ValuePickr - Chintan Baithak 2019 Indian Equities Market Past Return

Company 1, VST Industries Limited:
This is the first company I stared working to calculate return generated since IPO in April 1974. The company issued share of Rs 10 each at premium of Rs 6 per share (Total issue value: Rs 16 per share). Assuming an investor got 100 shares allotment of IPO and just hold same till date, including Bonus and Dividend, one would have got XIRR of 24.5% during April 1975-December 2019 period (~ 45 years). I was not able to get data of dividend for FY 1995 and FY1996, hence return have scope to improve marginally in case dividend are higher than nil as considred in my working.

The company was trading at dividend yield of 9.1% (Dividend of Rs 2.5 for Dec 75 year and price of Rs 27.5 in December 1976). P/E ratio as on December 76 price was 8 times.

As on December 2019, the company was trading at Dividend yield of 2.25% (Rs 95 Dividend and share price of Rs 4216) and PE of 25 times.

During 1975-2019 period (~43 years), the company net profit increased at CAGR of 12.7%.

So the growth in price, have came mainly from PE rerating. Last 10 year ROE for the company is around 36% and Dividend payout is also in upwards of 60%+ since last ten years.

I am enclosing excel sheet providing my working of XIRR for VST Industries.

Discl: VST Industries among Top 10 holding for me and I have been holding shares since 2009. It is the oldest holding in my portfolio and my view may be biased. I am not SEBI registered advisor and investors shall do their own due diligence before making any investment decision.
VST Indsutries Equity return since listing in 1975.xlsx (12.7 KB)

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