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HDFC Bank Ltd (NYSE:HDB)
Piotroski F-Score
6 (As of Today)

The zones of discrimination were as such:

Good or high score = 8 or 9
Bad or low score = 0 or 1

HDFC Bank Ltd has an F-score of 6 indicating the company's financial situation is typical for a stable company.

HDB' s 10-Year Piotroski F-Score Range
Min: 2   Max: 6
Current: 6

2
6

During the past 13 years, the highest Piotroski F-Score of HDFC Bank Ltd was 6. The lowest was 2. And the median was 4.


Definition

How is the Piotroski F-Score calculated?

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Jun14) TTM:Last Year (Jun13) TTM:
Net Income was 371.578807242 + 294.980611805 + 374.472675748 + 260.899912346 = $1,302 Mil.
Cash Flow from Operations was 0 + 2013.89653001 + 0 + 91.2362432231 = $2,105 Mil.
Revenue was 1168.49374334 + 1142.15358102 + 1092.17144881 + 982.844203487 = $4,386 Mil.
Gross Profit was 0 + 0 + 0 + 0 = $0 Mil.
Total Assets at the begining of this year (Jun13) was $69,666 Mil.
Total Assets was $81,762 Mil.
Long-Term Debt was $6,426 Mil.
Total Current Assets was $0 Mil.
Total Current Liabilities was $0 Mil.
Net Income was 308.539013738 + 247.680583168 + 342.81841819 + 226.962335217 = $1,126 Mil.

Revenue was 1061.61208815 + 1203.39076651 + 1032.24105184 + 1004.45386064 = $4,302 Mil.
Gross Profit was 0 + 0 + 0 + 0 = $0 Mil.
Total Assets at the begining of last year (Jun12) was $64,953 Mil.
Total Assets was $69,666 Mil.
Long-Term Debt was $6,549 Mil.
Total Current Assets was $0 Mil.
Total Current Liabilities was $0 Mil.

Profitability

Q1. Return on Assets (ROA)

Net income before extraordinary items for the year divided by total assets at the beginning of the year.

Score 1 if positive, 0 if negative.

HDFC Bank Ltd's current net income was 1,302. ==> Positive ==> Score 1.

Q2. Cash Flow Return on Assets (CFROA)

Net cash flow from operating activities (operating cash flow) divided by total assets at the beginning of the year.

Score 1 if positive, 0 if negative.

HDFC Bank Ltd's current cash flow from operations was 2,105. ==> Positive ==> Score 1.

Q3. Change in Return on Assets

Compare this year’s return on assets (1) to last year’s return on assets.

Score 1 if it’s higher, 0 if it’s lower.

ROA (This Year)=Net Income/Total Assets at the beginning of this year (Jun13)
=1301.93200714/69666.2237914
=0.01868814

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Jun12)
=1126.00035031/64952.7902571
=0.01733567

HDFC Bank Ltd's return on assets of this year was 0.01868814. HDFC Bank Ltd's return on assets of last year was 0.01733567. ==> This year is higher. ==> Score 1.

Q4. Quality of Earnings (Accrual)

Compare Cash flow return on assets (2) to return on assets (1)

Score 1 if CFROA > ROA, 0 if CFROA =< ROA.

HDFC Bank Ltd's current net income was 1,302. HDFC Bank Ltd's current cash flow from operations was 2,105. ==> 2,105 > 1,302 ==> CFROA > ROA ==> Score 1.

Funding

Q5. Change in Gearing or Leverage

Compare this year’s gearing (long-term debt divided by average total assets) to last year’s gearing.

Score 0 if this year's gearing is higher, 1 otherwise.

Gearing (This Year)=Long-Term Debt/Total Assets
=6426.08160277/81762.4633919
=0.07859452

Gearing (Last Year)=Long-Term Debt/Total Assets
=6549.31644383/69666.2237914
=0.09400992

HDFC Bank Ltd's gearing of this year was 0.07859452. HDFC Bank Ltd's gearing of last year was 0.09400992. ==> This year is lower or equal to last year. ==> Score 1.

Q6. Change in Working Capital (Liquidity)

Compare this year’s current ratio (current assets divided by current liabilities) to last year’s current ratio.

Score 1 if this year'’s current ratio is higher, 0 if it’s lower

Current Ratio (This Year)=Total Current Assets/Total Current Liabilities
=0/0
=

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=0/0
=

HDFC Bank Ltd's current ratio of this year was . HDFC Bank Ltd's current ratio of last year was . ==> Last year's current ratio is higher ==> Score 0.

Q7. Change in Shares in Issue

Compare the number of shares in issue this year, to the number in issue last year.

Score 0 if there is larger number of shares in issue this year, 1 otherwise.

HDFC Bank Ltd's number of shares in issue this year was 0. HDFC Bank Ltd's number of shares in issue last year was 0. ==> There is smaller number of shares in issue this year, or the same. ==> Score 1.

Efficiency

Q8. Change in Gross Margin

Compare this year’s gross margin (gross profit divided by sales) to last year’s.

Score 1 if this year’s gross margin is higher, 0 if it’s lower.

Gross Margin (This Year)=Gross Profit/Revenue
=0/4385.66297666
=0

Gross Margin (Last Year)=Gross Profit/Revenue
=0/4301.69776714
=0

HDFC Bank Ltd's gross margin of this year was 0. HDFC Bank Ltd's gross margin of last year was 0. ==> Last year's gross margin is higher ==> Score 0.

Q9. Change in asset turnover

Compare this year’s asset turnover (total sales divided by total assets at the beginning of the year) to last year’s asset turnover ratio.

Score 1 if this year’s asset turnover ratio is higher, 0 if it’s lower

Asset Turnover (This Year)=Revenue/Total Assets at the beginning of this year (Jun13)
=4385.66297666/69666.2237914
=0.0629525

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Jun12)
=4301.69776714/64952.7902571
=0.06622807

HDFC Bank Ltd's asset turnover of this year was 0.0629525. HDFC Bank Ltd's asset turnover of last year was 0.06622807. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=1+1+1+1+1+0+1+0+0
=6

Good or high score = 8 or 9

Bad or low score = 0 or 1

HDFC Bank Ltd has an F-score of 6 indicating the company's financial situation is typical for a stable company.


Explanation

The developer of the system is Joseph D. Piotroski is relatively unknown accounting professor who shuns publicity and rarely gives interviews.

He graduated from the University of Illinois with a B.S. in accounting in 1989, received an M.B.A. from Indiana University in 1994. Five years later, in 1999, after earning a Ph.D. in accounting from the University of Michigan, he became an associate professor of accounting at the University of Chicago.

In 2000, he wrote a research paper called "Value Investing: The Use of Historical Financial Statement Information to Separate Winners from Losers" (pdf).

He wanted to see if he can develop a system (using a simple nine-point scoring system) that can increase the returns of a strategy of investing in low price to book (referred to in the paper as high book to market) value companies.

What he found was something that exceeded his most optimistic expectations.

Buying only those companies that scored highest (8 or 9) on his nine-point scale, or F-Score as he called it, over the 20 year period from 1976 to 1996 led to an average out-performance over the market of 13.4%.

Even more impressive were the results of a strategy of investing in the highest F-Score companies (8 or 9) and shorting companies with the lowest F-Score (0 or 1).

Over the same period from 1976 to 1996 (20 years) this strategy led to an average yearly return of 23%, substantially outperforming the average S&P 500 index return of 15.83% over the same period.


Related Terms

Net Income, Cash Flow from Operations, Revenue, Gross Profit, Total Assets, Long-Term Debt, Total Current Assets, Total Current Liabilities


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

HDFC Bank Ltd Annual Data

Mar05Mar06Mar07Mar08Mar09Mar10Mar11Mar12Mar13Mar14
Q1 1111111111
Q2 1110111111
Q3 0100011010
Q4 0110111011
Q5 1001010001
Q6 0000000000
Q7 0000000000
Q8 0000000000
Q9 0111010010
F-score 3543364254

HDFC Bank Ltd Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
Q1 1111111111
Q2 1111111111
Q3 0000111101
Q4 0011110011
Q5 0100001011
Q6 0000000000
Q7 0111011101
Q8 0000000000
Q9 0000111100
F-score 2444566546
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