Matchday 3

What is the primary focus of Company Analysis?

• Predicting short-term price movements

• Studying a company's fundamentals, such as its business model, management, and growth potential

• Identifying overbought and oversold stocks using technical tools

• Evaluating market conditions and stock timing

Which of the following is NOT a key area to study in Company Analysis?

• Business Model

• Competitive Edge

• Moving Averages

• Growth Potential

What is the first step in analyzing a company?

• Studying the stock price trends

• Understanding what the company does and how it makes money

• Calculating its valuation ratios

• Comparing it to its competitors

What is referred to as a company’s “superpower”?

• Its ability to innovate and create unique products/services

• Its financial metrics like P/E ratio

• Its stock performance over time

• Its management strategies

What does the Profit and Loss (P&L) Statement represent?

• A company’s long-term growth potential

• A report card of a company’s financial performance over a specific period

• The amount of assets and liabilities a company has

• A breakdown of shareholders’ equity

Why is the P&L statement important for businesses?

• It tracks only the taxes a company pays

• It helps businesses decide on future strategies and attract investors

• It tracks long-term goals and assets only

• It focuses solely on a company’s net worth

If a company has an Operating Profit of ₹120,000 and Operating Expenses of ₹160,000, what is its Gross Profit?

• ₹280,000

• ₹120,000

• ₹160,000

• ₹40,000

What does the term ‘Operating Expenses’ include?

• Advertising and rent

• Interest paid

• Interest paid

• Other income

What does it mean when a company is part of a specific "sector" in the stock market?

• It operates globally.

• It belongs to a group of companies with similar business activities.

• It has a monopoly in its industry.

• It is listed on the stock exchange.

Why is it important to know the management team of a company before investing in its stock?

• To predict the company’s future success based on leadership.

• To see if the managers are rich.

• To find out if the managers own company shares

• To get personal investment advice from them.