A monumental task, and a valuable learning experience.
The CFA Institute Research
Challenge is a global competition, held across the world on a grand scale. This
challenge tests the analytic, valuation, report writing, and presentation
skills of management students.
Last year nearly 2500 students
from over 546 institutes in 45 countries participated and learnt best practices
in equity research from leading industry experts. Local CFA societies host and
launch local competitions involving teams of three to five business and finance
students from participating institutes who work directly with a local company
in researching and preparing company analysis. FLAME students won the 1st
position in the western region in 2012, beating many reputed and renowned
Business Schools. The students continue to participate and bring glory to FLAME
University, while they enrich their experience by many folds every year.
The
talented team that represented FLAME University for CFA Institute Research
Challenge 2015-16 consisted of 5 members, Mohammed Mandasaurwala, Team Leader
along with 4 Team Members – Vikas Gupta, Nishant Gadia, Kunal Kanungo and Yash
Tilakraj, under the tutelage of a very senior and experienced faculty, Prof.
Sujay Joshi.
For
this challenge, the team had to conduct an in-depth evaluative study on
Whirlpool India Ltd. It’s obviously no small task, as one can imagine. Just the
amount of literature available on the company would be overwhelming. Primary
research, valuation, studying the balance sheet, financial history, position in
the industry, gauging the competition etc., were a few tasks that were
undertaken. The research also involved quantitative evaluation as well as
qualitative evaluation, encompassing topline growth and bottom-line growth, analyzing
management capabilities, business model and its long term sustainability in light
of increased competition. The students
were asked to present a price target for the company over the next one year,
taking into account various parameters from the data available in the public
domain.
Besides Whirlpool the team also
analyzed its competitors, their financials and their competitive strengths to
gain more knowledge about the industry. Different companies use different
strategies to gain presence in the market. The team gained insights through dealer
surveys, analyzing market reports and by observing how the companies are
reacting towards current market scenarios.
The
work can be insurmountable, but the learning and experience one derives from
this is invaluable too. This detailed study provided experiential learning
about the various concepts and dynamics of equity valuation. Not only did this
exposure give the students immense benefits, but also the interactions with
mentors helped them form a strong base to understand how to look at companies
from different angles and study the reports in-depth.
Besides that, the team got a
real life experience working in a very active market scenario. They also learnt
the importance of working as a team, lending support and utilizing each other’s
strengths to enhance the results. For example, while one team member may be extremely
good at research, other can be better at analyzing the data. Some people are
shy and nervous during presentations, while others are extremely confident.
Understanding other’s strengths, while overcoming your own weaknesses, and
using it to the best of the team’s advantage in itself is a great learning
experience. This makes the student very ‘job ready’ in today’s competitive
scenario.
This whole experience was
extremely crucial for it gave an opportunity to implement theoretical knowledge
in practical scenarios. The competition also enhanced the analytical, decision
making, interpersonal, and presentation skills of its participants.