Hdfc Bank Beneish M Score

HDB -  USA Stock  

USD 54.25  2.63  4.62%

This module uses fundamental data of Hdfc Bank to approximate the value of its Beneish M Score. Hdfc Bank M Score tells investors if the company management is likely to be manipulating earnings. The score is calculated using eight financial indicators that are adjusted by a specific multiplier. Please note, the M Score is a probabilistic model and cannot detect companies that manipulate their earnings with 100% accuracy. Please check Hdfc Bank Piotroski F Score and Hdfc Bank Altman Z Score analysis.
  
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Hdfc Bank Issuance Repayment of Debt Securities is projected to based on the last few years of reporting. The past year's Issuance Repayment of Debt Securities was at 15.91 Billion. The current year Debt to Equity Ratio is expected to grow to 6.78, whereas Total Debt is forecasted to decline to about 1755.4 B. Hdfc Bank Asset Turnover is projected to slightly decrease based on the last few years of reporting. The past year's Asset Turnover was at 0.0414. The current year Debt to Equity Ratio is expected to grow to 6.78, whereas Book Value per Share is forecasted to decline to 1,083.
At this time, it appears that Hdfc Bank is an unlikely manipulator. The earnings manipulation may begin if Hdfc Bank's top management creates an artificial sense of financial success, forcing the stock price to be traded at a high price-earnings multiple than it should be. In general, excessive earnings management by Hdfc Bank executives may lead to removing some of the operating profits from subsequent periods to inflate earnings in the following periods. This way, the manipulation of Hdfc Bank's earnings can lead to misrepresentations of actual financial condition, taking the otherwise loyal stakeholders on to the path of questionable ethical practices and plain fraud.
-4.3
Beneish M Score - Unlikely Manipulator
Elasticity of ReceivablesN/AFocus
Asset QualityN/AFocus
Expense Coverage1.02Focus
Gross Margin Strengs0.99Focus
Accruals Factor1.02Focus
Depreciation Resistance1.0Focus
Net Sales Growth0.8Focus
Financial Leverage Condition1.0Focus

Hdfc Bank Beneish M-Score Indicator Trends

The cure to earnings manipulation is the transparency of financial reporting. It will typically remove the temptation of the top executives to inflate earnings (i.e., to promote the idea of 'winning at any cost'). Because a healthy internal audit department can enhance transparency, the board should promote the auditors' access to all the record-keeping systems across the enterprise. For example, if Hdfc Bank's auditors report directly to the board (not management), the managers will be reluctant to manipulate simply due to the fear of punishment. On the other hand, the auditors will be free to investigate the ledgers properly because they know that the board has their back.
Current ValueLast YearChange From Last Year 10 Year Trend
Revenues721.2 B899.8 B
Significantly Down
Increasing
Slightly volatile
Selling General and Administrative Expense309.6 B378.1 B
Significantly Down
Increasing
Slightly volatile
Net Cash Flow from Operations1143.7 B1060 B
Significantly Up
Increasing
Slightly volatile
Depreciation Amortization and Accretion14 B15.9 B
Fairly Down
Increasing
Slightly volatile
Total Assets8974.2 B10427 B
Fairly Down
Increasing
Slightly volatile
Investments8097 B9474 B
Fairly Down
Increasing
Slightly volatile
Property Plant and Equipment Net54 B61.1 B
Fairly Down
Increasing
Slightly volatile
Total Liabilities7961.2 B9244.9 B
Fairly Down
Increasing
Slightly volatile
Total Debt1755.4 B2035.6 B
Fairly Down
Increasing
Slightly volatile
Operating Income545.7 B505.8 B
Significantly Up
Increasing
Slightly volatile
Gross Margin0.890.9
Fairly Down
Decreasing
Slightly volatile

Hdfc Bank Beneish M-Score Driver Matrix

One of the toughest challenges investors face today is learning how to quickly synthesize historical financial statements and information provided by the company, SEC reporting, and various external parties in order to detect the potential manipulation of earnings. Understanding the correlation between Hdfc Bank's different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards Hdfc Bank in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find Hdfc Bank's degree of accounting gimmicks and manipulations.

About Hdfc Bank Beneish M Score

M-Score is one of many grading techniques for value stocks. It was developed by Professor M. Daniel Beneish of the Kelley School of Business at Indiana University and published in 1999 under the paper titled The Detection of Earnings Manipulation. The Beneish score is a multi-factor model that utilizes financial identifiers to compile eight variables used to classify whether a company has manipulated its reported earnings. The variables are built from the officially filed financial statements to create a final score call 'M Score.' The score helps to identify companies that are likely to manipulate their profits if they show deteriorating gross margins, operating expenses, and leverage against growing revenue.

Operating Expenses

323.61 Billion

Share
Hdfc Bank Operating Expenses is projected to increase significantly based on the last few years of reporting. The past year's Operating Expenses was at 393.99 Billion

Hdfc Bank Earnings Manipulation Drivers

Although earnings manipulation is typically not the result of intentional misconduct by the c-level executives, it is still a widespread practice by the senior management of public companies such as Hdfc Bank. It is usually done by a series of misrepresentations of various accounting rules and operating activities across multiple financial cycles. The best way to spot the manipulation is to examine the historical financial statement to find inconsistencies in earning reports to find trends in assets or liabilities that are not sustainable in the future.
201720182019202020212022 (projected)
Revenues508.36 B595.35 B674.12 B782.43 B899.79 B721.24 B
Property Plant and Equipment Net38.97 B43.19 B48.33 B53.09 B61.06 B53.96 B
Depreciation Amortization and Accretion9.68 B12.25 B12.8 B13.86 B15.94 B14.03 B
Selling General and Administrative Expense221.57 B243.14 B295.48 B328.74 B378.05 B309.58 B
Total Debt1,850.11 B1,872.61 B1,911.92 B1,770.08 B2,035.59 B1,755.38 B
Operating Income277.11 B339.96 B365.84 B439.83 B505.8 B545.73 B
Net Cash Flow from Operations94.27 B183.27 B171.18 B921.78 B1,060.04 B1,143.73 B

About Hdfc Bank Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Hdfc Bank's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Hdfc Bank using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Hdfc Bank based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
Please read more on our fundamental analysis page.
HDFC Bank Limited provides various banking and financial services to individuals and businesses in India, Bahrain, Hong Kong, and Dubai. HDFC Bank Limited was incorporated in 1994 and is based in Mumbai, India. Hdfc Bank operates under BanksRegional classification in the United States and is traded on New York Stock Exchange. It employs 141579 people.

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Please check Hdfc Bank Piotroski F Score and Hdfc Bank Altman Z Score analysis. Note that the Hdfc Bank information on this page should be used as a complementary analysis to other Hdfc Bank's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Bond Directory module to find actively traded corporate debentures issued by US companies.

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Is Hdfc Bank's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Hdfc Bank. If investors know Hdfc Bank will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Hdfc Bank listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
The market value of Hdfc Bank is measured differently than its book value, which is the value of Hdfc Bank that is recorded on the company's balance sheet. Investors also form their own opinion of Hdfc Bank's value that differs from its market value or its book value, called intrinsic value, which is Hdfc Bank's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Hdfc Bank's market value can be influenced by many factors that don't directly affect Hdfc Bank's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Hdfc Bank's value and its price as these two are different measures arrived at by different means. Investors typically determine Hdfc Bank value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Hdfc Bank's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.