SL Equity Guide BLOG

Diversified Conglomerates in CSE have been classified under different fields therefore investors can't really compare each other to understand which carries the better value. I have conducted an analysis using financial ratios as well as market ratios to rank each diversified company on their merits using a rating scale of 1-10 where 1 being the best and 10 being the worse. Using this analysis I have ranked 10 diversified conglomerates listed in CSE and ranked accordingly. The financial ratios used in this analysis are;, a) Return on Equity (ROE) - Profit attributable to shareholders / Equity balance b) Quick ratio - (Current assets - inventory) / Current liabilities c) Debtor turnover days - Trade payable balance / Sales revenue x 365 d) Gearing ratio - Total interest bearing borrowings / (Total interest bearing borrowings + Equity) e) Interest cover - Operating profit / Net finance cost f) OCF per share - Net cash generated from operations / No of shares in issue The market ratio...

The Food processing companies in CSE under new classification are not properly classified and not reflecting the true sector PE. Therefore I have selected 12 food processing stocks that are matching with the business in principle and calculated the "Cluster PE" based on the same company list to compare the relative (over) / under valuation of the different stocks based on the calculated cluster PE.  The below chart demonstrate the calculation mechanism of the said cluster PE for food processing companies. By using the above showed cluster PE I have calculated the individual PEs of 12 finance companies as of 2nd July based on trailing 4 quarter EPS basis. Then I have compared the PEs with the established cluster PE and list down the undervalued shares based on the highest degree of undervaluation as per below chart. I believe the above calculation will help you to identify the relative valuations of each finance sector stock and make it easy to take informed decisions. Thanks

The Diversified Finance sector in CSE under new classification is not reflecting the true sector PE due to the inclusion of number of non relevant companies. Therefore I have selected 19 finance stocks that are matching with the business in principle and calculated the "Cluster PE" based on the same company list to compare the relative (over) / under valuation of the different stocks based on the calculated cluster PE.  The below chart demonstrate the calculation mechanism of the said cluster PE for diversified finance companies. By using the above showed cluster PE I have calculated the individual PEs of 16 finance companies as of 30th June based on trailing 4 quarter EPS basis. Then I have compared the PEs with the established cluster PE and list down the undervalued shares based on the highest degree of undervaluation as per below chart. I believe the above calculation will help you to identify the relative valuations of each finance sector stock and make it easy to take i...

 New DVP System of CSE DVP stand for Delivery Vs Payment. SEC together with CSE is planning to introduce this to minimize the risk of default in settlement though nothing of such serious issues occurred previously so far. This DVP system is prevailing in all developed markets as well as emerging equity markets and by doing so SEC is planning to upgrade the status of CSE to an emerging equity market thereby attracting more foreign investments to the CSE. Some investors have very confused minds on this new method and some are scared of a blood bath in the market next week. I am advising my viewers that there is nothing negative in this system and will not affect any functionality of current system. Even under the DVP system anyone can buy any stock and sell at any time. The cash payment on the purchases will happen as usual T+3 time frame. Anyone can do day trades. Anyone can use margin trading and anyone can use broker credit as usual. Anyone can claim the dividend as long as they...

After the emergence of the third wave of Covid 19 the CSE ASPI has fallen from 7,644 points on 15th April 2021 to 7,240 points on 28th April 2021. This is 5,3% decline overall due to panic selling over another country lock down. But as I repeated over and over in my you tube channel "SL Equity Guide" the Government won't go for such a lockdown since its economic impact is severe to the country. Now the government has openly communicated that they are not going to another lock down and as a result the market is beginning to bounce back recovering the losses caused by earlier panic selling. Here I have produced a comparison of prices of 26 shares between the price they trade on 15th April and the price on 28th April. These shares are due to report good quarterly financial statements and I can see good short term upside potential as well. Here is the list.   

Today ASPI recovered to 7,310 showing signs of moving back towards 7.500 level. There are plenty of stocks currently trading at more than 10% price discount to their values previously when the ASPI hit 7,500 levels. These shares may have the potential to move back to those values faster in case ASPI reach 7.500 levels in near future. Further there are some stocks now surpass the prices prevailed when ASPI was @ 7,500 due to fundamental reasons and the most commonly attributable reason is expected good earnings reports for Q1 2021. These shares have the potential to reach closer to their high prices reached during January peak hence it will be beneficial to keep an eye on these shares. Below given are the snapshot of those shares for your easy reference. Thanks