Sharekhan Investment Specialist Interview Questions and Answers

Q1. Valuation related question: FCFE, FCFF, DCF, WACC
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Q1. Why motilal oswal as a choice
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Q2. Why do you want to work in IB
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Q1. Discuss financial model
Ans. 
A financial model is a tool used to forecast a company's future financial performance based on historical data and assumptions.
• Financial models are used to analyze a company's financial statements and make projections for future performance.

• They typically include income statements, balance sheets, and cash flow statements.

• Assumptions about factors such as revenue growth, expenses, and capital expenditures are key input...read more
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Q2. How does balance sheet statement work
Ans. 
Balance sheet statement shows a company's assets, liabilities, and shareholders' equity at a specific point in time.
• Balance sheet follows the formula: Assets = Liabilities + Shareholders' Equity

• Assets are what the company owns, liabilities are what it owes, and shareholders' equity is the difference between the two.

• It provides a snapshot of the company's financial position and helps investors and analysts assess its fi...read more
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Q1. About the work u have done in your previous job
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You should know the basics of mathematics operations

Ij this we have given a company's Financial statements and check how something affects 3 statements.

Q1. How depreciation changes Income statement and cash flow statement
Ans. 
Depreciation reduces net income on the income statement but is added back on the cash flow statement as a non-cash expense.
• Depreciation is a non-cash expense that reduces the net income on the income statement.

• On the cash flow statement, depreciation is added back as it does not involve an actual outflow of cash.

• Depreciation affects the profitability of a company on the income statement but does not impact its cash pos...read more
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Q2. How inventory affects cash flow statement.
Ans. 
Inventory affects cash flow statement by impacting operating cash flow through changes in inventory levels.
• Inventory purchases reduce cash flow from operations as cash is used to acquire inventory.

• Inventory sales increase cash flow from operations as cash is received from selling inventory.

• Changes in inventory levels impact working capital and cash flow from operations.

• Inventory write-downs or write-offs can also affec...read more
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Q1. What was your thoughts process on valuation methodology
Ans. 
My thought process on valuation methodology involves analyzing financial statements, market trends, and industry comparables to determine the value of a company.
• I start by examining the company's financial statements to understand its revenue, expenses, and profitability.

• I then research market trends and industry comparables to see how the company stacks up against its competitors.

• Next, I consider different valuation m...read more
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Q1. About the past organization,my role of work,my projects and what is the reason of change.
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Focuses on Financial Analysis, Banking Terms and basic knowledge, logical reasoning, decision making and valuations

Random topics are given. 12 mins total GD time. 8 to 10 mins for speaking of group members. 2 min for summary by one select candidate.

Q1. Whixh are the valuations methods you are aware about. How to conduct them.
Ans. 
Valuation methods include DCF, comparable company analysis, precedent transactions, and LBO analysis.
• Discounted Cash Flow (DCF) analysis involves forecasting future cash flows and discounting them back to present value.

• Comparable Company Analysis involves comparing the target company to similar publicly traded companies to determine valuation multiples.

• Precedent Transactions Analysis involves looking at past M&A transa...read more
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Q2. What is your understanding of financial statements. How are three related to each other.
Ans. 
Financial statements are documents that provide information about a company's financial performance and position.
• Financial statements include the income statement, balance sheet, and cash flow statement.

• The income statement shows a company's revenues and expenses over a period of time, resulting in net income or loss.

• The balance sheet provides a snapshot of a company's assets, liabilities, and equity at a specific poin...read more
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Q3. Tell us about yourself.
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Q4. Guesstimate based questions.
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Q5. Some more qustions on basic finance concept understanding
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Q1. Compare tata motors with mahindra basis a snapshot. Give points of comparison.
Ans. 
Tata Motors and Mahindra are two major players in the Indian automotive industry, with Tata Motors being larger in terms of revenue and market share.
• Tata Motors is a larger company in terms of revenue and market share compared to Mahindra.

• Tata Motors has a more diverse product portfolio including passenger vehicles, commercial vehicles, and electric vehicles, while Mahindra is known for its SUVs and tractors.

• Both compa...read more
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Q2. Metric understanding check based question such as ebitda/ev, pe ratio, debt to ebitda ratio, valuation methods.
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Q1. HR Round - tell me about yourself
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Q2. Are you aware of job terms and conditions
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Q3. Basic background questions for cultural fit check
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