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Message Icon Topic: Free Cash flow. Is this the only thing? Post Reply Post New Topic
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Jaspreet
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Quote Jaspreet Replybullet Posted: 27/Aug/2011 at 9:59am
Thanks Bobdylan for taking pains in doing these calculations.
The only doubt I have is around CFO (cash flow from operations). Under the heading "Cash Flows" it is directly quoted as "Net Cash From Operating Activities".
Using its value of 17.24, i get a -ve FCF.
I can assure you for Mayur this value is wrong.
:(

So where did it go wrong?
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Jaspreet
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Quote Jaspreet Replybullet Posted: 27/Aug/2011 at 10:10am
I have a theory.
One method of FCF = CFO - Capex
So, by this for Mayur FCF = 17.24 - 10.73 = 6.51
This sounds reasonable :P
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Quote bobdylan Replybullet Posted: 28/Aug/2011 at 3:04pm

they must have  accomodated the working capital changes in the cash flow from operations term .so what u have done cfo-capex come close and 7cr Free cash flow from both methods is plausible for a company like mayur.

i would advise to go from the basics like i did,because then u are sure of all the terms and u are directly taking figures from the balance sheet and P/L account.
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Jaspreet
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Quote Jaspreet Replybullet Posted: 28/Aug/2011 at 3:49pm
Sure, I agree! Appreciate everyone's effort and time for taking pains in explaining it.
Just goes on to show the power of TED :)
To me it is The Enlightenment Desk :P
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datta.supratik
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Quote datta.supratik Replybullet Posted: 28/Aug/2011 at 9:01pm
I have another query. Is cash flow calculation wrt to another parameter say EBIT(1-t) yield us better result. I mean do we have some ratio?

~Supratik
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LearningToFly
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Quote LearningToFly Replybullet Posted: 28/Aug/2011 at 9:16pm
Can you please explain the queation Supratik

Originally posted by datta.supratik

I have another query. Is cash flow calculation wrt to another parameter say EBIT(1-t) yield us better result. I mean do we have some ratio?

~Supratik
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j2eeprofessiona
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Quote j2eeprofessiona Replybullet Posted: 28/Aug/2011 at 11:57pm
nice work guys .... 
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Jaspreet
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Quote Jaspreet Replybullet Posted: 28/Aug/2011 at 10:25am
So we all agree that having free cash flow is all fine and nice.
But even I would like to view Free cash flow in some perspective. What is the yardstick we are looking at?
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