EQUITY RESEARCH REPORT

ON TELSA MOTORS INC

(OTC SHARES)

4TH QUARTER, (2015)

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Equity Research Report on Telsa Motors Inc (OTC Shares) | Seven Star FX Ltd

Contents

To Our Clients ____________________________________________________________________________________________ 3

Strategic Highlights .......................................................................................................................................................................... 3

Financial Highlights ............................................................................................................................................................................ 3

Operating Highlights ........................................................................................................................................................................... 3

Financial Summary ______________________________________________________________________________________ 4

Financial Statements: ____________________________________________________________________________________ 5

Statement of Comprehensive Income (Profits and Losses) ...................................................................................... 8

Statement of Cash Flows includes Operating, Investing & Financing ............................................................... 10

Notes to Financial Statements _________________________________________________________________________ 11

Accounts ................................................................................................................................................................................................ 11

Debt ......................................................................................................................................................................................................... 11

Contingent Liabilities .................................................................................................................................................................... 11

Independent Analyst Report ___________________________________________________________________________ 12

About the Analyst: ______________________________________________________________________________________ 17

Research Reports on Tesla Motors Inc.

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ABOUT THE COMPANY

Tesla Motors, Inc. is an American automotive and energy storage company

that designs, manufactures, and sells electric cars, electric vehicle power train

components, and battery products Tesla Motors is a public company that trades on

the NASDAQ stock exchange under the symbol TSLA The company sells its

products through a network of Tesla stores and galleries, as well as through

Internet. It has collaboration agreement with EnerNOC, Inc. for the deployment

and management of energy storage systems in commercial and industrial building

Fundamental Grade Report:

SSFX Fundamental Grade represents an overall assessment of the fundamentals of the

company graded in relation to other listed equity securities in USA. The grade facilitates easy

comparison of fundamentals between several companies, irrespective of the size or the

industry they operate in. The grading factors in the following:

¾ Business Prospects: Business prospects factors in Industry prospects and

company’s future financial performance

¾ Management Evaluation: Factors such as track record of the management, strategy

are taken into consideration

¾ Corporate Governance: Assessment of adequacy of corporate governance

structure and disclosure norms

The grade points are assigned on a five-point scale from grade 5 (indicating Excellent

fundamentals) to grade 1 (Poor fundamentals)

Fundamental Grade Assessment

5/5 Excellent fundamentals

4/5 Superior fundamentals

3/5 Good fundamentals

2/5 Moderate fundamentals

1/5 Poor fundamentals

The Above Valuation Grade represents an assessment of the potential value in the company

stock for an equity investor over a 12 month period. The grade is assigned on a five-point scale

from grade 5 (indicating strong upside from the current market price (CMP)) to grade 1 (strong

downside from the CMP)

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Seven Star FX Ltd Valuation Grade Assessment

5/5 STRONG UPSIDE (>25% FROM CMP)

4/5 Upside (10-25% from CMP)

3/5 Align (+-10% from CMP)

2/5 Downside (negative 10-25% from CMP)

1/5 Strong downside (<-25% from CMP)

Analyst Recommendation:

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To Our Clients

STRATEGIC HIGHLIGHTS

It is essential for the valuation to estimate future cash flows. The foundation for these estimates will be

made in the strategic analysis. The purpose here is to identify the non-financial value drivers, which I

consider to have the greatest influence on the future value creation of the business. The analysis will

follow a ”bottom top ” approach, where a macro environmental-, industry-, and internal analysis

provides an assessment of Tesla’s strength, strengths, weaknesses, opportunities and threats.

FINANCIAL HIGHLIGHTS

As the next step in the Financial Highlights, I had perform a historical financial analysis. In order to

compare and benchmark performance across different periods and companies within the industry, and

calculate the correct value creation, income statements and balance sheets for Tesla, BMW, Audi,

General Motors, Ford and Toyota, will be reformulated based on Petersen & Plenborg (2012) unless

otherwise stated. I have also and Kotler et al. Theories where I have found it useful to draw upon

several sources. Profitability, growth and risk will be focused on. The analysis of financial ratios will

follow the structure of the Du Pont model as described by Petersen & Plenborg

OPERATING HIGHLIGHTS

Following the external analysis, I will focus on industry specific factors and explain the extent to which

these factors influence the industry. The traditional model consists of two vertical sources of

competition; the power of suppliers and the power of buyers, and three horizontal; competition from

established rivals, competition from substitutes and competition from relatively new entrants. The

traditional Five Forces model has also been criticized for presenting a brief picture of the industry

structure.

Key Person:

Management of Tesla Motors Inc:

Mr. Elon Musk Mr. Deepak Ahuja Mr. Jay Vijayan

CEO CFO CIO

Research Reports on Tesla Motors Inc.

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Financial Summary

The details of Telsa Motors financial information is presented in a structured manner

and in a form easy to understand. They typically include basic financial statements,

accompanied by a management discussion and analysis The Financial Summary is

Described below into Certain Parts

1. A balance sheet, also referred to as a statement of financial position, reports

on a company's assets, liabilities, and ownership equity at a given point in

time.

2. An income statement, also known as a statement of comprehensive

income, statement of revenue & expense, P&L or profit and loss report,

reports on a company's income, expenses, and profits over a period of time. A

profit and loss statement provides information on the operation of the

enterprise. These include sales and the various expenses incurred during the

stated period.

3. A statement of cash flows reports on a company's cash flow activities,

particularly its operating, investing and financing activities.

Apart From That the Analyst Has Recommend the Stock Dealers Some part of Technical

Indicators that helps them to Deal in Their Decision Making Process

Research Reports on Tesla Motors Inc.

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Financial Statements:

• Liabilities

Research Reports on Tesla Motors Inc.

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Source: Tesla Audit Report

Research Reports on Tesla Motors Inc.

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• Ownership Equity

Source: NASDAQ Screen Watch

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STATEMENT OF COMPREHENSIVE INCOME (PROFITS AND LOSSES)

• Income

(In Thousands $)

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• Balance Sheet

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Cash Flow

STATEMENT OF CASH FLOWS INCLUDES OPERATING, INVESTING & FINANCING

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Notes to Financial Statements

ACCOUNTS

The Balance Sheet of Telsa motors shows the optimistic returns with an expected rise of

7.3%. and downtrend in Crude Oil Prices

DEBT

As per the Previous Year The Debt Increased for more than Two times as compared to

previous year with a record high which alarm the Danger if the Company goes in

Financial Crisis in Future

CONTINGENT LIABILITIES

The carrying values of our financial instruments including cash equivalents, accounts

receivable and accounts payable approximate their fair value due to their short-term

nature. As a basis for determining the fair value of certain of our assets and liabilities, we

established a three-tier fair value hierarchy which prioritizes the inputs used in

measuring fair value as follows

The Financial assets that are measured at fair value on a recurring basis consist of cash

equivalents. Telsa liabilities t are measured at fair value on a recurring basis consist of

our common stock warrant liability

Research Reports on Tesla Motors Inc.

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Independent Analyst Report

Source: Morning Star

From The Above Financial Reports & Analyst the Future of Tesla Motors Inc. Looks Quite

Optimistic but in Relatively the Momentum of Share Price in Co-relation With the Market

Data contradicts which can show a down trend in October – November of this year

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Source: Morning Star

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Watch List of Tesla Motors Inc.

Research Reports on Tesla Motors Inc.

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Technical Analysis: RSI

RSI Band Showed a trend Reversal of 73.51 on Friday moving the Graph Upwards from

66.14 on Thursday. Beneficial From Buyers Point of View

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Bollinger Bands (BB)

While the BB have a reversal mark on 276.71 on Upper End

Disclaimer: This Exchange-commissioned Report is based on data publicly available or from sources considered reliable.

Seven Star FX Ltd does not represent that it is accurate or complete and hence, it should not be relied upon as such. The Report

are subject to change without any prior notice. Opinions expressed herein are our current opinions as on the date of this Report.

Nothing in this Report constitutes investment, legal, accounting or tax advice or any solicitation, whatsoever. The user assumes

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subscribers / users of this Report.

REPORTED BY:

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About the Analyst:

Mr. Dhruv Williams, Market Analyst at Seven Star FX Ltd. Originally trained in the art of technical

analysis, he has since developed to become a strategist with great experience of FX majors and equity

markets. He provides research and strategy on Foreign Exchange, CFDs and Stock for Seven Star FX for our

clients. He is also a founder of SSFX Knowledge Center (Research arm of Seven Star FX). D’Williams is a

Graduate & Post Graduate from Mumbai University, and Holds MBA cum CFA from ICFAI University.

MR. DHRUV WILLIAMS ANALYST (GLOBAL MARKETS)

Email: dhruv@sevenstarfx.com

Analyst Disclosure

The preparation of the grading report,

hereby affirms that there exists no conflict of

interest that can bias the grading

recommendation of the company.

Seven Star FX Ltd

No. 5, Cork Street, Belize City, Central America

Tel +1 316 413 3777

www.sevenstarfx.com