Summer Training Report
On
Financial Modelling and Valuation
at
SUBMITTED BY: HARSHAD KUMBHARE
ROLL NO: 17135038
(Duration: 7th June 2021 to 21st July 2021)
pg. 1
INDEX
Sr. No. Content Pg. No.
1. Acknowledgement 3
2. Certificate 4
3. Introduction 5
4. Understanding Excel &. 6-7
Investment Decision Techniques
5. Application of Decision Techniques &. 8-9
Financial Statement Valuation
6. Conclusion 10
7. Bibliography 11
pg. 2
Acknowledgement
It is indeed a matter of great pleasure and proud privilege to
be able to present this project on “Financial Modelling and
Valuation”.
This report is an outstanding prospect to convey my
gratefulness to those many people whose timely help and
guidance went a long way in finishing this training online
working from commencement to achievement. I am very glad
to work with the organization “Internshala Trainings”.
Last but not the least would like to thank my friends, family
members and all those people who helped me for the
completion and deeper understanding of the concept of my
work.
pg. 3
Certificate
ǵ̿͝ʎǵɎڂČͽ˪Ȼʎǵ̿ɟ
ɥ̥˧ːÈ˗ȳʇǹ˗È˗͔̓ʇ͔͔ͣɄ˧ɥƛɄȧɴ˗˧ʳ˧ɪΖԕD¤ƧԖՏLJǹ̥ǹ˗ǹ̓ʇՏɴǹ̓̓ͣȧȧɄ̓̓ɥͣʳʳΖȧ˧ː̛ʳɄ͔Ʉȳǹ̓ʇΑΈɄɄʫ̓˧˗ʳʇ˗Ʉ͔̥ǹʇ˗ʇ˗ɪ˧˗
ʡ˱ǵ˱ɂʡǵˍڂġ́Ɏɟˍʡ˱ʄڂǵ˱Ɏڂǃǵˍͽǵͮʡ́˱ՐƛɴɄ͔̥ǹʇ˗ʇ˗ɪȧ˧˗̓ʇ͔̓Ʉȳ˧ɥƧ˗ȳɄ̥͔̓ǹ˗ȳʇ˗ɪbΑȧɄʳՏÈ˗΄Ʉ͔̓ːɄ˗͔WɄȧʇ̓ʇ˧˗
ƛɄȧɴ˗ʇ̡ͣɄ̓Տ̛̛ʳʇȧǹ͔ʇ˧˗˧ɥWɄȧʇ̓ʇ˧˗ƛɄȧɴ˗ʇ̡ͣɄ̓Տʇ˗ǹ˗ȧʇǹʳƍ͔ǹ͔ɄːɄ˗͔˗ǹʳΖ̓ʇ̓ǹ˗ȳLJǹʳͣǹ͔ʇ˧˗ː˧ȳͣʳɄ̓Ր
NJɄΈʇ̓ɴ¤ǹ̥̓ɴǹȳǹʳʳ͔ɴɄȠɄ͔̓ɥ˧̥͔ɴɄɥ͔̥ͣͣɄɄ˗ȳɄǹ΄˧̥ͣ̓Ր
Wǹ͔Ʉ˧ɥȧɄ̥͔ʇɥʇȧǹ͔ʇ˧˗ՓӪӨӪөԫӨӱԫӪӪ LɄ̥͔ʇɥʇȧǹ͔Ʉ˗˧ՐՓӬӲӨӨӳӮDԫӭӪӳWԫӪDӰԫӭӪӱӪԫӪӳӲөWӲӮӰӪWӬ
˧̥ȧɄ̥͔ʇɥʇȧǹ͔Ʉǹ͔ͣɴɄ˗͔ʇȧǹ͔ʇ˧˗Տ̛ʳɄǹ̓Ʉ΄ʇ̓ʇ͔ɴ̛͔͔̓Փԧԧ͔̥ǹʇ˗ʇ˗ɪ̓Րʇ˗͔Ʉ̥˗̓ɴǹʳǹՐȧ˧ːԧ΄Ʉ̥ʇɥΖռȧɄ̥͔ʇɥʇȧǹ͔Ʉ
pg. 4
Introduction
In today’s times, a successful financial professional is someone
who can handle large volumes of numerical data, bring
coherence to the data and make it useful for senior
management in their decision-making process.
In this program, I learned to create efficient, robust and
flexible financial models to report and analyze historical data,
prepare future projections and present integrated financial
statements, key financial ratios, outputs in a logical,
summarized and effective manner.
This training helped me to build a dynamic, logically designed,
well-structured 3-statement financial model and to create
multi-year forecasts for the income statement, cash flow, and
balance sheet. Performed scenario and sensitivity analyses to
enhance the robustness of the financial model to identify the
different valuation methodologies and discuss the pros and
cons of each.
I also perform a valuation analysis using comparable company
and precedent transactions analysis and calculated the
weighted-average cost of capital and construct a DCF model in
Excel.
pg. 5
Understanding Excel
&
Investment Decision Techniques
I grasped all the tips, tricks, shortcuts, functions and formulas
needed to be an Excel power user. This course was designed
specifically for Excel users who are performing professional
financial analysis and financial modelling. Hence it covered all
levels - from beginner to advanced users. The content was
geared towards financial modelling and financial analysis
used in investment banking, equity research, private equity
and more.
I learned about using various functions required during a
financial valuation of a company. Using simple function like
Goal Seek, Data Sorting & Filtering and many more, I
managed to build 3-Statement financial model of the company
“Hero Moto Corp” for 2018.
The second part of the training was the Investment Decision
Techniques wherein I learned how to calculate certain
important terms which plays a very crucial role in a company’s
performance. Here I learned about some major terms like time
value of money, future value and compounding which helped
me in understanding basic financial principles to applying
financial analysis and ratios to drive decisions.
pg. 6
In addition, I understood the language associated with finance
and the know how and when to use financial terms and
analysis techniques. I also read and assessed a company’s
performance using financial statements which helped me to
recognize the link between organizational strategy and
financial objectives and guided me to make more informed
decisions about a company.
pg. 7
Application of Decision Techniques
&
Financial Statement Valuation
Under this section, I learned the cost of a product varies in the
market and how it affects the sales of a company. I got to know
about varies terms like Make v/s Buy and Break-even Analysis
and EMI calculations.
The investment decision is about recognizing that often we
have to spend money to make money. We have to spend
money on assets in the balance sheet to generate annual
profits in the income statement. The investment decision is
best made by calculating the net present value or NPV of the
investment. Which is just a cost-benefit analysis that takes
into account the time value of money and risk.
Next and the most important part is the Financial Statement
Analysis. This is where the know-how of the mechanics of the
three financial statements i.e., balance sheet, income
statement and cash flow statements was covered. I used
various valuation metrics such as PE ratio, EPS ratio, EBITDA,
and many more to determine how cheap or expensive a stock
of a company is.
I analysed financial statements of two big company’s i.e.,
Nestle and Hero Moto Corp and calculated various metrics
pg. 8
and ratios to determine the health or the position of the
company financially in the market and the industry.
pg. 9
Conclusion
Financial Modelling is a technique used by companies for
financial analysis and for forecasting; planning the business
performance. It is carried out by developing a financial model
tool. It is a mathematical model created to get an abridged
version of financial performance. The output from financial
modelling are primarily used for decision-making.
Financial Modelling is done for strategic decision-making by
the management of the company for various purposes
like analyzing company’s performance, for valuation of a
business, comparison with peers and competitors in the
industry, forecasting the performance, etc. There are various
financial models and it involves various assumptions
and theories.
Financial Modelling technique is selected based on the needs
and requirement. The financial model tool is basically created
using excel spreadsheet.
Financial modelling is prepared for multi-purpose, it is used for
financial analysis, for decision-making and to understand the
company’s financial position and performance. Financial
Models are created based on the purpose and need to support
the decision-making and to resolve the business problems.
pg. 10
Bibliography
1. https://trainings.internshala.com
2. https://www.investopedia.com/terms/f/financialmodeli
ng.asp
3. https://corporatefinanceinstitute.com/resources/knowl
edge/accounting/three-financial-statements/
4. https://corporatefinanceinstitute.com/resources/knowl
edge/modeling/what-is-financial-modeling/
5. https://www.investopedia.com/financial-analysis-
4427788
pg. 11
