BTTL Cash Flow At BTTL*

Nisha Kothari, an MBA aspirant always had an immense interest in stock market. Her interest in stock market was obvious as her father had inaugurated his first entrepreneurial venture, a broking firm on Nisha’s first birthday. Before starting the broking firm, he had worked seven long years as a Portfolio Manager in one of the leading broking firms. During childhood, the colourful pages of the annual reports often caught Nisha’s attention. Though she didn’t understand, she tried to read the report, most specifically, the figures.

Since she joined commerce, her father used to teach her Accounting. Last year when Nisha finished her graduation and joined a premiere B-school, her father started tutoring her about Financial Statement Analysis, the prerequisite for valuation of stocks. Recently, he taught Nisha the importance of Cash Flow statement in a Fundamental Analysis of the company and also taught her Free Cash Flow to the Firm and Free Cash flow to the Equity Methods of stock Valuation.

Nisha wanted to apply these methods to the index stocks to see its result. But before experimenting, she wanted to get an expertise over preparation and analysis of Cash Flow Statement. Will will find a way, Nisha had found something interesting while reading an annual report of the company, Bhilwara Technical Textiles Ltd. in June 2010. The points of her interest in the company were- It was a very small company, de-merged from RSWM LTd., a leading textiles company in March 2009. As per the scheme of demerger, approved by the Hon'ble High Court of Rajasthan, every shareholder of RSWM holding 4 equity shares of Rs.10/- each was allotted 10 equity shares of Re.1/- each of BTTL .

Though the main object of BTTL was to carry on the business of manufacturers and producers of all kinds of automotive and home furnishing