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The document provides a guide on how to read a company's annual report, emphasizing its importance as an official source of information for investors. It outlines the key sections of an annual report, including financial highlights, management statements, and financial statements, and explains what to look for in each section. The document encourages investors to rely on the annual report over other media sources for accurate company data.

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5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Modules
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Certified
Junior
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Live

Module 3. Fundamental Analysis

1. 1 Introduction to Fundamental Analysis

2. 2 Mindset of an Investor
3. 3 How to Read the Annual Report of a Company
4. 4 Understanding the P&L Statement (Part 1)
5. 5 Understanding P&L Statement (Part 2)
6. 6 Understanding Balance Sheet Statement (Part 1)
7. 7 Understanding the Balance Sheet Statement (Part 2)
8. 8 The Cash Flow statement
9. 9 The Financial Ratio Analysis (Part 1)
10. 10 The Financial Ratio Analysis (Part 2)
11. 11 The Financial Ratio Analysis (Part 3)
12. 12 The Investment Due Diligence
13. 13 Equity Research (Part 1)
14. 14 DCF Primer
15. 15 Equity Research (Part 2)
16. 16 The Finale

3. How to Read the Annual Report of a Company

← Previous Chapters Next →

3.1 – What is an Annual Report?

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The annual report (AR) is a yearly publication by the company and is sent to the shareholders and other
interested parties. The annual report is published by the end of the Financial Year, and all the data made
available in the annual report is dated to 31st March. The AR is usually available on the company’s website
(in the investor’s section) as a PDF document, or one can contact the company to get a hard copy of the
same.

Since the company’s annual report, whatever is mentioned in the AR is assumed to be official. Hence, any
misrepresentation of facts in the annual report can be held against the company. To give you a perspective,
AR contains the auditor’s certificates (signed, dated, and sealed) certifying the sanctity of the financial data
included in the annual report.

Potential investors and the present shareholders are the primary audiences for the annual report. Annual
reports should provide the most pertinent information to an investor and communicate its primary message.
For an investor, the annual report must be the default option to seek information about a company. Of course,
many media websites claim to give financial information about the company; however, the investors should
avoid seeking information from such sources. Remember the information is more reliable if we get it to get it
directly from the annual report.

Why would the media website misrepresent the company information you may ask? Well, they may not do it
deliberately, but they may be forced to do it due to other factors. For example, the company may like to
include ‘depreciation’ in the expense side of P&L, but the media website may like to include it under a
separate header. While this would not impact the overall numbers, it does interrupt the overall sequencing of
data.

3.2 – What to look for in an Annual Report?

The annual report has many sections that contain useful information about the company. One has to be
careful while going through the annual report as there is a fragile line between the company’s facts and the
marketing content that the company wants you to read.

Let us briefly go through the various sections of an annual report and understand what the company is trying
to communicate in the AR. For the sake of illustration, I have taken the Annual Report of Amara Raja
Batteries Limited, belonging to Financial Year 2013-2014. As you may know, Amara Raja Batteries Limited
manufactures automobile and industrial batteries. You can download ARBL’s FY2014 AR from here
(https://www.amararajabatteries.com/Investors/annual-reports/)

Please remember, this chapter’s objective is to give you a brief orientation on how to read an annual report.
Running through every page of an AR is not practical; however, I would like to share insights into how I
would personally read through an AR and understand what kind of information is required and what
information we can ignore.

To better understand, I would urge you to download the Annual Report of ARBL and go through it
simultaneously as we progress through this chapter.

ARBL’s annual report contains the following 9 sections:

Financial Highlights
The Management Statement
Management Discussion & Analysis
10-year Financial highlights
Corporate Information
Director’s Report
Report on Corporate governance
Financial Section, and
Notice

Note, no two annual reports are the same; they are all made to suit the company’s requirement keeping in
perspective the industry they operate in. However, some of the sections in the annual report are common
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across annual reports.

The first section in ARBL’s AR is the Financial Highlights. Financial Highlights contains the bird’s eye
view on how the company’s financials look for the year gone by. . The information in this section can be in
the form of a table or a graphical display of data. This section of the annual report generally makes a multi-
year comparison of the operating and business metrics.

Here is the snapshot of the same:

The details you see in the Financial Highlights section are basically an extract from its financial statement.
Along with the extracts, the company can also include a few financial ratios calculated by the company itself.
I briefly look through this section to get an overall idea, but I wouldn’t say I like to spend too much time on
it. The reason for looking at this section briefly is that, I would anyway calculate these and many other ratios
myself, and while I do so, I would gain greater clarity on the company and its numbers. Over the next few
chapters, we will understand how to read and understand its financial statements and how to calculate the
financial ratios.

The next two sections, i.e. the ‘Management Statement’ and ‘Management Discussion & Analysis’, are
quite important. I spend time going through these sections. These sections give you a sense of what the
company’s management has to say about their business and the industry in general. As an investor or a
potential investor in the company, every word mentioned in these sections is important. In fact, some of the
details related to the ‘Qualitative aspects’ (as discussed in chapter 2), can be found in these two sections of
the AR.

In the ‘Management Statement’ (sometimes called the Chairman’s Message), the investor gets a perspective
of how the man sitting right on top is thinking about his business. The content here is usually broad-based
and gives a sense of how the business is positioned. When I read through this section, I look at how realistic
the management is. I am very keen to see if the company’s management has its feet on the ground. I also
observe if they are transparent in discussing what went right and what went wrong.

One example that I explicitly remember was reading through the chairman’s message of a well-established
tea manufacturing company. In his message, the chairman was talking about revenue growth of nearly 10%.
However, the historical revenue numbers suggested that the company’s revenue grew by 4-5%. Clearly, in
this context, the growth rate of 10% seemed like a celestial move. This also indicated that the man on top
might not really be in sync with ground reality, so I decided not to invest in the company. Retrospectively
when I look back at my decision not to invest, it was probably the right decision.

Here is Amara Raja Batteries Limited; I have highlighted a small part that I think is interesting. I would
encourage you to read through the entire message in the Annual Report.

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Moving ahead, the next section is the ‘Management Discussion & Analysis’ or ‘MD&A’. This, in my
opinion, is perhaps one of the most important sections in the whole of AR. The most standard way for any
company to start this section is by talking about the macro trends in the economy. They discuss the overall
economic activity of the country and the business sentiment across the corporate world. If the company has
high exposure to exports, they even talk about global economic and business sentiment.

ARBL has both exports and domestic business interest; hence they discuss both these angles in their AR. See
the snapshot below:

ARBL’s view on the Indian economy:

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Following this, the companies usually talk about industry trends and what they expect for the year ahead.
This is an important section as we can understand what the company perceives as threats and opportunities in
the industry. Most importantly, I read through this and compare it with its peers to understand if the company
has an advantage over its peers.

For example, if Amara Raja Batteries Limited is a company of interest, I would read through this part of the
AR and read through what Exide Batteries Limited has to say in their AR.

Remember, until this point, the discussion in the Management Discussion & Analysis is broad-based and
generic (global economy, domestic economy, and industry trends). However, in the future, the company
would discuss various aspects related to its business. It talks about how the business had performed across
various divisions, how it fares compared to the previous year, etc. The company, in fact, gives out specific
numbers in this section.

Here is a snapshot of the same:

Some companies even discuss their guidelines and strategies for the year ahead across the various verticals.
Do have a look at the snapshot below:
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After discussing these in ‘Management Discussion & Analysis,’ the annual report includes a series of other
reports such as – Human Resources report, R&D report, Technology report etc. Each of these reports is
important in the context of the industry the company operates in. For example, if I am reading through a
manufacturing company annual report, I would be particularly interested in the human resources report to
understand if the company has any labour issues. If there are serious signs of labour issues, it could lead to
the factory being shut down, which is not good for its shareholders.

3.3 – The Financial Statements

Finally, the last section of the AR contains the financial statements of the company. As you would agree, the
financial statements are perhaps one of the most important aspects of an Annual Report. There are three
financial statements that the company will present namely:

1. The Profit and Loss statement

2. The Balance Sheet and
3. The Cash flow statement

We will understand each of these statements in detail over the next few chapters. However, it is important to
understand that the financial statements come in two forms at this stage.

1. Standalone financial statement or simply standalone numbers and

2. Consolidated financial statement or simply consolidated numbers

To understand the difference between standalone and consolidated numbers, we need to understand a
company’s structure.

Typically, a well-established company has many subsidiaries. These companies also act as a holding
company for several other well-established companies. To help you understand this better, I have taken the
example of CRISIL Limited’s shareholding structure. You can find the same in CRISIL’s annual report. As
you may know, CRISIL is an Indian company with a major focus on corporate credit rating services.

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As you can see in the above shareholding structure:

a. Standard & Poor’s (S&P), a US-based rating agency holds a 51% stake in CRISIL. Hence S&P is the
‘Holding company’ or the ‘Promoter’ of CRISIL.
b. Public and other Financial institutions hold the balance of 49% of shares of CRISIL.
c. However, S&P itself is 100% subsidiary of another company called ‘The McGraw-Hill Companies’
i. This means McGraw Hill fully owns S&P, and S&P owns 51% of CRISIL.
d. Further, CRISIL itself fully owns (100% shareholding) another company called ‘Irevna’.

Keeping the above in perspective, think about this hypothetical situation. Assume, for the financial year
2014, CRISIL makes a loss of Rs.1000 Crs and Irevna, its 100% subsidiary makes a profit of Rs.700 Crs.
What do you would be the overall profitability of CRISIL?

Well, this is quite simple – CRISIL on its own made a loss of Rs.1000 Crs, but its subsidiary Irevna made a
profit of Rs.700 Crs, hence the overall P&L of CRISIL is (Rs.1000 Crs) + Rs.700 Crs = (Rs.300 Crs).

Thanks to its subsidiary, CRISIL’s loss is reduced to Rs.300 Crs instead of a massive loss of Rs.1000 Crs.
Another way to look at it is that CRISIL on a standalone basis made a loss of Rs.1000 Crs, but on a
consolidated basis, it made a loss of Rs.300 Crs.

Hence, Standalone Financial statements represent the company’s standalone numbers/ financials and do not
include its subsidiaries’ financials. However, the consolidated numbers include the companies (i.e.standalone
financials) and its subsidiaries financial statements.

I personally prefer to look through the consolidated financial statements to represent the company’s financial
position better.

3.4 – Schedules of Financial Statements

When the company reports its financial statements, they usually report the full statement and then follow it
up with a detailed explanation.

Have a look at the snapshot of one of ARBL’s financial statement (balance sheet):

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Each particular in the financial statement is referred to as the line item. For example, the first line item in the
Balance Sheet (under Equity and Liability) is the share capital (as pointed out by the green arrow). If you
notice, there is a note number associated with share capital. These are called the ‘Schedules’ related to the
financial statement. Looking into the above statement, ARBL states that the share capital stands at Rs.17.081
Crs (or Rs.170.81 Million). As an investor, I would obviously be interested in knowing how ARBL arrived at
Rs.17.081 Crs as their share capital. To figure this out, one needs to look into the associated schedule (note
number 2). Please look at the snapshot below:

Of course, considering you may be new to financial statements, jargon like share capital makes much sense.
However, the financial statements are straightforward to understand, and over the next few chapters, you will
understand how to read the financial statements and make sense of it. But for now, remember that the main
financial statement gives you the summary and the associated schedules give the details about each line item.

Key takeaways from this chapter

1. The Annual Report (AR) of a company is an official communication from the company to its investors
and other stakeholders.
2. The AR is the best source to get information about the company; hence AR should be the default
choice for the investor to source company-related information.
3. The AR contains many sections, with each section highlighting a certain aspect of the business.
4. The AR is also the best source to get information related to the qualitative aspects of the company.
5. The management discussion and analysis is one of the most important sections in the AR. It has the
management’s perspective on the country’s overall economy, their outlook on the industry they operate
in for the year gone by (what went right and what went wrong), and what they foresee for the year
ahead.
6. The AR contains three financial statements – Profit & Loss Statement, Balance Sheet, and Cash Flow
statement.
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7. The standalone statement contains the financial numbers of only the company into consideration.
However, the consolidated numbers contain the company and its subsidiaries financial numbers.

← Previous Chapters Next →

469 comments

1. Pratham Singh says:

April 26, 2025 at 4:00 pm

Dear Karthik Rangappa Sir,

First of the I really appreciate this useful, Important, well-structured and High quality free Education
and I want to thank you and whole Zerodha team for providing this free Highly valuable Education and
to the point .
I have One Question.
Q1- In 3.3– The financial statements, You have shown us the structure of CRISIL and whom it is
owned by and who it Owns. My Question is that Since, STANDARD&POORS have equity which is
51% in CRISIL AND CRISIL has 100% equity in Irevna and since STANDARS&POORS owns
CRISIL 51%, does that directly or indirectly makes them(STANDARD&POORS) shareholder in
Irevna too,because they have CRISIL equity which is 51? If no, then Why and if yes, then is it same as
crisil equity which is 51% or more or less?
I know one thing that since standards&poors owns crisil and they own irevna, they do have influence
over irevna because they own crisil, basically indirect control.
Thank you for your time,
Much love and support from Punjab.

Karthik Rangappa says:

April 27, 2025 at 12:56 pm

Thanks Pratham. I\’m happy you liked the content on Varsity!

So S&P and Irevna become related party and indirectly, there is ownership as well and by virtue
of that, there will be some influence as well

2. sujal says:
February 26, 2025 at 8:24 pm

in the example you mentioned in this chapter about the ownership percentage. so my question is how
much profit of theMCGRAW-HILL

Karthik Rangappa says:

February 27, 2025 at 1:15 pm

Dont remember now, Sujal. Request you to pls check the screenshots, I\’ve included the P&L
statements.

3. sujal says:
February 26, 2025 at 8:21 pm
https://zerodha.com/varsity/chapter/read-annual-report-company/ 9/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

much more valuable information for new participants

Karthik Rangappa says:

February 27, 2025 at 1:14 pm

Happy learning

4. Ajinkya says:
February 5, 2025 at 11:37 am

When a number is given in parentheses on a profit and loss statement, it indicates a negative value. I
did not know this, hence above statement is correct

Karthik Rangappa says:

February 6, 2025 at 9:58 am

Ah ok

5. Ajinkya says:
January 28, 2025 at 5:30 pm

In 3.3 Financial statements, correction is needed -> (Rs.1000 Crs) + Rs.700 Crs = (Rs.300 Crs) this
should be (Rs.1000 Crs) – Rs.700 Crs = (Rs.300 Crs)

Karthik Rangappa says:

January 29, 2025 at 9:57 am

Checkin this, Ajinkya.

6. Pramod kumar sharma says:

December 26, 2024 at 6:03 pm

Sir
In number of shareholders column , it includes total number of share i.e. (number of promoters shares
+ number of investers shares ) or it includes only number of investers shares only ??

Karthik Rangappa says:

December 27, 2024 at 9:44 am

It includes all the shares that are held by investors.

7. Baala Srinivas says:

December 20, 2024 at 8:00 am

https://zerodha.com/varsity/chapter/read-annual-report-company/ 10/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Hi Karthik,
Thank you for the efforts you and your team has put in!
Following are my questions

1. How reliable are these annual reports of the company, is there any way to ensure the trustworthiness
of the numbers provided in the annual report and assurance that they are not manipulated.

2. There can be situation where companies has to pay money out of the records to get things done, how
are these money handled and gets accounted into annual report?
(Note: I don\’t mean all companies do these, but we have seen these instances happening)

Karthik Rangappa says:

December 20, 2024 at 11:29 am

1) These are signed by the auditors, so we assume its accurate and true.
2) They dont, unless its a cash payment and it gets recorded. If you are talking about bribes etc,
then they dont

8. Praveen says:
November 27, 2024 at 6:07 am

How to find the most recents orders that a company has received and the deadline to fulfill that order ?
If possible an entire log or orderbook of a company?

Karthik Rangappa says:

November 27, 2024 at 6:06 pm

You need to keep track of the corporate filings made to the exchanges.

9. Vinitha Vinod says:

November 9, 2024 at 10:55 am

Being simple is being genius. Excellent simple way for layman to understand.

Karthik Rangappa says:

November 9, 2024 at 11:04 am

Thanks Vanitha. Happy learning

10. Kartik says:

September 25, 2024 at 7:09 pm

Tq, karthik sir for this wonderful explanation

Karthik Rangappa says:

https://zerodha.com/varsity/chapter/read-annual-report-company/ 11/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

September 26, 2024 at 9:40 am

Glad you liked it, happy learning

11. lumios says:

September 13, 2024 at 12:37 am

I am reading this in September 2024, and the content still holds up. It’s better than anything else out
there.

Karthik Rangappa says:

September 13, 2024 at 5:58 am

Happy learning

12. Gautham says:

August 26, 2024 at 4:33 pm

Hi Karthik,

Thanks for your efforts in making these modules. It helps a lot for the fresh investors like me. I just
couldn\’t able to understand why you have stated that you prefer consolidated financial statement.
Let\’s consider the same example with a minor change that Irvena making profit of 1200 crs. Now if I
look at the consolidated statement, the Crisil is making a profit of 200 crs as a whole but the actual
case is Crisil is going in loss. If I review the consolidated statement and invest in Crisil thinking that it
is making profit as a whole and sometime in the future Crisil sells its stake on Irvena for some reasons
then their financials will look bad and their shares may incur losses.

Please help me understand why its better to review consolidated statement rather than standalone
statement. Thanks.

Karthik Rangappa says:

August 27, 2024 at 9:59 am

But in reality, there is a cash flow exchange between the two companies. So the market will
value the entire thing as a single entity.

13. Dinesh kamaraj says:

July 18, 2024 at 6:31 am

In equity and capital section

What is mean by authorised,issued, subscribed and paid up..

Karthik Rangappa says:

July 18, 2024 at 9:42 am

https://zerodha.com/varsity/chapter/read-annual-report-company/ 12/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Do check this video – https://www.youtube.com/watch?v=q-

T2svXZ77s&list=PLX2SHiKfualGOP9093b6qo11EsgCz8IuQ&index=22

14. dattatri says:

July 8, 2024 at 9:40 am

this information was much better

Karthik Rangappa says:

July 8, 2024 at 9:57 am

Glad you liked it, happy learning

15. sagar D F says:

May 27, 2024 at 7:23 pm

pictures used in the contents aren\’t clearly visible

Karthik Rangappa says:

May 28, 2024 at 9:46 am

You can click on it to enlarge and see them properly.

16. Yatin says:

April 26, 2024 at 1:52 pm

okay, Thank you for the info

Karthik Rangappa says:

April 27, 2024 at 11:02 am

Sure, happy learning

17. Yatin says:

April 25, 2024 at 4:20 pm

Yes, may be. but I am not able to find its release date, any idea where to find it?

Karthik Rangappa says:

April 26, 2024 at 10:27 am

I think most ARs will be published towards end of May.

Reply
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18. Yatin says:

April 24, 2024 at 8:26 pm

Thank you for your reply I have asked my query in your previous reply

19. Yatin says:

April 24, 2024 at 8:23 pm

yes I understand that we are in 2024-25 financial year and it is the problem that I am not able find its
release date. But I am looking for AR for 2023-24. Could you please let me know where I can find its
release date or where to find on which date company is going to release their annual report?

Karthik Rangappa says:

April 25, 2024 at 10:12 am

Chances are the AR is not published yet?

20. Yeti says:

April 24, 2024 at 7:36 am

correction for 1st sentence –

Why do companies write 2022-23 in their annual report for Financial year 2023? It should be written
as 2023-24 right because it is from April’23 to March’24?

Karthik Rangappa says:

April 24, 2024 at 10:03 am

FY2022-2023 AR will be punished in 2023 right? Also pls see my previous reply.

21. Yeti says:

April 24, 2024 at 7:24 am

sorry for basic question-

Why do companies write 2022-23 in their annual report? It should be written as 2023-24 right because
it is from April\’23 to March\’24?
For example – Google says TCS released its on 15th April but in the annual report it is mentioned as
Integrated Annual Report 2022-23. Also TCS have not added there Annual report in pdf format it is in
kind of website format which is quite confusing while learning.
Please let me know, waiting for reply.

Karthik Rangappa says:

April 24, 2024 at 10:02 am

In India, the financial year is between 1st April to 31st March. So as of today we are in FY 2024
– 2025 and the previous FY was 2023-2024.

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22. pranav says:

February 5, 2024 at 9:33 pm

typo mistake- in the example of CRISIL- the loss of company is 300CR which is 1000-700, used +
sign instead of – sign

Karthik Rangappa says:

February 6, 2024 at 9:55 am

Ah, let me check this, thanks Pranav.

23. Abhay says:

January 16, 2024 at 9:00 pm

Should you always look at consolidated financials or are there cases wherein looking at the standalone
figures might make more sense. For example, Mahindra owns tech mahindra, m&m and mahindra
financials. In such a case where the subsidiaries are in different sectors wont it make more sense to
look at the standalone figures

Karthik Rangappa says:

January 17, 2024 at 8:26 am

If the company is small (unike RIL where there are 300 subsidiaries), then you can look at
standalone numbers. Else Consolidated works.

24. Abhay says:

January 12, 2024 at 3:39 pm

Hi, just wondering if there is an optimum number of stocks one should have in their portfolio. Also is
there an optimum number of stocks one must invest in, in any particular sector of choice. Thank you

Karthik Rangappa says:

January 13, 2024 at 9:01 am

Check this – https://zerodha.com/varsity/chapter/hedging-futures/

I think all research points to about 20-25 stocks across at least 5-8 sectors.

25. a says:
January 3, 2024 at 3:46 pm

good explaination

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26. Durgesh says:

January 1, 2024 at 2:47 pm

Thanks a lot karthik.It cant get more simplified ,Very much grateful to you

Karthik Rangappa says:

January 2, 2024 at 10:37 am

Happy learning, Durgesh!

27. Vamsi says:

December 18, 2023 at 8:27 pm

The PDF that can be downloaded isnt having table of contents. Can you please update it ?

Karthik Rangappa says:

December 19, 2023 at 10:11 am

Sure. Alternatively, you can con convert the content as a PDF from the browser I guess

28. Sathish says:

November 10, 2023 at 10:55 pm

What does it mean when the Independent Auditor Report says, \”following companies have
unfavourable remarks, qualification or adverse remarks given by respective auditors\” about the
subsidiaries of a company? Does this mean that the governance of the parent company itself is in
question and its better to stay away? Came across these kind of reports for 2 companies recently.
Thanks.

Karthik Rangappa says:

November 11, 2023 at 11:31 am

Yes, it means the company under consideration should be evaluated carefully, including the
subsidiaries.

29. vinayak says:

October 2, 2023 at 3:33 pm

sir i have downloaded the annual report of 22-23 it consist of 172 pages we cant cover all the
information in the md&a could you suggest us important information and the information we can
ignore in md&a

Karthik Rangappa says:

October 3, 2023 at 9:38 am
https://zerodha.com/varsity/chapter/read-annual-report-company/ 16/77
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Maybe you can try this – https://www.arsummary.com/

30. hemant says:

October 2, 2023 at 1:08 pm

only a person with 99% knowlege should come here for that remaining 1%

31. Vivek says:

September 17, 2023 at 10:47 pm

Greate Information. Nice way of teaching

Karthik Rangappa says:

September 19, 2023 at 9:08 am

Happy learning!

32. Sathish says:

August 20, 2023 at 6:04 pm

Sir, as You know there are little information available on microcaps. I did some digging into the AR of
one of those. I found the Management analysis and discussion section the worst, hardly 1 page. They
didn\’t even spend time to elaborate. Obviously concalls won\’t be available. So I dug into credit rating
reports and some info on valuepickr. Then visited the company\’s website. Some of the companies look
extremely undervalued given the cash flows and fundamentals, but lack of information is a problem.
Could you suggest me something that I can look into in addition to these to get more information in
these situations? Thanks.

Karthik Rangappa says:

August 21, 2023 at 10:24 am

I get your point. The best possible way is to figure out what their competition has to say. If that
also does not help, then secondary research like industry data etc will help.

33. Prakash says:

August 17, 2023 at 7:07 pm

Sir/Madam,
I am clear with \”Share Capital\”, could you pls explain it

Karthik Rangappa says:

August 18, 2023 at 10:02 am

Check this Prakash, have explained here – https://www.youtube.com/watch?v=iH3ODZ5PYU4

https://zerodha.com/varsity/chapter/read-annual-report-company/ 17/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

34. Sathish says:

June 21, 2023 at 3:22 pm

Just now watched your whole video on Annual Report you made on youtube a long time ago. Well
made sir. I have 3 questions.

1. Is there anything you would do to quick check the integrity of the audit itself. Like it failed in the
case of Satyam. I\’m currently focusing on learning account forensics, so this would really help.

2. In TA side, is 50 DMA a good indicator for making sell decisions if I find that the company\’s story
is not intact.

3. Could you point out to a good book or source that helps in making sell decisions. I actually find this
more challenging.
Thank You.

Karthik Rangappa says:

June 22, 2023 at 9:58 am

1) So far, I just go with the repute of the company doing the audit. But I\’d love to dig more and
identify landmines.
2) Yes, you can use that. Best to combine both TA and FA here and not just TA
3) No book dedicated to just this topic. At least, i cant think of one

35. kris says:

June 9, 2023 at 8:50 pm

Is this information updated sir. I see comments from 2014. By the way very good information

Karthik Rangappa says:

June 10, 2023 at 5:51 am

Comments keep pouring in, Krish. Also, understanding of the company\’s AR remains the same
across time

You can also check this – https://www.youtube.com/watch?

v=8rUc0MaMzik&list=PLX2SHiKfualFGenPFh2onjzsh8TeprEmU

36. Basim says:

June 1, 2023 at 4:01 am

Thanks again man

If only my teachers at school would explain in such way

Karthik Rangappa says:

June 1, 2023 at 10:34 am

https://zerodha.com/varsity/chapter/read-annual-report-company/ 18/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Happy learning, Basim!

37. Sathish says:

May 12, 2023 at 3:16 pm

Thanks a lot for that clarification. Just completed your personal finance and mutual funds module.
Never thought analyzing a mutual fund should be based on so many factors. Very well written. Wish
there was a certificate test for this.

Karthik Rangappa says:

May 13, 2023 at 11:24 am

Thanks for the kind words, Sathish. I hope you continue learning on Varsity. We will soon add
Varsity certification here-Varsity certified please do keep an eye out.

38. Sathish says:

May 11, 2023 at 12:17 pm

1. But when I did a basic account forensic check like contingent liabilities as a % of networth, EBITDA
– CFO convertion, Auditor\’s fees increase etc, most of the companies passed. They are fundamentally
strong based on financial statements. Valuation is good. But the only thing is that promoters are part of
these committees although not the chair person. So is that enough of a red flag to stay away despite
other things looking decent?

2. In case of a broking business contingent liabilities as a % of networth will be higher given the nature
of the business due to huge bank guarantees for margins. So should I not look at this criteria for a
broking business or is it still relevant?
Thanks Sir.

Karthik Rangappa says:

May 12, 2023 at 10:02 am

1) It is common in India for promoters to be a part of these committees, especially in smaller

companies. Dont discard the company just on this one factor. Dig deeper.

2) You should. By the way, the BG business will reduce going forward in the broking business.

39. Sathish says:

May 10, 2023 at 8:42 pm

I see many companies, especially small caps, having promoter in their audit committee, Nomination
and renumeration committee and risk management committee which I guess is a red flag. But what
about directors? Norms say(if I\’m not wrong) that 2/3rd should be independent. Could you clarify as
to how exactly we need to analyze this aspect briefly? Thanks Sir.

Karthik Rangappa says:

May 11, 2023 at 11:40 am
https://zerodha.com/varsity/chapter/read-annual-report-company/ 19/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Yes, you should pay a lot of attention to these things and see if there are any red flags in
corporate governance. In the Indian context, getting a sense of good corporate governance is
super important.

40. James Alex Cooper says:

May 1, 2023 at 7:38 pm

Thanks brother

Karthik Rangappa says:

May 2, 2023 at 10:54 am

Happy learning!

41. Pranay says:

April 15, 2023 at 10:31 pm

580*

42. Pranay says:

April 15, 2023 at 10:29 pm

Hi, let\’s assume CRISIL holds a 60% stake in Irevna. So, in that case, the net loss of CRISIL is =
(1000) + 60% of 700 = (1000)+ 420 = 560. So in this case net loss in the consolidated statement of
CRISIL will be 560 Cr. Am I right in assuming this?

Karthik Rangappa says:

April 17, 2023 at 10:26 am

Yes, that right.

43. Sajit Sharma says:

April 9, 2023 at 1:07 pm

Everything at one place .Thank you so much.

Karthik Rangappa says:

April 9, 2023 at 1:22 pm

Happy learning

44. awanish says:

March 30, 2023 at 1:52 pm

https://zerodha.com/varsity/chapter/read-annual-report-company/ 20/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Hey Karthik,
Hope you are doing well. I would like to appreciate your efforts towards educating India to world of
Finance. Thank You.

Question :
While going through an Annual Report, if i have this information:
Ratio to median remuneration of employees : 10.03,
The median salary at global level of employment is : 11,73,300
how do i calculate this person\’s salary?

Thanks in advance.

Karthik Rangappa says:

March 31, 2023 at 11:37 am

Not sure how once can do that, Awanish. You can only get the company\’s average and maybe
median salary. But that information will not be of much use in my opinion.

45. mobik.in shopping [email protected] says:

January 2, 2023 at 2:05 pm

Kharab Ipad tha isliya Abhi tak nhi diya

46. Vijay says:

October 12, 2022 at 9:33 pm

Even in 2022, Karthik Sir\’s Varsity helping the newcomers in a great way with good examples. Thank
you, Sir… நன் றி.

Karthik Rangappa says:

October 13, 2022 at 11:23 am

Happy learning, Vijay

47. SUKHDEEP KUMAR says:

September 25, 2022 at 4:30 pm

Great article.

48. Aparna says:

September 8, 2022 at 4:28 pm

A topic I have dreaded to learn due to its sheer size and complex jargons.
Thanks for breaking it down and explaining it so well.

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Karthik Rangappa says:

September 9, 2022 at 5:06 am

I\’m glad you found the topic helpful and early to understand. Happy learning

49. Arijith S says:

September 4, 2022 at 10:41 am

Sir,today everyone is considered about pitrioski score for investing in stocks.does it is reliable?

Karthik Rangappa says:

September 4, 2022 at 11:41 am

Cant comment, as I\’ve never used it myself for investing.

50. Kirti Sardana says:

July 17, 2022 at 10:39 pm

Not sure if companies can hide some facts in annual reports e.g. showing wrong profits, order pipelines
? If no then who are the validating authorities for annual reports ?

Karthik Rangappa says:

July 18, 2022 at 10:42 am

The auditors sign off the company\’s financial statements, so at least the company\’s financials
can be trusted unless the auditor is also involved. But That said, other things in the annual report
are basis what the company says.

51. Jamshad Muhammed says:

June 22, 2022 at 5:27 pm

Thank you very much for the chapters and I think anyone can understand lessons easily.
Simple but powerful.

Karthik Rangappa says:

June 23, 2022 at 10:23 am

Happy learning, Jamshad.

52. Kartik Jain says:

April 30, 2022 at 8:14 pm

How to get hard copy of annual report every year from a company?

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5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Karthik Rangappa says:

May 1, 2022 at 5:06 pm

You can write to them and request for a copy, provided you are the company\’s shareholder.

53. Pratik says:

April 15, 2022 at 12:42 pm

Thanks for such a wonderful content.

Simple and crisp.

Karthik Rangappa says:

April 15, 2022 at 1:56 pm

Happy reading!

54. Tejas says:

March 2, 2022 at 5:40 pm

Hello Karthik. How do we get better at reading the management discussions and analysis to figure out
which company is actually worth investing in? Won\’t all companies talk optimistically about their
company? As mentioned, we could use quantitative analysis to figure it out, but in terms of qualitative
analysis, how do we know if a company is good. Does it come through practice? Please let me know.
Thank you.

Karthik Rangappa says:

March 2, 2022 at 9:04 pm

Tejas, the only way to get better is by reading as many MD&A as possible. One specific trick
that helped me is to read peer ARs. For example, if I\’m dealing with BAjaj Auto, I\’ll also read
TVS and Hero\’s AR to get a perspective.

55. Raghunandan Prabhu says:

February 15, 2022 at 5:28 pm

Hey Karthik,

Great content and thanks for spreading the knowledge.

Any plans to release Varsity web application. It is sometimes cumbersome to use mobile app to read
huge content. Humble request to release the web application.

Thanks and Regards,

Raghu

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Karthik Rangappa says:

February 15, 2022 at 10:00 pm

Thanks Raghu. No plans for a dedicated web app. But will pass this a a feedback to the team.

56. pratiksha says:

February 14, 2022 at 2:15 am

amazing explaination. i am new to fundamental analysis, this module was very helpful.

Karthik Rangappa says:

February 14, 2022 at 10:16 am

Glad you find the module helpful, happy learning

57. Saket Kumar says:

February 8, 2022 at 9:25 pm

The graphic at the beginning is really cute (and apt).

Karthik Rangappa says:

February 9, 2022 at 9:35 am

Thanks, Saket. I\’ll let the illustrator know

58. Surya says:

January 28, 2022 at 6:19 pm

Sir how can one do stock picking. Which stocks should be choosen for evaluation, how will it be
decided??

Karthik Rangappa says:

January 28, 2022 at 7:13 pm

I\’d suggest you read this module to get an understanding of that Surya

59. Karan Shetty says:

December 2, 2021 at 2:58 pm

Great content! Thanks for sharing your knowledge in such a good way

Karthik Rangappa says:

https://zerodha.com/varsity/chapter/read-annual-report-company/ 24/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

December 2, 2021 at 8:38 pm

Happy learning, Karan!

60. Sandeep S Dabhade says:

November 5, 2021 at 11:23 pm

great initiative sir.

Karthik Rangappa says:

November 6, 2021 at 10:48 am

Happy learning!

61. vijay jadhav says:

October 20, 2021 at 8:45 am

very nice & informative

Karthik Rangappa says:

October 20, 2021 at 7:37 pm

Happy learning!

62. Aishwarya says:

October 16, 2021 at 1:24 am

Hi, can you please tell me where I can find in the investments made by the company in AGM report

Karthik Rangappa says:

October 16, 2021 at 6:55 pm

Please see the investment section in the Balance sheet and then the associated notes.

63. Priya Kamriya says:

October 6, 2021 at 5:21 pm

These is the best content I ever read relating to capital market

Karthik Rangappa says:

October 7, 2021 at 10:40 am

Happy reading, Priya!

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64. Nani says:

September 29, 2021 at 3:28 am

Anyone getting profits in stock market?

I m the beginner
With. Your ans I can decide
I can proceed in market or not

65. Awishkar Ghimire says:

August 23, 2021 at 10:08 pm

If*

66. Awishkar Ghimire says:

August 19, 2021 at 9:29 pm

In company A owns 20% of company B(less that 50% so B is not a subsidiary of A ), will the
profits(numbers) of B be reflected in company A\’s consolidated numbers?

67. Terry says:

August 16, 2021 at 5:51 pm

\” Along with the extracts, the company can also include a few financial ratios calculated by the
company itself.The reason for looking at this section briefly is that, I would anyway calculate these and
many other ratios myself\”
So my question is, if the ratios are already given by the company why would you calculate them again?
It later says \”while I do so, I would gain greater clarity on the company and its numbers.\” Could you
please explain How you gain clarity by doing so?

Karthik Rangappa says:

August 16, 2021 at 9:34 pm

Companies dont give out all the ratios, you will have to calculate these yourself. When you do
so, you may as well calculate the ratios that\’s given by the company as well. When you do so
you can be doubly sure about things like taking numbers from consolidated financials.

68. Shubhika says:

July 25, 2021 at 12:33 pm

Like how many shares they offered to public and how many shares public has subscribed .

Karthik Rangappa says:

July 25, 2021 at 6:58 pm

Yeah, I have no idea, need to check this myself

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69. Shubhika says:

July 25, 2021 at 12:30 pm

Thanks…karthik
But I didn\’t find on any website..I tried to find \’ history of Amara Raja IPO \’ but didn\’t get any clue
on google.
Can you share that page or link where you could able to find it .

Regards
Shubhika

Karthik Rangappa says:

July 25, 2021 at 6:58 pm

I need to Google it myself

70. Shubhika says:

July 23, 2021 at 11:01 am

Sir the last screenshot of financial statement show the difference between issued capital and subscribed
capital .
That difference is wondering me. It means public have not fully subscribed the capital of the company
Isn\’t it a negative point of the company
As company offer a shares to the public and haven\’t subscribed it fully by public .
If we check balance sheet of 2020 -21 still it unsubscribed.
Help me on this to understand

Karthik Rangappa says:

July 23, 2021 at 7:40 pm

Yes, at the point of its IPO, the shares were not fully subscribed, hence the difference between
issued and subscribed. This will continue to reflect in the BS

71. Sachin Waghmare says:

June 27, 2021 at 10:30 pm

Your writings make life easy. Simple and easy to understand.

Karthik Rangappa says:

June 28, 2021 at 9:49 am

Happy learning, Sachin!

72. Ram Pujan Patel says:

June 12, 2021 at 2:28 pm
https://zerodha.com/varsity/chapter/read-annual-report-company/ 27/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

I liked it to much. We also need to explain terminology of annual report

Karthik Rangappa says:

June 13, 2021 at 9:30 am

Yup, hopefully, this chapter helps.

73. Divyansh dwivedi says:

June 6, 2021 at 3:37 am

Thanks a lot man. Reading it at 3 in night love the way you wrote it .Hats off.

Karthik Rangappa says:

June 6, 2021 at 9:42 am

Happy reading!

74. Aryan M Pachpute says:

April 24, 2021 at 11:17 pm

Great work. loved the simplicity of all the modules.

Karthik Rangappa says:

April 25, 2021 at 10:19 am

Happy learning, Aryan!

75. Ankit Kumar says:

March 29, 2021 at 8:18 pm

Will I get a notification if someone replies me?

Karthik Rangappa says:

March 29, 2021 at 8:33 pm

Not really, you will have to check it manually.

76. Gaurav says:

March 25, 2021 at 6:22 pm

Hi Karthik, quick question – what news apps do you follow to stay abreast of current developments?

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Karthik Rangappa says:

March 26, 2021 at 10:56 am

Pulse – https://pulse.zerodha.com/

77. gagan says:

March 3, 2021 at 12:34 pm

Can you please darken the paragraph text? It\’s a little difficult to read.

Karthik Rangappa says:

March 4, 2021 at 11:32 am

Hmm, not sure if that can be done.

78. Kamal says:

February 24, 2021 at 10:33 pm

I am very happy to see comment sections still being monitored. Good to know that our queries will be
answered. Just one thing. A financial report runs 100s of pages. How can one read that for every
company? And if one finds the company not good(Which is a good thing) his time and effort are gone
and he has to start again with another company. Isn\’t it like finding a needle in a haystack?. So can one
really invest well without reading all the 100s of pages, while having his daily job to do?

Karthik Rangappa says:

February 25, 2021 at 10:06 am

I understand, Kamal. People usually follow a top-down approach, as in analysing the sector,
identify the companies within the sector and then shortlist 2-3 companies based on broader
numbers. Weekend reading is good enough in my opinion.

79. Himanshi says:

February 4, 2021 at 8:21 am

Sir, your writing imparts well-needed simplicity to these complex concepts.

Karthik Rangappa says:

February 4, 2021 at 1:58 pm

Happy reading, Himanshi

80. Jay says:

January 31, 2021 at 7:04 pm

https://zerodha.com/varsity/chapter/read-annual-report-company/ 29/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Request to change the link for the annual report. As of 2021, the link does not lead to the report page.
New link is https://www.amararajabatteries.com/Investors/annual-reports/

Karthik Rangappa says:

February 1, 2021 at 8:39 am

Thanks, Jay. Will do that.

81. shubham says:

January 29, 2021 at 11:17 am

thank you for this wonderfull content….waiting for more fundamental analysis content…

Karthik Rangappa says:

January 29, 2021 at 12:32 pm

The module is complete but will add a Financial modelling module sometime this year.

82. Dr. Ajinkya Niwal says:

January 11, 2021 at 11:35 am

Thank you so much for explaining in such simple terms. Mr. Kartik and entire Zerodha Varsity team
deserve a loud applause. Even the most difficult topics have been made simple. I regret that i could not
read this 2 years earlier. My financial literacy would have been different. Keep on writing.Your efforts
are making a difference in our lives.

Karthik Rangappa says:

January 11, 2021 at 9:42 pm

Happy reading, Doc! Glad you liked the content

83. Nagasri says:

January 5, 2021 at 8:46 pm

Wow!! Great course made note of every point. Reading it in 2021- I am a budding investor this is
really helpful. Much better than the paid content circulating on YouTube and other platforms

Thanks much!

Karthik Rangappa says:

January 6, 2021 at 11:54 am

Happy to note that, Nagasri Hope you enjoy reading the content!

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84. Siva Nadarajan says:

January 1, 2021 at 6:14 pm

The explanation was excellent. Easy for a beginner to understand it ! Great work ..!

Karthik Rangappa says:

January 1, 2021 at 7:01 pm

Good luck, Siva!

85. Avi says:

December 18, 2020 at 2:17 pm

Sir how much time should one spend reading annual report

Karthik Rangappa says:

December 19, 2020 at 10:00 am

Time does not matter as long as you get all the information

86. prajwal says:

December 12, 2020 at 1:48 pm

plz any tell me how to find out interest rate on percentage for the stock

Karthik Rangappa says:

December 13, 2020 at 7:43 am

Sorry, I dint get that.

87. Radha says:

December 1, 2020 at 9:39 pm

Your modules are so simple to understand and encourage to learn more. Hope to continue on a profit
journey here on.

Karthik Rangappa says:

December 2, 2020 at 9:46 am

Happy learning, Radha!

88. Abhishek Kanthed says:

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5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

November 24, 2020 at 4:25 pm

The annual report isn\’t accessible from the link anymore. Can you update the link?

Karthik Rangappa says:

November 24, 2020 at 8:53 pm

Yeah, I guess the company has changed the link. Can you please google for the annual report?

89. raghav says:

November 19, 2020 at 6:23 pm

The link to Annual Report of Amara Raja Batteries Limited is not working and it redirects us to the
main website of Amara Raja. can somebody please help?

Karthik Rangappa says:

November 19, 2020 at 8:16 pm

Please google for Amara Raja Annual report, you will be directed to the right link.

90. satish says:

November 15, 2020 at 9:45 pm

Hi Karthik, You mentioned that One needs to read atleast last 3-5 years of AR\’s before investing. So
while doing so, do I need to read MD&A, director\’s statement form all the AR\’s? or do I only need to
read MD&A from the recent annual report?

Karthik Rangappa says:

November 16, 2020 at 8:45 am

Yes, that will help you understand the company and its business better.

91. Niharranjan Nayak says:

November 12, 2020 at 7:11 pm

valuable lessons

92. Suraj says:

October 7, 2020 at 12:21 pm

Sir, I was going through the annual report (2018-19) of LIC and want to know which one is
consolidated/standalone financial statement out of
1. \”Financial Statement (Segmental)\” and
2. \”CAPITAL REDEMPTION (INCLUDING ANNUITY CERTAIN) INSURANCE BUSINESS\”
in the pic?

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5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Link for the pic: https://i.ibb.co/4ZKwq6s/lic.png

According to my understanding 1. will give information about the company\’s financials(consolidated)
and 2. will give information about its insurance business alone.

Karthik Rangappa says:

October 8, 2020 at 8:25 am

1) This seems like segment-wise P&L

2) Not sure about this

Before the financial statement, the company will explicitly mention that the financials are
consolidated.

93. roopam says:

September 20, 2020 at 4:57 pm

good evening sir Ji

A few questions regarding this article
1- you have mentioned the use of \”tijori finance\” and \”screener\” in the comments sections
Isn\’t \”Tickertape\” better than these both and also a subsidiary of zerodha?
2-as mentioned in this chapter that crisil is 51% owned by S&P so now if crisil makes 100 crore profit,
so does 51 crore of total profit generated go to S&P?
thank you

Karthik Rangappa says:

September 20, 2020 at 9:18 pm

Tickertape is good as well. Its just that the other two are free to use.
That depends on the profit share/royalty arrangement between the two companies.

94. roopam says:

September 19, 2020 at 3:14 pm

i couldn\’t
find amar raja\’s annual report on its site as well through the link you have given

Karthik Rangappa says:

September 19, 2020 at 7:03 pm

I guess ARBL would have changed/updated the site.

95. tarun says:

September 7, 2020 at 9:25 pm

thanks a lot for sharing this information

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Karthik Rangappa says:

September 7, 2020 at 9:30 pm

Happy reading, Tarun!

96. satish says:

August 18, 2020 at 9:43 pm

Hi karthik, Do i need to read everything in management discussion and analysis(MD&A)? Considering

ITC it has 78 pages of MD&A. Do i need to study everything or do i need to skim through it?

Karthik Rangappa says:

August 19, 2020 at 9:19 am

You can skim through it. Most of it will be subtle marketing but do read between the lines and
look at the fine print. It usually provides valuable insights not just on the company but also about
the industry

97. Suraj says:

August 17, 2020 at 11:30 pm

Was simple and easy to understand. Thanks so much!!

Karthik Rangappa says:

August 18, 2020 at 9:10 am

Happy reading!

98. Joshua says:

July 22, 2020 at 1:21 am

Thanks Karthick, hoping to get some good news soon

99. Joshua says:

July 21, 2020 at 12:23 am

Hi Karthick,

Just a Suggestion, I see the Varsity in the playstore and I believe you are providing certificates if a
module is completed over the App. I presume that content is almost the same in both Varsity app and
varsity web, but I don\’t see any options to get certificates in Varsity web. I am a kind of person who is
comfortable reading through big screen (laptop, compute) rather than in Mobile, I believe most people
will be just like me. If you could set Quizzes in the end of every module and provide certificates the
readers will be more motivated to learn. Thanks

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5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Karthik Rangappa says:

July 21, 2020 at 10:52 am

Thanks for the feedback. We are actually thinking of doing something better with regard to
certification. Ironing out the details. Hopefully, we should have something soon.

100. Suraj says:

July 19, 2020 at 2:38 pm

Doubt:
If I find that some companies are going to perform well, I will simply invest by buying their shares.
But, if I think that some companies will not perform well ahead, should I invest by making a sell
order?

Karthik Rangappa says:

July 19, 2020 at 6:35 pm

No, you can simply avoid buying these companies.

101. Devashish says:

July 17, 2020 at 7:51 pm

Hi Karthik
I have a query regarding the financial statements of the companies.
There are various online sites such as tijorifinance and screener where the financial numbers are a bit
different then the ones which are mentioned in the annual reports of the companies. Is this a small
margin which we can overlook or is it always recommended to look into the annual reports and make
the excel sheets from their although that would be time consuming. What would you suggest?
Thanks!!!!

Karthik Rangappa says:

July 18, 2020 at 10:30 am

I prefer to take the numbers directly from AR and do the excel work. But if it is for a quick and
dirty calculation, I rely on one of these two sits. They are more or less accurate.

102. satish says:

July 15, 2020 at 8:11 pm

Even after considering only FINANCIAL HIGHLIGHTS, THE MANAGEMENT

STATEMENT,MANAGEMENT DISCUSSION AND ANALYSIS. We still have around 30 pages out
of ~100. Do we need to study all the matter present or Still there is a need to eliminate some matter?

Karthik Rangappa says:

July 16, 2020 at 10:59 am

https://zerodha.com/varsity/chapter/read-annual-report-company/ 35/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

What you need is MD&D, Director\’s report, and Consolidated financials. Everything else is a
good add on.

103. Satish says:

July 14, 2020 at 4:50 pm

Hi Karthik,
Usually AR range any where between 100-300 pages. When going through AR how can a Newbie
filter out required data and eliminate unwanted publicity by the company. Simply asking how can a
person decides what is useful and what is not and skip it?

Karthik Rangappa says:

July 14, 2020 at 9:36 pm

Thats exactly what I\’ve highlighted in this chapter. You can also check this video –
https://www.youtube.com/watch?v=fTIOzRPOXsk

104. Mohit Jain says:

July 13, 2020 at 4:25 pm

Great example for the differentiation between standalone and consolidated basis! Thank you so much
sir!

Karthik Rangappa says:

July 13, 2020 at 8:30 pm

I\’m glad you could relate to it, Mohit.

105. Aman says:

July 12, 2020 at 11:03 am

Do every investor is entitled to get a hard physical copy of the annual report?if yes how to get it.

Karthik Rangappa says:

July 12, 2020 at 11:23 am

Yes, but now you can just download the AR from the company\’s website.

106. Vijaya Sarathi Ravi says:

July 9, 2020 at 12:52 am

Thank you.

https://zerodha.com/varsity/chapter/read-annual-report-company/ 36/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

107. Vijaya Sarathi Ravi says:

July 8, 2020 at 7:09 pm

Hello Mr. Karthik,

Wonderful explanation, shows the effort gone in making this notes.
Can we get the fundamental data in excel format?

Karthik Rangappa says:

July 8, 2020 at 8:35 pm

Thanks!

You can check sites like screener or Tijori, they may provide an excel download option.

108. Aagam says:

July 8, 2020 at 6:58 pm

Hello sir,

Here you said that they will show in the AR.

For example, if I am reading through a manufacturing company annual report, I would be particularly
interested in the human resources report to understand if the company has any labor issues. If there are
serious signs of labor issues then it could potentially lead to the factory being shut down, which is not
good for the company’s shareholders.

But I think so the company will not disclose such things in his report.

What you say sir?

Karthik Rangappa says:

July 8, 2020 at 8:29 pm

They are supposed to highlight the same in AR, especially the manufacturing companies.

109. Viney says:

June 21, 2020 at 10:57 pm

Hello Karthik,

I have been referring varsity for quite sometime. I must appreciate the hard work you have put into this
study material. You paid attention to details nevertheless made sure it doesn\’t get too theoretical and
monotonous. Awesome piece of work !! Thanks much for everything!

110. Arvind says:

June 18, 2020 at 7:17 pm

what is long-form.EBITDA, EBIT, PAT.?

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5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Karthik Rangappa says:

June 18, 2020 at 10:31 pm

Earning Before Interest, Tax, Depreciation, and amortization.

Earning Before Interest, Tax.
Profit After-tax.

111. VirRaja Kumar says:

June 11, 2020 at 5:50 pm

https://bankermind.com/biggest-stockbrokers-in-india/
this website show Zerodha is no.1 broker in India….. It is true?

112. Surya N. Parija says:

June 8, 2020 at 11:53 pm

Nice explanation sir.Sir do we use only TA for trading or FA is also used. Kindly tell me because I want
to start trading ASAP I completed the TA module now should I start trading or complete all the other
modules then paper trading. And at last actual trading.
THANK YOU.

Karthik Rangappa says:

June 9, 2020 at 11:00 am

FA is great from making investments, while TA is good for taking trading positions. I\’d suggest
you paper trade for a while until you get the necessary confidence to trade in real markets.

113. Ranjeet says:

May 30, 2020 at 4:32 pm

I would really like to appreciate the way things have been explained , So simple and yet powerful. A
layman can easily understand this. Hats off to the writer.

Karthik Rangappa says:

May 30, 2020 at 7:38 pm

Happy to note that, Ranjeet

114. Shreya Koushik says:

May 21, 2020 at 1:11 pm

Thanks a lot.
The post really meant and helpful for beginners like me. I am still learning stock picking and stock
analysis by using free services of

https://zerodha.com/varsity/chapter/read-annual-report-company/ 38/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

https://ticker.finology.in/ and money control but I want to know how good and helpful is their premium
plan offerings. Any help would be greatly appreciated.

Karthik Rangappa says:

May 21, 2020 at 8:11 pm

I\’ve never really used a premium service, so cant comment

115. Anad Ahamed Aslam says:

May 8, 2020 at 5:09 am

Good morning karthik…… While reading this varsity I came to know that this was written in
2014…….so I didnt post any comments… Coz i thought I won\’t get reply…. But recently in previous
chapters I saw comments with replies …. Even after so many years u r following it…. Thanks for
that…. It will help many new beginners……..
Back to the topic…
In this chapter u have taught… How to read annual report….. But how will we conclude that this is this
good annual report or not to investigate further or not to invest??

Thank you

Karthik Rangappa says:

May 8, 2020 at 9:13 am

We make it a point to answer as many queries as possible on a daily basis

Generally speaking, after reading through the AR, you should not have any queries. Which
means to say, all the information available to you must be detailed in the AR. This would make it
a good AR

116. harshid patel says:

April 25, 2020 at 9:34 pm

The table in page 21 (in pdf) is very different from the actual annual report i downloaded from the
company website.
The heading are same but the content is different in both the tables under management\’s discussion
and analysis.
Did they change it or what ???

Karthik Rangappa says:

April 26, 2020 at 8:42 am

Is it for the same year? They aren\’t supposed to change the contents/numbers, if they do, they
usually do with a clarifiecation.

117. Sam says:

March 31, 2020 at 5:33 pm
https://zerodha.com/varsity/chapter/read-annual-report-company/ 39/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

And for these above mentioned companies should I consider consolidated statements.

Karthik Rangappa says:

April 1, 2020 at 9:02 am

Yes, please.

118. Sam says:

March 31, 2020 at 5:27 pm

Hi,
If I take the standalone statements do I get a good analysis or I have to go for consolidated statement.I
didn\’t clearly understand as to which companies I have to consider consolidated statement as for tata
motors there are many shareholding companies.Do I have to check the annual report of each
shareholding companies. And for other companies like mahindra,maruti suzuki ,L&T and hero honda
motors.

Karthik Rangappa says:

April 1, 2020 at 9:02 am

Sam, it is consolidated by default for all companies. Consolidated gives a better picture of the
company\’s overall financial health.

119. Roshan Kumar says:

March 30, 2020 at 11:05 pm

I reading these chapters and I have some questions.

1. it\’s basic or advance level information in these chapters?

2. After completion of these chapters, I have to attend more classes or its sufficient to analyze a stock
fundamentally?

Karthik Rangappa says:

March 31, 2020 at 12:01 pm

This is fairly everything that you need to know, Roshan. Of course, you can build on this, it\’s
entirely up to you. But this is good enough information for you to get started.

120. Roshan kumar says:

March 30, 2020 at 10:58 pm

Really a nice initiative from Zerodha to educate newcomers and its users. I read this chapter and I
found its very easy and simple wording and a nice way to educate people who want to learn it. it\’s
from my heart, I salute the guy who wrote this article really a wonderful explanation.

https://zerodha.com/varsity/chapter/read-annual-report-company/ 40/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Karthik Rangappa says:

March 31, 2020 at 11:59 am

Thanks for the kind words, Roshan. Happy reading

121. Sam says:

March 30, 2020 at 12:54 pm

I\’m actually doing a financial analysis of selected automobile manufacturing companies in India.I\’ve
taken tata motors as one company,should I consider standalone statement or consolidated statement as I
am a new comer in finance.

Karthik Rangappa says:

March 31, 2020 at 11:31 am

Consolidated statements. Good luck with the analysis

122. prakhar says:

March 29, 2020 at 11:10 am

http://www.amararaja.co.in/annual_reports.asp link doesnt redirect me to annual report.

Karthik Rangappa says:

March 29, 2020 at 11:13 am

They must have changed the URL, please look at the website > investor section.

123. Daniel Abraham says:

March 25, 2020 at 2:00 pm

Is the mandatory for all the companies to send me a hardcopy of the annual report on my request, if I
own even 1 share in the company ?

Karthik Rangappa says:

March 26, 2020 at 2:23 pm

Nope, not mandatory. They can email as well or make it available on the website from where you
can download.

124. Ajinkya says:

March 21, 2020 at 9:13 am

Explained in simple words.. Thank you !

https://zerodha.com/varsity/chapter/read-annual-report-company/ 41/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Karthik Rangappa says:

March 21, 2020 at 11:52 am

Happy reading!

125. Saurabh Jindal says:

March 13, 2020 at 2:29 pm

Really great. Everything is in it.

Karthik Rangappa says:

March 14, 2020 at 12:15 pm

Thanks! Happy reading

126. Arnav says:

March 6, 2020 at 12:35 pm

Hi Sir, what according to you is not published in Annual reports. What information about the company
are you looking for which isnt there.
Thank you !

Karthik Rangappa says:

March 7, 2020 at 3:59 pm

I think pretty much all details an investor need is present in the AR. If you are looking for
information beyond what\’s available in the AR, then maybe you are over analysing a company

127. Aditya Yadav says:

February 22, 2020 at 2:58 pm

extremly usefull content

Karthik Rangappa says:

February 23, 2020 at 12:51 pm

Happy reading!

128. Arnav says:

February 17, 2020 at 1:29 pm

Hi Sir,

https://zerodha.com/varsity/chapter/read-annual-report-company/ 42/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

I have couple of doubts regarding reporting

1. Do companies publish Quarterly reports. If yes where can we find them

2. For e.g. if a company\’s overall liabilities have increased, can we also check where have they used
the additional funds as in which projects etc.

Karthik Rangappa says:

February 18, 2020 at 11:38 am

1) Companies publish only P&L data on a quarterly basis

2) Yes, but this will be made available yearly, in their annual report

129. ms> says:

February 13, 2020 at 3:13 pm

>such a woderful read\’, I really liked it<

130. Savio says:

January 11, 2020 at 3:37 pm

Are these annual reports standard across the world or is this format (P&L statement, CF, and Balance
sheet) only specific to India. I was going through the annual report of one U.S. company but I could
not find any schedules with breakup of the various components under the P&L statement. Also I could
not find the Cash Flow statement as well, there were other financial documents however.

Karthik Rangappa says:

January 12, 2020 at 7:57 am

Nope, this is specific to India. The US has a different format of publishing the AR. However,
financial statements are similar. You can find the associated notes in the supporting documents I
guess filed with the SEC.

131. DrChanna Hubli says:

October 31, 2019 at 9:02 am

Sir, Very Nice Explanation. Time and again I feel it should be in Video Format. I couldn\’t download
annual report of Amara raj Batteries. It Takes me to the website, but there is no investor column. Please
Help. Even in NSE website, i couldn\’t get annual report.

Thanks in advance.

Karthik Rangappa says:

October 31, 2019 at 11:40 am

I think the company has changed its site. Check this –

https://www.amararajabatteries.com/Investors/annual-reports/

https://zerodha.com/varsity/chapter/read-annual-report-company/ 43/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

132. Anirudhh says:

September 7, 2019 at 7:28 pm

Hey Karthik,
Thanks for so much Information on AR
As you have mentioned going through Management Discussion & Analysis is important and there is a
ton of information in it, Since I\’m new to investing, I\’d like to ask, is it important to take notes for
MD&A and compare them with other Companies of Same sector,
And can u suggest where exactly we need to take notes, Since I can\’t remember all the information on
an Annual Report

Karthik Rangappa says:

September 8, 2019 at 8:47 am

Anirudhh, comparing MD&A of two different companies in the same sector is a golden practice,
suggest you do that

133. Indrajitsinh Gohil says:

August 26, 2019 at 7:18 pm

The link has been changed to below:

https://www.amararajabatteries.com/Files/AnnualGeneralMeetingFiles/2013/Annual-Report-2013-
14.pdf

Karthik Rangappa says:

August 27, 2019 at 9:22 am

Thanks for the update, will get this changed.

Reply
134. HOW TO READ ANNUAL REPORT OF THE COMPANY says:
August 7, 2019 at 3:15 pm

[…] How to Read the Annual Report of a Company […]

135. Soujanya Holkar says:

July 30, 2019 at 9:37 pm

The link of AR of the Amara Raja batteries (http://www.amararaja.co.in/annual_reports.asp) is no more

available kindly provide some other example.
Thanks

Karthik Rangappa says:

July 31, 2019 at 2:09 pm

They must have changed the URL, I\’d suggest you look up on their site. The technique remains
the same irrespective of the example.
https://zerodha.com/varsity/chapter/read-annual-report-company/ 44/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

136. Vinay Mittal says:

July 11, 2019 at 6:04 pm

I have never read something this good, So much content to understand yet so short. Great work!!

Karthik Rangappa says:

July 12, 2019 at 11:29 am

Happy to note that, Vinay! Glad you liked the content

137. Ram says:

May 7, 2019 at 12:10 pm

Hey Karthik,
I was going through INOX leisure\’s Annual report, it had the management discussion and analysis
report but didn;t have the Management Statement
So…….?

Ram says:
May 7, 2019 at 1:38 pm

And also what are \’executive directors\’ ?

Karthik Rangappa says:

May 8, 2019 at 1:15 pm

Executive Directors are full-time employees of the firm who also have decision making a
role in the company.

Ram says:
May 9, 2019 at 1:45 pm

Karthik could you please suggest me a book or something from where I can get to
know the structure of a company like directors chairman ceo and all that.

Karthik Rangappa says:

May 10, 2019 at 11:08 am

I think any basic business book should help you with this. Maybe 1st year
MBA finance books?

Karthik Rangappa says:

May 8, 2019 at 1:13 pm

https://zerodha.com/varsity/chapter/read-annual-report-company/ 45/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

That is ok, few companies combine it within MD&A.

138. Poornima says:

April 28, 2019 at 1:19 am

I want annual report of skdrdp

Karthik Rangappa says:

April 28, 2019 at 11:05 am

Suggest you check their website >>> investor section.

139. Akshay says:

March 3, 2019 at 6:50 pm

Could you recommend me books that would provide me with further details on fundamental analysis

Karthik Rangappa says:

March 4, 2019 at 2:42 pm

I\’d suggest Securities Analysis by Graham.

140. Amit says:

March 2, 2019 at 8:53 pm

Hi sir

Where can I see employees are holding their company\’s share or not?
I can\’t found in annual report shareholding pattern section .

Karthik Rangappa says:

March 3, 2019 at 8:30 am

If the holdings are less than 1%, then you will not know. Shareholdings higher than 1% will be
disclosed to exchanges and will appear in the quarterly shareholding statement.

141. vaibhav raj says:

February 28, 2019 at 6:29 pm

sir, why there is some difference between the closing amount of a year and the opening amount of next
year
example if there is 2000 in 31st march 2016 then in next year it will show 1800 or 2100?

Karthik Rangappa says:

https://zerodha.com/varsity/chapter/read-annual-report-company/ 46/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

March 1, 2019 at 11:14 am

Thats the amount added or utilized during the year. The notes will have the details.

142. Revant Malani says:

January 28, 2019 at 1:12 am

Hi sir,
I would really like to connect with you and discuss my investment ideas with you. I\’m a young,
passionate and curious student who is extremely fond of investments and would be grateful to have an
opportunity to speak to you.

Karthik Rangappa says:

January 28, 2019 at 12:03 pm

Revant, I\’m not sure of if I can devote time to individual queries/investment ideas. However, I
can certainly help you with learning related to the subject. Please do feel free to ask however
ever queries you have here, on this platform. Thanks.

143. Sangita Mahajan says:

January 22, 2019 at 11:16 am

Can we check the annual report of Banks also?

Karthik Rangappa says:

January 22, 2019 at 1:17 pm

Yes, you certainly can.

144. PRATIK SANJAY MOHADIKAR says:

January 15, 2019 at 6:26 pm

As a Learner, This is the Best Platform for Learning the whole market and its strategy, your
explanation strategy is also unique.

Thank you so much for providing this material.

May God Bless you, sir.

Karthik Rangappa says:

January 16, 2019 at 11:25 am

Thanks for the kind words, Pratik. Happy learning

145. Bama Dutta says:

https://zerodha.com/varsity/chapter/read-annual-report-company/ 47/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

December 23, 2018 at 8:38 am

Can you share any link or discuss on \”Accounting policies\” – where to get the data and how it
manipulates?

Karthik Rangappa says:

December 24, 2018 at 12:15 pm

I think being completely aware of how balance sheet works (explained in this module), will help
you deal with this.

146. Saurabh Neel says:

December 21, 2018 at 7:47 pm

Can we replace annual report from stockreport+ by zerodha??

Karthik Rangappa says:

December 22, 2018 at 12:38 pm

Nope, Stockreport+ is not really a replacement for the annual report.

Saurabh Neel says:

December 22, 2018 at 5:58 pm

So what are the actual use of stockreport+, Then it is worthless ??

Karthik Rangappa says:

December 24, 2018 at 12:10 pm

Well, if it was worthless, why would TR deploy so much resource

Check this to know more – https://www.youtube.com/watch?

v=ct5IkGcJNtc&t=334s

147. Sundeep says:

December 19, 2018 at 11:58 am

Sir you have mentioned that a shareholder can get a Hardcopy of the Annual Report by contacting the
company. I have mailed the company\’s investor\’s relations to send me a copy of the same. I haven\’t
heard from them and its been more than a month. What do you suggest I do?

Karthik Rangappa says:

December 20, 2018 at 11:09 am

https://zerodha.com/varsity/chapter/read-annual-report-company/ 48/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Sundeep, if you are not too particular about the hard copy, then you can download the softcopy
from their website. Look for it under the investor section. Thanks.

148. Lokesh Aggarwal says:

December 6, 2018 at 6:05 pm

Thanks for sharing so much important information about the AR.

Karthik Rangappa says:

December 7, 2018 at 11:48 am

Good luck, Lokesh. Happy reading

149. Suraj says:

November 29, 2018 at 5:11 pm

Good………..
Very good…….
Excellent…………..
Super…………………….

Karthik Rangappa says:

November 30, 2018 at 11:14 am

Thanks, Suraj

150. Ankit says:

November 18, 2018 at 1:50 pm

Hello sir,
You have explained things wonderfully! It\’s commendable.
My question is related to the example quoted by you above where in S&P held 51% stake in CRISIL.
Now, if S&P or let\’s say Mc graw hill generate the AR, will they also include whole of the 700cr profit
in their AR considering the fact that CRISIL is not a 100% subsidiary of any of them?

Karthik Rangappa says:

November 19, 2018 at 11:20 am

Thanks for the kind words, Ankit. Yes, they will have to report this in AR.

151. Karthik says:

November 2, 2018 at 5:03 pm

Sir, can u post a article on how to read a annual report of Insurance companies. Thank u.

https://zerodha.com/varsity/chapter/read-annual-report-company/ 49/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Karthik Rangappa says:

November 3, 2018 at 10:54 am

I\’ll try and do that, Karthik.

152. Shrey Bhandari says:

September 28, 2018 at 4:18 pm

Hello,

Sir, why there is difference between the value of financial data of 2017 (in balance sheet of 2018), and
financial data of actual 2017 balance sheet. For example in 2018 balance sheet, the financial data of
2017 shows total Assets of 1,16,094 Lakhs, but in actual previous year annual report, financial data of
2017 shows assets of 78,866 lakhs. Why there is difference and which numbers should we consider?

Karthik Rangappa says:

September 29, 2018 at 9:52 pm

Sometime, the management may want to restate the numbers. For this reason, I always look at
the current year AR to look at the previous year\’s number.

153. Manoj makwana says:

September 14, 2018 at 4:54 pm

Fundamental analysis not so easy its all about which positive points we could figured out from balance
sheet & directors speech.

Karthik Rangappa says:

September 15, 2018 at 4:57 pm

Yes, it takes some effort to learn FA

154. Manish Sharma says:

September 14, 2018 at 12:52 pm

I am not able to find AR(Annual reports) of AMARA RAJA Company. Can you again share the link or
an Excel or word file. So that we can connect properly with this>??
Waiting for your reply.

Beginner!

Manish Sharma says:

September 14, 2018 at 12:56 pm

https://zerodha.com/varsity/chapter/read-annual-report-company/ 50/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

P.S.
The link you shared in this chapter is not working.

Karthik Rangappa says:

September 14, 2018 at 1:52 pm

Ah, can you visit their site and look for it in the investors\’ section? Thanks.

Karthik Rangappa says:

September 14, 2018 at 1:52 pm

You can download the report from here – http://www.amararaja.co.in/annual_reports.asp

Manish Sharma says:

September 14, 2018 at 2:45 pm

404 – File or directory not found.

The resource you are looking for might have been removed, had its name changed, or is
temporarily unavailable.

After clicking on the link you provided sir, above written line is coming.

Karthik Rangappa says:

September 15, 2018 at 4:45 pm

Ah, let me check Manish. Meanwhile, I\’d suggest you check directly on the
company\’s website.

155. Rajdeep Dey says:

August 18, 2018 at 12:04 pm

Hi Sir,
It\’s Just Amazing to read this Lessons I m thoroughly enjoying it\’s written in so easy to language that
a Layman like me can also Understand it.

I have a small Request sir Could u plz add a chapter for \”How to read the AR of the BFSI companies\”
and the important ratios to watch out.
Thank you.

Karthik Rangappa says:

August 19, 2018 at 9:12 am

Thanks for the kind words, Rajdeep

I\’ll try and put up a chapter on it.

https://zerodha.com/varsity/chapter/read-annual-report-company/ 51/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

156. Amit mavani says:

August 14, 2018 at 12:23 pm

Hi sir

1 .is related party transactions is one type of expense ? If yes then where is show in profit n loss
statement ?
2.this type of transaction of done from reserve n surplus balance ?
I see only in annual report but not in balance sheet or P& L statement

Give explanation in detail

Karthik Rangappa says:

August 14, 2018 at 3:11 pm

1) This will be mentioned separately in the annual report, Amit. You cannot differentiate this by
looking at the financial statements

2) From the regular income. Like I said, this information is no included in the financial
statement.

157. Shankaran says:

July 28, 2018 at 1:49 pm

Hi Karthik,

Varsity is a gem among the stock market information sites, with simple as well as clear in depth info.

Thanks for sharing the info.

Karthik Rangappa says:

July 29, 2018 at 10:05 am

Glad you liked it, Shankaran. Happy learning!

158. Amit mavani says:

July 28, 2018 at 9:46 am

Hi sir

Where can I find a management\’s commentary which release every quarterly results ?
And what\’s its title if it\’s available in its website ?

Karthik Rangappa says:

July 29, 2018 at 9:35 am

Visit the Investor\’s section on the website of the company you wish to track. Within this section,
you can find the Quarterly results. The quarterly results contain various things like P&L,

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management view etc. Here is the link for Infy – https://www.infosys.com/investors/reports-

filings/Pages/index.aspx#quarterly

159. JASDEEP SINGH says:

July 14, 2018 at 12:12 pm

Hi Sir ,
Thanks for your articles .Your articles are pure gold .
In qualitative aspects I know what to analyse but I don\’t how to analyse .
For eg. I know I should check management\’s background but i don\’t know what to check in
management\’s background

Karthik Rangappa says:

July 15, 2018 at 10:05 am

Here are a couple of things –

1) Check if their past experience – indicates if they deserve to be where they are
2) Check for compensation – are they drawing more than what is fair practice
3) Their Lifestyle – remember Suzlon/Kingfisher
4) Other directorships/ownerships

I\’d suggest you check the latter chapters in this module for more insights.

Jasdeep singh says:

July 15, 2018 at 5:16 pm

Thanks a lot sir

I have read all the modules altleast two times. It is pure gold.
Varsity takes a nursery student to PhD level.

Karthik Rangappa says:

July 16, 2018 at 10:52 am

Thanks for the kind words, Jasdeep

Good luck!

160. R Santosh Reddy says:

July 8, 2018 at 6:00 am

Hi Sir,

Thank you for varsity!!

Awesome articles ever I loved reading.

Karthik Rangappa says:

July 8, 2018 at 12:49 pm

https://zerodha.com/varsity/chapter/read-annual-report-company/ 53/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Good luck and happy reading, Santosh

161. Vinoth says:

July 7, 2018 at 7:10 pm

Awesome content.sir.1question sir.there are thousands of companies there.where can I find which
company is doing well???.and which news and magazines can I read to have better knowledge about
investing.thank u sir

Karthik Rangappa says:

July 8, 2018 at 12:45 pm

Its best if you start using a screener for this. You can give your criteria and start filtering out
stocks. Check out https://screener.smallcase.com/welcome (paid version) and
https://www.screener.in/ (free version). Good luck.

162. Debdeep Nanda says:

July 2, 2018 at 7:03 pm

So in the example of CRISIL owning 100% of IREVNA, which statement would actually affect the
share price of CRISIL; the standalone one, or the consolidated one??

Karthik Rangappa says:

July 3, 2018 at 1:26 pm

The consolidated one.

163. SAMAR says:

May 26, 2018 at 11:17 pm

DO U HAVE E BOOK FOR THIS WHOLE TOPICS OR IN PDF TO TAKE A PRINTOUT , IT WILL
BE BETTER TO STUDY.

Karthik Rangappa says:

May 27, 2018 at 2:18 pm

The PDF is available for you to download at the end of this page –
https://zerodha.com/varsity/module/fundamental-analysis/

164. Vikram says:

May 24, 2018 at 3:32 pm

Hi Sir,

https://zerodha.com/varsity/chapter/read-annual-report-company/ 54/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Very informative article.

I have a question, where does a company declare its quarterly result first?
I mean for example, suppose TCS is going to declare its quarterly result, then where do they announce
their result at very first?
On their websites they post the result after sometime of announcement, so where do they actually
announce result first.

Thank you!

Regards,
Vikram

Karthik Rangappa says:

May 25, 2018 at 11:02 am

They send the results first to the exchanges and then update the same on their websites. Some
even hold a press meet to discuss the results.

Vikram says:
May 25, 2018 at 1:09 pm

Hi,

Thanks for replying and clearing the doubt.

Regards,
Vikram

Karthik Rangappa says:

May 26, 2018 at 12:18 pm

Welcome, Vikram.

165. Nitin Karekar says:

May 8, 2018 at 4:35 pm

Hello Nitin here!

First i would like to thank for such information described in simple manner.

Pls share more more information helpful for every one..

Karthik Rangappa says:

May 9, 2018 at 11:14 am

What sort of information are you looking at, Nitin?

166. Sunil says:

May 7, 2018 at 7:31 am
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Hi,

First of all, a heart felt thanks for the wonderful and lucid article on FA. I was into this FA since 1 year
and have tried lot of books and websites (paid as well). However, i can\’t remember any one of them
even trying to match with the work done here.
Simply, hats off.

However, my question, out of the thousands of companies, how do we chose one for FA. I have seen an
answer to this as selecting from a screener website (screener.in). Also you said you mentioned about
the filter by end of the module. Apoligies, but i could not get this.
Can you please help us on this as well on how to pick a company first? May be i missed the filter, can
you please enlighten?

Once again, thanks for the wonderful article.

Karthik Rangappa says:

May 7, 2018 at 9:08 am

By filter, I mean a site like screener. You can always start with an industry that looks interesting
to you and then selecting companies that fit your criteria. For example, if you like tyre
manufacturers as an industry, then look for companies within it – this will narrow down your
search from few thousands to few handful of companies.

167. Amit says:

April 24, 2018 at 12:43 am

Hey Karthik,

I work as an Equity Research Analyst in an IB. You statement on consolidated v/s standalone caught
my eye.
\”I personally prefer to look through the consolidated financial statements as it gives a better
representation of the company’s financial position.\”

Umm, as an Analyst, I infact screen the PnL of a company while calculating many ratios so that it
doesn\’t include the effects of inorganic growth like earnings from its subsidiaries, inorganic earnings
due to foreign currency appreciation, one-time earnings and other non-recurring earnings etc.. I usually
exclude them and in many cases scale them down so as to reduce the impact of such inorganic growth
parameters on the parent company I am analyzing and that is the norm kinda followed across IBs.

Shouldn\’t we infact and exclude (or scale down) the impact of subsidiaries from the consolidated
financial statements? Shouldn\’t the core business of a company be analyzed since core operating
earnings are the ones we use to value the company using FCFF or FCFE DCF method

Karthik Rangappa says:

April 24, 2018 at 11:13 am

Amit, perhaps I should have worded this better. Here is another way to look at this – If the
company is focused one couple of verticals and has a few products, then chances are that its
standalone FS is pretty much consolidated. So in a sense, by taking in the consolidated, you are
also accounting for the residual value. Now, if the company is large enough to derive significant
value from other subsidiaries (Coromandel and EID come to my mind), then maybe it does make
sense to value it on an overall basis.

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I understand your argument, but I guess the market, at the end of the day values the business in
its entirety.

Amit says:
April 24, 2018 at 1:49 pm

Hi Karthik,
Thanks for enlightening it furthur :). Makes sense. I just graduated from b school and have
joined this IB. Apologies if what I said was naive or not appropriate. Just entered this field.
Happy to learn more from a professional like you and looking forward to learn from other
varsity modules as well. Many thanks for these modules!

Karthik Rangappa says:

April 25, 2018 at 11:16 am

Hey Amit, no apologies here

Your opinion is as good as mine. Good luck and I hope you have a glorious career
ahead!

168. Kishan Modi says:

April 13, 2018 at 3:57 am

When looking at the financials for a subsidiary company, should I also factor in the financials of it\’s
parent company? Let\’s say- the subsidiary has been incurring losses in last 2 FY but parent company
had impressive figures in their income statement. In this scenario, parent company most likely will
rescue it\’s subsidiary.

Karthik Rangappa says:

April 13, 2018 at 2:59 pm

Yes, you certainly have to consider the parent company\’s financials.

Kishan Modi says:

April 15, 2018 at 3:30 am

Alright, thanks!

Karthik Rangappa says:

April 16, 2018 at 1:51 am

Cheers!

169. Digvijay says:

March 24, 2018 at 1:24 pm

https://zerodha.com/varsity/chapter/read-annual-report-company/ 57/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Hi Kartik,

Your content is simply amazing for a new investor. Can you comment on the below strategy
1. Doing deep FA on stocks under 100rs and keep investing in them ?
2. Keep yourself limited to Nifty 50 and invest according to TA ?

Karthik Rangappa says:

March 25, 2018 at 12:05 pm

1) Doing deep FA is good, but why do you want to restrict it to stocks under 100? The value can
be anywhere, could be in a 100 Rupee stock or a 1000 Rupee stock
2) Stick to Nifty 50 for trading

170. Amit mavani says:

March 23, 2018 at 9:56 am

Hiii
What is exact related party transactions?
Is that amounts is subtract from revenue or add in revenue ??

Please describe in detail .

Karthik Rangappa says:

March 23, 2018 at 11:19 am

Company A paying out Company B (which is closely related to Company A)…or the other way
round….. is termed as related party transaction.

Amit mavani says:

March 23, 2018 at 12:00 pm

Ya but if company A is paying out to company B then how can calculate this amount ? Is
that minus from company A profit or something else ?

Karthik Rangappa says:

March 24, 2018 at 12:06 pm

You will find a separate section in the Annual Report meant for Related party
transactions, I\’d suggest you please do have a look at it.

171. Amit mavani says:

February 21, 2018 at 5:40 pm

Hi
Thank you for posting a nice info in simple language .

https://zerodha.com/varsity/chapter/read-annual-report-company/ 58/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

I have following question

1. How can I know the chairman ,MD ,promoters past records like involved in bribery ,crime etc ? And
their life style ?

2. \’Related party transactions\’ and salary of MD ,chairman ,directors where can I find in annual
reports of company ?

Karthik Rangappa says:

February 22, 2018 at 1:08 pm

1) I usually take the help of Google. Type the promoters make plus scam and Google will throw
up results
2) Look for the related party transactions in the Annual report.

172. Abhishek says:

February 12, 2018 at 5:22 pm

What is shareholder equity?

Karthik Rangappa says:

February 13, 2018 at 10:25 am

Shareholder equity = Reserves & Surplus + Share Capital. This is also called the net worth of the
promoters.

173. Saigiri says:

January 29, 2018 at 2:04 pm

Hi,
Let me first express my thanks for sharing this info in a very simple and easy way.

My question is
Its very important to read and understand Management Statement’ and ‘Management Discussion &
Analysis. The Mgmt might mislead and put a better picture forward which is not actually there or
conceal vital information. How do we validate this.

Karthik Rangappa says:

January 30, 2018 at 11:14 am

True, that is very much possible. Hence, it\’s important to read this MD&A of a competing
company as well. Companies with similar business landscape will have similar business
challenges…and this comparison will help in understanding if the company is misleading or not.

174. Shanmugam says:

January 8, 2018 at 7:13 pm

https://zerodha.com/varsity/chapter/read-annual-report-company/ 59/77
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In this case I need to check every fund that if any of those had purchased particular company .but
practically it is difficult.

Karthik Rangappa says:

January 9, 2018 at 10:54 am

I agree, hence this is best does as a once in a quarter task.

175. Shanmugam says:

January 7, 2018 at 6:07 pm

Hi Sir
Where can I find that when mutual fund bought the shares of particular company? For example
particular company bought reliance shares in the month of jan_2017 .Where can I get this details.

Karthik Rangappa says:

January 8, 2018 at 11:19 am

The fund house itself updates this information on the fund\’s fact sheet, this is available on the
website of the fund.

Omkar. Khatavkar says:

May 1, 2018 at 4:31 pm

Not sure if you are looking for this..it gives insight of which mutual funds owns a particular
stock
https://www.valueresearchonline.com/funds/comres.asp

Karthik Rangappa says:

May 2, 2018 at 7:51 am

You can use Coin as well – https://coin.zerodha.com/

176. nandhan A says:

January 5, 2018 at 3:58 pm

Hi karthik

could you please share this excel sheet if possible

Karthik Rangappa says:

January 6, 2018 at 9:54 am

Sure, will try and upload this. Thanks.

Reply
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177. nandhan A says:

January 2, 2018 at 2:06 pm

Hi sir

could you please share the financial calculation excel sheet ?which you have shown in below u tube
training

https://www.youtube.com/watch?v=fTIOzRPOXsk

178. Shanmugam says:

January 2, 2018 at 7:21 am

Hi Karthick
It is pretty good artical
I would like to know below detail

Where can I get the sector details? for example which sectors are performing well now and which are
not performing well in the current year?

Which sectors will be good and not good in the year ahead ?
Could you please tell few websites wherein I can know these details.

Karthik Rangappa says:

January 3, 2018 at 10:28 am

You can look at the sectoral charts to get an update on the overall sector performance. This is a
fair indication of how things are moving in the sector.

Shanmugam says:
January 3, 2018 at 1:27 pm

Hi Karthick
Thanks for reply.
Where can I get sectoral performance details?
Any website are there to indicate sectoral performance?

Karthik Rangappa says:

January 4, 2018 at 10:57 am

Check this –
https://www.nseindia.com/products/content/equities/indices/indices.htm

Shanmugam says:
January 7, 2018 at 6:08 pm

Thanks for useful update .

Thanks to zerodha Team.

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Karthik Rangappa says:

January 8, 2018 at 11:20 am

Cheers! Happy learning.

179. chidambaram says:

December 27, 2017 at 8:08 am

Hi Sir,
In case of consolidated and standalone financial statement, if a holding company is making a loss and
subsidiary is making profit such that the consolidated statement is ends in profit, doesn\’t that mean the
holding company is not performing well?In this case if we look at the consolidated statement and if it
looks attractive (profitable- only because of subsidiary company) ,then can we invest in holding
company? Or instead we should invest in subsidiary? or neither of both?

chidambaram says:
January 4, 2018 at 7:45 am

Hi Sir,
Kindly answer clarify my doubt.

Karthik Rangappa says:

January 4, 2018 at 11:59 am

Sorry, I seem to have missed your query. You can choose to invest in the subsidiary.
However, I really don\’t think it would matter especially if the holding company has no
other investments. I can think of Coramandel Fertilizers and EID Parry as an example
here.

180. Sashidhar. L says:

December 15, 2017 at 8:01 am

The annual reports of only last 5 years are available in NSE website. Where can one find the reports
since the beginning of the company sir ?

Karthik Rangappa says:

December 15, 2017 at 1:46 pm

Check on the company\’s website itself, the annual report will be under the investor\’s section.

Sashidhar. L says:
December 15, 2017 at 2:29 pm

Sir that\’s what I thought too. I was researching company called NATCO Pharma. Looks
like it was listed in 1995. But even in the company\’s website I couldn\’t find the annual
reports before 20011-12. Can you please help look into it and help me? Thanks in advance.

Reply
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Karthik Rangappa says:

December 16, 2017 at 6:25 pm

Here is what I found – http://www.bseindia.com/stock-share-

price/stockreach_annualreports.aspx?scripcode=524816&expandable=0

181. Deepak says:

November 30, 2017 at 11:48 pm

How can we get the quarterly result publishing date of all the companies listed in stock exchange?

Karthik Rangappa says:

December 1, 2017 at 11:36 am

You will have to keep a tab on the company. The dates can vary across companies.

182. Deepak says:

November 30, 2017 at 11:45 pm

Usually when quarterly result gets published the share price changes accordingly. In this case how can
we benefit from reading the annual report?

Karthik Rangappa says:

December 1, 2017 at 11:35 am

In case of Quarterly results, you need to be in a position to understand the quarterly numbers
keeping the numbers stated in the AR in perspective.

183. VICKY says:

November 9, 2017 at 10:33 pm

Dear Karthik. Hats off to your efforts in bringing an article so easy to understand on how to read an
AR.
I am deciding to invest my money in equity but I see so many companies with good financials that I
couldn\’t finalize where to invest in.
I am 23 years, working in a PSU and very much interested in personal finance. It was Zerodha only
from where I took entry in share market, a place where money can me made at the highest rate possible
in current scenario with heavy risk. I lost some money during initial days in day trading and then I
realized it is very important to gain substantial knowledge in this field to save the capital. Then I saw
VARSITY!! I fell in love with it when I read it just for the first time. I have committed to myself
without adequate learning, I won\’t swim down. Thanks for helping me in my process of being a good
swimmer!!

Karthik Rangappa says:

November 10, 2017 at 11:36 am

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Vicky, I\’m so happy to hear this!

Like they say, the only edge in the stock market is you \’Knowledge\’. So stay committed, work
heard, and learn! I\’m sure markets will reward you for it

Good luck, stay profitable.

184. vinayagamoorthy says:

October 28, 2017 at 10:00 am

dear karthick sir,

can u explain the things mentioned in note number 2, how the value is 178.0 something

Karthik Rangappa says:

October 28, 2017 at 12:27 pm

Ah, note 2 is talking about the share capital, which is basically core to the share holder\’s equity.
Gives you information on authorized capital, issued, subscribed capital etc.

185. Nancy says:

October 13, 2017 at 3:53 pm

CRISIL making 1000cr losses!!! CRISIL is fundamentally very strong.The hypothetical example was
way too much :). Thanks for yet another lovely chapter.

Karthik Rangappa says:

October 13, 2017 at 7:16 pm

Cheers! Glad you liked the chapter

186. binay says:

October 7, 2017 at 11:01 pm

can we have a chapter on valuation of companies pls?

Karthik Rangappa says:

October 9, 2017 at 11:05 am

We already have that covered – https://zerodha.com/varsity/chapter/dcf-primer/

187. binay says:

October 7, 2017 at 11:01 pm

beautifully explained, hatsoff

Reply
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Karthik Rangappa says:

October 9, 2017 at 11:04 am

Cheers!

188. Sid says:

September 9, 2017 at 8:23 pm

Why is issued share capital more than the paid-up capital?

Sid says:
September 12, 2017 at 5:13 pm

Are all paid up shares also issued shares?

Karthik Rangappa says:

September 13, 2017 at 11:23 am

Most likely.

189. Sid says:

September 9, 2017 at 8:18 pm

Where does the money raised from series-A and series-B funding add up? Does it add up in the issued
share capital or paid-up capital or neither??

190. Sid says:

September 9, 2017 at 8:17 pm

Where does the money raised from series-A and series-B funding add up? Does it add up in the issued
share capital or paid-up capital or neither?

Karthik Rangappa says:

September 10, 2017 at 10:58 am

Issued.

191. Saiyed Kamil says:

August 31, 2017 at 11:20 am

In the last snapshot, how is the subscribed capital more than the issued capital?

Karthik Rangappa says:

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September 1, 2017 at 7:23 am

No, its not.

192. Sunil says:

August 17, 2017 at 9:24 pm

Articles are good. I am going through it one by one. Are you having downloadable ebook. As I am new
to market I have started to read this articles as per index. But I feel it is better to learn first fundamental
then technical. You should have given fundamental topics first and technical articles afterwards. What
you think, I am correct or I should understand first technical analysis first.

Once again thanks for providing this easy to understand and assisting to gain the knowledge of market.

Karthik Rangappa says:

August 18, 2017 at 11:03 am

It\’s all online Sunil, you can choose to read FA first and then TA. It does not make any
difference in my opinion

Happy learning.

193. Shashi says:

August 7, 2017 at 8:54 am

Hi there ,
What is Indian equivalent of SEC filings in the US. I ask because in US , AR are jazzed up compared
to SEC filings. Please advise.

Karthik Rangappa says:

August 7, 2017 at 11:40 am

Nothing as of now, we just depend on the AR.

194. Sai Sreedhar says:

May 28, 2017 at 5:07 pm

Hi Karthik
Is there a place where we can find the exact time of the result release. Every website only publishes the
date but not the time of release.

Karthik Rangappa says:

May 28, 2017 at 8:26 pm

Not sure if this is reported anywhere.

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Sai Sreedhar says:

May 29, 2017 at 8:55 am

So, we keep looking at the stock price for break-out, confirming the results ?

Karthik Rangappa says:

May 29, 2017 at 7:01 pm

Something like that

195. Tanmay Dhar says:

May 27, 2017 at 11:53 pm

Hi Karthik Sir,

Awesome articles. I have never found any article about Fundamental Analysis of such simplicity.
Thank you very much for your effort.

I have one question. How can I make sure whether the management of a company of my interest is
good enough to sustain the growth of that company?

Karthik Rangappa says:

May 28, 2017 at 5:30 pm

Thanks for the kind words!

Estimating the management is the most difficult thing to do, no straight solution for this

196. Shridhar says:

May 7, 2017 at 8:03 pm

Nice very informative

Karthik Rangappa says:

May 8, 2017 at 3:03 am

Cheers!

197. Satyaki Mallick says:

May 1, 2017 at 1:44 pm

What will be some good reading material to follow to study and know about companies for
Fundamental Analysis ?

Karthik Rangappa says:

https://zerodha.com/varsity/chapter/read-annual-report-company/ 67/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

May 2, 2017 at 7:06 am

You are at the right place to learn about FA. Start here and follow up with companies Annual
Report.

Satyaki Mallick says:

May 4, 2017 at 8:35 pm

Ok. Thanks Karthik. Will the company\’s annual report be enough to learn about the
company..?

Karthik Rangappa says:

May 5, 2017 at 7:37 am

Yes, much more than enough

198. aminravjani says:

April 20, 2017 at 10:13 pm

Properly written ..Will definitely go through all of the topics…

Thank you for all these efforts…

Karthik Rangappa says:

April 21, 2017 at 11:34 am

Welcome! Happy reading.

199. Raja Sundaram says:

April 6, 2017 at 4:36 pm

Wonderful article Karthik. Thank you !

Karthik Rangappa says:

April 7, 2017 at 8:11 am

Thank you

200. HARI BASKARAN says:

February 8, 2017 at 6:45 pm

Dear KARTHIK RANGAPPA,

i had gone over lots of investment articles to gain ideas and knowledge
regarding primary and secondary markets through Books, websites, PPTs, PDFs.
but your collection , composition and presentation can be prasied in a single word

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5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

called \”MARVELOUS\”. good work sir., keep going,

Thank you

Karthik Rangappa says:

February 9, 2017 at 12:43 pm

Thanks for the kind words, Hari

201. Himanshu Pant says:

January 3, 2017 at 4:57 pm

You mention the following

\”One example that I explicitly remember was reading through the chairman’s message of a well
established tea manufacturing company. In his message, the chairman was talking about a revenue
growth of nearly 10%, however the historical revenue numbers suggested that the company’s revenue
was growing at a rate of 4-5%. Clearly in this context, the growth rate of 10% seemed like a celestial
move. This also indicated to me that the man on top may not really be in sync with ground reality and
hence I decided not to invest in the company. Retrospectively when I look back at my decision not to
invest, it was probably the right decision.\”

However I find it hard to believe that any chairman for any publicly traded company will lie so
outrightly about his company. In other words , don\’t the companies take adequate measures to ensure
that the various facts mentioned in AR are in sync ?

Karthik Rangappa says:

January 4, 2017 at 11:23 am

He certainly was not lying. In fact, when management makes a forward looking statement, it is a
reflection of what they expect out of the coming year(s). In this particular case, the expectations
were way too much. By the way, this is not too uncommon – look back at management
statements from Suzlon, IVRCL etc.

Himanshu Pant says:

January 5, 2017 at 3:00 pm

Oh that was a forward looking statement … ? I thought that was the assessment of year
gone by

Karthik Rangappa says:

January 6, 2017 at 1:00 pm

Nope, its a fwd looking statement.

202. Rahul says:

October 11, 2016 at 9:17 am

Very soft and simple language used to explain. Much easy to understand, thanks zerodha
https://zerodha.com/varsity/chapter/read-annual-report-company/ 69/77
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Karthik Rangappa says:

October 11, 2016 at 10:16 am

Thanks Rahul!

203. RD3032 says:

August 1, 2016 at 1:17 pm

Hi Karthik,
First off all thanks for your effort to make us educate about the stock market. This chapter talks all
about how to analyse and do valuation a company. But my problem is that how can I choose a
company among thousands several companies. What was your approach when you chose Amaraja?
Thanks,
Deepak

Karthik Rangappa says:

August 1, 2016 at 5:16 pm

A simple screening technique will help you shortlist companies. You can use sites like
screener.in for this!

Himanshu says:
October 24, 2017 at 11:07 pm

Interesting that you mentioned screener for initial shortlisting, what criteria/filter you put ?

Karthik Rangappa says:

October 25, 2017 at 10:53 am

Well, the same that I\’ve mentioned towards the end of this module

204. Ankur Agrawal says:

July 14, 2016 at 12:49 am

If I want to have Annual report of any company in physical form directly from the company, how can I
get it?

Also, Is it mandatory for me to be a shareholder in that company at the time of requesting for annual
report?

Karthik Rangappa says:

July 14, 2016 at 8:51 am

You can contact the company to get the copy of the AR, and no you need not be a shareholder of
the company to get one.

https://zerodha.com/varsity/chapter/read-annual-report-company/ 70/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

205. Vinay Prabhakar says:

July 12, 2016 at 2:18 am

The contents are really helpful. Are there any other organised resources that one refer to??

Karthik Rangappa says:

July 12, 2016 at 11:08 am

There aren\’t any, exactly why we started Varsity !

206. Ankur Agrawal says:

July 9, 2016 at 11:16 pm

Why has amara raja batteries not published its annual report for FY16 till now. It is 9th of july 2016
and the year ended on 31st March 2016.

Karthik Rangappa says:

July 10, 2016 at 9:00 am

Not sure Ankur!

207. Deepshikha Bhardwaj says:

June 16, 2016 at 3:50 pm

God bless you all for taking this initiative. I have a lot of interest in markets and finance, but also the
mental block that these were never my subjects. Have tried to attain clarity from various sources, left
almost no stone unturned to seek help in learning all this, but never came across anything so clear and
simple. Thanks a lot for reviving my hopes.

Karthik Rangappa says:

June 17, 2016 at 10:40 am

Glad to hear that Deepshikha! I hope the contents here helps you not in understanding the subject
but also identify profitable opportunities.

208. Abhilash says:

February 29, 2016 at 5:58 am

Like Annual report from company website where do we get Quarterly reports of a company ?

Karthik Rangappa says:

February 29, 2016 at 12:00 pm

https://zerodha.com/varsity/chapter/read-annual-report-company/ 71/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

On a quarterly basis we get P&L statement. AR is published once a year.

209. Gopan Radhakrishnan says:

February 15, 2016 at 6:13 am

Well explained, just the practical useful part, I found the whole chapter 3 very informative from a new
entrant point of view. Thanks.

Karthik Rangappa says:

February 16, 2016 at 6:44 am

Glad to know that

210. chandana says:

January 31, 2016 at 5:31 pm

The best platform to get the details knowledge of finance without paying a penny!Hats off to you guys
for this social service.Thanks a lot.

Karthik Rangappa says:

February 1, 2016 at 6:20 am

Nice to hear that Chandana

211. Srajan Agadi says:

January 3, 2016 at 6:04 am

Thankyou.

Karthik Rangappa says:

January 4, 2016 at 5:54 am

Welcome!

212. sudeshnabora says:

October 1, 2015 at 7:30 am

While explaining consolidated financial statement by focusing on the impact a subsidiary has on its
holding company.

I wanted to know, what would be the consolidated financial statement for the subsidiary company
(Irevna, for instance).
Will it have a profit or loss ? (keeping Crisil has a loss of 1000cr and Irevna has a profit of 300 crores).

https://zerodha.com/varsity/chapter/read-annual-report-company/ 72/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Karthik Rangappa says:

October 1, 2015 at 10:18 am

Usually the company gives out the financials of subsidiary – at least the basic info like revenue,
EBITDA, EBIT, PAT.

213. Sanjeev says:

September 29, 2015 at 12:22 pm

Very good content posted for us. Undoubtedly a very good learning for new comers(me). Have one
question.
I am assuming all the companies release their Annual Reports on or before March 31st xxxx.
Is my assumption correct?
If yes, will all the long term investors invest from April xxxx?
If yes, will there be huge volume investing in April?
Do we see subdued activity in the remaining months from the long term investors?

Karthik Rangappa says:

September 30, 2015 at 6:06 am

AR comes out by around April. However long term investors dont really wait for the AR to be
released. They prefer to study and understand how the business has evolved over years, which is
available in previous years AR.

Sanjeev says:
September 30, 2015 at 6:12 am

Thanks for your reply karthik…

214. Michael Mathew says:

June 4, 2015 at 5:39 pm

Your Modules are very helpful for a new investor in the market like me .I have a small query,where can
a retail investor get a company\’s 10 years of financial statements or annual Reports

Karthik Rangappa says:

June 5, 2015 at 5:37 am

Thanks Michael, glad you are liking Varsity

You can find the information on the company\’s website. For example check this –
http://www.tataglobalbeverages.com/our-investors/annual-reports

215. K Siva Kumar says:

May 28, 2015 at 9:53 am
https://zerodha.com/varsity/chapter/read-annual-report-company/ 73/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

Thanks for reply. I agreed for your answer. Apart from this how can we choose a sector which will do
better in this year or a particular period of time like IT did in early 2000s ? What are the aspects should
be considered while doing this ?

Karthik Rangappa says:

May 29, 2015 at 4:56 am

To figure out which sector is likely to well in the coming years requires a detailed understanding
on –

1) Macro economic situation

2) Emerging trends within the sector (disruptions if any)
3) Regulatory overview

These aspects clearly help in figuring out which sectors are likely to do well in the future.

216. K Siva Kumar says:

May 28, 2015 at 8:54 am

If we go through every company AR, They all talk about their future in a positive way about their
expansions and investments. How can we segregate companies?

Karthik Rangappa says:

May 28, 2015 at 9:38 am

Agreed – management is always inclined to talk positively about their company (especially
about the company\’s future). However a good analyst will be in a position to figure out if the
management is being realistic or not. Needless to say, this attribute is a function of experience.
Also, always check what the company\’s peers are saying in their AR – this will also throw in
some perspective. Having said this you would be surprised to know there are companies who are
candid about business cycles and the future prospects.

Shrey says:
January 10, 2019 at 4:30 pm

Any example of such a company you mentioned above?

I am perplexed as there are terms used in the MD&A which i don\’t understand, and this is
because I don\’t know the business.
And if i ignore them, i\’d just be looking at their growth rate figures..

Karthik Rangappa says:

January 11, 2019 at 11:00 am

Cant remember of any right now, but I\’d suggest you look up the annual reports of
few FMCG companies (smaller ones).

217. jaya krishna says:

https://zerodha.com/varsity/chapter/read-annual-report-company/ 74/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

May 21, 2015 at 2:58 pm

thank u very much…..its very simple and lucid explation…..i read ur technical analysis also
completly…..its extra ordinary….. hatsoff to u

Karthik Rangappa says:

May 22, 2015 at 2:51 am

Thanks for the encouragement

218. sugata ghosh says:

April 28, 2015 at 6:00 am

the font size of table/ graphs/ charts are too small…

Karthik Rangappa says:

April 29, 2015 at 5:56 am

I suppose you can click on the images to enlarge it. Also, we are working on an e-book format,
the images will be much clearer in that.

219. srihari says:

April 10, 2015 at 3:11 pm

\”Well, this is quite simple – CRISIL on its own made a loss of Rs.1000 Crs, but its subsidiary Irevna
made a profit of Rs.700 Crs, hence the overall P&L of CRISIL is (Rs.1000 Crs) + Rs.700 Crs =
(Rs.300 Crs).\”

In the statement above, I think it must be 1000 crs – 700 crs.

Waiting for the options module. Thankyou very much for whole material. It is excellent

Karthik Rangappa says:

April 11, 2015 at 9:43 pm

No…CRISIL made a loss of Rs.1000 Crs, hence this should be deducted from the profit of
Rs.700 Crs. Net loss is therefore Rs.300Crs. By the options module has started, we are 4
chapters through with it…check this – http://zerodha.com/varsity/module/option-theory/

Indranil says:
August 10, 2015 at 10:56 am

the bracketed (Rs.1000 Crs) actually means -Rs.1000 Crs i think ..that\’s why the confusion.

Karthik Rangappa says:

https://zerodha.com/varsity/chapter/read-annual-report-company/ 75/77
5/4/25, 9:30 PM How to Read the Annual Report of a Company – Varsity by Zerodha

August 11, 2015 at 5:58 am

Yup, all numbers in brackets indicate -ve value.

220. Nikhil Zelawat says:

December 25, 2014 at 7:36 pm

Thank you for sharing…nice content for newbiees

Karthik Rangappa says:

December 26, 2014 at 6:20 am

Glad you liked it

221. J V Indudhar says:

December 20, 2014 at 2:57 pm

This modules are very helpful and hats-off to the simple explanation thanks a lot

Karthik Rangappa says:

December 22, 2014 at 4:57 am

Thanks, glad you liked them

222. devasia pm says:

November 27, 2014 at 1:10 am

it is very nice for new comer

Karthik Rangappa says:

November 27, 2014 at 5:20 am

Thank you