DSE Intrinsic Value Calculator

What is Intrinsic Value?

Intrinsic value is the "real" or "actual" value of a company, regardless of its current market price. For value investors on the Dhaka Stock Exchange, the goal is to buy stocks when their market price is significantly lower than their intrinsic value, providing a Margin of Safety.

The Benjamin Graham Formula

Benjamin Graham, the father of value investing and mentor to Warren Buffett, developed a simple yet powerful formula for retail investors. The "Graham Number" is the upper bound of the price an investor should pay for a stock.

The number 22.5 is derived from Graham's belief that the P/E ratio should not exceed 15 and the P/BV (Price to Book) ratio should not exceed 1.5 (15 × 1.5 = 22.5).

Why use Intrinsic Value on the DSE?

The Bangladesh market often experiences periods of high volatility and irrational price movements (especially in speculative stocks). By focusing on Intrinsic Value, you can avoid overpaying during a bubble and have the confidence to hold through a market crash.

• Conservative Valuation: It relies on tangible data (Earnings and Assets) rather than hype.
• Risk Mitigation: Buying below the Graham number ensures you are not overpaying for assets.
• Long-term Discipline: It encourages a "Buy and Hold" mentality based on business fundamentals.

Growth-Adjusted Valuation

Our calculator also includes a Growth-Adjusted fair value model. This is useful for sectors like Pharma and Telecom in Bangladesh, where companies consistently grow their earnings by 10-15% annually.