate capex data into an analysis of management abil- ity, we screen for capex growth in relation to sales growththe lower the ratio, the better. We also screen for capex in relation to depreciation and amortization (D&A). If a company manages to keep capex below D&A, it may generate free cash ? ow in excess of net income, perhaps justifying an above-average multiple of reported income.24)Are the board of directors competent enough.25)Management compensation an d incentives?26)It may be fair to state that most superinvestors achieve success by ? nding high-quality businesses at attractive prices. A high-quality business typically has several key attributes, including high returns on capital employed, an ability to reinvest capital at a high rate of return, an ability to sustain high rates of return through durable competitive advantage, a balance sheet that affords the company strategic ? exibility, and a management team that is both capable and shareholder-friendly. An attractive price is easier to gauge, as it typically implies a high yield based on earnings or free cash ? ow to market value. In rare instances of market distress, high-quality busi- nesses may also trade at a discount to tangible book value. 27)The per-share trading range of a stock generally tells us less than does a trading range modi?ed for certain operating data. For example, when we analyse how a company s current forward P/E ratio compares to the companys historical range of forward P/E ratios, we can quickly gauge how the market s perception of a company s earnings growth prospects has changed over time. Also useful might be comparing the P/E ratio percentile rank of a company within its industry to the historical percentile rank. This might reveal how a company is perceived relative to other companies in the same industry. The P/E ratios can be highly volatile, as annual pro?tability for all but the most stable businesses also tends to be volatile. As a result, plotting a historical chart of enterprise value to revenue, in absolute terms and as a percentile rank, could give us more meaningful insights.28)Consistent FCF 29)Remember, when he was analysing the balance sheet of optocircuits he found dissimilarities in the exmployees payment a big company with 500 employees were paying less than 12000 per employees!!! The first red flagNo tax was paid at all for a company with PAT of 534cr only 2cr was the tax paid,!!! the next red flag.Big acquisitions were favoured by large debts.The working capital was negative.30) In the absence of identi? able drivers of inef? ciency, the prob- ability may be higher that our appraisal of value contains an oversight or ? aw. If we can identify a non-fundamental factor that explains the low valuation, we gain con? dence in an esti- mate of value that differs from the market price. 31) Look for disconforming ecidence.after the complete hypothesis. 32)What are the trends in the changes of working capital 33)Percentage balance sheet will help in undedrstanding the progress of the balance sheet.Compare percentage income statement to get ideas on the industry,34)Study the banking sector, 7 companies avg 5years, Ev/ ebit, Pe variations, quantitative and qualitative factors.After reading financial statement book create a base report and then build up on that, making variations in the future.