Application of Graham Rao Analysis in January 2003 to "A" Group Stocks of BSE

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S.No. Company, 7 year Avg. EPS, 7 year growth rate, fair value, Price on 29/1/03
1 ABBOTT(I) 25.36 29.5 507.26 303.25
2 ADANIEXPO 31.92 18 574.56 135.55
3 AUROPHARMA 21.77 50 435.32 240.8
4 BEL 11.23 50 224.68 188.15
5 BHEL 19.96 11 219.60 188.6
6 BPCL 20.67 15.5 320.43 194.4
7 CONCOR 22.69 35 453.80 233.8
8 EMERCK 14.54 20 290.80 241.6
9 GAIL 10.58 18 190.48 69.9
10 GMDC 19.53 15 292.95 86.1
11 GSK CONSUMER 17.11 25.2 342.20 269
12 GTL 31.88 20 637.68 76.3
13 HCL-INSYS 12.24 39 244.80 90.8
14 HIND ZINC 1.82 19.5 35.49 17.9
15 HINDALC0 72.92 10 729.20 599.35
16 IBP 25.92 27.8 518.40 225.2
17 ICI 13.68 15 205.20 119.95
18 IOC 26.41 16 422.56 244.3
19 JB CHEMICALS 16.13 13.8 222.53 178.35
20 KOCHI REF. 11.94 12.9 154.03 45.5
21 LICHSGFIN 12.77 20 255.40 65
22 MOSERBAER 16.95 36 339.00 194.55
23 MRF 146.15 24 2923.00 874.1
24 MTNL 18.12 13 235.56 107.45
25 NEYVELI LIGNITE 2.70 18.8 50.80 25
26 NIIT 25.27 24.5 505.40 133.15
27 NOVARTIS 16.02 19 304.42 267.55
28 ONGC 24.06 18.5 445.11 376.75
29 P&G 24.45 22.9 489.00 394
30 PENTAMEDIA GR. 24.03 13.9 334.02 16.35
31 PIDILITE 13.75 25 274.92 241.55
32 PUNJABTRAC 13.36 36 267.16 144.65
33 ROLTA 8.66 34.5 173.20 70
34 SBI 30.17 17.5 527.94 283.45
35 SONATSOFTW 1.46 38.5 29.22 15.95
36 SSI 18.24 41.5 364.76 84.5
37 TATATEA 16.72 18.5 309.32 160.45
38 VSNL 34.77 23 695.40 90
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The above shares were identified as potential buys using Graham-Rao analysis in Januarry 2003. Each row contains 7 year averate EPS, 7 year growth rate in EPS, calculated fair value and market price on 29/1/03. In August 2006, it was found that this portfolio outperformed the BSE sensex. I prepared a working paper on the performance of this portfolio.

Narayana Rao