Investment Banking Nerd

What does a Private Equity Firm sees for Deal to a Great Businesses ? 1. Large and Ideally Growing Target Addressable Markets (TAMs): Even a great business can be a bad investment if its TAM is rapidly shrinking. Conversely, a growing TAM allows a great company to grow exponentially, like an electric battery company benefiting from the expanding electric vehicle market. Investors also assess how well a company can serve this market, considering product distribution abilities and go-to-market strategies. 2. Strong Competitive Moat: A competitive moat is a non-negotiable feature for PE investments. It refers to a company's unique advantages, such as brand strength, proprietary technology, or cost efficiency, that protect it from competitors and ensure long-term profitability. Without a strong moat, a business risks being overtaken, as exemplified by Blackberry's decline despite initial market share, due to its inability to protect itself from iPhone and Android competitors. 3. St...

Mapped Equity Research for a Private Company which is unlisted requires following beginning steps to understand and move on to the NEXT Steps ! 1. Deep Understanding of  the Sector which majorily requires the Product and Services offered  2. Parent Company and the origin  3. Financials & Clients list  4. The Projects or Work currenlty being executed ; with future plans & start of its execution. How will the above four points will help you to almost execute the whole research and Complete you Mandate ? Step 1. Deep Understanding of the Sector ! The Valuation of the Private Co. for Equity research is done through Market Comparable of the company in the sector providing the same product and services while having it's Revenue and PAT nearby to the Private Co. we are doing research for. How will you do the Market Comparable ?  If you are LAZY !! Then just take the P/E of the 5 most matching company as explained above and average the P/E in excel the formu...