Value Investment Scenario in India

Value Investing

Introduction
Value investing is a strategy by which various investors are trying to get an underpriced stock or asset, mostly selling at a price lower than its intrinsic value. In this strategy, funds end up purchasing such assets at a discount and hold them in the long run; sooner or later, the funds realize their return since the market eventually corrects its pricing to show the true value of the asset. This is an advisable financial investment strategy founded on some of the world's greatest investors, such as Warren Buffett and Benjamin Graham.
The article explains how the value investing concept works, basic principles, the way it works, strategies, possible risks, and practical examples to enable investors to have a better understanding of how the techniques are to be applied in real life.
What is Value Investing?
Value investing is a long-term investment strategy which involves the buying of securities-such as equities, bonds, or even real estate-at a price below its intrinsic or actual value. More precisely, a value investor tries to find investments where the current market price for a security is lower than what its value can be estimated through the company's financial health and performance metrics along with future outlook. In the very fundamentals of value investing, it is held that, over time, the market will recognize its value and therefore, automatically raise the price.
Benjamin Graham, also dubbed the father of value investing, defined value investment as buying of a security where the price paid lies below its inherent value with room for safety through a margin. A margin provides a cushion on the investor, in case its assumptions for evaluating the security come out to be wrong. His emphasis was therefore on disciplined methodical investment such that the accent would be strictly on strong fundamentals but are transiently undervalued in the market.
The Fundamentals of Value Investing
The fundamental basis of value investing is