Stock Investing Made Easy

Investing in the stock market has always been a desirable choice but a challenging task for generating additional wealth, especially in a changing interest rate scenario. The potential wealth-building opportunities available in the market can be maximized by gaining knowledge and building confidence in stock market investing. 

Keeping this in mind, we have curated a stock investing course that will provide you with the right knowledge and confidence needed to analyze and evaluate businesses. 

This course aims to help you make well-informed decisions that align with your financial objectives using real-world examples and practical activities.

In this course, we will first understand the basics of fundamental analysis and the goals behind doing it. We will then delve into the various approaches to stock investing and learn to analyze a company by conducting company analysis and understanding the financial statements. 

Additionally, you'll learn about ratio analysis, a powerful approach that highlights important aspects of a company's financial health, such as liquidity, profitability, efficiency, solvency, growth potential, and risk assessment. 

As we progress through the modules, you'll learn strategies for determining what makes certain businesses more competitive than others. Additionally, we will discover how to apply this information to wise investing decisions that provide significant rewards. 

Please find below the topics covered under the course Stock Investing Made Easy:

Section 1: Introduction to the Fundamental Analysis

We will start with understanding the basic concept of fundamental analysis and how you can become an owner of a company by purchasing its shares. We will then touch upon the factors that affect the stock prices, such as negative or positive newsflow, liquidity in the company, etc. Additionally, we will also explore the 5 mantras of value investing. 

Section 2: Different Approaches to Stock Investing

Further, we will explore the different approaches to investing using fundamental analysis in detail. Using simple comparisons, we will first understand the Top Down & Bottom Up approach to investing. Then, we will understand the significance of economic analysis before investing in a company and see how a prevailing economic condition can impact a company’s financials using examples from the IT sector. Next, we'll look at Porter's Five Forces Analysis, a popular framework for identifying strong businesses from competitors and identifying sectors that provide good investing opportunities. We will also touch upon the outcomes of Porter’s Five Forces model and understand its advantages and disadvantages. Moving on, we’ll look at another analysis technique known as SWOT analysis with a detailed explanation of the meaning of a business’ Strengths, Weaknesses, Opportunities, and Threats with practical examples.

Section 3: Learn to Analyze a Company

Now we will look at the various parameters, such as the business model and financials, which are to be analyzed before investing in a business. We will then understand the difference between the qualitative aspects including corporate governance, management etc and quantitative aspects, such as financial ratios. Additionally, you will find an extensive guide on a annual report, covering everything from an introduction to its detailed content. This will equip you with the knowledge of effectively utilising an annual report for analyzing a company's investment worthiness.

Section 4: Learn to Read a Balance Sheet

Moving on, we will understand what a balance sheet is and explore both the assets and liabilities side of the balance sheet. We will also learn how to analyze a company by looking at its balance sheet. 

In this section, we will delve into a case study decoding a balance sheet of a made-up entity. This will help you understand how to interpret the data given in a company's balance sheet. Next, we will understand the asset side, i.e., the left side of a balance sheet and the liability side, i.e., the right side of the balance sheet. It will cover the various types of headings that come under the asset side of a balance sheet and how each point is relevant to us.

Section 5: Analyzing Financial Statement

Next, we will look at the different financial statements of a company, such as a Cash Flow Statement and Profit and Loss Statement and how to analyze them to understand a business’s financial condition. We will also learn how to calculate the profit and loss of a company. 

We will start by understanding the importance of the cash flow statement and its types, including cash flow from operations such as tax payment, salary payment, factory rent, etc; cash flow from investing such as acquiring a factory, buying equipment, etc. and cash flow from financing such as interest payment, dividend payments, etc. We then move on to understand a business’ income statement, where we cover details such as expenses and income. This will help us understand how to calculate the net profit based on the various data provided. With the help of a case study on Pidilite Industries, we will explain individually each heading that comes under an income statement.

Section 6: Learn Ratio Analysis

• Efficiency Ratios: These are essential parameters under fundamental analysis that help to analyze numerical values in financial statements. We will understand ratios such as Days of Payable, Earnings Per Share (EPS), Days of Inventory, PAT Margin(%), EBITDA Margin(%), EBIT Margin, Book Value per Share, and Working Capital Cycle and analyze them using StockEdge App. 
• Growth Ratios: These ratios give you an idea about the rate at which a business is growing. We will learn about various ratios, including EBITDA Growth, Earnings Per Share Growth(%), Net Profit Growth(%), Net Sales Growth(%) and track using StockEdge App. 
• Return Ratios: These ratios measure how well an investment is being managed. They help in determining if an investment generates the maximum possible return. We will explore ratios such as Return on Equity (ROE), Return on Capital Employed (ROCE), and Return on Assets (ROA) and track using StockEdge App.
• Cash Flow Ratios: These ratios indicate how frequently a business can pay off current obligations with cash generated over the same period. We will learn and analyze ratios such as Free Cash Flow per Share and Cash Flow per Share with StockEdge App.
• Solvency Ratios: A company's cash flow is evaluated using a solvency ratio to see if it can cover its long-term obligations. We will learn and analyze the Current Ratio, Interest Coverage Ratio, and Debt-to-Equity Ratio and track them using StockEdge App.
• Banking Ratios: These ratios provide insights into how effectively a bank manages its assets, liabilities, and operations. We will understand various banking ratios such as Net Interest Margin, Yield on Advances, Net Non-Performing Assets (NPA), Operating Income Growth, Interest Expended to Total Funds, and Interest Income to Total Funds.
• Valuation Ratios: A valuation ratio compares a company's market worth to its financial soundness. It helps us assess how attractive the stock is. We will analyze ratios, including Market Cap to Sales Ratio, EV to EBITDA Ratio, Price to Book Value Ratio, etc.

Section 7: Key to Fundamental Analysis

In this section, we will understand how we can use the historical financial statements of a company to estimate its current position. You will understand what part of your sales is Total Expenses, EBITDA & EBIT. Moving ahead, we will understand how to estimate the 5-year P/L Statement of Pidilite Industries to understand future forecasts. We will then understand how to estimate the 5-year Balance Sheet of Pidilite Industries. Further, we will touch upon the concept and importance of the historical balance sheet and learn how to estimate the current position from its historical balance sheet. We will then learn to estimate the quarterly financial data provided by the company and use them to analyze it.