UNIVERSITY OF MUMBAI 2008-2010 PROJECT ON “EQUITY ANALYSIS”

Submitted By

VISHAL S NABDE Roll. No. 18

Summer Internship for Academic Year 2009-2010

Specialization: FINANCE

Submitted in fulfilment of requirement of Masters in Management Studies (MMS)

GUIDED BY PROF: DR. A.R.PHOPALEY

TO IBSAR INSTITUTE OF MANGEMENT KARJAT

IBSAR Institute of Management Studies Dahivali, Karjat. (Affiliated to Mumbai University) Summer Internship Project Academic Year 2009-2010

CERTIFICATE

This is to certify that the project work titled “EQUITY ANALYSIS ” “is a Bonafide work carried out by VISHAL S. NABDE, a candidate for the MMS Examination direction. of UNIVERSITY OF MUMBAI, under my guidance and

Date:

Dr. A.R.Phopaley

Advisor Place: IBSAR, Karjat Karjat

ACKNOWLEDGEMENT At the outset I take opportunity to place on record my sincere obligation towards our respected Lt. Col. J. L. Ram, Dr. Phopaley, whose dedicated initiative and encouragement were source of inspiration and prime focus in the successful completion of my project work. I take this opportunity to thank all those who have been instrumental in bringing out this Report and who have made it possible to finish my Summer Training successfully at RELIGARE SECURITIES LIMITED(RSL), LATUR. I am thankful to respected BRANCH MANAGER MR. VINOD PANDHARE & finance dept. of RSL for giving there valuable and precious suggestions and guidelines and encouragement extended to me for successful completion of this project. I would also like to thank the library staff for providing me with the required books It gives me immense pleasure in thanking Mr. Amol Kulkarni for giving me this opportunity to take up Summer Placement in the esteemed Organization and also for giving me the opportunity to associate myself with the Company. It was a pleasure to be associated with the Organization and the people in various other Departments of the Organization.

DECLARATION

I Mr. Vishal Nabde student of master in management studies II nd year (3rd sem) at “IBSAR” hereby declare that I have completed my research project titled “equity analysis” as partial fulfilment of the requirement of the course curriculum for the academic year 2009-10 under the guidance of Branch Manager Mr. Vinod Pandhare & members of finance dept. The data that has been collected by me is truly authentic and is not borrowed or copied from any dissertation report. The project contains true and complete information

Signature of student Vishal nabde

INDEX
S.NO. Chapter 1. Chapter 2. Chapter 3. PARTICULARS
Introduction Company Profile Equity Analysis

PAGE NO.

Analysis of Indian Automobile Industry • Fundamental Analysis
a. Economy b. Industry c. Company

• Technical Analysis
a. b. c. d. e.

- Financial & Non-Financial

Share Price Analysis Moving Average Moving Average Crossover Bollinger Band M.A.C.D

Chapter 4. Chapter 5.

Conclusion Bibliography

Ex-CMD of Ranbaxy Laboratories Ltd. SUN F&C. Besides the reach of RELIGARE. The primary focus of Religare Securities Ltd. The Company is a member of the National Stock Exchange (NSE) and OTCEI. RELIGARE is a pioneer in the concept of partnership to reach multiple Locations in order to effectively service its large base of individual clients. Pioneer ITI. BOI-MF. is to cater to services in Capital Market Operations to Institutional Investors. the clients of the company greatly benefit by its strong research capability. a Company promoted by the late Dr. SBI. Punjab & Sind Bank. . Depository Participant Service. ICICI Can bank MF. IDBI Principal. As on date the Company is empanelled with UTI. IDBI. IFCI.INTRODUCTION :COMPANY PROFILE RELIGARE Securities Ltd. which encompasses fundamentals as well as technical knowledge. The growing list of financial institutions with whom RSL is empanelled as approved Broker is a reflection of the high levels of services maintained by the Company. Prudential ICICI. RELIGARE was founded with the vision of providing integrated financial care driven by the relationship of trust. ING Baring and J M Mutual Fund. The bouquet of services offered by RELIGARE includes Broking (Stocks and Commodities). Advisory on Mutual Fund Investments and Portfolio Management Services. Oriental Insurance. GIC. Punjab National Bank. PNB-MF. (RFSL). (RSL) is a wholly owned subsidiary of RELIGARE Financial Services Ltd. UTI-Offshore. Parvinder Singh.

GROUP : RELIGARE in recent years has expanded its reach in health care and financial services wherein it has multiple specialty hospital and labs which provide health care services and multiple financial services such as secondary market equity services. RSL provides platform to all segments of the investor to leverage the immense opportunity offered by equity investing in India either on their own or through managed funds in Portfolio Management. RELIGARE SECURITIES LIMITED 1. The ARN No. of the Religare Securities Ltd. . RELIGARE Comdex Limited and RELIGARE Finvest Limited which provide services in Equity. portfolio management services. is 33764. The ARN No. is required by to be available with the broker who deals on behalf of investors or sell the mutual funds of the different companies present in the market. depository services etc. Depository Participant with National Securities Depository Limited (NSDL) and Central Depository Services Limited (CDSL). RELIGARE financial services group comprises of Religare Securities Limited. A SEBI approved Portfolio Manager. Member of National Stock Exchange of India and Bombay Stock Exchange of India. 2. 3. Commodity and Financial Services business & Religare Insurance Advisory Ltd.

Religare Enterprises Limited .

Shivinder Mohan Singh MISSION To be India's first Multinational providing complete financial services solution across the globe VISION Providing integrated financial care driven by the relationship of trust and confidence. Sunil Godhwani Mr.DIRECTORS OF RELIGARE SECURITIES LIMITED Chairman : Managing Director : Director : Director : Director : Mr. Harpal Singh Mr. . Malvinder Mohan Singh Mr. Vinay Kumar Kaul Mr.

com India Bulls HDFC Securities 5paisa.BROKERAGE :INTRADAY:.3 paisa (.          ICICI Direct.30 paisa (.com Motital Oswal IL&FS Karvy .03%) (NEGOTIABLE) Competititors of Religare :There are several financial security companies playing their roles in Indian equity market.3%) (NEGOTIABLE) DELIVERY:. But Religare faces competitions from these few companies.com Share Khan (SSKI) Kotak Securities.

It appeals mainly to short term traders. 1. The subject of Equity analysis. In Fundamental analysis a company s goodwill. Technical analysis refers to the study of market generated data like prices & volume to determine the future direction of prices movements. this equity analysis does not discuss how to buy & sell shares. you are out to make money. Equity analysis is basically a combination of two independent analyses. who let their heart rule. namely fundamental analysis & Technical analysis. pencil. Greed must be avoided patience may be a virtue. turnover. Decision should be based on actual movement of share price measured both in money & percentage term & nothing else. calculations are based on considered FACTS & not on HOPE. liquidity. its performances. The focus of technical analysis is mainly on the internal market data. It is the oldest approach to equity investment dating back to the late 19th century. profitability & financial health was checked & analysis with the help of ratio analysis for the purpose of long term successful investment. ruler. It should be pointed out that. Assumptions for the Equity Analysis. it also works in abnormal share-market conditions. prices & volume data. A general investor can apply the principles by using the simplest of tools: pocket calculator. Works only in normal share-market conditions with great reliability. i. Their head eliminate all emotions for decision making. . the attempt to determine future share price movement & its reliability by references to historical data is a vast one. plotting of CHARTS to extremely sophisticated indicators. but does discuss a method which enables the investor to arrive at buying & selling decision. leverage. watchful attention. Fundamental analysis is useful in long term investment decision. Be ruthless & calculating. chart paper & your cautious mind.e. but with low reliability. The financial analysts always need yardsticks to evaluate the efficiency & performances of any business unit at the time of investment. covering many aspect from the calculating various FINANCIAL RATIOS.e. i. Technical analysis mainly seeks to predict the short term price travels. but impatience can frequently be profitable. In Equity Analysis anticipated growth.WHAT’S THIS EQUITY ANALYSIS? Professional investor will make more money & less loss than.

. because the scenario of equity analysis is revolving around the term money 4. ANALYSIS OF AUTOMOBILE INDUSTRY Over a period of more than two decades the Indian Automobile industry has been driving its own growth through phases.C Approach) a. History repeats: investors & speculators react the same way to the same types of events homogeneously. You are buying stock & not companies. The automobile sector has been contributing its share to the shining economic performance of India in the recent years. tradition s & trust. whether it is short run or long run. so the investment object has vital importance associated to return along with risk.2. Although the equity analysis is art as well as sciences so. so don t be curious or panic to do postmortem of companies performances. 7. 3. 10. 6. Capital market trend is always a friend.I. To understand this industry for the purpose of investment we need to analyze it by following two approaches: 1). it also has some exceptions. perceptions. the crowd Vc the individual. 8. risk management was up to the investor s knowledge. Capital market has a typical market psychology along with other issues like. ENVIRONMENT & ECONOMICAL ANALYSIS. Portfolio management. Fundamental Analysis (E. An individual perceptions about the investment return & associated risk may differ from individual to individual. India has become a hub of domestic and exports business. 5. Economy b. Company 2).Technical Analysis EQUITY ANALYSIS. 9. With comparatively higher rate of economic growth rate index against that of great global powers. Industry c. Cash management gets the magnitude role. Equity analysis is purely based on the INVESTMENT PHILOSOPHY .

2 Determine the condition of the industry. Today. Fundamental analysis typically focuses on key statistics in company s financial statements to determine if the stock price is correctly valued. The typical approach to analyzing a company involves four basic steps : 1 Determine the condition of the general economy. The service sector is growing rapidly in the past few years. This is the pie.5 per cent for FY 2009-10 Mr. Most fundamental information focuses on economic. Economic analysis is a process whereby strengths and weaknesses of an economy are analyzed. Economic analysis is important in order to understand exact condition of an economy. the GDP growth has downgraded it to 7.000 reflecting improvement in the living standards of an average Indian. ECONOMY Economic analysis is the analysis of forces operating the overall economy a country. industry and company conditions in an effort to determine the value of a company s stock. . Following is the graph showing a trend of Indian GDP trend in past 3 years.1 per cent for 2008-09 and predicted it to be 6. GDP and Automobile Industry In absolute terms. The per capita Income is near about Rs38. industry and company statistics. India is 16th in the world in terms of nominal factory output.chart showing contributions of different sectors in Indian economy. TECHNICAL ANALYSIS Fundamental analysis is the study of economic. 3 Determine the condition of the company. Directly and indirectly it employs more than 10 million people and if we add the number of people employed in the auto-component and auto ancillary industry then the number goes even higher. 4 Determine the value of the company s stock a).FUNDAMENTAL ANALYSIS Fundamental Analysis. As the world economy slips into recession hitting the demand hard and the banking sector takes conservative approach towards lending to corporate sector. Montek Singh (Planning Commission of India). automobile sector in India is one of the key sectors of the economy in terms of the employment.

02 million to 8.85 % during April – December 2008. higher interest rates. But at the end of the year. A moderate amount of inflation is important for the proper growth of an economy like India because it attracts more private investment.86% over December 2007 Two Wheelers registered minor growth of 1.7% with passenger car sales shows 1. The fall in wholesale prices from a year earlier is mainly due to a statistical base effect and doesn’t suggest contraction in demand. In last FY despite of skyrocketing oil prices (crude oil price has already up to $130 compared to $20 per barrel five years back). Although the sector was hit by economic slowdown.83 million while two-wheelers increased from 8. two wheelers and three wheelers) increased from 10. industry had to face the hard truth and witnessed the fall in sales compared to last year.Source :India Central Statistical Organization The market value of Automobile Industry is more than US$8 bl.31% growth while Commercial Vehicles segment slumped 21.41 million. However.oil price hike.72 million as compared to 9.5 percent over the past five years. Inflation Despite of negative inflation these days (-.65 million in 2007-08. Passenger Vehicles segment registered negative growth.17 million vehicles in 2008-09.85 million vehicles in 2007-08 to 11. the effect of inflation has affected every sector which is related to car manufacturing and production. India is strong and growing industry but the impact of recession is evident now on industry as sales & growth of automobile companies have declined. Global recession has hit the Indian auto industry. commercial vehicles. Passenger vehicles increased marginally from 1. and Contribution in Indian GDP is near about 5% and will be double by 2016. In December 2008. overall production fell by 22 % over the same month last year. the Reserve Bank of India said few week back. Recession All the major auto companies enjoyed the high growth ride till the mid 2008.77 million to 1.43 percent fall in December 2008 over the same month last year.21% on 22-Aug-09) we saw an increasing trend of sales in auto sector. Two Wheelers sales recorded 15. The automotive industry in India grew at a computed annual growth rate (CAGR) of 11. Total number of vehicles sold including passenger vehicles. two-wheelers and threewheelers in 2008-09 was 9. The effect of inflation has taken the rise in the price rate of the cars by 3-4% which in turn suffices the need to . but growth rate in last FY2008-09 was only 0. However. The increase in the price of fuel and the steel due to inflation has led to a slower growth rate of the car industry in India. One of its supporting facts is that the sales in December 2008 for passenger vehicles fell by 13. Indian automobile Industry was not as much affected and experts think that Indian automobile industry will continue to grow this year despite all obstacles. while revising its inflation forecast for the FY through March to around 5% from 4%. overall production (passenger vehicles. commercial vehicles.7%.

have been consistently registering higher growth rates every passing year for their domestic flourishing domestic automobile markets. FDI inflows in Automobile Industry 2008-09 was Rs.) INDUSTRY ANALYSIS (AUTOMOBILE) The current trends of the global automobile industry reveal that in the developed countries the automobile industries are stagnating as a result of drooping markets. has been permitted under automatic route to this sector. while in April-May 2009 it was around Rs. In 2009.5.53 million units in 2008-09 from 1. Export of passenger vehicles increased from 218. which has led to a turnover of USD 12 billion in the Indian auto industry and USD 3 billion in the auto parts industry.739 units in 2008-09. b. . FDI’s In India FDI up to 100 percent. more and more MNC’s coming in India to setup their ventures which clearly shows the scope of expansion.meet the rise in price of the raw materials to build a car. automobile sales (including passenger r vehicles.9 per cent to 2. of India Export Society of Indian Automobile Manufacturers (SIAM). which may be attributed to the global economic recession. except for the decline in the export of commercial vehichles in the financial year 200809. commercial vehicles.The Indian automobile sector is far from being saturated. Source. The industry is at the crossroads with global mergers and relocation of production centers to emerging developing countries. estimated rate of growth of India Auto industry is going to be 9% . Despite recession. Being one of the fastest growing sectors in the world its dynamic growth phases are explained by the nature of competition. Product Life Cycle and consumer demand.25% compare to 200708. two-wheelers and three-wheelers) in the overseas markets increased to 1.497 Cr. leaving ample opportunity for volume growth.212 Cr an increase of 47.23 million units in 2007-08.5 per cent by 2015. There is a continuous increase in the export of automobiles since the financial year 200203. India enjoys a cost advantage with respect to casting and forging as manufacturing costs in India are 25 to 30 per cent lower than their western counterparts the Investment Commission has set a target of attracting foreign investment worth US$ 5 billion for the next seven years to increase India's share in the global auto components market from the existing 0. the Indian automobile market continues to perform better than most of the other industries in the economy in coming future. whereas the automobile industry in the developing nations.401 in 2007-08 to 335.FDI Statistics Govt. The car market and the car industry witnessed a fall of 8-9%.

In the pioneer phase. Business strategies are developing. The cumulative growth of the Passenger Vehicles segment during April 2007 – March 2008 was 12.79 percent.Segmentation of Automobile Industry The automobile industry comprises of Heavy vehicles (trucks. often at an accelerating rate of sales and earnings growth. Following is the segmentation that how much each sector comprises of whole Indian Automobile Industry.07 percent. The Commercial Vehicles segment grew marginally at 4. tempos. successful companies can grow at extraordinary rates. However.66 percent.57 percent and Multi Purpose Vehicles by 21. the product market has been established and there is at least some historical guide to ground demand estimates. Light . tractors). The industry is growing rapidly. Industrial Analysis of any industry can be done based on the following headings: 1.17 percent. SWOT Analysis 3. Indian Automotive Industry is booming with a growth rate of around 15 % annually. passenger cars. and Three-wheelers.) Industrial Life Cycle The industrial life cycle is a term used for classifying industry vitality over time. Commercial Vehicles. The Indian automobile sector has passed this stage quite successfully. Two-wheelers. Industrial Life Cycle 2. In the growth phase. and there is high risk of failure. maturity and decline. Industry life cycle classification generally groups industries into one of four stages: pioneer. While Medium & Heavy Commercial Vehicles declined by 1.39 percent in this period. Industry Specific Index 1. the product has not been widely accepted or adopted. growth. Utility Vehicles by 10. Passenger Cars grew by 11. buses.

Environmental factors internal to the firm usually can be classified as strengths (S) or weaknesses (W). with motorcycles and electric two wheelers segments declining by 11. However.49 percent and Passenger Carriers declined by 2.90 percent and 44. 2. but the scope of growth of the automobile sector is very much possible in India due to the increasing income of the middle class and their income as well as standard of living. Companies began to focus on market share rather than growth. growth slows as penetration reaches practical limits. Two Wheelers registered a negative growth rate of 7. Industry demand tends to follow the overall economy.93% respect.71 percent with sales of Goods Carriers declining drastically by 20. Scooters and Mopeds segment grew by 11.92 % during this period.Commercial Vehicles recorded a growth of 12. Three Wheelers sales fell by 9.29 percent. The growth rate of the automobile industry in India is greater than the GDP growth rate of the economy.March 2008 compared to the last year. SWOT analysis of the Indian automobile sector gives the following points: Strengths • Large domestic market • Sustainable labor cost advantage • Competitive auto component vendor base • Government incentives for manufacturing plants • Strong engineering skills in design etc Weaknesses • Low labor productivity • High interest costs and high overheads make the production uncompetitive • • • Various forms of taxes push up the cost of production Low investment in Research and Development Infrastructure bottleneck Opportunities • Commercial vehicles: SC ban on overloading .64% and 16. and those external to the firm can be classified as opportunities (O) or threats (T). Such an analysis of the strategic environment is referred to as a SWOT analysis.63% respect. so the automobile sector can be very well be said to be in the growth phase. As the product matures.13 percent during April.) SWOT Analysis A scan of the internal and external environment is an important part of the strategic planning process.

• • • • Heavy thrust on mining and construction activity Increase in the income level Cut in excise duties Rising rural demand Threats • Rising input costs • Rising interest rates • Cut throat competition 3. Sectoral Indices are very useful in tracking the movement and performance of particular sector.) Industry Specific Index Industry specific index also called as sectoral index are those indices. BSE Auto Index comprises all the major auto stocks in the BSE 500 Index. All stocks in a sectoral index belong to that sector only. Hence an index like the BSE auto index is made of auto stocks. which represent a specific industry sector. BSE AUTO Index 5 Year Chart .

Maruti Suzuki. indian auto industry start picking up growth slowly in the first end of 1st quarter index reaches to its highest in his history.) COMPANY ANALYSIS (Maruti Suzuki & TATA Motors) The company analysis shows the longterm strenght of the company that what is the financial Position of the company in the market where it stand among its competitors and . so there is a lot of scope to growth in this industry. Than we saw a steady fall in the index and in the mid 2006 reaches to years lowest point it again start booming and than year on year we saw a up and down movement in the index as lots of new players came in Indian market with foreign colaboration but when 2008 came with global slowdown it brings the demand of automobile so low that index reaches to its lowest in past 5year . c. etc. But in the beginning of 2009 right from 1 st quarter auto industry again start regaining and we saw a tremondous growth in auto industry which never seen before not in india but all over the world. Most of the company even shut down their manufacturing units for more than a week. Also no further launches were made in mid or late 2008 and postponed to next year. Intially in 2003 when major giants got listed on stock exchange TATA Motors.com Above is the Indian Auto Industry Index(BSE) shows the up’s and down’s over the period of 5 years. We have also saw a fall in FDI’s in automobile Industry. production came down because of less demand in the economy.• Automobile Industry Index at BSE for 5 Year COMPANY Source:Google finance. And this growth of industry will be carry further as festive season still to come. The demand of 2 and 4 Wheelers start increasing rapidly which also force auto industry to employ more workers to meet demand and with in the 2nd quarter of FY2009-10 Auto index reaches to its highest ever crossed mark of 6000.

795 units in August 2008. what are the policies of government towards the company and how the stake of the company divested among different groups of people.92 crores. As of May 10.808 vehicles in August 2009. Until recently. Govt.3% to 69.113 vehicles in August 2008. has sold a total of 84. 203. of India sold its complete share to Indian financial institutions.629 units.28739. midsize car and utility vehicle segments.79 crores compared to Rs. a decline of 10. 18.908 vehicles in the same period of 2008.7%.47 crores in 2007-08.847 units. Govt. The turnover for the fiscal 2008-09 stood at Rs. Profile of Maruti Suzuki Maruti Suzuki is one of India's leading automobile manufacturers and the market leader in the car segment. a decline of 60.33093.6%. 2007.2028.27 crores (2007-08: Rs. The Profit after Tax for the year was Rs. Revenues (net of excise) for the year were Rs. 25660.7%.2% to 14. what is the future plans of the company. It is the leader in commercial vehicles in each segment.who are the key drivers of the company.583 Million & Profit After Tax at Rs. Fundamental Analysis consist of following Study of Balance sheet Study of Profit and Loss a/c Study of Ratios Balance Sheet : . compared to 59. The company is the world’s fourth largest truck manufacturer.28% of the company was owned by the Indian government.93 crores) in 2008-09.76 crores compared to Rs. Total passenger car sales in August 2009 increased 30. The company's domestic sales in August 2009 increased 29.961 vehicles.28599.7%.5% to 69. compared to 54. and among the top three in passenger vehicles with winning products in the compact.1013.2% by Suzuki of Japan. and the world’s second largest bus manufacturer. both in terms of volume of vehicles sold and revenue earned.351 units in August 2008 The company's exports increased 156. reported gross revenue (stand-alone) of Rs. With this. a decline of 50. 12. The Profit before Tax was Rs.1001.41 crores in 2007-08.26 crores compared to Rs. Profile of Tata Motors Tata Motors Limited is India’s largest automobile company.Maruti Suzuki India Ltd. and 54.2576. a year marked by severe demand contraction in the automobile industry. compared to 5. an increase of 41. compared to 53. of India no longer has stake in Maruti Udyog.187ml.

the financial statements are built to be used together to present a complete picture of a company's finances. The balance sheet must follow the following formula: Assets = Liabilities + Shareholders' Equity Each of the three segments of the balance sheet will have many accounts within it that document the value of each. represent what the firm owes others. Equity capital represents the contribution of equity shareholders who are the owners of the firm. . The income statement. The balance sheet shows the financial condition of a business at a given point of time. as well as the amount invested by the shareholders. The format prescribed in the Companies Act classifies liabilities as follows : Share Capital: Share capital includes equity capital and preference capital. as there is no one set template that accurately accommodates for the differences between different types of businesses. on the other hand. Accounts such as cash. A liability arises when a firm receives benefits or services and .A financial statement that summarizes a company's assets. the balance sheet of a company shall be in either the account form or the report form. These three balance sheet segments give investors an idea as to what the company owns and owes. This makes sense: a company has to pay for all the things it has (assets) by either borrowing money (liabilities) or getting it from shareholders (shareholders' equity). As per the Companies Act. It's called a balance sheet because the two sides balance out. defined very broadly. It is a snapshot of what a company owns and owes at that point in time. promises to pay cash or provide goods and services in future. inventory and property are on the asset side of the balance sheet. Neither statement is better than the other rather. liabilities and shareholders' equity at a specific point in time. The balance sheet is one of the most important pieces of financial information issued by a company. while on the liability side there are accounts such as accounts payable or long-term debt. shows how much revenue and profit a company has generated over a certain period. The exact accounts on a balance sheet will differ by company and by industry. in turn. Liabilities Share Capital Reserves and Surplus Secured loans UnSecured loans Current liabilities and provisions Assets Fixed Assets investments Current assets . loans & advances Miscellaneous expenditure Liabilities Liabilities.

Assets are classified as follows under the Companies Act: Fixed Assets: fixed assets. loans and advances are: inventories. other current assets and loans and advances. plant and machinery. sundry creditors. Current liabilities include items such as bills payable. and copyrights. . and other exp. Investment: investments represent financial securities owned by the firm. These assets may be tangible or intangible. carries no fixed rate of dividend. being the risk capital. cash and bank balances. The major components of current assets. also called non current assets. buildings. Miscellaneous Exp : this comprise of items such as preliminary exp. and plant and machinery. patents. discount allowed on issue of securities. Current Assets: this category consists of cash and other assets which get converted into cash or which result in cash savings. are assets that are expected to produce benefits for more that one year. building. Intangible assets include goodwill. dividend. Assets Assets are resources which are expected to provide a firm with future economic benefits. Current liabilities and Provisions: current liabilities and provisions represent obligations that are expected to mature within a year. Preference capital represents the contribution of preference shareholders and the dividend rate payable on it is general fixed. and provisions include items such as provision for taxes. In common practice for companies to transfer from the profit and loss account to various reserve accounts. Secured loan: Secured loan are loans that are secured by a charge on the assets of the firm. They are divided into two categories. and development expenditure to the extent not written off or adjusted. furniture. debtors.Equity capital. Tangible fixed assets include items such as land. during the operating cycle of the firm. This process is called appropriation. long term investment and current investment. The charge may be created in the form of pledge or hypothecation of movable assets such as inventories and debtors and or in the form of mortgage of immovable assets such as land. interest accrued etc. Reserve and Surplus: Reserve and Surplus comprise retained earnings as well as non earnings items like share premium and capital subsidy. interest paid out of capital during construction. by way of higher cash inflows or lower outflows. Unsecured loans: in contrast to secured loans. unsecured loans are loans which are not secured by a charge on the assets of the firm.

Following is the financial and Non-Financial analysis of Maruti Suzuki & TATA Motors. and showing the net profit or loss in a specified accounting period . instead of showing only the final profit measure. Also known as the "profit and loss statement" or "statement of revenue and expense". The income statement is the most analyzed portion of the financial statements. the companies act does require that the information provided should be adequate to reflect a true and fair picture of the operations of the company for the accounting period. Structure of Profit and Loss a/c Income Sales Expenditure Material and other expenditure Interest Depreciation Profit before tax Provision for tax Profit after tax While a single step profit and loss account aggregates all revenues and expenses. Further. a multi step profit and loss account provides disaggregated information.) Motors Balance Sheets Maruti Suzuki TATA .by summarizing revenues and expenses. The companies act has prescribed a standard form for the balance sheet. It displays how well the company can assure success for both itself and its shareholders through the earnings from operations. • Financial Analysis a.depicts a business entity s financial performance due to operations as well as other activities rendering gains or losses. it presents proft measures at intermediate stages as well. but none for the profit loss account. However.Profit and Loss a/c : A financial report that . the profit after tax figure.

) Income Statements Maruti Suzuki TATA Motors .b.

But as trend shows TATA motors have potential so an shareholder expect better in future. that is.RATIO ANALYSIS OF TATA MOTORS AND MARUTI SUZUKI EPS measures the profit available to the equity shareholders per share. the amount that they can get on every share held. EPS = Net income.Dividends onPreferredStock . Till 2008 both the companies had a rising EPS but in 2009 both of them fall and the effect more on Tata motors as they bought two brands Ford Motors and fall in sales results in low EPS.

However recession brought hurdles but both companies have potential to grow in future as lots of products are still to add in their portfolio. The quick ratio is a very stringent measure of solvency.77 in 2009. Maruti is always showing a positive trend as its ratio is always greater than 1 except in 2008. while TATA motors was doing good till 2007.Average Outstanding shares The trend shows that Tata’s net profit margin is quite stable until it falls to 3. Net profit Ratio = (Net profit) × 100 (Net sales) Both giants of Automobile industry shows positive trend in Sales Revenue over the past 5year. While the net profit of India’s no. A general rule of thumb suggests that the quick ratio should be around 1. But the future prospect for both the company’s profit is higher.1 car manufacturer Maruti Suzuki shows a negative trend from 2007 onwards. Profit margins come down as recession hits economy badly hence sales get reduced and cost get increased very much. but the performance decreased from . Moreover increased demand in foreign market also seems to be a positive signal for better future.

Maruti is going very swiftly in this field. Debt-Equity Ratio= Total Debt Total Equity The current ratio is a convenient and reliable tool for measuring a company's level of liquidity. It means that a lot of debt is used by TATA’s to finance its increased operations. The ratio acts as an indication that the firm is able to generate funds to make all needed payments in the future. We see that the debt –equity ratio of TATA motors is very high compared to that of Maruti. .2008 onwards as shortage of cash was there and current liabilities and provision increased by Rs800Cr. Sometimes the cost of the debt financing may outweigh the return that the company generates on the debt through investment and business activities and can lead to bankruptcy. Tata motors and Maruti Suzuki both the companies showed a positive trend in paying dividends till 2008. A high debt to equity ratio suggests that a company has financed its growth mostly via debt. so we see in graph that Maruti has more strong liquidity than TATA Motors as its current ratio is always greater than 1. Both the companies possess a good ratio but the ratio which is close to 2 is desirable. thus. the ratio indicates whether the firm is likely to be a going concern. Maruti is more successful in paying off its liabilities. Expansion plans of TATA brought down its cash & Bank Balance and increase of outside liabilities.

it always provided dividend of above 10 per share to its shareholders while maruti stick to below 5 per share. even though the fall in dividend in 2009.but the scenario changed in 2009 as both the company’s dividend per share fell. Dividend Per Share = Total amount of Dividend Share Outstanding • Financial Analysis 1. Share Holding Pattern for Quarter Ended 30-June-09 . According to graph TATA’s dividend was much higher than that of Maruti. still both the companies are earning good profit.

Ventures & Products Being a venture of Japanese company Suzuki big stake of the company is held by foreign promoters which shows that they can divest their part(small part) to raise money in future. they have firmed up a massive expansion plan of its service network and plans to expand it to 1700 towns and cities from the current of about 1200. Tata Motors is looking east. However institutional investors also held 39% major stake in the company but general public have very small part which shows that less presence of share in the secondary market hence low volume trading in stock market. To take it a step further Tata has also initialized plans for the manufacture of a hybrid car which it will market with Chryster in the U. towards neighboring Myanmar to boost its sales by setting up a truck manufacturing plant. at least in fourwheeler segment. The company hopes to have a version for Europe by 2011 and one for the U. TATA Motors Tata Motors is try to be in a position to dominate the Indian Auto industry. After launching the world’s cheapest car.S.000 cr.Above is the updated share holding pattern of TATA motors which shows that Indian promoter share in the company is 41% that means if they are not in the position to raise further money from general public. By the year 2010. is now aiming to launch its cars in Indonesia and is also planning to sell Nano in South America with the help of Fiat. 2. They have also been coming with . The company plans to increase the number of service stations and workshops to over 3800 from about 2800 currently. Maruti Suzuki Maruti Suzuki has expanded the capacity at its Manesar plant to 1. Tata also apparently has its eye on the European and U. Tata Motors. out of which a quarter will be assigned for amplifying leadership network to 1000 in number. Suzuki Motors plan to increase their dealership in India. After the launch of Nano. Nano. Tata Motors had inked a joint venture with Thailand’s Thonburi Auto Assembly’s to manufacture up to 35.S perhaps by 2012. The expansion is estimated to cost $ 3. This is a step to increase their sales to one million units as well as for a better position in the Indian auto market. is searching options to pump approximately Rs. markets. Tata Motors have announced that they are interested in the idea of designing electric cars. General Public also have quite large stake in the company compare to its competitors. 8. As Maruti Suzuki eyes one million sales by 2010. During the next 3-4 years on capital expenditure and product development. Company already raised huge money by selling their large stake to institutional investors about 27%. As part of its expansion plans in Southeast Asia.000 one tone pickup trucks a year over the next 3-5 years.7 lakhs unit per annum from January 2009.5 billion.S. Tata Motors.

Government Policies Towards Indian Automobile Industry Automobile industry in India also received an unintended boost from stringent government auto emission regulations over the past few years. 1. • Specific component of excise duty applicable to large cars and utility vehicles will be reduced to 15. whom will make India as a production hub and export to nearest market. as this will surely had an impact on the Automobile Industry. .000 rupees per vehicle from 20. to 1. The announced reduction on the basic customs on bio-diesel is great news for all companies working on environmental saving technologies. 2. motivate many foreign commercial vehicle manufactures to set up shops in India. • . The move is aimed at helping India emerge as a hub for global manufacturing and sourcing for auto parts.specific sales promotion programmes targeted at interior regions. This ensured that vehicles produced in India conformed to the standards of the developed world.000 cr. the overall R&D facilities will be progressively completed by 2015. • • • Bring in a minimum foreign equity of US $ 50 Million if a joint venture involved majority foreign equity ownership Automatic approval for foreign equity investment upto 100% of manufacture of automobiles and component is permitted FIIs including overseas corporate bodies (OCBs) and NRIs are permitted to invest up to 49 per cent of the paid-up equity capital of the investee company. The Haryana government has allotted 700 acres of land to Maruti Suzuki for hi – tech Research & Development complex at Rohtak. subject to approval of the board of directors and of the members by way of a special resolution. Though it has an advantage in India. While the development of the allotted land and construction of the test tracks will be completed in the first phase by 2012. thanks to low costs and government policies it soon faces stiff competition from it multinational competitors all eyeing for a share in the ever growing Indian auto sector. And will introduce world class R&D facilities into India.000 rupees earlier.500 cr. will see an investment in the range of Rs. The policies adopted by Government will increase competition in domestic market. Investments in making auto parts by a foreign vehicle maker will also be considered a part of the minimum foreign investment made by it in an auto-making subsidiary in India. The upcoming facility. among them is the “Mera Sapna Meri Maruti: New Panchayati Scheme”. • The Proposal by the Govt. to set up an expert group to advise on a viable and sustainable system of pricing petroleum products.

Technical analysis mainly .Technical analysis Technical analysis refers to the study of market generated data like prices & volume to determine the future direction of prices movements.

It is the tool of financial analysis. Drawbacks / limitations of technical analysis: 1 Technical analysis does not able to explain the rezones behind the employment or selection of specific tool of Technical analysis. 2. It provides important & vital information regarding the current price position of the company. 3. because of the persistence of trends & patterns analysis of past market data can be used to predict future prices behaviors. prices & volume data. Supply & demand are influenced by variety of supply & demand affiliated factors both rational & irrational. 4.seeks to predict the short term price travels. Usually the following tools & instruments are used to do the technical analysis: . 6. 3 The technical analysis must be a self defeating proposition. 2 The technical analysis failed to signal an uptrend or downtrend in time. For that matter a verity of tools was consider. calculating & interpreting graph & chart to assess the performances & status of the price. As more & more people use. which not only studies but also reflecting the numerical & graphical relationship between the important financial factors. Shifts in demand & supply bring about change in trends. 5. It also provides the base for decision-making in investment. Basic premises of technical analysis: 1.e. employ it the value of such analysis trends to reduce. Barring minor deviations stock prices tend to move in fairly persistent trends. Market prices are determined by the interaction of supply & demand forces. It appeals mainly to short term traders. These include fundamental factors as well as psychological factors. i. This Technical analysis is helpful to general investor in many ways. The one of the most frequently used yardstick to check & analyze underlying price progress. The focus of technical analysis is mainly on the internal market data. It is the oldest approach to equity investment dating back to the late 19th century. Technical analysis involves the use of various methods for charting. It is important criteria for selecting the company to invest. This shift s can be detected with the help of charts of manual & computerized action.

Bar: It gives the detailed information about every aspect. This type of chart is ideal for securities with no high or low price data i. and candlestick. mutual funds or that is even with the equity in case of base price. Line: A line chart simply connects the closing prices from one period to the next..e.Price Styles Price in a chart can be displayed in three styles: bar. Japanese Candlestick: A candlestick is black if the closing price is lower than the . line.

.opening price. A candlestick is white if the closing price is higher than the opening price.

volume decreases on the head and is especially light on the right shoulder. pause. The changing of expectations often causes price patterns to emerge. prices typically decelerate. shift the security's supply/demand. Confirmation of a new down-trend occurs when the "neckline" is penetrated. Following the penetration of the neckline. During a healthy up-trend. and then reverse. their price patterns are often very similar. It gets its name from the resemblance of a head with two shoulders on either side. If prices are then unable to rise . A sign that the trend is weakening occurs when the volume accompanying rallies is less than the volume accompanying the preceding rally. In a typical Head-and-Shoulders pattern. Although no two markets are identical. it is very common for prices to return to the neckline in a last effort to continue the up-trend. The right shoulder is created as the bulls try to push prices higher. INTC). Head and Shoulders: The Head-and-Shoulders price pattern is the most reliable and well-known chart pattern. the "left shoulder" and the "head" are the last two higher-highs. These phases occur as investors form new expectations and by doing so. the more dramatic the ensuing prices move. An up-trend is formed as prices make higher-highs and higher-lows in a stair-step fashion. They eventually change direction and when they do. volume should increase during each rally. Predictable price behavior often follows these price patterns. but are unable to do so.Price Patterns: Overview: A basic principle of technical analysis is that security prices move in trends. . . We also know that trends do not last forever. The trend is broken when this upward climb ends. they rarely do so on a dime. the longer a pattern takes to form. The reason this reversal pattern is so common is due to the manner in which trends typically reverse. Instead. Chart patterns can last from a few days to many months or even years. This signifies the end of the up-trend. Generally speaking. As you can see in the illustration (Intel.

decreases as expectations shift and traders become indecisive. which was high during the previous trend. they usually decline rapidly on increased volume. An inverse (or upside-down) Head-and-Shoulders pattern often coincides with market bottoms. Rounding bottoms occur as expectations gradually shift from bearish to bullish. A double bottom has the same characteristics as a double top except it is upside is down. Prices then decline marking the beginning of a new down-trend. retreat. volume usually decreases as the pattern is formed and then increases as prices rise above the neckline Rounding Tops and Bottoms: Rounding tops occur as expectations gradually shift from bullish to bearish. The gradual. Volume. Volume then increases as the new trend is established Double Tops and Bottoms A double top occurs when prices rise to a resistance level on significant volume. and subsequently return to the resistance level on decreased volume. As with a normal Head-and-Shoulders pattern.Volume during both rounding tops and rounding bottoms often mirrors the bowl-like shape of prices during a rounding bottom. yet steady shift forms a rounded top.above the neckline. .

a Double top reversal pattern has been formed. To measure the likely downward reaction. To measure the likely upward reaction.Tops T1 & T2 are almost at the same level & trend violated the support line formed with the help of bottom B1 hence. Bottom B1 & B2 are almost at the same level & trend violated the resistances level formed with the help of top T1 hence. Deduct these distances from the intervening top & that will be the upward target of the double bottom reversal pattern. measure the distances between the intervening top & the double bottom. a Double bottom reversal pattern has been formed. measure the distances between the intervening bottom & the double tops. . Deduct these distances from the intervening bottom & that will be the downward target of the double top reversal pattern.

T2 & T3 are almost at the same level & trend violated the support line formed with the help of bottom B1 because the B1 is the lowest bottom hence. measure the distances between the intervening bottom & the triple tops. To measure the likely upward reaction. a triple top reversal pattern has been formed. measure the distances between the intervening top & the triple bottom. . Deduct these distances from the intervening top & that will be the upward target of the triple bottom reversal pattern.Tops T1. To measure the likely downward reaction. Deduct these distances from the intervening bottom & that will be the downward target of the triple top reversal pattern. Bottom B1. a triple bottom reversal pattern has been formed. B2 & B3 are almost at the same level & trend violated the resistances level formed with the help of top T1 because the T1 is the heights top hence.

Dow Theory is broken down into six basic tenets. which is when the public at large catches on to what the experts know and begin to trade in the same direction and in the Excess phase. Public participation and Excess. but then started increasing again. Downtrends. In the graph shown above. The accumulation phase is one in which the expert traders are actively taking positions which are against the majority of people in the market. where rampant speculations occur and the “smart money” starts to exit their positions. but it then suddenly decreased near the month of June’2009. The public participation phase. which are defined as a move after the market makes a move sharply in one direction where the market recedes in the opposite direction before continuing in its original direction. which are defined as when the market makes lower lows and lower highs and Corrections. . Accumulati on Public Excess Upstrea m The first tenet of Dow Theory is that the market has three trends. but also price philosophy. The Dow Theory addresses not only technological analysis and price action. Up trends are defined as a time when successive rallies in a security price close at levels higher than those achieved in previous rallies. it is shown that the share prices of Tata motors were increasing in the year 2009. Accumulation. The second tenet of Dow Theory is that trends have three phases.Implication of DOW THEORY The Dow Theory is valid even in today’s volatile and technology driven market.

when the prices were decreasing during recession. The above graph also illustrates the sixth tenet. the share prices started increasing but they again saw a decline. In the case of Tata motors. which may be attributed to the news of breach of JLR contract with Ford Motors which may cause Rs. The sales of Tata motors decreased by 4% in June end’ 2009 which can be one more reason for the decline in stock prices of Tata motors.Upstrem Primary trend Deviati The third tenet of Dow Theory is that the market counts all news. which says that trends exist until definitive signals prove that they have ended. . meaning that once news is released it is quickly reflected in the price of an asset. but the market then again followed its prior trend of declining prices.3bl panelty. In the case of Tata motors. the stock price even increased once. as the market started recovering after December’2008. The market may show moves which are against the primary trend but this do not mean that the trend is over and the market will normally resume its prior trend.

When the performances diverge. we can see that the movement of stock prices of Tata motors and SENSEX are more or less in the same direction. One thing which very clear is TATA motors react very badly whenever there is a negative sentiments comes in market results SENSEX comes down. it is warning that change is in the air. However.SENSEX AND TATA MOTORS Tenet four of Dow Theory is that the averages must confirm each other. Different sets of colored line in above chart prove this fact. when people came back to the market. prices also increased. prices went down and after recession. Tenet five is that Trends are confirmed by volume. that means that the performance of related industries should move in one direction for the health of a particular industry. and TATA motors also comes down. In case of Tata motors. when the people stopped investing during recession. .

1425 Support level RS. Resistance & Support Level This Technical tool helps in telling that what would be the price band of share price in which it move in near future on the basis of past high and low levels made by a particular scrip. As it is seen in the past 4 months TATA share price moved up and it keeps making on new level so perfect resistance level for this share is not easy to predict as performance of this share is very good The above band of resistance and support level shows that the price compare of shares will in to move all scrips of between this range only until unless any wrong reaction came out in economy or when any correction takes place the prices will move in between this band only. (1-Jul-09 to 7-Sept- Resistance Level Rs.490 approx.1275 approx. .430 approx. Support Level Rs. Resistance Level shows the price above which share price will not move in normal case on the other hand Support level shows the minimum share price which can be touched by share or crossing of this share will not be there in normal market condition Following is the Resistance & Support level of Maruti Suzuki & TATA Motors for the period of 2 months: Resistance Level Rs.1.

In above figure we have compare the share price of Tata Motor and Maruti with moving average of 50 period of Tata Motors. A buy signal is generated when the security's price rises above its moving average and a sell signal is generated when the security's price falls below its moving average. Simple Moving Average (50 periods)-Medium Term A Moving Average is an indicator that shows the average value of a security's price over a period of time. The method of interpreting a moving average is to compare the relationship between a moving average of the security's price with the security's price itself.2. Maruti respectively. It is designed to keep you in line with the security's price trend by buying shortly after the .

security's price bottoms and selling shortly after it tops. We have compare the share price of Tata Motor and Maruti with moving average of 200 period of Tata Motors. In the near future both the companies show Buy signal as their security prices rises above its moving average. Maruti respectively by taking share prices of 5 year to take out the Moving average for 200 periods. Long Term Simple Moving Average (200 periods) In the above chart Moving Average is an indicator that shows the average value of a security's price over a period of time. Yellow area in the graph indicates buy signal and Green area indicates sell signal. so industry as whole is also performing outstanding. It shows that both companies are performing better. So keeping a hold position for the companies would be profitable in future. This shows that an investor can kept a hold position or can buy for longer period . Yellow area in the graph indicates Buy signal and Green area indicates Sell signal. This Tool of 200 Periods tells us about the position of share to buy or sell for a long period say for 9-12 months. A buy signal is generated when the security's price rises above its moving average and a sell signal is generated when the security's price falls below its moving average. 3. In the near future both the companies show buy signal as their security prices rises above its moving average.

and divergences. Crossovers: Yellow area shows that there was situation when sell position occurred in the end of month June till mid of July as MACD curve below EMA or Signal line shows a sell situation otherwise we saw a buy position of TATA Motors most of the time Light Green area shows that investor want to buy and wan to be in hold position. . overbought/oversold. here are three popular ways to use the MACD: crossovers.of time but as we can see in case of Maruti the moving average line is also rising which shows that Buy n hold position for very long period could be unprofitable a minor correction in the share price can bring down the share price line and then moving average line will easily cross the share price line. called the "signal" (or "trigger") line is plotted on top of the MACD to show buy/sell opportunities. A 9-day exponential moving average(EMA). The trend of buying is seems to be over here or in coming few days and a selling or booking of profit could be seen hence MACD line could fall below EMA in coming time. The MACD is the difference between a 26-day and 12-day exponential moving average. 4. TATA MOTORS MACD Sell Overboug Overso Buy Above graph shows the MACD of TATA motors for the period of 6 months.

MARUTI SUZUKI MACD Overboug Overso Crossover: The above graph shows the MACD of Maruti Suzuki. Moving Average Crossover 20 Periods S B 50 Periods . here Yellow area shows the selling position as MACD line is below EMA line the Light Green area shows the buy position which occur last time in the end of July but now buy position for Maruti is created as EMA or signal line seems to be below MACD line and it will probably continue in near future. For both TATA Motors & Maruti Suzuki Overbought/Oversold: The amount of green lines in above graph on the up side shows the overbought situation by the investor which mean that investor buy more shares at this time and oversold situation occurs when green line is on the downside.

A crossover occurs when a faster Moving Average (i. above yellow circle shows that area when price fall below average price and then it move onto lower side. Bu No Sell Position or Always Position of .e. The increasing trend in the prices after buy signal of shares shows that good amount of profit could be achieved in future if stick with hold position. longer moving average of 50 periods cut shorter moving average from the lower side and shows a holding position of shares in coming future also. a longer period Moving Average-50 periods) which is considered a bullish crossover or below which is considered a bearish crossover. M. A cross above a moving average suggests that the bulls are is in control and that the price may be getting ready to make a move higher and Maruti Share Prices show that trend of moving up prices. Below is the MAC graph of Maruti Suzuki for past 6 months in which we haven’t see any sell position till yet the movement of share price is always on the positive side that is increasing so we can say that buying opportunities is always there in case of Maruti Suzuki.e.C helps in telling buying opportunities when the shorter moving average crosses above the longer moving average and selling opportunities when the shorter moving average crosses below the longer moving average.A. Following is the MAC of TATA Motors & Maruti Suzuki to understand the position of both companies average share movement Above is the MAC graph of TATA Motors for the period of 6 months in which ‘S’ denote the selling situation or position whereas ‘B’ is the point after approx 1 month when we saw a bounce back in share prices hence a buy signal occurs which is because. A move below the moving average suggests that the bears are in control of the price action and that the asset will likely move lower. a shorter period Moving Average20 periods) crosses either above a slower Moving Average (i.

The overbought and oversold stocks are apt to reverse course. The prices fell too fast and are susceptible to bargain hunting. the bands expand. i. . and when the market is LOUD. During the months of April.5.e. It’s better to buy stocks when it touches the lower band. but in regards all other technical factors should be considered while buying. while in mid of July the stock went below the lower band. mid July and mid august the stock of TATA motors crossed the upper band which means that during these periods the prices rose very fast. It’s also seen that the volatility increased to new highs after July because the bands started to widen. May. As we can see in the graph is that the at most of the time the graph lies between the middle band and the upper band Maruti which shows an increasing price trend in the market and it’s called Riding the Band. TATA Motors On the graph it can be seen the overall trend of the market and quick reference for supply and demand as well as support and resistance areas by using a 20 days moving average and 2 standard deviation in calculating the Bollinger Bands. An oversold stock has gone down too fast. Basically. Suzuki When the stock is outside the upper end of the Bollinger band it is considered as ‘OVERBOUGHT’. which means that stock has gone up too fast and when a stock is outside the lower band it is ‘OVERSOLD’. the bands contract. this little tool tells us whether the market is quiet or whether the market is LOUD! When the market is quiet. BOLLINGER BAND Bollinger bands are used to measure a market’s volatility.

Initially the bands show slight slope and lie approximately parallel to each other. but then onwards the bands started to widen which creates high volatility and looking at the future scenario it may be analysed that the stock will see a fall as at the end of august the band was overbought. . therefore it becomes an important factor in determining the price trend as it tells that the prices have not fallen very fast in these six months. Knowing whether or not prices are high or low on a relative basis can enhance the interpretation of other indicators. because when price is trading near the upper or lower Bollinger band line. this means that the price of the stock is oscillating up and down between the bands through a channel. there is a possibility of trend reversal. During the june month the bands contracted very much which shows low volatility. A security can become overbought or oversold for an extended period of time. The buy and sell signals are not given when prices reach the upper or lower bands. and it can assist with timing issues in trading. Such levels merely indicate that prices are high or low on a relative basis. The stock also shows overbought many times during the six months but it did not show any oversold trend.

The Indian auto market is still untapped. . 430 to Rs. moreover in two wheeler segment many companies like Mahindra and Mahindra grow even more than expectations. as we seen in last 3-4 months TATA recovers approx.7% and the above facts and figures in our study also support this truth.1275 to Rs. whenever there is a negative sentiment in the market regarding TATA Motors there is a steep fall in the stock price of TATA Motors but we have seen quick recovery in its share prices to regain its primary trend E. I have also come to know that share price movement of TATA Motors is just according to the movement of SENSEX. By analyzing the current trend of Indian Economy and Automobile Industry I can say that being a developing economy there is lot of scope for growth and this industry still have to cross many levels so there is huge opportunities to invest in and this is proving as more and more foreign Companies setting up there ventures in India. Like TATA has launch NANO the people’s car and now TATA motors is also planning to come out with an electric car as well as hybrid car. 490 if certain correction made in the market.90% after downfall. The majority of the people in country don’t own a four wheeler and all the major auto companies are trying to increase their sales by several moves.CONCLUSION Indian Automobile Industry is in the growth phase and the expected growth rate is 9-10% for FY2009-10 as compared to last year growth rate which was just 0.1425 and that of TATA Motors will move in the range of Rs. From the Technical Analysis of both companies i come to know that the share price of Maruti will move in the band of Rs.g.

com www.com www.yahoofinance.bseindia.com www.in www.in FDI statistic government of India India Central Statistical Organization Economic Times .worldfact.moneycontrol.googlefinance.rbi.google.com www.co.com www.org.BIBLIOGRAPHY www.