Glossary

The cheapest money a bank can raise. Above 40% is a structural advantage.

The pressure to be always fully invested is what makes people buy their fifth-best idea, and the fifth-best idea is where the losses live.

The single most useful cross-check on an income statement, and it needs two numbers you already have open.

A lengthening cycle is often the first quantitative sign that business quality is slipping.

The most useful document most Indian investors have never opened. It finds the folios you forgot.

Read it alongside the other two. Negative operating cash flow with a large positive here describes a company kept alive by fresh borrowing rather than by trading.

Negative is the normal state for a company still building something. Persistently positive usually means assets are being sold, which flatters this year and shrinks the next one.

The money genuinely available to owners after keeping the lights on.

Compare five years of this against five years of net profit. Divergence is the red flag.

No deduction, and no set-off against losses. The rate sits well above the ordinary top slab, which is the point — it is designed to be worse than having declared the income.

The reason profit is an opinion and cash is a fact. Dozens of timing judgements sit between a sale being booked and money reaching the bank.

Sustained above about 10% deserves an explanation. The multi-year trend matters far more than any single year.

The ledger minus the cash box. A large and widening gap is not fraud; it is a question that needs an answer.

Most destroy value. Check the price paid, how it was funded, the goodwill created, and what happened to the last five before judging the sixth.

A toll on entering rather than on holding. It is retained for some months and is not released simply because you have sold the shares, which is why a GSM stock costs more to own than the quote suggests.

Matters more than which stocks you pick. It determines how much a crash actually costs you.

It leaves solvency untouched and hands liquidity to somebody else to decide. A company can be worth far more than it owes on every valuation and still fail on a date.

One half of an identity that always balances, because every rupee of asset was funded either by a lender or by an owner.

Dull and far more predictive than the vivid story in front of you.

Growth capex builds the future; maintenance capex just stops the present from falling apart.

Written to sit above the market so that failing to deliver is never the cheaper option. In an illiquid stock, where auctions most often find nobody, the penal 20% is usually the binding term.

Sales that do not collect are not sales. A sustained lag means construction has stalled.

Matters not because it is accurate but because it is what the price already reflects. Good results below consensus still fall.

The one place a company sets out, in its own words, what the next twelve months demand in cash. Because it is undiscounted it will not tie to the balance sheet, and that is the design rather than an error.

It was not granted free — look for what it cost, in a wider spread, security created, a dividend not declared or capital expenditure deferred. And a waiver reached after the reporting date does not move a reclassified loan back to non-current.

Its real output is a range and a set of stated assumptions, never a target price.

Interest cover asks whether the interest is affordable; this asks whether the repayments are. In a year containing a bullet maturity the two answers are nowhere near each other.

Your required return. Change it by two points and the valuation moves by a third.

You do not need to know why a large fund is accumulating. The accumulation shows up as rising price on rising volume whether or not the reason is public.

Sustainable only when covered by free cash flow — a company borrowing to maintain its dividend is buying goodwill with someone else's money. It is now taxed in your hands at your slab rate.

Only genuine when the deployment levels are written down beforehand. Vague intent to buy the fall reliably turns into buying after the recovery is obvious.

Cumulative operating cash flow divided by cumulative profit over five years is the quick version. Above 0.8 is healthy.

It is meant to feel like dead money. That is the price of never being a forced seller.

What you would actually pay, including the debt you inherit.

Turns "is this a good company?" into "can this company grow 25% a year for ten years?" — a far more answerable question.

Overnight news is not partly traded through before the bell here. It arrives whole, into one call auction and the first minutes of the session.

The cash return on buying the whole company. Much harder to manipulate than earnings.

The market pays badly for urgency. Almost every plan that fails does so at the moment its owner stopped being able to choose the date of the sale.

The number every leverage ratio starts from, and the one that says nothing at all about when any of it has to be repaid.

Earnings rising every year while capital earns 8% against a 12% cost is value destruction with a nice chart.

Registering voluntarily lets you claim input credit and commits you to periodic returns permanently.

A flat can take months to sell, and longer in a bad market. That is not a small footnote — it is the main risk of property.

What it is actually worth, as opposed to what it currently trades at.

Water use is a real risk for a beverage maker and near-irrelevant for a software firm. Without this filter a sustainability report reads as hundreds of equally weighted facts.

Payment for the wait and for the chance the scheme never completes. It narrows as approvals land and gaps out the moment one is in doubt.

An overdue MSME balance is a tax item as well as a working capital one: delayed payment carries statutory interest, and the income tax law defers the deduction to the year of actual payment where the time limit is breached. If it is biting, it shows up by name in the tax reconciliation note.

The bridge between the price of the shares and the price of the business. A company with more cash than debt has negative net debt.

Years of earnings needed to repay all debt. It is what rating agencies lead with.

What an owner could actually take out each year without the business shrinking.

It takes every single-stock future open at expiry and every single-stock option that finishes in the money, while index contracts stay cash-settled — which is why the two behave so differently in the final week. A cheap option finishing marginally in the money becomes an obligation for the full strike price times lot size.

Profit flattered by a tax holiday or a deferred tax reversal is real but not repeatable.

Not caveats followed by “but”. The bear case you would genuinely struggle to answer.

Built for comparability rather than for the original year’s reporting. It lets you set a rival’s margins and working capital beside a listed company on a like basis.

Without a PAN the transaction is either refused or reported with a declaration in its place. It is why a counter asks for the card on things that feel unrelated to tax.

Valued as a perpetuity with the decline rate added to the discount rate. A business shrinking 8% a year is worth a low multiple of its cash, not nothing — provided the cash actually comes out.

It catches ordinary family arrangements. An informal loan settled in cash exposes both sides to a penalty equal to the amount, which is an expensive way to do somebody a favour.

It penalises the receiver, not the payer, in an amount equal to the sum received. That single design choice is why the jeweller, hospital and builder simply decline the cash — you meet the rule as a refusal, not a notice.

Two very different things share this caption: money that was always meant to be rolled, and a long loan whose date has arrived. Read them as one number and you misread both.

Share issues, changes to the articles and much of managerial remuneration need one. The higher bar is where minority votes matter most.

Earns deposit interest while behaving like a savings account. The natural home for an emergency fund.

The number everybody reads and the one worth least. The assumptions that produced it are the useful part.

Usually 60–80% of the answer, and by far the least knowable part of it.

The cleanest reason to sell there is, and the whole reason for naming the disproof before buying.

A daily candle is a session, not a day. The chart draws no gap for weekends or holidays, so anything you count in bars is counted in sessions while interest, time value and news accumulate in calendar time.

Lagged for most of the 2010s, which is exactly the kind of stretch that makes people abandon a factor before it works.

Not the same as the money being lost. In a liquidity failure the bonds are sound and cannot be sold this week; in a credit failure the borrower cannot pay at all. On the day, both look like a blocked redemption.

Where profit recorded but not collected disappears. Profit of ₹300 crore plus ₹120 crore of depreciation, less a ₹410 crore rise in receivables, leaves about ₹10 crore of operating cash.

A permission to borrow rather than a promise of funding, and it never appears on a repayment calendar because it has no maturity. It is worth least on the day it is needed most.

The only honest measure of a SIP. Your app’s absolute return is not comparable to an index’s annual return.

Read the auditor’s report and cash flow first, the chairman’s letter last.

It removes the need to be a good forecaster. Where being wrong costs a little and being right pays a lot, a low hit rate still compounds.

Everybody studies barriers to entry. Barriers to exit decide how deep a downturn gets and how many years it lasts, because loss-making capacity keeps running while it covers its cash costs.

The number worth negotiating. A higher basic means more forced saving and less monthly cash; a lower basic means the reverse.

Two years of spending in cash, the next few in debt, the rest in equity. You are never a forced seller.

The single largest lever on reported profit. Spend the same cash, show a much bigger number.

Nobody restates anything, so the whole effect lands in one year’s growth rate while both years remain individually correct. The revision itself moves no cash.

A framework, not a forecast. Failing to reach the upper rail warns you the trend is weakening before any line has broken.

Markets discount them because you cannot choose which parts you own, and cash thrown off by the good businesses can be redeployed into ventures you never picked.

Useful as a benchmark for what is already priced in, not as a forecast. Being right with the consensus pays nothing.

India has no combined national print. Each exchange broadcasts its own trades, so the volume figure you read belongs to one venue rather than to the market.

The most forecastable dilution there is: the number of shares that will exist on conversion is public from the day the general meeting approves it.

Indian cash equity trading is overwhelmingly on-exchange and visible. Large negotiated trades go through the exchange block-deal window and are disclosed the same day.

It can swing reported profit with no cash moving. A profit beat from a deferred tax reversal is not an operating improvement.

Only an asset if future profits arrive to absorb it. Recognising one is management recording a forecast on the balance sheet.

The estimate is management’s. Extend asset lives and profit rises, with no change to cash.

One question with two entirely different sets of financial statements behind it. Yes, and the loans go and a gain is booked now; no, and they stay and the cash received is a borrowing.

Useful, but based on accounting profit. When it diverges sharply from FCF yield, trust the cash.

The word SEBI uses in the disclosure. Pledges are the common case; the category is broader.

Cash that belongs to you and arrives once. It sits inside total earnings per share, which is why the year of a large sale looks like the cheapest year in a decade.

The number every 8:30 am bulletin opens with. Compare it against its own level at 3:30 pm yesterday rather than against the Nifty cash close, and the basis cancels out — what remains is the genuine overnight change. It says nothing about any individual stock.

Confirmation of a change that already happened, not a forecast. Late by construction.

The bet is that the market's forecast is too low. It fails when growth disappoints, or when rates rise and the multiple de-rates violently while earnings are still fine.

The required run rate. Rather than forecasting, you extract the market’s forecast and judge whether the company can hit it.

Cash parked in a warehouse earning nothing. Building faster than sales is a warning.

Delivery trades produce capital gains; intraday and F&O produce business income, taxed at slab and carrying audit thresholds. A few casual intraday trades genuinely change which form you file.

Sort them by when they fall due, not only by size. A profitable company still fails if the obligations arrive before the cash does.

Read it as an evacuation plan rather than a weather forecast. It does not say a fire is coming; it says how long the building takes to empty, which is a fact about the building and was measurable the whole time.

Read what the cases are about. A product liability claim implies something structural; a commercial dispute usually does not.

The average is history and this is the forecast. When it sits above the average, the average will climb on its own as old paper matures and is replaced — without the company borrowing one extra rupee.

It stops the derivatives tail growing large enough to wag the cash market. The basis on which it is computed has been revised, so read the current circular for the formula — what has not changed is that the names reaching the ceiling are overwhelmingly midcaps with concentrated promoter holdings and thin deliverable float.

A bias, and occasionally a useful one — ring-fencing retirement capital from trading capital works.

The case families most expect a power of attorney to cover is the one Indian agency law treats as ending it. Joint holdings and radical simplification, arranged early, do the work a document cannot.

The genuine bull case for an SME holding — better liquidity, wider coverage, index eligibility. It is also uncommon and slow, so it is not something to rely on when you buy.

Best case a few percent extra; worst case the principal. The rating is the most informative line.

The strike with the largest call open interest often acts as resistance and the largest put strike as support, because writers hedging those positions generate real buying and selling. One source of confluence, not a forecast.

Stop cascades add selling unrelated to the news, which is why the first print is not information.

Cash selling alongside a growing long futures position is a different story from cash selling alongside growing shorts. Published free, read by almost nobody.

Sale proceeds become genuinely withdrawable only after this. Anything the app shows you before it is a trading limit, not cash.

Only as good as the growth forecast, which is almost always optimistic.

The first of the two taxable events, and the one that catches people. You owe cash on a paper gain before you have sold anything — particularly harsh at an unlisted startup where there is nobody to sell to.

In broking, prefer the narrower DDPI, which permits debits only for settlement, over a broad POA. In family finance, know the limit: Indian agency law treats an agent’s authority as ending if the person who granted it becomes of unsound mind, so an ordinary POA is generally understood not to survive the loss of mental capacity — the very case families buy one for.

A rent holiday with the end date printed in a public notification. Counting the cash is correct; carrying the margin past the tenure quietly assumes a scheme extension nobody has announced.

Note-light and seasonal, and many companies omit the cash flow statement two quarters a year.

The stricter liquidity test — because unsold stock in a downturn is exactly what you cannot convert to cash.

It manufactures revenue that never becomes cash. Where it surfaces is the related-party note and large receivables from group companies that persist year after year.

Small individually and very large collectively. The genuine edge is a long horizon, no redemption pressure and the freedom to hold cash — never speed or information.

Two shops book ₹1 lakh. One took cash from four hundred walk-ins; the other gave ninety days’ credit to two buyers who can return the goods.

The large unexplained debit that turns out to be your own money going back to your bank. Idle cash with a broker is the one balance a broker failure can reach.

Booking something at 2R satisfies the part of you that wants certainty; trailing the rest keeps you in the occasional trade that pays for a quarter. Neither impulse gets to override the plan.

Shows up as excess cash and an inability to deploy a lump sum. It can also flip into compulsive spending.

Each sector has two or three numbers that actually matter, and they differ in every case.

Failures have historically involved breaching exactly this. It is why idle cash is the exposed asset.

Permitted here for every class of investor, but every sale must be capable of delivery. That single requirement is why a bearish view with a three-week horizon cannot simply be held in the cash market, and why holding a short is structurally more awkward than holding a long.

If you cannot build the case against your own position, you do not understand it well enough to hold it or to leave it.

Occasionally the most important note in the entire report, and almost never read.

Less a cost than a cash-flow delay: the money comes back at filing but is blocked until then. Nothing to do with the IT company that shares the initials.

A success might triple; a failure approaches zero slowly while absorbing more capital each time you average down. Credible ones show operating cash flow improving before profit does.

Treating an ordinary undrawn limit as cash is the commonest error in a liquidity schedule. Run the test with it at zero, then note the headroom separately.