Synopsis on

A study on Fundamental analysis and stock performance evaluation of selected oil

and gas industries during 2012-2017
BY
NAZAMA ANGADI
1AY16MBA46

Submitted to

VISVESVARAYA TECHNOLOGICAL UNIVERSITY,

BELGAUM

In partial fulfillment of the requirements for the award of the degree of

MASTER OF BUSINESS ADMINISTRATION
Under the guidance of

INTERNAL GUIDE EXTERNAL GUIDE

Dr. VIRUPAKSHA GOUDA SATHYANDRAKUMAR

Assistant prof MANAGER
AIT Edelweiss broking ltd

Department of MBA
Acharya Institute of Technology
Soldevanahalli, Hessaraghatta Main Road, Bangalore-90
December 2017

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 CONTENTS
Sl. Description Page No.
1. Internship Project details 1
2. Objective of the study 2
3. Research Design 2
4. Data Sources and Sample Design 2
5. Hypothesis Framework 2
6. Statistical Tests 2
7 Time Activity Chart 3

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1. Internship Project Details

Title : A study on Fundamental analysis and stock evaluation of 5 selected

PUS’s stocks.
Student Name: Nazma angadi
USN No: 1AY16MBA46
Specialization: Finance and Human resources
Section: B
Contact No: 8152047517
Email ID: nazmaangadi@gmail.com
Address: BELAKU, Plot no:45
8th cross, vidagiri,
Bagalkot 587102

Internal Guide: Dr. Virupaksha Gouda

Contact No: 9876899098
Email ID: gouda_vims@rediffmail.com
Designation: Assistant Professor
College: Acharya Institute of Technology

Extrenal Guide: Sathyendrakumar

Contact no. 9916386881
Email id. Satyendra.kumar@edelweiss.in
Designation Sale Manager
Internship Period: 15 January 2018 to 23 March 201

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Introduction:
Indian government has built large number of PUS’s since 1950 and then companies are
undergoing privatisation since 1991. Then companies are appear to have huge assets with them.
However stock market performance of these companies are not up to the expectations. Our
project is intended to take study in depth about these valuable companies to identify the value
involved in it.

Introduction to the fundamental analysis

The fundamental analysis is the research of the fundamental forces that affecting well being of
the Economy, Industry groups and companies. Like maximum analyzes, the intention is to
expand one predict future rate modifications and profits. At the employer degree, the primary
analysis. This may additionally include reviewing financial statistics, management, enterprise
standards and opposition. Father, at the enterprise degree, the deliver and call for of merchandise
can be checked. For the country wide economic system, fundamental analysis can consciousness
on economic statistics to evaluate Current and future monetary growth.

In order to expect destiny stock prices, essential analysis combines the economic system,
enterprise, and business enterprise analysis to arrive on the fair cost of the inventory, i,e intrinsic
value. If the truthful cost isn't same to the contemporary inventory price, the fundamental analyst
thinks the inventory value is just too excessive or too low. Since the contemporary market place
price will subsequently generally tend to truthful value, the honest cost ought to be predicted to
determine whether to buy securities. By wondering that costs do not appropriately reflect all of
the available information, fundamental analysts will bear in mind the use of price variations

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Literature review:
Some empirical research has been carried out in both to examine the effect of privatization. The
studies undertaken in the former attributed the superior efficiency of private firms to market
structure rather than to ownership, while the few studies done in the pointed to marginal
efficiency differences between public and private firms (Kikeri, Nellis, and Shirley, 1994).

Megginson, Nash and Van Randenborgh (1994) compared the pre- and post- privatization
financial and operating performance of 61 firms from 18 (12 developed and 6 developing)
countries and 32 industries over the period between 1961 and 1990. Megginson et al suggested
that there is strong evidence that, after privatization, their sample firms became more profitable,
increased their real sales and their investment spending, and improved their operating efficiency.
Joshi and Little (1994) have attempted to estimate the real rates of return to investment in the
public and private sectors.

Naib (2002) compared efficiency of 26 enterprises (13 public and 13 private) for a 12 year
period from 1988-89 to 1999- 2000. The results indicated that both public and private firms
experienced modest positive average annual growth rate during this period. Thus this study also
revealed that at the enterprise level there is little empirical justification for general presumption
in favour of either type of ownership and a case by case examination may be more revealing.

Jagan Mohan Rao (1993) In ‘Financial appraisal of Indian Automotive Tyre Industry’ "studied
India's financial evaluation Automotive tire enterprise. The observe ambitions to discover
finance Indian tire industry conditions –and their economic strength and weakness. This end the
modest try to measure and examine the financials Inter-company and inter-departmental analysis
of a given performance For a while (1981-1988). The main studies result is the utilization of
fixed belongings Many tire companies are not as productive as predicted Inventory management
is pretty precise. Tire enterprise universal income Performance is laid low with inconsistencies
and inefficiencies.

Kallu Rao (1993) 3 studied the company's economic evaluation Review and Prospect of Tea
Industry. In this area has made an try Research and evaluation of the important variables inside
the tea enterprise and future projections for the next 10 years, the fashion of income and profits
in the wish help selection-makers make the proper selections. Various monetary ratios Has been
calculated to investigate the monetary function of the enterprise. This Tea manufacturing
enterprise income and earnings forecast shows that, Indian tea enterprise has a shiny future.
Recent adjustments in India Economic policy will boost foreign exchange earnings, so as to be
Benefit those organizations that export to hard currency.

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Pai, Vadivel and Kamal (1995) studied varied businesses and organizations Financial overall
performance: a observe. Work tough to look at this courting The Relationship among Diversified
Businesses and Their Financial Performance. Seven big companies have special products in their
portfolio, including associated merchandise and other products nalyzed the operation in unique
industries. A set of overall performance measures/ Rations, and used to decide the level of
financial performance. This effects display that the varied companies studied are in appropriate
monetary situation performance. However, the performance changes from one organization to
every other has been discovered and information set up.

Vijayakumar (1996) 6 In the "Corporate Liquidity Assessment – a Discrimination Analysis Act

"has shown the boom fee of income, Leverage, current ratio, operating expenses, income and
vertical integration Important variables that decide a employer's profitability Sugar enterprise. In
addition, I also studied quick-term liquidity Cooperating and privately owned amongst 28
decided on sugar factories department. Discrimination analysis has been used to distinguish
among items Venture companies primarily based on liquidity and liquidity for low-threat
companies Ration With the assist of Z, the discrimination of the "Z" rating turned into calculated
Discrimination characteristic, based totally on business enterprise's 'Z' score Sort by mobility.

M. Yameen and I. Ahmad entitled "The Impact of Corporate Governance Practices at the
Financial Performance of Hindustine Oil Company Limited". They have examined the position
of corporate governance practices in improving the business enterprise's enterprise performance,
monetary performance and shareholder wealth. It also found that corporate governance has a
effective impact on the general economic overall performance of Hindustan Oil Company
Limited.

Problem statement:

Even though fundamental analysis is one of the highly researched topic. Research related to
fundamental analysis of PSU’s of Oil and Gas company stocks is limited. This project is
undertaken to fill the research gaps and contribute to knowledge related to PUS’s stocks (Oil and
Gas companies) performance.

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Objectives:

 To analysis the performance of PSU’s in the stock market.

 To determine a PSU’S intrinsic value or its growth prospects
 To identify the future potential performance of selected PSU stocks
 To compare the selected stocks performance during 2012-2015

Hypothesis:

Null hypothesis: PSU stock performance is not likely depended on fundamentals of the
company.

Alternative hypothesis: PUS stock performance is likely to dependent on fundamentals of the

company.

Objectives

 To analysis the performance of PSU’s in the stock market.

 To determine a PSU’S intrinsic value or its growth prospects
 To identify the future potential performance of selected PSU stock
 To compare the selected stocks performance

RESEARCH METHODOLOGY

The present is based on the secondary data sources which includes-

1. The annual report of BPCL, HPCL IOCL, ONGC for the year 2009-2010 to interpret the ratios
of the company.

2. Books on portfolio management and financial management.

SCOPE

1) This study gives an overview on of BPCL, HPCL, IOCL, ONGC, which help to investors
while investing.

2) This study consists of Economic-Industry-Company framework of analysis with the following

aspects-

a) Economic analysis consists of various variables such as inflation, interest rates, foreign
exchange rates, infrastructure, monsoon, economic & political stability.

b) Industry analysis consists of Demand, potential market, targeted Industrial growth.

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c) Company analysis consists of financial statement, analysis of financial statements, Companies
prospects, growth, and Management board of company

Data collection:

Secondary data of 2012-2017 from BSE, NSE, moneycontrol.com, Edelweiss mobile trading
app, website of selected companies, annual reports, News paper cuttings,

Analysis and interpretation:

Collected data will be analysed using statistical tools, tools such as men, median, mode,
correlation, regression will be used to analyse the data.

Bibliography:
Bhaya, H. (1990): ‘Management Efficiency in the Private and Public Sectors in India’ in J. Heath
(ed.), Public Enterprise at the Crossroads, London: Routledge.

Jha, R. and B.S. Sahni (1992). ‘Measures of Efficiency in Private and Public Sector Industries:
The Case of India’, Annals of Public and Cooperative Economics, 63(3):489- 495.

Megginson, W., & Netter, J. (2001). From state to market: A survey of empirical studies on
privatization. Journal of economic literature, 39(2), 321-389.
Website: google,com

Time Activity Chart

Activity Time Line Remarks

Understanding Structure,
culture and functioning of
the Organization
Preparation of Research
instrument for data
collection
Data Collection
Analysis and finalization of
report
Week 1 and 2 Understand products/services and the
problems of the organization
Week 3 and 4 Discussion with the guide for
finalization of research instrument in
his/her domain and present the same to
the guide.
Week 5 and 6 Date collected will be edited,coded,
tabulated and presented to the guide for
suggestions for analysis.
Week 7 and 8 Use Regression Analysis and other
appropriate statistical tools and

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 techniques and analyse the data.
Submission of Report Week 7 and 8 Discuss with guides, make final
corrections and submit bound copies.

Signatures:
Student: Internal Guide:

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