Technical & Fundamental

Analysis on Stock

By CA. Ram Chandra Khanal

Technical & Fundamental Analysis.

Fundamental analysis:
Companies are selected for in-depth analysis based on primary

financial indicators published by the respective companies.

Maximum possible number of companies need to be considered
Stock prices of companies with good financial conditions need to be
compared with the valuation result
Appropriate companies based on valuation and market price need to
be considered for investment portfolio
Companies with good financial conditions but market price is higher
are placed in watch list

Technical Analysis is done to identify the best timing for market

entry and exit

Analysis of international companies in sectoral basis are also made
to get the feel of our market valuation

Technical and Fundamental.

Collection of data :

Primary Sources as well as from secondary sources (i.e.

newspapers, publications and various websites)
Major reports are audited reports, quarterly reports,
directives and circulars published by Nepal government,
NRB, Insurance Board, and other regulatory bodies.
Apart from domestic financial data, we need to see yearly
analysis of international prospects to know general outline.

Research Process
Various tabulations should be created based upon the nature

of the data that are collected.

As for example for overall snapshot of financial indicators of
companies, a excel sheet can be generated as:
Comp
any

Net
Profit

Net
worth

ROE

EPS

DPS

Div
Yield

PB

PE

FY..

FY..

FY..

FY..

FY..

FY..

FY..

FY..

The table is prepared with year wise data of every companies,

in sector classification as per NEPSE, which helps in further
classification of companies.

Research Process
Apart from financial snapshot of companies, also the

quarterly reports and audited reports are keyed in excel

format as published for further analysis.
Also, the book closure notices, dividend declaration notices,
AGM notices and other notices are properly taken into
consideration and need to checked before investments.
Also a separate sheet is prepared for technical past data as
total trading days, number of trades, market capitalization,
turnover to market and so on to find out the market liquidity
of the stocks.

Research Analysis Risk / Return

Also fundamental risk and return of the individual companies

are sought out based upon the past dividend, to evaluate the
per unit risk of the return expected. Used to determine the
risk return trade off.
The financial snapshot is extensively used for filtering
companies for investment with objectives as value, growth
and trading

Technical Analysis of NEPSE

650

300

250

4-Jan-09
10-
22-
28-
1-Jun-09
5-Jul-09
11-
16-
2-Nov-09
8-Dec-09
12-
16-
5-Apr-10
17-
21-
26-Jul-10
31-
6-Oct-10
18-
23-
2-Feb-11
13-
19-
26-
4-Jul-11
7-Aug-11
14-
30-
5-Dec-11
8-Jan-12
15-
28-
3-
10-
15-Jul-12
21-
24-
7-Nov-12
17-
23-
3-Mar-13
9-Apr-13
20-
20-
24-Jul-13
1-Sep-13
6-Oct-13
24-
29-

NEPSE chart
1150

4 Jan 09- 15 Jan 14

1100

1050

1000

950

900

850

800

750

700

661.78
656.75

550
555.93

500

450

292.32
677.8

600

578.68
536.2

432.82

400

350

301.3

THANK YOU