CHAPTER 1

INTRODUCTION

1
INTRODUCTION

Investments in securities are spread across a wide cross-section of industries and

sectors and thus the risk is reduced. Diversification reduces the risk because all stocks may
not move in the same direction in the same proportion at the same time. Mutual fund issues
units to the investors in accordance with quantum of money invested by them. Investors of
mutual funds are known as unit holders.
The profits or losses are shared by the investors in proportion to their investments.
The mutual funds normally come out with a number of schemes with different investment
objectives which are launched from time to time. A mutual fund is required to be registered
with Securities and Exchange Board of India (SEBI) which regulates securities markets
before it can collect funds from the public.
A trade is an activity in which a buy and a sell order match with each
other. Matching of two orders is done automatically by the system. Whenever a trade takes
place, the system sends a trade confirmation message to each of the users involved in the
trade. The trade confirmation slip gets printed at the trader workstation of the user with a
unique trade number. The system also broadcasts a message to the entire market through
the ticker window displaying the details of the trade. This section describes trade-related
activities like viewing the trades, trade modification/cancellation, etc. Before the trade is
affected, the system performs checks with respect to the following parameters: -
a) The security in which the trade is to be affected is not suspended from operations.
b) Trading members involved in the potential trade are not suspended from operations.
c) Turnover limits for the trading members involved are not exceeded. Once the trade for
an order entered is confirmed by the system, a message is sent to the trader workstation.
The system generates a Trade Confirmation Slip that is printed on the printer of the trader
workstation.

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Need of the study

Investment in stocks offers good investments opportunities to the investors. An investor

can invest in as many number of companies listed on NSE and BSE. The amount of

investment by the retail investors are increasing and the selection of a stock has become

difficult, so as investor has to compare the risk involved in investment in stocks.

OBJECTIVES

 To determine if there is a difference of return and risk of securities

listed on NSE.

 If there is any difference of return and risk of securities, whether one can take an

advantage of these or not.

 Impact of price variance of share on NSE will affect the investor or not or how

they can be benefited through price variance.

Scope

The scope of study is limited to the Indian stock market. The study aimed to analyze how

an investor can reduce his investment risk by the effective use of trading on NSE.

METHODOLOGY

Methodology is a way in which we find out the information. It describes how the project is

done. The methodology includes method procedures and techniques used to collect and

analyze information.

Data collection source is secondary data. Secondary data are information, which

has previously been collected by some organization. The data used for the study is of

historical or secondary nature which is collected from the web site of NSE and BSE.

3
Theoretical framework of the study:

Average Mean

The arithmetic mean of a given set of data is their sum divided by their number of

Observations.

𝑆𝑢𝑚𝑜𝑓𝑜𝑏𝑠𝑒𝑟𝑣𝑎𝑡𝑖𝑜𝑛𝑠
𝐴𝑣𝑒𝑟𝑎𝑔𝑒𝑅𝑒𝑡𝑢𝑟𝑛𝑠 =
𝑁𝑢𝑚𝑏𝑒𝑟𝑜𝑓𝑜𝑏𝑠𝑒𝑟𝑣𝑎𝑡𝑖𝑜𝑛𝑠

𝑥1+𝑥2+⋯……….𝑥𝑛
Ẍ=
𝑛

Median

The median is that variable, which divides the group into two equal parts, one part
comparing all the values greater and the other, all values less than the median. In other
words median defined as the middle value in the data set when its elements are arranged in
the sequential order that is in either ascending (or) descending order of magnitude. Thus
the median is a measure of location of centrality of the observatism.

Ungrouped data

(i) If the number of observations (n) is odd number

𝑛+1 th
Median=Size (or) value of ( ) observation in the array.
2

(ii) If the number of observations is an even number

Median = (n/2)th observations + (n/2+1)th observation /2

4
Standard Deviation

The numerical value of population or sample variance is difficult to interpret

because it is expressed in square. To reach an interpretable measure of variance
expressed in the units of of original data we take a square root of variance which is
known as standard deviation or root mean square deviation. The standard deviation of
population and sample denoted by S or

∑𝑥 2 𝑛𝑥 −2
Standard Deviation= √𝑛−1 − 𝑥−1

Variance

A measure of variability based on squared deviations of observed values in the

data set

about the mean value.

̅̅̅2
∑(𝑥−𝑥)
Variance = 𝑛−1

Correlation

A statistical technique that is used to analyze the strength and direction of

relationship

Between two quantitative variables, is called correlation analysis.

Karl Pearson’s coefficient of Correlation

This method popularly known as Pearson coefficient of correlation and is most

widely used par action. This is denoted by symbol “r”. The formulae for computing

Pearson ‘r’ is

∑𝑥𝑦
Karl Pearson’s r=
𝑁𝜎𝑥𝜎𝑦

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 Where 𝑥 = (𝑋 − ̅̅̅
𝑋) ; 𝑦 = (𝑌 − 𝑌)

N =No., pairs of observations

𝜎x = Standard deviation of x series

𝜎y = Standard deviation of y series

r = The correlation coefficient

T – Distribution Applications

Testing difference between means of two samples

Given two independent random samples of size n1 &n2 with means x1&x 2 and standard
deviations s1&s2 . We may interested in testing the hypothesis that samples come from the
same population. To carryout the test we calculate the static as follows.

𝑋̅1 −𝑋̅2 𝑛1 𝑛2
t= ×√
𝑆 𝑛1 +𝑛2

where,
𝑋̅1 = mean of first sample

𝑋̅2 = mean of second sample

𝑛1 = No., of observations of first sample

𝑛2 = No., of observation of second sample

S = combined standard deviation

The value of S calculated by

∑(𝑋1 −𝑋̅1 )2 +∑(𝑋2 −𝑋̅2 )2

S =√
𝑛1 +𝑛2 −2

Standard Error

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 The standard deviation of the sampling distribution is called standard error. It is
also

called so because it measures the sampling variability due to chance of random forces.

Test for difference between Proportions

If two samples are drawn from different population, we may be interested in

finding out whether the difference between the proportions of success is significant or not.
The standard error of difference between proportion is calculated by applying the
following formulae.

1 1
S.E(𝑃1 − 𝑃2 ) =√𝑝𝑞( + )
𝑛1 𝑛2

Where P= the pooled estimate of the actual proportion in the population where the value of
P obtained by

𝑛1 𝑝1 +𝑛2 𝑝2 𝑥1 +𝑥2
P= (or) P =
𝑛1 +𝑛2 𝑛1 +𝑛2

Where 𝑥1 &𝑥2 = number of occurrences

𝑛1 &𝑛2 = Sample size

𝑃1 −𝑃2
If is less than 1.96 S.E (5% level) the difference is regarded as the random
𝑆.𝐸
sample

Variation that is as not significant.

Covariance

The joint variance between quantitative variables is known Covariance. It is

an Absolute measure. It can be either positive (or) negative (or) Zero.

1
Cov (xy) = ̅̅̅
∑(𝑥 − 𝑥̅ )(𝑦 − 𝑦)
𝑛

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Samples:

To conduct a study the sample has been chosen the common companies listed on NSE and

BSE form different industries. The study has been conducted for a sample of equity stocks

with thirty companies and the sample consist of HCL TECH, TCS, SATYAM, WIPRO,

INFOSYS, PATNI COMP,FINANCIAL TECH,SASKEN COMM, TECH

MAHINDRA,GEOMETRIC, MPHASIS, NIIT TECH, HEXAWARE,INFOTECH,TATA

ELXI,POLARIS,HINDUJA, SAKSOFT, BLUE

STAR,RAMCO,SOFTPRO,SONATA,CRANESSOFT,CYBERTECH,ONWARDTECH,

GOLDSTONE, UTV , SUBEX,MEGASOFT.

Analysis: For the analysis purpose the methods used are the comparative study and

calculation of Risk Adjusted Returns, average returns, correlation covariance has been

calculated.

LIMITATIONS

 The study is done by using secondary data that is historic data of price of

shares listed on NSE and BSE of different companies.

 The analysis and interpretation of data is restricted to necessary information.

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 CHAPTER 2

LITERATURE REVIEW

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STOCK:

It is a type of security that signifies ownership in a corporation and represents a claim on

part of the corporation's assets and earnings.

There are two main types of stock: common and preferred. Common stock usually

entitles the owner to vote at shareholders' meetings and to receive dividends. Preferred

stock generally does not have voting rights, but has a higher claim on assets and earnings

than the common shares. For example, owners of preferred stock receive dividends before

common shareholders and have priority in the event that a company goes bankrupt and is

liquidated.

Also known as shares or equity.

Stock Exchange

The Securities Contract (Regulation) Act, 1956 [SCRA] defines ‘Stock Exchange’ as any

body of individuals, whether incorporated or not, Constituted for the purpose of assisting,

regulating or controlling the business of buying, selling or dealing in securities. Stock

exchange could be a regional stock exchange whose area of operation or jurisdiction is

specified at the time of its recognition or national exchanges, which are permitted to have

nationwide trading since inception.

INTRODUCTION OF NSE

The National Stock Exchange of india limited has genesis in the report of the High

Powered Study Group on Establishment of New Stock Exchanges, which recommend

promotion of a National Stock exchange by Financial Institutions(FIs) to provide access to

investors from across the country on an equal footing. Based on the recommendations,

NSE was promoted by leading financial institutions at the behest of Government Of India

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and was incorporated in November 1992 as a company. On its recognition as a Stock

Exchange under the Securities Contracts (Regulation)Act, 1956 in 1993, NSE commenced

its operations in the Whole Debt Market(WDM) segment in June 1994. The Capital

Market (Equities) segment commenced operations in November 1994 and operations in

Derivatives segment commenced in June 2000.

The National Stock Exchange is India's largest financial market. Established in 1992, the

NSE has developed into a sophisticated, electronic market, which ranks third in the world

for transacted volume. The NSE conducts transactions in the wholesale debt, equity and

derivative markets.

Based in Mumbai, India, the National Stock Exchange is a leader in market technology.

The exchange's supports more than 3,000 VSAT terminals, making the NSE the largest

private wide-area network in the country. The National Stock Exchange has been a

pioneer for Indian financial markets, being the first electronic limit order book to trade

derivatives and ETFs.

The NSE include the following is as follows,

India Index Services & Products Ltd. (IISL)

India Index Services & Products Ltd. (IISL) is a joint venture between the National Stock

Exchange of India Ltd. (NSE) and CRISIL Ltd. (formerly the Credit Rating Information

Services of India Limited). IISL has been formed with the objective of providing a variety

of indices and index related services and products for the capital markets.

IISL has a licensing and marketing agreement with Standard and Poor's (S&P), the world's

leading provider of investible equity indices, for co-branding IISL's equity indices

Objectives of IISL pools the index development efforts of CRISIL and NSE into a

coordinated whole - India's first specialized company focused upon the index as a core

product. IISL has the following objectives:

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To develop, construct and maintain indices on Indian equities and commodities that serve

as useful market performance benchmarks and are the underlying indices for derivatives

trading

To develop related products and services this can be used by investors for managing their

exposures in the equity and commodity markets To provide data and information on the

trading activity in the Indian stock markets To provide market participants with value

added research on the Indian equity and Commodity markets All the erstwhile indices of

NSE & CRISIL, Such as Nifty, Nifty Junior, Defty, CRISIL 500, CRISIL MIDCAP 200

index etc. have been transferred to IISL which now maintains, develops, complies and

disseminates the indices.

The indices of IISL are now known under the following names:

S.No. Old Name New Name

1 Nifty S&P CNX Nifty

2 Defty S&P CNX Defty

3 Crisil 500 Equity Index S&P CNX 500 Equity Index

4 Nifty Junior CNX Nifty Junior

5 Crisil Midcap 200 CNX Midcap 200 Index*

6 Crisil PSE CNX PSE Index

7 Crisil MNC CNX MNC Index

PSE indicates Public Sector Enterprises

MNC indicates Multinational Corporation

*CNX Midcap 200 Discontinued from July 18, 2017

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1. S&P CNX Nifty

S&P CNX Nifty is a well diversified 50 stock index accounting for 22 sectors of the

economy. It is used for a variety of purposes such as benchmarking fund portfolios,

indexbasedderivativesandindexfunds.

S&P CNX Nifty is owned and managed by India Index Services and Products Ltd. (IISL),

which is a joint venture between NSE and CRISIL. IISL is India's first specialized

company focused upon the index as a core product. IISL has Marketing and licensing

agreement with standard & poor’s (S&P), who world leaders are in index services.

The total traded value for the last six months of all Nifty stocks is approximately 52% of

the traded value of all stocks on the NSE Nifty stocks represent about 63% of the Free

Float Market Capitalization as on Dec 31, 2016.

Impact cost of the S&P CNX Nifty for a portfolio size of Rs.2 crore is 0.10% S&P CNX

Nifty is professionally maintained and is ideal for derivatives trading From June 26,

2017, S&P CNX Nifty is computed based on free float methodology.

2. S&P CNX Defty

Almost every institutional investor and off-shore fund enterprise with an equity exposure

in India would like to have an instrument for measuring returns on their equity investment

in dollar terms. To facilitate this, a new index the S&P CNX Defty-Dollar Denominated

S&P CNX Nifty has been developed. S&P CNX Defty is S&P CNX Nifty, measured in

dollars.

Salient Features

Performance indicator to foreign institutional investors, off-shore funds, etc.

Provides an effective tool for hedging Indian equity exposure.

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Impact cost of the S&P CNX Nifty for a portfolio size of Rs.2 crore is 0.16%

Provides fund managers an instrument for measuring returns on their equity investment in

dollar terms.

3. S&P CNX 500

The S&P CNX 500 is India’s first broad based benchmark of the Indian capital market.

The S&P CNX 500 represents about 92.57% of total market capitalization and about

91.17% of the total turnover on the NSE as on Sept 30, 2016.

The S&P CNX 500 companies are disaggregated into 72 industry indices viz. S&P CNX

Industry Indices. Industry weightages in the index reflect the industry weightages in the

market. For e.g. if the banking sector has a 5% weightage in the universe of stocks traded

on NSE, banking stocks in the index would also have an approx. representation of 5% in

the index.

4. CNX Nifty Junior

The next rung of liquid securities after S&P CNX Niftyis the CNX Nifty Junior. It may

useful to think of the S&P CNX Nifty and the CNX Nifty Junior as making up the 100

most liquid stocks in India.

As with the S&P CNX Nifty, stocks in the CNX Nifty Junior are filtered for liquidity, so

they are the most liquid of the stocks excluded from the S&P CNX Nifty. The

maintenance of the S&P CNX Nifty and the CNX Nifty Junior are synchronized so that

the two indices will always be disjoint sets; i.e. a stock will never appear in both indices at

the same time. Hence it is always meaningful to pool the S&P CNX Nifty and the CNX

Nifty Junior into a composite 100 stock index or portfolio.

CNX Nifty Junior represents about 12 % of the Free Float Market Capitalization as on Dec

31, 2016.

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The traded value for the last six months of all Junior Nifty stocks is approximately 15% of

the traded value of all stocks on the NSE

Impact cost for CNX Nifty Junior for a portfolio size of Rs.50 lakhs is 0.13%

From May 04, 2015, CNX Nifty Junior is computed based on free float methodology.

5. CNX Midcap 200

The medium capitalized segment of the stock market is being increasingly perceived as an

attractive investment segment with high growth potential. The primary objective of the

CNX Midcap 200 Index is to capture the movement and be a benchmark of the midcap

segment of the market.

CNX Midcap 200 represents about 72% of the total market capitalization of the Mid-Cap

Universe and about 70% of the total traded value of the Mid-Cap Universe (Mid-Cap

Universe is defined as stocks having average six months market capitalization between

Rs.75 crores and Rs.750 crores).

Industry weightages in the index dynamically reflect industry weightages in the market

Provide investors a broad based benchmark for comparing portfolio returns vis-à-vis

market returns in the midcap segment.

6. CNX PSE Index

As part of its agenda to reform the Public Sector Enterprises (PSE), the Government has

selectively been disinvesting its holdings in public sector enterprises since 1991. With a

view to provide regulators, investors and market intermediaries with an appropriate

benchmark that captures the performance of this segment of the market, as well as to make

available an appropriate basis for pricing forthcoming issues of PSEs, IISL has developed

the CNX PSE Index, comprising of 20 PSE stocks. The CNX PSE Index includes only

those companies that have over 51% of their outstanding share capital held by the Central

Government and/or State Government, directly or indirectly.

15
7. CNX MNC Index

The CNX MNC Index comprises 15 listed companies in which the foreign shareholding is

over 50% and / or the management control is vested in the foreign company.

INVESTMENT:

The money earn is partly spent and the rest saved for meeting future expenses. Instead of

keeping the savings idle may like to use savings in order to get return on it in the future.

This is called Investment. Investment is the sacrifice of certain present value for the

uncertain future reward. It entails arriving at a numerous decision such as type, mix,

amount, timing, grade etc. of investment and disinvestment.

Investment in asset is an activity which evokes interest and attracts people from any

profession irrespective of there occupation, economic status, education and family back

ground. Usually a person who is having more money than he requires for consuming

currently can be termed as a potential investor. He uses his extra cash to invest in

securities or other assets like precious metals stones and real estate or else he can simply

deposit money in his bank account. When this concept is applied to corporate, the

corporate will invest their money for expanding there existing projects or to undertake new

ventures. In a broader sense all these activities give the meaning “INVESTMENT”.

For an economist investment is the net addition made to the nation’s

capital stock which consists of goods and services which are used in production process

and will generate revenue when sold in the market. But as a securities analyst one must

understand investment from financial point of view the financial investment is the

allocation of money to assets that are expected to yield some gain over a period of time.

Hence it is an exchange of financial claims in the form of stocks and bonds for money

which is expected to yield return and have a capital growth over the years.

16
As financial and security analyst we must be concerned only with financial investment

made in securities i.e..,

Fixed income securities

Ex: - bonds and debentures

Variable income securities

Ex: - Equity shares/ common stock/ stock

Investment has two attributes and they are

-Time and

-Risk.

Attribute of time is related to the sacrifice of present consumption to get a return in the

future. But getting the return in the future may be uncertain and this uncertainty is the risk

factor. But this risk is undertaken to reap some return from the investment.

THE INVESTMENT PROCESS

The investment processes can be divided into following five stages.

1. Forming an investment policy.

2. Investment analysis

3. Security valuation

4. Portfolio construction

5. Portfolio evaluation

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Investment avenues are broadly classified under the following heads.

1. Corporate securities

2. Equity Shares

3. Preference shares

4. Debentures/bonds (debenture issued by private companies/ bonds issued by

government companies.)

5. Warrants

6. GDRS and ADRS (global depository receipts and American depository receipts)

7. Derivatives

8. Deposits in banks and non banking companies

9. Post office deposits and certificates

10. Life insurance policies

11. Provident fund schemes

12. Government and semi government securities.

13. Mutual funds scheme

14. Real assets

15. Billion Investments

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RETURN:

The ratio of money gained or lost on an investment relative to the amount of money

invested. The gain or loss of a security in a particular period is called return. The return

consists of the income and the capital gains relative on an investment. It is usually quoted

as a percentage

The general rule is that the more risk you take, the greater the potential for higher return -

and loss.

In security analysis as security analyst we must primarily concern with return from the

investors perspective. They may concern is to compute or estimate the return for an

investor on a particular investment. The investment concern with as a financial assets like

a share or debenture or some other financial assets like a share or debenture or some other

financial instrument.

MEAN RETURN: In securities analysis, it is the expected value, or mean, of all the likely

returns of investments comprising a portfolio. It is also known as "expected return". It is

the mean, or expected, return that investors try to maximize at each level of risk.

Mean returns attempt to quantify the relationship between the risk of a portfolio of

securities and its return. It assumes that while investors have different risk tolerances,

rational investors will always seek the maximum rate of return for every level of

acceptable risk.

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Methods of measuring returns:

Return can be calculated in:

1. Ex- Post Returns: Return calculations done ‘after-the-fact,’ in order to analyze what rate

of return was earned.

R= P1 – P0 + D1 *100

P0

Where, r = return,

P1 = Purchase price of the end year.

P0 = Purchase price of beginning year.

D1 = Amount of dividend paid in P1.

RISK:

Risk is a concept that denotes a potential negative impact to an asset or some characteristic

of value that may arise from some present process or future event.

Risk is the probability that an investment's actual return will be different than expected.

This includes the possibility of losing some or all of the original investment. It is usually

measured by calculating the standard deviation of the historical returns or average returns

of a specific investment.

Types of risks:

There are two types of risks associated with equity investments

Systematic risk and

Unsystematic risk.

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1. Systematic risk: Systematic riskInfluences a large number of assets, a security arises

due to some extraneous variables. A significant political event, for example, could

affect several of the assets in your portfolio. But there still exists some techniques, which

help to hedge against the systematic risk of a security.

2. Unsystematic risk:

Unsystematic risk is referred to as "specific risk". This kind of risk affects a very small

number of assets. It is the variation in the return of scrip due to that scrip specific factors

or movements. These are risks associated with the economic, political, sociological and

other macro-level changes. They affect the entire market as a whole and cannot be

controlled or eliminated merely by diversifying .For example, say the Government

announces tax sops to companies in a particular sector; it is going to affect the prices of

the stocks of companies which are operating in that sector and not all the stocks.

Risk Measures

Statistical measures that are historical predictors of investment risk and volatility and

major components in modern portfolio theory (MPT). MPT is a standard financial and

academic methodology for assessing the performance of a stock or a stock fund compared

to its benchmark index. There are five principal risk measures:

R-Squared: Measures the percentage of an investment's movement that is attributable to

movements in its benchmark index.

Standard Deviation: Measures how much return on an investment is deviating from the

expected normal or average returns.

21
1. Standard Deviation:

1. A measure of the dispersion of a set of data from its mean. The more spread apart the

data is, the higher the deviation.

2. In finance, standard deviation is applied to the annual rate of return of an investment to

measure the investment's volatility (risk).

A volatile stock would have a high standard deviation. In mutual funds, the standard

deviation tells us how much the return on the fund is deviating from the expected normal

returns.

Standard deviation can also be calculated as the square root of the variance.

Standard deviation= √(1/n-1∑nt=1rit—‾ri)

Where

n=is number of securities

rit is historical or ex-post return generated by ith stock in time period‘t’.

ri is excepted return generated by ith stock in time period ‘t’.

COVARIANCE A statistical measure of the correlation of the fluctuations of the annual

rates of return of different investments. A measure of the degree to which returns on two

risky assets move in tandem. This measure is equal to the product of the deviations of

corresponding values of the two variables from their respective means.

One method of calculating covariance is by looking at return surprises

(deviations from expected return) in each scenario. Another method is to multiply the

correlation between the two variables by the standard deviation of each variable.

A positive covariance means that asset returns move together.

A negative covariance means returns move inversely.

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CORELATION

A measure that determines the degree to which two variable's movements is associated.

Statistical measure of the degree to which the movements of two variables are related.

The correlation coefficient for two variables X and Y is defined as the

covariance of X and Y divided by the product of the standard deviations of the individual

variables. The correlation coefficient is calculated as:

COVAB   AB A B
OR

The correlation coefficient will vary from -1 to +1. A -1 indicates perfect negative

correlation, and +1 indicates perfect positive correlation.

23
 CHAPTER -III

INDUSTRY PROFILE

COMPANY PROFILE

24
COMPANY PROFILE
Indiabulls is India’s leading Financial, Real Estate and Power Company with a wide
presence throughout India. They ensure convenience and reliability in all their products
and services. Indiabulls has over 640 branches all over India. The customers of Indiabulls
are more than 4,50,000 which covers from a wide range of financial services and products
from securities, derivatives trading, depositary services, research & advisory services,
consumer secured & unsecured credit, loan against shares and mortgage & housing
finance. The company employs around 4000 Relationship managers who help the clients
to satisfy their customized financial goals. Indiabulls entered the Real Estate business in
the year 2005 with its group of companies. Large scale projects worth several hundred
million dollars are evaluated by them.
Indiabulls Financial Services Ltd is listed on the National Stock Exchange (NSE), Bombay
Stock Exchange (BSE) and Luxembourg Stock Exchange. The market capitalization of

Indiabulls is around USD 2500 million (29thDecember, 2006). Consolidated net worth of
the group is around USD 700 million. Indiabulls and its group companies have attracted
USD 500 million of equity capital in Foreign Direct Investment (FDI) since March 2000.
Some of the large shareholders of Indiabulls are the largest financial institutions of the
world such as Fidelity Funds, Goldman Sachs, Merrill Lynch, Morgan Stanley and
Farallon Capital.
Indiabulls Group is one of India’s top business houses with businesses spread over Real
Estate, Infrastructure, Financial Services, Securities, Retail, Multiplex and Power sectors.
The group companies are listed on important Indian and Overseas markets. Indiabulls has
been conferred the status of a “Business Superbrand” by The Brand Council, Superbrands
India.

VISION

To be the largest and most profitable financial services organization in Indian retail market
and become one stop shop for all non banking financial products and services for the retail
customers. To become the preferred long term financial partner to a wide base of
customers whilst optimizing stake holder’s value

25
MISSION

Rapidly increase the number of client relationships by providing a broad array of product
offering to emerge as a clear market leader. To establish a base of 1 million satisfied
customers by 2017. We will create this by being a responsible and trustworthy partner.

COMPANY’S HISTORY IN INDIA

In 1999, three IIT-Delhi alumni Sameer Gehlaut, Rajiv Rattan and Saurabh Mittal
acquired Orbis,a Delhi based stock broking company. Young entrepreneur Sameer
Gehlaut established Indiabulls in 2000, after acquiring orbis Securities, a stock brokerage
company in Delhi. The group started its operations from a small office near HauzKhas bus
terminal in Delhi.The office had a tin roof and two computers. The idea of leveraging
technology for trading stocks led to the creation of Indiabulls Incorporated on 10th
January 2000, it was converted into a public limited company on 27th February 2004.
Its original idea of leveraging technology bore fruit when Indiabulls was accorded
permission to conduct online trading on Indian stock exchanges.The company had
achieved the distinction of becoming only the second brokerage firm in India to be granted
this consent. The challenges facing it were immense – not least of all the mind set of
investors who were called to make the big leap from traditional stock trading to a
completely online interface. Having overcome this resistance, the company later expanded
its service portfolio to include equity, F&O, wholesale debt, mutual fund distribution and
equity research.
In 2003/04, Indiabulls ventured into insurance distribution and commodity trading. It
successfully floated its IPO in September 2004 and in the same year entered the consumer
finance segment. Real estate, the new sunrise industry, was the next frontier for Indiabulls.
In 2016/17, it entered this sector. But it wasn’t just real estate that was booming.
Opportunities were opening up in retail and infrastructure as well. To cement its position
in the Indian business and industry firmament, Indiabulls acquired Pyramid Retail in 2107
and marked its presence in the power sector by launching Indiabulls Power.

26
India bulls Financial Services Limited
Indiabulls Financial Services Limited was incorporated on January 10, 2000 as M/s
OrbisInfoTech Private Limited at New Delhi under the Companies Act, 1956. The
name of company was changed to M/s. Indiabulls Financial Services Private Limited
on March 16, 2001. In the year 2004, Indiabulls came up with it own public issue &
became a public limited company on February 27, 2004. The name of company was
changed to M/s. Indiabulls Financial Services Limited.
The company was promoted by three engineers from IIT Delhi, and has attracted more
than Rs.700 million as investments from venture capital, private equity and institutional
investors and has developed significant relationships with large commercial banks such as
Citibank, HDFC Bank, Union Bank, ICICI Bank, ABN Amro Bank, Standard Chartered
Bank and IL&FS.
Brand Values
Indiabulls is amongst the largest non-banking financial services companies in India and
enjoys strong brand recognition and customer acceptance. The company attributes its
dominant position in the brokerage industry to the preferential status it enjoys with
investors Coupled with its forays into various segments; the Group believes that the bulk
of its brand story is yet to be written. Indeed, when a case study on India’s youngest
brands which have had a profound impact on the economy is crafted, Indiabulls will
feature prominently in it

INDIABULLS GROUP

 Total Group Networth – Rs. 19,502 Cr

 Total Group PAT for 9M FY 16-17 – Rs. 1,034 Cr.
 Total Group Capital Expenditure – Rs. 6,200 Cr. (US $ 1.2 bn.) capex in FY 16-17.
Planned capex of Rs. 29,000 (US $ 5.7 bn.) by FY 2015-16.
 Focus on Execution and on ground results translating into profits.
 For its ongoing projects Indiabulls Group consumes 385 MT of Steel,
550MT of Cement & 1,700 CUM of RMC on daily basis.
 Creating Value for Shareholders – Dividend payout of Rs. 543.6 Cr. in 9M FY13-
14

27
Products offeredEquities and Derivatives
 Offers purchase and sale of securities (stock, bonds, debentures etc.)
 Broker assisted trade execution
 Automated online investing
 Access to all IPO's

Our Management Team:

 Mr. Divyesh Shah ( Chief Executive Officer )
 Mr. Sujitraychowdary ( Vice President )
 Mr. R.Venkataraman (Executive Director)

The Board of Directors:

 Mr. Sat Pal Khattar (Non Executive Director)

 Mr. SanjivAhuja (Independent Director)
 Mr. NileshVikamsey (Independent Director)
 Mr. KrantiSinha (Independent Director)

Milestones Achieved

 Developed one of the first internet trading platforms in India

 Amongst the first to develop in-house real-time CTCL (computer to computer link)
with NSE

 Introduction of integrated accounts with automatic gateways to client bank

accounts

 Development of products such as Power Indiabulls for high volume traders

 Indiabulls Signature Account for self-directed investors

 Indiabulls Group Professional Network for information and trading service

28
STRATEGY AND FOCUS
 Consolidation – aim to be among top 3 players in existing businesses within next 3
years
 No new products – focus on gaining size and scale in existing core areas
 No capital market fund raising – all businesses are well funded to achieve growth
and size
 Goal- FY 2015/16 – target of US $ 1.5 billion in cash generation from the 3
companies (Finance, Real Estate and Power)
.MAJOR COMPETITORS

 KOTAK SECURITIES
 SHAREKHAN

ANALYSING THE COMPETITORS STRENGTH &WEAKNESS :-

Competition, being an important market force needs to be tracked, analyzed &preempted.
Market leader always have a system to help them preempt
anycompetitive moves. For this, it is not just important to know competitor by name,
but also critical to understand its major strength & weaknesses.
A competitor’s strength may be its marketing systems, aggressive sales force, and itsrelati
onship with major external environmental variables like government &financial institute o
r a financial resources base. For the effective competitiveanalysis only strength &
weaknesses are not sufficient we need to consider other key factors like market share of
the company & 7p s of service marketing i.e.
 Product
 Price
 Place
 Promotion
 Process
 Physical evidence

29
 SWOT ANALYSIS

 Services: As products of India bulls is an extremely innovative product with very

less cost services like online trading facility, institutional and domestic broking,
customized research reports with almost 80% efficiency etc give India bulls an
edge over its competitors.

 Exposure updating tie-ups with leading banks

 Well diverse Investment portfolio

 India bulls has presence in the Real Estate, Infrastructure, Financial Services,
Securities, Retail, Multiplex and Power sectors

 Weaknesses

 It should have its own mutual funds as it provides advises on mutual funds

 Position to answer the question of the clients in their fields.

 It does not provide indices on major world markets, ADR Prices of Indian Scripts.

 Lacks Banking arm.

 Opportunities

 ATM facility should be provided for easy withdrawals.

 Tie-ups with third party companies for selling products.

 High client base will help for cross sales of its products.

 Threats

 Companies like Share khan, ICICI Direct, Kotak Securities and Private brokers are
major threats.

 Banks with Demat facilities are jockeying for position.

30
 CHAPTER - IV

DATA ANALYSIS

&

INTERPERTATION

31
Performance Evaluation

Performance Evaluation is specification of method and procedure for accruing the

information needed to structure to solve the problem. Various statistical tools are used for

the study are average, standard deviation, variance, covariance, correlation and beta values

and the study has conducted on companies like HCL TECH, TCS, SATYAM, WIPRO,

INFOSYS, PATNI COMP,FINANCIAL TECH, SASKEN COMM, TECH

MAHINDRA,GEOMETRIC, MPHASIS, NIIT TECH, HEXAWARE, INFOTECH,

TATA ELXI, POLARIS, HINDUJA, SAKSOFT, BLUE STAR, RAMCO, SOFTPRO,

SONATA, CRANESSOFT, CYBERTECH, ONWARDTECH, GOLDSTONE, UTV,

SUBEX AND MEGASOFT as they are listed commonly on both stock exchanges.

For evaluation of the study 30 stocks monthly return are taken for a period of 24 months

(i.e. of January 2017 to Sept 2017) where first day trading of a month is consider as

opening price and last day of trading of a month is consider as closing price of stock. After

collecting the all 24 months values monthly returns are calculated by using the standard

formula i.e. (P1-P0/P0)*100, like this for all 30 companies return were calculated from

NSE and BSE. Next step is finding of average return of securities by sum of the monthly

return /number of months.

Second thing is calculation of risk which can be know with a formula of

STANDARD DEVATION

(1/n-1∑nt=1rit—‾ri)

Where = n is number of securities

rit is historical or ex-post return generated by ith stock in time period‘t’.

ri is excepted return generated by ith stock in time period ‘t’.

32
 RETURNS VALUES OF NSE COMPANIES:

HCL Patni Financial Tech

Tech TCS Satyam Wipro Mastek Infosys Computer Tech SaskenComm Mahindra
1.932 -0.243 -3.319 2.316 2.949 1.938 2.805 -0.124 0.649 1.820

NIIT Hexaware Infotech Tata Hinduja Blue

Geometric Mphasis Tech Tech Enter Elxsi Polaris venture Saksoft Star Info
0.481 4.910 0.507 2.373 2.268 0.510 3.989 -0.949 -1.963 -0.451

Ramco Softpro Sonata Cranes Onward Goldstone UTV Subex

System system Software Soft Cybertechsys&sof technology Tech Soft System Megasoft
-0.779 3.189 -1.151 -5.706 -0.589 -0.487 -2.684 -1.671 -1.833 -4.046

Table.1

40.000
GT
35.000

30.000 SS
FT
SC SSY
25.000 S HV RS
M TM G N P OT Me
HT IE
20.000 BS Son U
PC TE CSS
H
T MP Sak
15.000 W Cs
I
10.000

5.000 MP
P
M PC HT IE SS
H W I TM
0.000 T FT SC G N TE
HV BS RS CSS OT
Son U SSY
Sak GT
S Me
-5.000 Cs
Risk Return
-10.000

33
 RISK VALUES OF NSE COMPANIES:

HCL Patni Financial Tech

Tech TCS Satyam Wipro Mastek Infosys Computer Tech SaskenComm Mahindra
17.852 16.127 23.965 14.316 23.040 11.385 18.762 28.370 26.951 23.462

Blue
NIIT Hexaware Infotech Tata Hinduja Star
Geometric Mphasis Tech Tech Enter Elxsi Polaris venture Saksoft Info
23.039 15.876 23.230 21.569 21.066 18.789 23.683 24.531 15.962 20.026

Ramco Softpro Sonata Cranes Onward Goldstone UTV Subex

System system Software Soft Cybertechsys&sof technology Tech Soft System Megasoft
24.796 30.215 20.149 13.469 18.354 22.865 35.910 20.124 27.405 23.715

Comparison Of NSE & BSE Risk

40.000
35.910
35.000
30.215
30.000 28.370
26.951 27.405
24.531 24.796
23.965 23.683 23.709
25.000 23.040 23.462
23.039 23.230 22.865
21.569
21.066
20.026 20.149 20.124
18.762 18.789
20.000 17.852 18.354
16.127 15.876 15.962
14.316
15.000 13.469
11.385

10.000

5.000

0.000

Risk(NSE) RISK(BSE)

34
 RETURNS VALUES OFBSE COMPANIES:

HCL Patni Financial Tech

Tech TCS Satyam Wipro Mastek Infosys Computer Tech SaskenComm Mahindra
1.160 0.282 -3.795 2.200 3.141 1.879 2.668 -0.624 1.001 1.452

Blue
NIIT Hexaware Infotech Tata Hinduja Star
Geometric Mphasis Tech Tech Enter Elxsi Polaris venture Saksoft Info
0.140 4.350 1.224 1.981 1.314 0.489 2.737 -1.638 -10.442 -0.042

Ramco Softpro Sonata Cranes Onward Goldstone UTV Subex

System system Software Soft Cybertechsys&sof technology Tech Soft System Megasoft
-0.298 2.233 -0.264 -4.963 -2.398 -1.811 -2.881 0.014 -1.821 -3.965

40.000
GT

30.000
SS
FT SC SSY
HV RS Me
S G N P
M TM
20.000 HT Son OT U
PC IE TE
H T BS CSS
MP
W Cs
Sak
I
10.000

MP
M PC P
W I HT IE SS
H SC TM G N TE
0.000 T
FT BS RS Son U
HV CSS OT GT SSY
S Me
Cs

-10.000 Sak

-20.000

Risk(BSE) Return(BSE)

35
 RISK VALUES OF BSE COMPANIES:

HCL Patni Financial Tech

Tech TCS Satyam Wipro Mastek Infosys Computer Tech SaskenComm Mahindr
17.336 17.055 23.224 14.611 23.107 11.507 18.697 27.420 27.752 23.002

Blue
NIIT Hexaware Infotech Tata Hinduja Star
Geometric Mphasis Tech Tech Enter Elxsi Polaris venture Saksoft Info
24.111 16.746 23.711 20.792 19.275 18.944 23.450 25.102 13.715 17.840

Ramco Softpro Sonata Cranes Onward Goldstone UTV Subex

System system Software Soft Cybertechsys&sof technology Tech Soft System Megasoft
24.992 28.393 20.229 13.857 17.120 20.672 35.856 20.275 26.977 24.275

40.000

30.000

20.000

Risk
10.000
Return

0.000
Mastek

Tech Mahindra
Infosys
Satyam
Wipro

Geometric

Tata Elxsi

Hinduja venture
Patni Computer
Financial Tech

Softpro system

Onward technology
HCL Tech
TCS

Sasken Comm

NIIT Tech

Ramco System

Subex System
Megasoft
Mphasis

Infotech Enter
Hexaware Tech

Cybertech sys&sof
Polaris

Blue Star Info

UTV Soft
Cranes Soft
Saksoft

Goldstone Tech
Sonata Software

-10.000

-20.000

36
37
38
39
40
Here in the graphs the symbols are quoted as

H = HCL Tech

T = TCS

S = Satyam

W = Wipro

M = Master

I = Infosys

PC = Patni Computer

FT = Financial Tech

SC = Sasken Communications

TM = Tech Mahindra

G = Geometric

MP = Mastek

N = NIIT Tech

HT = Hexaware Technologies

IE = InfoTech Enter

TE = Tata ELXI

P = Polaris

HV = Hinduja Venture

Sak = Saksoft

BS = Blue Star Info

RS = Ramco System

SS = Softpro System

Son = Sonata Software

CS = Cranes Soft

CSS = Cybertech System & Software

OT = Onward Technology

GT = Goldstone Tech

U = UTV Soft

SSy = Subex System

Me = Megasoft

41
 -8.000
-6.000
-4.000
-2.000

-12.000
-10.000
0.000
2.000
4.000
6.000
-8.000
-6.000
-4.000
-2.000
0.000
2.000
4.000
6.000

-12.000
-10.000
HCL Tech
TCS

H
H
Satyam

T
T
Wipro

S
S
Mastek
Infosys
Patni Computer W
W
M
M

Financial Tech
I

Sasken Comm
PC
PC

Tech Mahindra FT
FT

Geometric
SC
SC

Mphasis
NIIT Tech
TM
TM

Hexaware Tech
G
G

Infotech Enter
MP
MP

Tata Elxsi
N
N

Return(NSE)
Polaris

42
HT

Hinduja venture
IE
HT IE

Saksoft
TE

Blue Star Info

GRAPH 4
P
P

Ramco System
Softpro system
HV
HV

Return(BSE)
Sonata Software
Sak
Sak

Cranes Soft
BS
BS

Cybertech sys&sof
RS
RS

Onward technology
SS
SS

Goldstone Tech
Son
Son

UTV Soft
Cs
Cs

Subex System
Megasoft
CSS
OT
CSS OT

GT
GT

Return(BSE)
Return(NSE)
U
U

SSY

Me
 10.000
15.000
20.000
25.000
30.000
35.000
40.000

5.000

0.000

10.000
15.000
20.000
25.000
30.000
35.000
40.000

0.000
5.000
H
H
HCL Tech

T
T
TCS

SS
Satyam
Wipro

W
Mastek
M
Infosys

I
Patni Computer
Financial Tech PC
Sasken Comm
Tech Mahindra
FT SC
FT SC

Geometric
TM

Mphasis
TM G
G

NIIT Tech
MP
MP

Hexaware Tech
N
N

Risk(NSE)
Infotech Enter
Tata Elxsi
HT

43
Polaris
IE
HT IE

Hinduja venture
TE

Saksoft
P

Blue Star Info

Risk(BSE)
HV
HV

Ramco System
Softpro system
Sak
Sak

Sonata Software
BS
BS

Cranes Soft
RS

Cybertech sys&sof
SS
SS

Onward technology
Son

Goldstone Tech
Cs
Cs

UTV Soft
Subex System
CSS
CSS

Megasoft
OT
OT
GT

U
SSY
SSY

Risk(BSE)
Me
Me

Risk(NSE)
 10.000
20.000
30.000
40.000

0.000

-20.000
-10.000
HCL Tech
TCS
Satyam
Wipro
Mastek
Infosys
Patni Computer
Financial Tech
Sasken Comm
Tech Mahindra
Geometric
Mphasis
NIIT Tech
Hexaware Tech
Infotech Enter
Tata Elxsi
Polaris
Hinduja venture

44
Saksoft
Blue Star Info
Ramco System
Softpro system
Sonata Software
Cranes Soft
Cybertech sys&sof
Onward technology
Goldstone Tech
UTV Soft
Subex System
Megasoft
COMPARISON OF NSE & BSE RISK AND RETURN VALUES

Risk(BSE)
Risk(NSE)
Return(BSE)
Return(NSE)
Analysis of Returns of the Different Stocks by Using T-Test:

Sample data is consisting of 30 common companies listed on NSE nifty and BSE Sensex.

COMPANY NAME RETURN ON NSE RETURN ON BSE

HCL Tech 1.932 1.160
TCS -0.243 0.282
Satyam -3.319 -3.795
Wipro 2.316 2.200
Mastek 2.949 3.141
Infosys 1.938 1.879
Patni Computer 2.805 2.668
Financial Tech -0.124 -0.624
SaskenComm 0.649 1.001
Tech Mahindra 1.820 1.452
Geometric 0.481 0.140
Mphasis 4.910 4.350
NIIT Tech 0.507 1.224
Hexaware Tech 2.373 1.981
Infotech Enter 2.268 1.314
Tata Elxsi 0.510 0.489
Polaris 3.989 2.737
Hinduja venture -0.949 -1.638
Saksoft -1.963 -10.442
Blue Star Info -0.451 -0.042
Ramco System -0.779 -0.298
Softpro system 3.189 2.233
Sonata Software -1.151 -0.264
Cranes Soft -5.706 -4.963
Cybertechsys&sof -0.589 -2.398
Onward technology -0.487 -1.811
Goldstone Tech -2.684 -2.881
UTV Soft -1.671 0.014
Subex System -1.833 -1.821
Megasoft -4.046 -3.965

As sample design is less than 30 t-test is applicable for above data.

μ 1= average return of 10 different security listed on NSE.

μ 2= average return of 10 different security listed on NSE.

45
NULL HYPOTHIES: it states that there is no significance difference of return on

securities listed commonly on NSE and BSE.

H0: μ 1= μ 2

Alternative hypothesis: it state that there is significance difference of return on securities

listed commonly on NSE and BSE.

H1: μ 1= μ 2

NSE BSE
Name
VALUE VALUE
Mean 0.223 -0.223
Variance 6.002 8.788
Observations 30 30
Pearson Correlation 0.823312
Hypothesized Mean
Difference 0
Degee of freedom 8
t Stat 19.05
P(T<=t) One-tail
t Critical One-tail 1.645
P(T<=t) two-tail
t Critical two-tail 1.96

INTERPRETATION: The calculated t-test value is 19.05, which is greater than the table

value of 1.960 at 5%level of significance. Since the calculated value is less than the table

value its lie in rejected area it inferred that it accepted null hypothesis by stating that it

state that there is no significance difference of return on securities listed commonly on

NSE and BSE.

46
The above table showing GDP growth also a factor in market rally towards bullish zone,
but it’s not only a cause to growth, there are so many other factors also involved in market
volatility. When GDP numbers increases market participates in bullish, decreases market
participates in bearish.

Month Open High Low Close

Jan 13 19,513.45 20,203.66 19,508.93 19,894.98
Feb 13 19,907.21 19,966.69 18,793.97 18,861.54
Mar 13 18,876.68 19,754.66 18,568.43 18,835.77
Apr 13 18,890.81 19,622.68 18,144.22 19,504.18
May 13 19,459.33 20,443.62 19,451.26 19,760.30
Jun 13 19,859.22 19,860.19 18,467.16 19,395.81
Jul 13 19,352.48 20,351.06 19,126.82 19,345.70
Aug 13 19,443.29 19,569.20 17,448.71 18,619.72
Sep 13 18,691.83 20,739.69 18,166.17 19,379.77
Oct 13 19,452.05 21,205.44 19,264.72 21,164.52
Nov 13 21,158.81 21,321.53 20,137.67 20,791.93
Dec 13 20,771.27 21,483.74 20,568.70 21,170.68
Jan 14 21,222.19 21,409.66 20,554.28 20,647.30
Jan 15 29005.25 29354.47 27898.65 29279.65

47
INTERPRETATION:
According to CNBC-TV 18 India's third quarter gross domestic product (GDP) came in at
6.7% as against 7.21% in previous quarter, lowest growth in the last ten quarters. CNBC-
TV18 poll saw it at 6.84%.
The above news are negative to the index on 25th January 2017, because GDP numbers
decreased when compare to January numbers. Sensex dips to 20425.68 from high of
18001.35 and nifty dips to 5352.25 from 5458.8.

48
INFLATION NUMBERS:

Date BSE SENSEX

January 2013 204579

December 2014 1242455source from bse

January 2015 20478.51

January 2016
20,647.30

January 2017
29279.65

IIP DATA

49
When IIP (India’s industrial Production) numbers increases, than previous data it shows
positive impact on index, if it decreases its negative impact
INTERPRETATION : In January 2017 index stands at 2300 levels, where inflation
recorded a high of 22.54. From the above graph one can observe that by end of 2016,
inflation recorded of 8.33. Here index stands at 20500. Inflation data for January 2017 to
December 2016 is stable, no high fluctuations towards positive and negative. For Indian
economy decreased inflation is
positive impact, especially for banking sector.

50
Year wise descriptive statistics for Nifty and Sensex:

TABLE 1

Year Name of the Minimum index Maximum index Daily average

indices level level return
2000-2001 Nifty 808.7 1212.75 0.0029%
Sensex 2764.16 4280.96 0.1163%
2001-2002 Nifty 931 1756 0.1561%
Sensex 3245.27 5933.56 0.1411%
2002-2003 Nifty 1124.7 1624.65 -0.0944%
Sensex 3540.65 5541.54 -0.1379%
2003-2004 Nifty 854.2 1198.45 0.0032%
Sensex 2600.12 3742.07 -0.0113%
2004-2005 Nifty 922.7 1146.5 -0.0524%
Sensex 2834.41 3512.55 -0.0557%
2005-2006 Nifty 924.3 1982.15 0.2444%
Sensex 2924.03 6194.11 0.2383%
2006-2007 Nifty 1388.75 2168.95 0.0681%
Sensex 4505.16 6915.09 0.0492%
2007-2008 Nifty 1902.5 3418.95 0.2075%
Sensex 6134.86 11307.04 0.2158%
2009-2010 Nifty 2632.8 4224.25 0.0466%
Sensex 8929.44 14652.09 0.0500%
2010-2012 Nifty 3633.6 6287.85 0.0853%
Sensex 12455.37 20873.33 0.0919%
2012-2013 Nifty 4806.75 6312.45 0.0635%
Sensex 15651.95 21108.64 0.0705%

2014-2015 Nifty 5607.15 4636.75 0.2092%

Sensex 16899.77 16598.48 -01.22%
2015- 2016 Nifty 6053.80 6284.65 -1.09%
Sensex 20424.67 205154.68 -1.065%
2016-2017 Nifty 8654.87 8761.40 0.0598%
Sensex 28975.65 29279.15 0.3548%

51
 Symbol Open High Low LTP Prv close Change % change Volume
ACC 1199 1209.25 1166 1180 1195.05 -15.05 -1.28 478597
AMBUJA 156 157.6 150.6 152.65 155.3 -2.65 -1.74 2411264

52
CEMENTS
AXIS BANK 1150 1156.3 1138 1141.75 1159.35 -17.60 -1.54 672736
BHEL 317.75 321.9 316.05 318.5 317.8 0.70 0.22 1933380
BPCL 620 621.95 614.8 617.9 622.6 -4.70 -0.76 158779
BAJAJ-AUTO 1728.4 1750 1708.15 1712.05 1729.9 -17.85 -1.04 169782
BHARTI AIRTEL 386.8 395.75 386.8 395 391.8 3.20 0.81 879076
CAIRN 297.55 304.9 295 301.85 298.3 3.55 1.18 821534
CIPLA 292.35 295.75 287.3 288.3 295.4 -7.10 -2.46 861078
DLF 238.65 242 237.45 238.7 242.15 -3.45 -1.45 2218602
DRREDDY 1645.1 1657.45 1626.25 1628.65 1670.7 -42.05 -2.58
GAIL 420 427.05 420 424.8 422.9 1.90 0.45 327852
GRASIM IND 2479.7 2514.4 2455 2502 2480.45 21.55 0.86 19184
HCL TECH 437 449 428 429.95 443.75 -13.80 -3.21 443251
HDFC 683 686.7 679.5 684.5 688.85 -4.35 -0.64 968286
HDFC BANK 485.1 493 482.5 483.55 490 -6.45 -1.33 1791545
HERO HONDA #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A
HINDALCO 135.35 136.7 134.1 136.35 135.95 0.40 0.29 4771046
HUL 371.4 384.5 371.2 384.2 375.8 8.40 2.19 4264434
ICICI BANK 917.95 923.5 896.8 900.9 931.15 -30.25 -3.36 3181526
ITC 211.5 212.5 209.25 209.55 213.15 -3.60 -1.72 6774574
IDFC 131.2 133 130.15 132.95 132.5 0.45 0.34 2032464
INFOSYS 2840 2874.1 2826.1 2834.5 2877.55 -43.05 -1.52 641052
JINDALSTEL 557.2 564.05 548.35 551.7 562.55 -10.85 -1.97 576150
JPASSOCIAT 76.2 77.55 75.15 75.55 77.45 -1.90 -2.51 5710091
KOTAKBANK 506.65 515.1 505.45 506.45 512.4 -5.95 -1.17 243133
L&T 1395 1396 1378 1387.4 1413.15 -25.75 -1.86 1216829
M&M 859.2 863 842.55 844.85 865.35 -20.50 -2.43 986846
MARUTI 1122 1134.5 1112.65 1124.7 1125.3 -0.60 -0.05 508852
NTPC 179.05 180.9 178.1 179.85 179.25 0.60 0.33 675322
ONGC 275.55 280.9 275.55 277.9 277.65 0.25 0.09 708199
POWER GRID 104.25 105.15 103.5 103.7 104.85 -1.15 -1.11 511148
PNB 976.25 1001 969.05 999 976.25 22.75 2.28 727800
RANBAXY 500 505.6 498.2 503 502.05 0.95 0.19 195440
REL CAPITAL 363.65 373.55 362.55 365.35 370.15 -4.80 -1.31 1180859
RELIANCE 870.5 878.5 864.55 868.1 877.55 -9.45 -1.09 1840235
RELIANCE
INFRA 457 467.8 444.1 447.5 464.3 -16.80 -3.75 816815
RELIANCE
POWER 94.5 96 94 94.65 95.5 -0.85 -0.90 972959
RELIANCE
COMM. 78.55 80.75 78.55 79.35 79.85 -0.50 -0.63 2650604
SBIN 1892.5 1921 1886 1912 1906.3 5.70 0.30 1138014
SIEMENS 855 865 847.15 848.3 854.9 -6.60 -0.78 41462
SAIL 111.65 112.9 110.6 111.1 112.2 -1.10 -0.99 1071122
STER 125 125 121.7 122.75 127.35 -4.60 -3.75 6967339
SESAGOA 204.3 208.75 204.3 207.15 207.35 -0.20 -0.10 1143427
SUNPHARMA 500 515.9 500 513.6 504.45 9.15 1.78 610437
TATA
CONSULTANCY 1108 1123 1098.1 1103.65 1115.8 -12.15 -1.10 412138
TATA MOTORS 195.1 202.45 195 196.35 198.45 -2.10 -1.07 12119574
TATA POWER 100.7 101.85 99.5 101.25 100.45 0.80 0.79 4827406
TATA STEEL 477.45 480.15 472 472 482.95 -10.95 -2.32 385199
WIPRO 367.75 374.75 364.95 372.8 366.6 6.20 1.66 1063721

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Alysis of risk of the different stocks by using t-test

Company NSE
BSE Values
Name Values
HCL Tech 17.852 17.336
TCS 16.127 17.055
Satyam 23.965 23.224
Wipro 14.316 14.611
Mastek 23.040 23.107
Infosys 11.385 11.507
Patni Computer 18.762 18.697
Financial Tech 28.370 27.420
SaskenComm 26.951 27.752
Tech Mahindra 23.462 23.002
Geometric 23.039 24.111
Mphasis 15.876 16.746
NIIT Tech 23.230 23.711
Hexaware Tech 21.569 20.792
Infotech Enter 21.066 19.275
Tata Elxsi 18.789 18.944
Polaris 23.683 23.450
Hinduja venture 24.531 25.102
Saksoft 15.962 13.715
Blue Star Info 20.026 17.840
Ramco System 24.796 24.992
Softpro system 30.215 28.393
Sonata Software 20.149 20.229
Cranes Soft 13.469 13.857
Cybertechsys&sof 18.354 17.120
Onward
technology 22.865 20.672
Goldstone Tech 35.910 35.856
UTV Soft 20.124 20.275
Subex System 27.405 26.977
Megasoft 23.715 24.275

As sample design is less than 30 t-test is applicable for above data.

μ 1= average risk of 10 different security listed on NSE.

μ 2= average risk of 10 different security listed on NSE.

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NULL HYPOTHIES: it states that there is no significance difference of risk on securities

listed commonly on NSE and BSE.

H0: μ 1= μ 2

Alternative hypothesis: it state that there is significance difference of risk on securities

listed commonly on NSE and BSE.

H1: μ 1= μ 2

NSE BSE
Name
Values Values
Mean 21.63327 21.33472
Variance 27.51562 27.4258
Observations
Pearson Correlation 0.982784
Hypothesized Mean
Difference
Degree of freedom 58
t Stat 5.654
P(T<=t) One-tail
t Critical One-tail 1.645
P(T<=t) two-tail
t Critical two-tail 1.96

INTERPRETATION: The calculated t-test value is 5.654, which is greater than the table

value of 1.960 at 5%level of significance. Since the calculated value is greater than the

table value its lie in accepted area it inferred that it accepted null hypothesis by stating that

it state that there is a significance difference of return on securities listed commonly on

NSE and BSE.

55
CHAPTER-V

FINDINGS

SUGGESTIONS

CONCLUSION

56
FINDINGS:

1. Fluctuations are more in secondary market than any other market.

2. There are more speculators than investors.
3. Information plays a vital role in the secondary market.
4. Previously rolling settlement is T+5 days, now it changed to T+2 days and
further it will be changing to T+1 day.
5. Observed how to trade shares in the stock markets through online.
6. Analyzed how to reduce fraud nature trading and outside trading.
7. I knew how was the SEBI regulating all stock markets activities and
companies performance while online trading,
8. Majority stock markets are NSE and BSE.
9. BSE was conducting worldwide trading (ex: foreign exchanges also) and
NSE was conducting national wide trading under the India.
10. Identified how to check opening price and high price while comparing to
other companies.
11. Finally online trading was better than manual trading compare to time
consumption among both trading.

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SUGGESTIONS

i. Private companies still have to perform their trading well compare to

government companies.
ii. SEBI has to learn the online trading process for illiterate investors.
Because they can be have some interest to trading.
iii. SEBI has to give more suggestions to stock markets for attract the more
investors into trading.
iv. Both government and SEBI have to support the small companies if they
getting losses due to market fluctuations.
v. SEBI has to take care of the sentiment of normal investors and give
them some securities for the money spent on the particular share.
vi. There are N-number of company listed in the share market..Investors
doesn’t have proper idea about the company .so SEBI has to give all the
required information to the customer regarding that particular company
vii. As there is a market risk is involved in the market so investors point of
view they have to keep certain amount of money in the fixed deposit
and keep few amount of money into the share market
viii. Before investing the amount in the share market Investors has to go
through the company and their performance in details

58
 CONCLUSION:

An investor as many opportunities to invest in different avenues through which he

can earn returns on invest with different types of risk with that investment. But different

avenues has different risk apatite with them, an investor has to choose how much risk he

can take towards his investment.

By Investment in stock securities return and risk cannot be predict that easily as a risk

free feature does not have in equity shares. Risk and return are two sides of one coin

generally it has higher the risk high return and lowers the risk low return.

Some of investor may have a notation that by buying the stock from NSE or BSE it makes

the difference of return in investment and their riskness towards the stock, but with this

comparative study it got conclude that there is no significance difference in risk and return

to an investor either by investing in companies listed commonly on both exchanges i.e.

NSE OR BSE. The conclusion is an indication of economic representation of country. As

in India still we don’t have decoupling facility due to which an investor can use the

opportunity of by buying and selling the securities from either of exchanges that is NSE or

BSE.

The conclusion is not just based on t test but this even can be conclude by

comparing the results of stocks return calculated by collecting their closing prices from

secondary source that is from NSE and BSE historical data.

59
BIBLIOGRAPHY

BOOKS REFERED:

Security Analysis and Portfolio Management

Author V.K BHALLA

Edition 12th

Investment Management

Topic: Investment, page no.3, 4

WEBSITES:

www.nseindia.com

(Home>equities>market information>historical data>security-wise price volume data)

www.nseindia.com

http://www.nseindia.com/histdata/stockprc.asp

http://www.bseindia.com/about/abindices/bse30.asp

www.answers.com

http://www.answers.com/risk

www.investopidia.com

http://www.investopedia.com/dictionary/default.asp

JOURNALS REFERRED:

Indian Journal of Finance August September, 2011page 3 and 27

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