Monday, November 22, 2010

WHY IDEA CELLULAR EPS IS LOW ?


Dear Sir,
I am an investor and I am reading your blog regularly, I kindly request you to reply for my big doubt mentioned below:-
=> Why Idea Cellular company profit is around 1000 crores yearly but there EPS &
Book Value is very low at Rs: 2.57 and Rs:34.
I can get the exact reason, kindly explain in detail please.
Thank you
Regards,
Gokul


1. Gokul ji first of all I correct your data EPS of idea cellular is 3.19 in FY 09-10 and book value 34.58.
2. EPS means earning per share so total number of share in idea cellular is 3,29,98,37,792 ( in march 2010 now idea cellular increase his share capital and at present it is 3,30,09,83,279 ) and net profit in FY 09-10 is 1,053.66 cr. Means 10536600000 Indian rupee so when we divided this profit with total number of share 10536600000/3,29,98,37,792 then this is equal to 3.19 and called earnings per share of idea cellular.
3. And book value of a company means “The net asset value of a company share called book value. It is the total value of the company's assets that shareholders would theoretically receive if a company was bankrupt and all the asset of company was liquidated so book value have no any direct relation to company net profit
4. CLICK HERE TO READ DETAILS ON BOOK VALUE
5. I think you may satisfy with this reply.

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