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Valuation of Selected Indian Stocks using Discounted Cash Flow Techniques

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  • Shradhanjali Panda

    ("Dimitrie Cantemir" Christian University)

Abstract

The present paper aims at using a valuation model based on Discounted Cash Flow Method. Quarterly intrinsic values for the year 2010 are calculated by this model. The calculated Intrinsic values are compared with the corresponding market values in order to know whether the model is capable enough to capture the market price or not. Welch’s t-test is conducted to check the significance level between the two values and robustness of the model. Selected “A” category companies are taken for the study and the time period of the study is from 1st January, 2001 to 31st December, 2010.

Suggested Citation

  • Shradhanjali Panda, 2013. "Valuation of Selected Indian Stocks using Discounted Cash Flow Techniques," Knowledge Horizons - Economics, Faculty of Finance, Banking and Accountancy Bucharest,"Dimitrie Cantemir" Christian University Bucharest, vol. 5(4), pages 36-42, December.
    • Handle: RePEc:khe:journl:v:5:y:2013:i:4:p:36-42
    as

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    References listed on IDEAS

    as
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    3. Welch, Ivo, 2000. "Views of Financial Economists on the Equity Premium and on Professional Controversies," The Journal of Business, University of Chicago Press, vol. 73(4), pages 501-537, October.
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    6. Fama, Eugene F & French, Kenneth R, 1995. "Size and Book-to-Market Factors in Earnings and Returns," Journal of Finance, American Finance Association, vol. 50(1), pages 131-155, March.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Equity Free Cash Flow; Fundamental value; Market value; Discounted Cash Flow; Equity stock;
    All these keywords.

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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