Like pretty much everyone who tracks the stock market longer than is probably healthy, I’ve been pulling AI into my process. Part of it is just grunt work. News here, data there. But the part that’s blown my mind is using LLMs to actually understand a business or an industry.
In the old days (like a few months ago), I’d start with the big heavy DRHP. Now? My work begins at on the door of an LLM. (Gemini, in this case)
I’ve been messing around with prompts, and I think I’ve stumbled on something pretty useful. You can have different prompts for different purposes, such as analyzing financials, exploring how the industry has evolved, or zooming in on specific competitive advantages.
The prompt I’m sharing below is meant to help better understand the business. It is not a substitute for the real documents, but it’s a great way to get an overview and build context before diving into the details.
You are an equity research analyst in India. Analyze the company [Company Name] using only credible sources such as annual reports, investor presentations, DRHPs, earnings call transcripts, reputable equity research, Screener.in, Trendlyne, and other industry reports. If information is not explicitly available, mark it as inferred.
Follow the structure as mentioned below.
1. Basics
Explain how the company makes money in very simple, child-level terms. Include its founding story, who started the company, when, and why, and describe how the business has evolved over time.
2. Products and Services
Describe the company’s products or services in detail, and explain how they are made or delivered. Highlight the key raw materials or inputs, how exposed they are to commodity cycles, and whether volatility in these inputs poses a risk to margins. For services businesses, focus on key operational costs (e.g., employee expenses in IT services).
3. Supply and Cost Structure
Explain the supply chain and key suppliers, noting dependencies and bargaining power. Discuss the overall cost structure—what portion is fixed versus variable—and assess whether the business is capital-intensive. Also describe the level of debt and leverage risk.
4. Customers, Pricing, and Revenue Model
Explain who the company’s core customers are and whether demand is concentrated or diversified. Discuss whether the product or service is a must-have, who makes the purchasing decision, and whether switching costs exist. Then describe the company’s pricing strategy (premium, competitive, regulated, cost-plus), its revenue mix (domestic vs exports, product vs services), and clarify whether revenues are one-time, recurring, or seasonal.
5. Porter’s Five Forces
Apply Porter’s framework specifically to this company’s industry, keeping the analysis brief (two to three sentences per force):
Barriers to entry
Bargaining power of suppliers
Bargaining power of customers
Threat of substitutes
Intensity of rivalry
6. Moat
Discuss whether the company enjoys sustainable competitive advantages such as brand, scale, technology, regulation, or network effects. Comment on whether it possesses pricing power.
7. Management and Ownership
Provide a short background on the founder and current management team, including whether the founder is still running the business. Summarize promoter holding levels and highlight any governance issues or legal cases linked to management.
8. Growth Drivers and Risks
Explain the key drivers of growth—such as pricing power, volume expansion, new products, entry into new geographies, or acquisitions. Then outline the main risks the company faces—whether business, operational, regulatory, cyclical, or technological disruption.
9. One-Sentence Summary and conclusion
Wrap up your research by writing a one-sentence summary of what the company really does and how it makes money. Follow that with a very short overview of its strengths, weaknesses, biggest risks, and growth drivers.
Finally, end with an investor takeaway paragraph that projects where the company could realistically be in ten years. You can have multiple paths here. Keep it balanced and objective—less “hot tip,” more “clear picture” for an investor deciding whether the business belongs on their radar.
Give me the report where you : -
Use clear section headers for each part
Cite sources where possible.
Flag assumptions as “inferred” if not directly stated
Of course, mercilessly edit the prompt and shape it to your own investing process. But seriously, try it out on Gemini with deep research. Just keep in mind that AI can be wrong, which is why I do not put much weight on the numbers, the analysis, or the conclusions it generates. I use it mainly to understand the business, its context, and the big picture rather than as a source of hard data.
And if you are looking for a solid investment checklist to integrate into a prompt, a great place to start is The Investment Checklist by Michael Shearn. You could also check out the Value Tortoise Investment Journal, which I put together to help structure the process.
That’s all for now. Thanks for reading.
Disclaimer: This is not investment advice. Please do your own research and consult a qualified financial advisor before making any investment decisions.
Cover image taken from Unsplash