FUNDAMENTAL ANALYSIS OF

SELECTED FMCG SECTOR

SHARES

VINEETH V B
MBA IV SEMESTER (REGULAR)
REG. NO: JMAIMBA 039

Under the guidance of

(Capt.) Dr.SUSEELA MENON R
READER IN COMMERCE
VIVEKANANDHA COLLEGE
KUNNAMKULAM
OBJECTIVES OF THE STUDY

To analyze the performance of the shares in FMCG

(Fast Moving Consumer Goods) sector in Indian
Capital Market.
To take long term and short-term investment decisions.
To compare the performance of sample companies.
To study the factors which influence the share price of
the Company.
RESEARCH METHODOLOGY

DATA COLLECTION METHOD

The needed data for the research work is collected

from the various secondary sources like websites,
magazines, journals etc.
SAMPLE SIZE

For the purpose of study, 5-year (2004-05 – 2008-09)

balance sheet and income statements of 5 sample
companies are collected. The Companies are –

Britannia Industries Ltd.

Dabur India Ltd
Godrej Consumer Products Ltd.
ITC Ltd.
Radico Khaitan Ltd.
FUNDAMENTAL ANALYSIS
Fundamental analysis is the study of economic,
industry, and company conditions in an effort to
determine the value of a company’s stock.
Fundamental analysis typically focuses on key
statistics in a company’s financial statements to
determine if the stock price is correctly valued.

Economic analysis
Industry analysis
Company analysis
ECONOMY ANALYSIS
FACTORS INFLUENCING ECONOMY

Growth rate of national income

Inflation
Government revenue, expenditure & deficit
Interest rate
Exchange rate
Infrastructure
Monsoon
Economic and political stability
INDUSTRY ANALYSIS
An industry analysis, the number of key factors should
be considered in this industrial analysis, we can
analyze past sales and earning performance, the
performance of the industry, the attitude of the
government towards the industry, labour condition of
the industry, competitive conditions are reflected in
any barriers to entry, this exists and stock prices of
firms in the industry relative to their earnings.
COMPANY ANALYSIS
Current ratio
Quick ratio
Debt Equity ratio
Gross Profit Margin
Net Profit Margin
Return on Capital employed
Earnings per Share
Dividend per Share
Dividend Pay out Ratio:
Book Value per Share
Return on Equity
Debtors Turnover Ratio:
Intrinsic value
FINDINGS
ITC is having the highest Current ratio and Radico
Khaitan is having the higest Liquidity Ratio among the
selected companies.
All companies except Radico Khaitan is having Debt
Equity Ratio less than 1.
Britannia is having the highest Earnings Per Share.
Britannia is having the highest Dividend per Share as
an average followed by Godrej and ITC.
Britannia is having the highest book value per share.
Dabur is having the lowest ratios

ITC and Radico Khaitan are over valued ie,their

market values are more than intrinsic values. The
market value of Godrej is almost equal to its intrinsic
value. But the shares of Britannia and Dabur are under
valued, so their prices can be expected to increase.
SUGGESTIONS
The debt equity ratio of ITC and Britannia are in the low
position for increasing the rate at which inventories are
converted into sales and then into cash.
The debtors turnover ratio of Radico Khaitan is in a low
position, so it have to be improved.
It would be better to invest in Dabur because of its under
valued price.
In the point of view of investors, it would be better to
invest in Britannia as it is doing well in many of the
ratios and Britannia is a under valued share, its price can
be expected to increase.
CONCLUSION
This study focused on fundamental analysis using
various tools which help in trading strategies for risk
reduction and maximization for return. The buyer of
shares should be careful in making analysis of the
economy, industry, company and he should also make
technical study of share price, this would help him to
detect shift in demand and supply of stock. I hope this
project report would be helpful in providing a general
idea on using fundamental analysis of company and its
share price for short term and long term investment.
THANK YOU