A PROJECT REPORT ON FUNDAMENTAL AND TECHNICAL ANALYSIS

OF
STATE BANK OF INDIA”

SUBMITTED IN PARTIAL FULFILLMENT OF

THE DEGREE OF
MASTER OF BUSINESS ADMINISTRATION
By
THEERTHA P
Reg. no :( 1NZ14MBA77)

Under the guidance of

INTERNAL GUIDE EXTERNAL GUIDE

Mr. RAMESH KUMAR N Mr. SHAJI NEELAKANDAN

Asst. Professor Asst. General Manager
New Horizon College of Engineering State Bank of India
Outer Ring Road, Marthahalli, Kannur Branch
Bangalore-560 103 Fort Road, Kannur 670008
Ph.no: +91-9447788866

NEW HORIZON COLLEGE OF ENGINEERING

MARATHAHALLI BANGALORE -560103
BATCH: 2014-16
 ACKNOWLEDGEMENT
The writing of this dissertation has been one of the most significant academic
challenges, I have ever had to face. Without the support, patience and guidance of
the following people, this study would not have been completed. It is to them I owe
my deepest gratitude.
First I would like to thank god for his grace and wisdom, which kept me going,
and help me to complete this project successfully.
Secondly I thank the management of New Horizon College of Engineering,
Visvesvaraya Technological University, Belgaum for the continuous support.
I am grateful to our Principal Dr. Manjunatha for his constant support,
inspiration and suggestion throughout the study. I deem it a great pleasure to express
my esteem gratitude with all respect to Dr. Sheelan Mishra, Head of the Department,
for her interest and kind help in making necessary arrangement to undertake this
study
Thirdly I would like to express my deep sense of gratitude towards my guide
Mr. Ramesh (Dept. of Management Studies).
I am greatly indebted to Mr. Shaji Neelakandan (Asst. MANAGER), State
Bank of India who guided me despite his hectic job commitment. His wisdom,
knowledge, and commitment inspired and motivated me to accomplish this study.
Without his initial consideration for me, this project would have been a failure.
Finally I thank my parents for their continuous encouragement and valuable
support which helped me to accomplish this project.

Theertha P
 TABLE OF CONTENTS

CHAPTER TITLE PAGE NO

INTRODUCTION 1

TITLE OF STUDY 2

STATEMENT OF PROBLEM 2

NEED FOR THE STUDY 2

OBJECTIVES OF THE STUDY 3

SCOPE OF THE STUDY 3

1 LIMITATION OF THE STUDY 3

RESEARCH METHODOLOGY 3

LITERATURE REVIEW 4

INDUSTRY PROFILE 6

COMPANY PROFILE 10

SERVICES OFFERED 11

2 ABOUT LOGO 15

VISION , MISION & VALUES 16

KEY EXECUTIVES 17

ORGANIZATION CHART 18

3 THEORETICAL BACKGROUND OF THE STUDY 19

4 ANALYSIS AND INTERPRETATION OF DATA 27

5 FINDINGS 65

SUGGESTIONS 67

CONCLUSION 68
 LIST OF TABLES

TABLE NO TITLE PAGE NO

4.1 GROSS DOMESTIC PRODUCT 27

4.2 INFLATION 29

4.3 EXPORT GROWTH 30

4.4 IMPORT GROWTH 31

4.5 FOREIGN DIRECT INVESTMENT 32

4.6 DEPOSIT GROWTH 33

4.7 CREDIT GROWTH 34

4.8 NET INTEREST MARGIN 35

4.9 RETURN ON TOTAL ASSET 36

4.10 SHARE HOLDING PATTERN 37

4.11 RETURN ON EQUITY RATIO 38

4.12 DEBT EQUITY RATIO 40

4.13 EARNINGS PER SHARE 42

4.14 DIVIDEND PER SHARE 44

4.15 DIVIDEND PAYOUT RATIO 46

4.16 PRICE EARNING RATIO 48

4.17 SIMPLE MOVING AVERAGE 50

4.18 EXPONENTIAL MOVING AVERAGE 54

4.19 RELATIVE STRENGTH INDEX 58

4.20 RATE OF CHANGE 61

 LIST OF CHARTS

TABLE NO TITLE PAGE NO

4.1 GROSS DOMESTIC PRODUCT 27

4.2 INFLATION 29

4.3 EXPORT GROWTH 30

4.4 IMPORT GROWTH 31

4.5 FOREIGN DIRECT INVESTMENT 32

4.6 DEPOSIT GROWTH 33

4.7 CREDIT GROWTH 34

4.8 NET INTEREST MARGIN 35

4.9 RETURN ON TOTAL ASSET 36

4.10 RETURN ON EQUITY RATIO 39

4.11 DEBT EQUITY RATIO 41

4.12 EARNINGS PER SHARE 43

4.13 DIVIDEND PER SHARE 45

4.14 DIVIDEND PAYOUT RATIO 47

4.15 PRICE EARNING RATIO 49

4.16 SIMPLE MOVING AVERAGE 53

4.17 EXPONENTIAL MOVING AVERAGE 57

4.18 RELATIVE STRENGTH INDEX 60

4.19 RATE OF CHANGE 64

EXECUTIVE SUMMARY

The report “Fundamental and Technical Analysis of State Bank

of India” is a study to analyze the strength and weakness of the shares of the Bank. The main aim
of the study is to suggest the investors, whether to buy or sell the shares, based on the valuation
(underpriced or overpriced) of shares. Also to analyze the trend (Bullish or Bearish) of the shares
in the market. The secondary objective of the study is to analyze the company’s performance.

To analyze the share, Fundamental and Technical analyses are

used. In the fundamental analysis, Economic, Industry and company analysis is used. In technical
analysis, tools like Moving Average, Relative Strength Index and Rate of Change are used. In
fundamental analysis ratio analysis is done to examine the performance of the company. In the
technical analysis, the movement of the corresponding graphs are studied to interpret whether to
buy or sell or hold the share.
 CHAPTER I

INTRODUCTION
 Chapter I Introduction

1.1 INTRODUCTION OF THE STUDY

Investment is placing cash into something with the desire of benefit. All the more
particularly, investment is the putting cash or cash flow to buy of financial items or any resources
in order to increase cost-effective returns as interest, dividend capital gain sends, or rise of the
value of the instrument i.e. capital gains. An investment is the decision of an individual or a firm,
after a few investigation or examination, to put or loan cash in an asset, instrument or machinery,
for example, property, thing, stock, bond, or the foreign resource in foreign currency, that has
certain level of danger and gives the likelihood capital repudiate of creating returns over a
timeframe. Investment accompanies the danger of the loss of the principal amount. The investment
that has not been completely analyzed can be exceptionally hazardous as for the investment
proprietor in light of the fact that the likelihood of losing cash is not inside of the proprietor's
control. The distinction in the middle of investment and speculation can be inconspicuous. It relies
upon the investor’s brain whether the intention is for loaning the asset to another person for
financial reason or not. In the perspective of Fundamental Analysis, stock valuation in light of
fundamentals means to provide an assessment of their inherent estimation of the stock, in light of
forecasts predictions of the forthcoming money flows and cost-effectiveness of the business. A
way to deal with invest examination, technical analysis is drastically unique in relation to
fundamental analysis. Technical analysis don't assess an expansive number of Fundamental
components identifying with the organization, the industry and the economy, rather they analyze
market created information like price and volume to decide the future heading of price movement.

Here I conduct fundamental and technical analysis of SBI listed at NSE and the project was
completed in around in 10 weeks started from Dec 2015 to Feb 2016.

1
1.2 TITLE OF THE PROJECT

“Fundamental and Technical Analysis of State Bank of India”

1.3 STATEMENT OF PROBLEM

Everyday number of shareholders are losing their moneys by financing without any basic
information. A well-organized market depends on information. Absence of data makes
ineffectiveness, that cause misrepresent the shares (over or under valued). Equity analysis provide
information to the market. Equity analysis is important as it helps the investors to get information
about the market so that each investor need not to investigate every share and thus creating the
markets more effective.

1.4 NEED OF THE STUDY

The quick development of capital markets in India opened new investment roads for
investors. The securities exchanges have gotten to be alluring investment choices for the common
people. Stock is possession in an organization, with every offer of stock speaking to a modest bit
of proprietorship. The more shares you claim, the greater part of the organization you possess. The
more shares you possess, the more profits you win when the organization makes a benefit. An
investor might likewise expect capital additions from the stocks.

As we go over in everyday life, numerous investors are losing their assets with no major
information. A productive market depends on information. An absence of data makes
inefficiencies that outcome in stocks being distorted (over or underestimated). The part of equity
examination is to give information to the market. This examination is important in light of the fact
that it fills data holes so that every individual investor does not have to analyze each stock in this
way making the business sectors more effective.

2
1.5 OBJECTIVES OF THE STUDY

 To understand the macroeconomic variables those will have an impact on the organization
progress.
 To study the various trends, opportunities, difficulties of the industry in which the
organization works.
 To analyze the price movements of SBI.
 To represent the trend of the stock price through graphs of the technical analysis.
 To give suggestions to the investors regarding investment in SBI.
 To gain practical knowledge of technical analysis.

1.6 SCOPE OF THE STUDY

The scope of the project is restricted to understanding the basics of fundamental analysis
and technical analysis and apply it to take a choice of investing in State Bank of India.

1.7 LIMITATION OF THE STUDY

 During the limit period of study, the study may not be a detailed, complete and utilitarian
one in all aspects.
 Few of financial tools are used for the analysis.
 The conclusion cannot be generalised as market variations are unpredictable.

1.8 RESEARCH METHODOLOGY

Secondary Data: The Secondary data is collected from past Audited Annual reports and Balance
Sheet and websites like www.bseindia.com, www.nse.com, www.moneycontrol.com and also
from company websites, books, newspapers and periodicals.

3
Technical Tools

 Ratio analysis
 Simple moving average
 Exponential moving average
 Relative strength index
 Rate of change

1.9 LITERATURE REVIEW

According to Jaffery Abarbanell and Brain Bushee (1997) “Fundamental Analysis,

Upcoming Incomes and Share Prices”, in their study examined the relationship among accounting
based fundamental signs and future earnings of security prices. They applied multiple regression
analysis to analyse the data. The study found that investors are not completely relying on the
information given by the analyst. They also found that the variables such as Gross Domestic
Product, inflation, firm specific variables are prior earnings, expected earnings growth, relation
between fundamental signal and future earnings, revisions and forecast errors are most influencing
factors in fundamental analysis.

Sandip Mukherji, Manjeet, and Kim (1997), “A Fundamental Analysis of Korean Stock
Returns” in their article examined about the relation among share return and fundamental factors
in Korean firms yearly share value in the course of period of 1982-83. The study found that share
dividends are confidently related to book-market proportion, sales-price proportion and debt-
equity proportion. It also found that yield is adversely associated to organization size and not
considerably associated to earnings price proportion. They recommended that book-market and
sales-price proportions are more effective pointers than the earnings-price and the debt-equity
ratio.

Achelis said "Technical analysis as a procedure of examining a share’s past values in an

effort to decide possible coming prices."

4
 Murphy said "Technical analysis is the analysis of market act, mainly by using charts, for
the predicting upcoming price movements. The word “market action” comprises the 3 important
sources of data accessible to the technician—price, volume, and open interest."

Pring said "Skill of technical analysis is to find a trend reversal at a reasonably initial period
and ride on that movement till the measure of the proof displays or verifies that the trend has
reversed. [...] Hence, technical analysis is based on the supposition that persons will remain to
make the similar errors they have created previously."

Cory Janssen, Casey Murphy and Chad Langager said “Technical analysis
is a process of assessing shares by examining the data created by movement in the market, like
historical prices. Technical experts do not try to calculate a share's fundamental worth, but in its
place utilize graphs and other tools to ascertain designs that can propose upcoming actions.

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 CHAPTER I

INDUSTRIAL & COMPANY PROFILE

 Chapter II Industry & Company Profile

2.1 INDUSTRY PROFILE

For the country and public in it banking industry is a helping hand. Banking supported in
improving economy and guide in the advancement of Indian skyline. The division converted trust
and desire of number of individuals into actuality. But to do as such, it is needed to regulate number
of challenges, endure the humiliations of foreign regulation and the pains of division. Nowadays,
banks in India can certainly contend with present world banks.

Earlier in twentieth century, moneylending, and giving high premium loan, was extensively
dominant in India. Joint stock banks and advancement of Cooperative movement has taken the
business from the money lender in India, who are still in India but lost their threatening side.

Cooperative banks exist in India side by side with commercial banks and undertake an
additional part in providing need-based money, mainly for farming and agriculture-related
business including cultivating, livestock, dairy, hatchery, individual loans etc. alongside few
commercial enterprises and self-service motivated activities.

The local banked acted an awfully necessary part in East India Company in the Mughal
period. The first Joint Stock Company to be founded was the general bank of India in the year
1786.

Earlier nineteenth century the East India Company organized 3 banks:

In 1809, the Bank of Bengal.

In 1840, the Bank of Bombay and

In 1843, the Bank of Madras.

These banks were together called as Presidency Banks, stood autonomous divisions and
worked also. The three banks was combined in the year 1920 and another, the Imperial Bank of
India was organized on 27th January of the year 1921. When the SBI Act was passed in the year
1955, the effort of the Imperial Bank of India was controlled by State Bank of India.

6
 The RBI, the national bank, was established in 1935, after passing RBI act 1934. As the
swadeshi program raised, many banks with Indian administration were built up in the nation in
particular, Punjab National Bank ltd., Bank of India ltd., Canara Bank Ltd., the Bank of Baroda
Ltd., and the Central Bank of India Ltd.14 noteworthy banks of India in were nationalized in the
year 1969 and again in 1980 6 more banks were nationalized.

Currently in India Commercial system may be divided as follows

 Public sector banks

 SBI & its secondary named the State Bank group.
 2national banks.
 Regional rural banks mostly supported by public segment.
 Private sector banks
 Ancient banks.
 Novel private banks.
 External banks.
 Scheduled banks.
 Non-scheduled banks.
Banking in India started in the primary period of eighteenth era in 1786 by the appearance of
the General Bank of India. Which was trailed by Bank of Hindustan. These banks are presently
old. Later, Indian government set up three banks in the country. Which were the Bank of Bengal
in 1809, the other banks, known as the Bank of Madras and the Bank of Bombay, were set in 1843
and 1840, correspondingly. These presidency banks stood joined into the Imperial Bank of India
beneath the Imperial Bank of India Act, 1920.

Two or after three decades Credit Lyonnais begin Calcutta processes in 1850. By then,
Calcutta became best dynamic exchanging place, basically because of business of the British
Domain, and because of that finance movement originated and flourished there. Allahabad Bank
was the 1st wholly claimed Indian bank which was built up in the year 1856.

By the nineteenth century, with foundation of banks for example Punjab National Bank
and Bank of India – business got extended, which were established under private possession. From

7
1935the RBI officially tackled obligation of controlling the national lending area. RBI got
nationalized after independence and was given extensive influences.

The banking foundations extended & turn out to be progressively unpredictable underneath
the effect of deregulation, advancement and innovative upgradation, it is critical to keep up
harmony among proficiency and security. In the past 30 years from nationalization gigantic
deviations have occurred in the budgetary markets and also in the banking sector because of
monetary area changes. The banks have made their conventional capacities and was developing,
enhancing and turning out with novel sorts of administrations to cook rising requirements of the
clients. Banks was given more independence to outline their own particular approaches. Quick
headway of innovation has added to critical decrease in exchange costs, encouraged more
prominent expansion of diversification and enhancement in credit conveyance of banks. Provident
standards, in accordance with worldwide norms, was placed for advancing & upgrading banks’
proficiency.

Regardless this excellent advancement, difficult issues have risen replicating in a reduction
in efficiency and effectiveness, and breakdown of productivity of banking system. The
characteristics of advance portfolio has been worsening and has been seen in the method of capital
asset enhancement and in era of bank’s wage. Capital shortage together with insufficiency of
advance loans procurements effect negatively the investor’s certainty. Government, subsequently,
organized a committee called “Narasimham” to investigate difficulties and prescribe ways for
financial sector to expand the reliability.

The acknowledgement of proposals made by the Narasimham Committee, has brought

about change to heretofore exceptionally control and over administered banking sector into market
obsessed and greatly aggressive one.

The huge & fast extension & enhancement of banking was been without any stresses.
Banking industry is arriving another phase in it will be threatening expanding challenge from non-
banks in local market and worldwide. Operational arrangement of banking in India is relied upon
to experience a significant variation amid the following period. With rise of private banks, the
private bank area has improved & differentiated with emphasis to the wholesale and also retail
banking. The current banks have large number of branches, while the private banks have the

8
influenced by gigantic capital and the ability of creating refined financial items and utilization of
best in class innovation.

Continuous deregulation that is being introduced in while fortifying the opposition would
likewise encourage forging commonly helpful connections, which would at last upgrade banks
excellence and substance. The banking background in India gave a worthy account, fair with united
endeavors of Development banks, regional rural banks and cooperative banks will give a good
amount of viable retail channels in order to fulfill the increasing financial problems. The
technological stage has likewise influenced the system of banking, prompting quick electronic
fund transfer. Be that as it may, the advancement of electronic banking has additionally prompted
new regions of danger, for example, information safety and reliability requiring new systems of
hazard management.

9
2.2 COMPANY PROFILE
The starting point of the State Bank of India backtracks in the principal decade of the
nineteenth century with the foundation of the Bank of Calcutta in Calcutta (2 June 1806) the State
Bank of India had a turning point in the beginning of 19th century. 3 years after the bank was re-
planned to the Bank of Bengal on 2 January 1809. An interesting establishment, it was the main
bank supported by the Government of Bengal which was under the control of British India. The
Bank of Bombay, started on 15 April 1840, and the Bank of Madras, founded on 1 July 1843,
amalgamated the Bank of Bengal. The 3 of these banks together got mixture on 27 January 1921
and were known as Imperial bank of India. State Bank of India was formed on 1 July, 1955, with
the formation of the State Bank of India Act, 1955, by adopting properties of the Imperial Bank of
India.

SBI was conceived with another feeling of social reason with the help of 480 workplaces
including divisions, sub workplaces and Local Head Offices acquired from the Imperial Bank. The
idea of managing an account like negligible vaults of group investment funds & loan specialists to
reliable gatherings was almost immediately to offer route to idea of deliberate saving money
serving the developing & broadened budgetary necessities of arranged monetary advancement.
The State Bank of India was bound to go about as the leader in the appreciation & help the Indian
managing an account framework into the energizing field of national improvement.

Functions:

1. The bank performs the general commercial bank functions such as accepting deposits,
giving loans, providing remittances, issuing letters of credit etc.
2. It performs as the agent of the Reserve Bank in places where there are no branches of the
RBI.
3. It acts as an agent of the registered co-operative banks.
4. It is authorized to buy and sell of gold and silver.
5. It underwrites the issue of stocks, shares and other securities.
6. It is authorized to grant financial support to establishments are granting advances on the
basis hire purchase against book debts.

10
 7. SBI can subscribe share capital, or to buy or sell of any banking companies’ shares in the
market. It is also authorized to form or operate its subsidiary banking companies.

The items and administrations of State Bank of India:

 Personal Banking:
 SBI Loan for Pensioners
 SBI Term Deposits
 Credit (Mortgage of Property)
 SBI Recurring Deposits
 SBI Housing Loan
 SBI Car Loan
 Credit (Shares and Debentures)
 Rent plus Scheme
 Medic-Plus Scheme
 SBI Educational Loan
 Rates of Interest
 SBI Personal Loan

 Provincial/Agricultural
SBI provides to necessities of landless rural workers and agriculturists using a system
containing 6600 rustic &semi-urban divisions. 972 specific divisions have been organised
in various areas of the nation solely for improving horticulture using credit arrangement.
These divisions incorporate 427 Agricultural Development Branches (ADBs) &547
divisions with DBDs and 2 Agricultural Business Divisions at Hyderabad and Chennai
obliging the requirements of greetings tech business farming activities.

11
The arrangements for provincial individuals

 PRODUCE MARKETING LOAN SCHEME

 CROP LOAN (ACC)
 LOAN AGAINST WAREHOUSE RECEIPTS/COLD STORAGE RECEIPTS
 AGRICULTURAL TERM LOANS (ATL)
 KISAN CREDIT CARD SCHEME (KCC)
 MINOR IRRIGATION SCHEMES
 FARM Mechanization SCHEMES
 LAND DEVELOPMENT SCHEMES
 FINANCING OF COMBINE HARVESTERS
 LAND PURCHASE SCHEME
 KISAN GOLD CARD SCHEME
 KRISHI PLUS SCHEME
 ARTHIAS PLUS SCHEME
 BROILER PLUS SCHEME
 DAIRY PLUS SCHEME
 FINANCE TO HORTICULTURE
 AGRI BUSINESS HEADS
 LEAD BANK SCHEME

 Government Business
SBI's connection with Government trade are far reaching. There is no big surprise in that
beyond 9315 divisions in India, around 7000 divisions are leading Government Business. The
extensive system of our divisions gives simple entree to the normal people to store accompanying
Government levy & benefits installments.

SBI e-impose is an online duty installment office which spares time, both paperless and free.
It is accessible on a 24x7 premise & empowers clients to pay charges on the web, effortlessly and

12
effortlessness. Pay Direct/Indirect charges using SBI e-impose and also unwind. Other government
organizations incorporate government accounts, open prudent asset &elder native's annuity plan.

 Corporate Banking
SBI is a one shop giving budgetary items/administrations of variety for huge, intermediate
and little clients equally household and global.
 Working Capital Financing
Help amplified equally as Fund and Non-Fund based offices to proprietary concerns, Partnership
firms and Corporates.

 Term Loans
To bolster capital consumptions for organizing new pursuits additionally for extension, redesign
and so forth.

 Conceded Payment Guarantees

To bolster buy of capital types of gear.

 Corporate Loans
For an assortment of trade related purposes to MNCs.

 Send out Credit:

To Corporates/Non Corporates

5. E-Banking: Following are the administrations gave by SBI online-

a. RTGS/NEFT

b. SBI VISHWA YATRA FOREIGN TRAVEL CARD

c. SERVICE CHARGES AND FEES

d. ATM SERVICES

e. INTERNET BANKING

f. E-PAY

g. E-RAIL
13
h. RBIEFT

i. SAFE DEPOSIT LOCKER

j. BROKING SERVICES

k. MAGNETIC INK CHARACTER RECOGNITION (MICR)

l. FOREIGN INWARD REMITTANCE

6. Worldwide Banking:

Worldwide banking administrations of SBI are conveyed in order to give the advantage to
its Indian clients, non-occupant Indians, remote elements and banks using a system of 67
workplaces/divisions in 29 nations. The system is expanded by a bunch of Foreign and NRI
divisions inside India & reporter joins with more than 522 banks. Bank's Subsidiaries and joint
ventures in foreign countries additional emphasize the Bank's global vicinity.

14
2.3 ABOUT LOGO

The theme of the logo of SBI is ‘Togetherness’, where the universe of banking services
address the ever changing clients’ issues and sets up a connection that is similar to a circle, it
demonstrates wide-ranging services for clients. The logo likewise indicates a bank which has
arranged to do anything to go as far as possible, for its clients.

The blue pointer speaks the philosophy, that the bank is continually searching for the
development and more up to date, all the more difficult, more promising path. The key hole shows
safety and security.

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2.4 VISION, MISSION and VALUES

VISION

 My SBI.
 My Consumer first.
 My SBI: First in consumer happiness

MISSION

 We will be quick, mannerly and active with our clients.

 We will communicate the language of fledgling India.
 We will generate products and amenities which aid customs attain their aims.
 We will go afar the demand of obligation to create our clients feel esteemed.
 We will be of facility even in the farthest place of our nation.
 We will propose brilliance in facilities to persons in a foreign country as far as we do to
persons in India.
 We will include the art expertise to improve quality.

VALUES

 We will every time be frank, clear and right.

 We will esteem our clients and associated persons.
 We will be information obsessed.
 We will study and we will pass our knowledge.
 We will certainly not make the relaxed way out.
 We will do all we be able to give to the public we labor for.
 We will develop self-importance in nation

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2.5 KEY EXECUTIVES

17
2.6 ORGANISATION CHART

CHAIRMAN
CGM
(GLOBAL
CDO CFO
MARKRETS)

CCO CIO

CVO

MD & GE MD & GE MD & GE MD

(CORPORATE (NATIONAL (A&S) (COMPLIANCE
BANKING) BANKING) & RISK)

DMD (CAG) DMD (CHIEF DMD (I & MA)

OPERATING
All
OFFICER)
Subsidiaries
DMD (CS & DMD &
DMD (MCG)
NB) CHIEF RISK
OFFICER
All Associate
CGMs Banks
DMD (SAMG)
(Circle)
CGMs (BU) CMG & GCO

DMD (IBG)

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2.7 SWOT Analysis

Strengths

 SBI is the major bank in the country in relations of market stake, assets and profits,
 As per current statistics it has further 13,000 channels and 25,000 number of ATM.
 The bank has existence in 32 nations appealing money exchange all over the world
 SBI has the initial mover benefit in marketable banking facility
 SBI has in recent times improved its vision and mission reports viewing a sign of leaning
to new age banking facilities
 Brand Name: SBI bank has got a status in the market over the period.
Weakness

 Absence of appropriate knowledge focused facilities when related to private banks

 Workforces express unwillingness to resolve problems rapidly because of greater career
safety and clients’ waiting time is lengthy when matched to private banks
 The banks expends a large volume on its hired structures
 SBI has the major amount of workers in banking segment, therefore the bank expends a
significant quantity of its profits in worker’s wages payment
 Even though upgraded, SBI still have insight of outdated bank to novel age clients
 Bank did not invite wages accounts of business and several government segment workers
wage accounts are also moved to banks under private control for easiness of actions unlike
earlier.
Opportunities

 As the bank is still to improve some of its banking tasks, there is a well opportunity of
utilizing innovative machineries and software to develop client associations
 Young talented graduates are increasing to expose new skyline.
 Can earn a good money in foreign as SBI has 150 workplaces in 32 nations which add 14-
15% in net income.
 Venture in Information Technology will reduce operation costs of SBI

19
Threats

 FDIs permitted in banking segment is greater than before to 49% , this is a main hazard to
SBI as persons have a tendency to move to overseas banks for improved amenities and
skills in banking facility.
 Further other government banks are displaying client favor to change to Banks controlled
by private party and monetary facility suppliers for credits and loans, as SBI includes
severe checking measures and processing take long time
 Private bank has started investing into countryside and semi city segment which used to be
the stronghold of the SBI and further PSU banks.

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 CHAPTER III

THEORETICAL BACKGROUND
 Chapter III Theoretical Background

3.1 FUNDAMENTAL ANALYSIS:

Fundamental Analysis is the examination of the basic powers that influence the prosperity
of the economy, business gatherings and organizations. Similarly as with most examination, the
objective is to build up an estimate of future value development and benefit from it. At the
organization level, Fundamental Analysis might include examination of money related
information, administration, business idea and rivalry. At the business level, there may be an
examination of supply and demand strengths of the goods. For the country’s economy, basic
examination may concentrate on financial information to evaluate the present and future
development of the economy.

To gauge future stock costs, fundamental examination consolidates financial, industry, and
organization investigation to infer a stock's reasonable worth called intrinsic value. In the event
that reasonable worth is not equivalent to the present stock value, major examiners trust that the
stock is either over or underestimated. As the present business sector cost will eventually float
towards reasonable worth, the reasonable quality ought to be assessed to choose whether to
purchase the security or not. By trusting that costs don't precisely mirror all accessible data, crucial
examiners hope to gain by supposed value disparities.

Fundamental Analysis is a strategy for attempting so as to assess a security to calculate its

intrinsic worth by inspecting related monetary, budgetary and other subjective and quantitative
components. Fundamental experts endeavor to consider everything that can influence the securities
worth, including macroeconomic components (like the general economy and industry situations)
and particular variables (like the budgetary position and administration of organizations).

OBJECTIVES OF FUNDAMENTAL ANALYSIS

 To anticipate the course of country’s economy in light of the fact that financial action
influences the organization’s benefit, shareholders dispositions and desire and eventually
share value.

21
  To evaluate the share value variation by concentrating on the strengths working in the
general economy, and additionally impacts curious to commercial ventures and
organizations.
 To choose the perfect time and right shares for the venture
THREE STAGES OF FUNDAMENTAL ANALYSIS

1) Analysing of the country’s economy and improvements (Economic Analysis)

2) Examining the possibilities of the business to which the firm has a place (Industry Analysis)

3) Evaluating the anticipated act of the organization (Company Analysis)

The three stage examination of fundamental investigation is likewise called as an EIC

(Economy-Industry-Company investigation) structure or a top-down methodology

Here the money related investigator first makes estimates for the economy, then for
commercial ventures lastly for organizations. The business figures depend on the conjectures for
the economy and thus, the organization estimates depend on the gauges for both the business and
the economy. Likewise in this methodology, industry gatherings are looked at in contrast to other
industry gatherings and organizations in contrast to different organizations. As a rule,
organizations are contrasted and others in the same gathering.

Hence, the fundamental investigation is a 3 stage examination of

a) The economy

b) The industry and

c) The organization

22
3.2 TECHNICAL ANALYSIS:

Fundamental investigation and Technical examination are the two major ways to deal with
security examination. Technical investigation is habitually utilized as a complement to
fundamental examination as opposed to as an auxiliary to it. By investigation, the cost of stock
relies on upon interest and supply in the commercial center. It has little relationship with the
intrinsic worth. All money related information and business sector data of a given stock is now
reflected in its business sector cost.

Technical examiners have created devices and procedures to concentrate on historical cases
and foresee future cost. Specialized investigation is fundamentally the investigation of the business
sectors as it were. Technical investigators consider the specialized qualities which might be normal
at business sector defining moments and their goal evaluation. The past defining moments are
examined with a perspective to build up a few attributes that would help in recognizable proof of
significant business sector max and min. People responses are, all around predictable in
comparative however not indistinguishable response; with his different devices, the expert
endeavors to accurately get changes in pattern and exploit them.

Technical investigation is coordinated towards anticipating the price of a share. The cost
at which a purchaser and vender resolve an agreement is thought to be the exact figure which
union, weighs lastly communicates all variables, normal and nonsensical, measurable and non-
measurable and is the main assume that matters.

Moving Average:

Moving Average is a pointer which demonstrates the average worth of share’s value over
a period. While ascertaining a moving average, a scientific investigation of the share's average
worth over a prearranged time is prepared. As the share value deviates, its average price changes
high or low.

23
Interpretation:

The well-known technique for deciphering a moving average look at the bond among a
moving averages of share's value by the share's value. A purchase sign is created while the share
value ascends over its moving average & an offer sign is produced while the share value falls
underneath the moving average.

The moving average exchanging framework is not proposed to become at the precise base
nor at the definite top. Maybe, it is intended to retain you in accordance with the share price pattern
by purchasing not long after the share price bottoms and offering soon later its max.

Basic component in a moving average is sum of interval utilized as a part of figuring the
average. At the point when utilizing knowledge of the past, you can simply locate a moving
average which will be beneficial. 39 week or 200 day moving average is the well-known moving
average. This moving normal is a brilliant reputation in scheduling the main (lengthy term) market
movements.

Advantages:

Benefit of moving average arrangement (i.e., purchasing & offering when prices break over
their moving average) is you will dependably be on the "correct" place of the market: prices can't
increase all that much lacking the value growing beyond its average. On the off chance that the
pattern does not keep going for a noteworthy timeframe, ordinarily double the span of the moving
average, you will lose cash.

Price Rate-Of-Change:

The Price Rate-of-Change ("ROC") pointer shows distinction among the present price &
the price x-time periods prior. Distinction is shown either in points or as a rate. The Momentum
pointer shows the exact data, however communicates as a proportion.

24
Interpretation:
The security prices flow fast and withdraw in a repeating wave-like movement. This
recurrent activity is the aftereffect of the varying desires as bulls and bears battle to regulate prices.

The wave-like movement in an oscillator design is done by computing the sum that values
have altered above a given time. As prices expand, the ROC increases; as prices decrease, the ROC
drops. The more prominent adjustment in prices, the more prominent adjustment in ROC.

Time utilized to figure the ROC might extend from 1-day (that brings about an unstable
graph demonstrating the day by day value alteration) to 200-days. 12 & 25 day ROC is the well-
known periods for small to intermediary exchanging. The time were advanced by Gerald Appel
and Fred Hitschler.

12 day ROC is a phenomenal small to medium term over purchased/oversold pointer. The
greater the ROC, the more over purchased the stock; the lesser the ROC, the high probable an
oversold. Be that as it may, as with all over purchase/oversold pointers, it is reasonable to hold for
the market to start to amend before setting your business. A market that shows up overbought
might continue overbought for quite a while. Truth be told, to a great degree overbought/oversold
readings as a rule infer an extension of the present pattern.

The 12-day ROC has a tendency to become extremely recurrent, wavering forward and
backward in a genuinely general cycle. Regularly, value deviations can be expected by considering
the past rotations of the ROC and connecting the past rotations to the market

25
Relative Strength Index (RSI):

The Relative Strength Index ("RSI") is a prevalent oscillator. Initially presented by Welles
Wilder in a Magazine (June 1978).The "Relative Strength Index" is somewhat deceptive the
Relative Strength Index does not reflect about the relative power of two stocks, yet more the inward
power of a solitary share. A suitable title may be "Internal Strength Index."

Interpretation:
At the point when Wilder presented the Relative Strength Index, he suggested utilizing a
14day Relative Strength Index. From that point forward, 9day and 25day Relative Strength Indexes
additionally picked up prevalence. The less days utilized to figure the Relative Strength Index, the
further unpredictable the pointer.

The Relative Strength Index is a worth taking after oscillator that arrays somewhere around
0 &100. A famous technique for investigating the RSI is to search for a dissimilarity where the
share is making another top, yet the RSI is neglecting to exceed its past high. This dissimilarity
means that a looming inversion. A failure swing is at the point when the RSI turns down and
decreases beneath latest trench. The failure swing is viewed as an affirmation of the looming
inversion.

In Mr. Wilder's book, he deliberates five usages of the Relative Strength Index:

1. Tops and Bottoms. The RSI normally best is 70 above and bottoms is underneath 30. It
for the most part structures these max and min afore the fundamental value outline.
2. Chart Formations. The RSI regularly frames diagram, for example, head and shoulders
or triangles that could conceivably be obvious on the value outline.
3. Failure Swings. This is the place the RSI surpasses a past top or drops underneath a late
low (trough).
4. Support and Resistance. The RSI appears, infrequently further plainly than value
themselves, stages of support and resistance.
5. Divergences. Divergences happen while the value makes another high or low which is not
affirmed by another high or low in the RSI.

26
 CHAPTER IV
DATA ANALYSIS & INTERPRETATION
 Chapter IV Data Analysis & Interpretation

4.1 FUNDAMENTAL ANALYSIS

Analysis of Indian Economy

Real GDP

Real Gross Domestic Product (Real GDP) is an alteration of the GDP measurement which
is basically used to calculate the growth and size of the economy of a country. Real GDP comprises
changing the typical GDP character to account for inflation which eliminate the influence it has
on GDP growth.

GDP = Consumption + Investment + Government Spending + Exports – Imports

𝐺𝐷𝑃
𝑅𝑒𝑎𝑙 𝐺𝐷𝑃 =
(1 + 𝐼𝑛𝑓𝑙𝑎𝑡𝑖𝑜𝑛 𝑠𝑖𝑛𝑐𝑒 𝑏𝑎𝑠𝑒𝑟 𝑦𝑒𝑎𝑟)

Table4.1showing Real GDP growth

YEAR REAL GDP GROWTH (%)

2010-11 8.9

2011-12 6.7

2012-13 5.1

2013-14 6.9

2014-15 7.2

27
 Chart 4.1 showing Real GDP growth

REAL GDP GROWTH (%)

10
8.9
9
8 7.2
6.7 6.9
7
6 5.1
5
4
3
2
1
0
2010-11 2011-12 2012-13 2013-14 2014-15

INTERPRETATION

From the table it is clear that Real GDP growth showed a fluctuating trend. Real GDP
growth showed a decreasing trend from 2010-11 to 2012-13. It decreased from 8.9% in 2010-11
to 5.1% in 2012-13, after that in 2013-14 it increased to 6.9% and again in the year 2014-15 it
increased to 7.2%.

28
INFLATION

The rate of inflation calculates the proportionate variation in buying power of a specific
currency. As the cost of prices rise, the buying power of the money declines.

𝐶𝑃𝐼𝑇ℎ𝑖𝑠 𝑌𝑒𝑎𝑟 − 𝐶𝑃𝐼𝐿𝑎𝑠𝑡 𝑌𝑒𝑎𝑟

𝐼𝑛𝑓𝑙𝑎𝑡𝑖𝑜𝑛 𝑅𝑎𝑡𝑒 =
𝐶𝑃𝐼𝐿𝑎𝑠𝑡 𝑌𝑒𝑎𝑟

TABLE 4.2 showing Inflation rate

YEAR INFLATION (CPI AANUAL AVG. %)

2010-11 10.8
2011-12 10.3
2012-13 10.2
2013-14 9.5
2014-15 6.4

CHART 4.2 showing Inflation rate

INFLATION (CPI AANUAL AVG. %)

12 10.8
10.3 10.2
9.5
10

8 6.4
6

0
2010-11 2011-12 2012-13 2013-14 2014-15

INTERPRETATION

From the table it is clear that Inflation showed a decreasing trend for the last 5 years from
2010-11 to 2014-15. Highest Inflation of 10.8% was showed in the year 2010-11 and lowest of
6.4% was showed in the year 2014-15.

29
EXPORT GROWTH

The rate at which the amount of an economy's exports raises (or declines) over a period of
time. Net exports are one factor in GDP, the export rate gives to whole development or
deterioration in an economy.

TABLE 4.3 showing Export rate

YEAR EXPORT % CHANGE

2010-11 39.8
2011-12 22.5
2012-13 -1.8
2013-14 4.7
2014-15 -1.3

CHART 4.3 showing Export rate

EXPORT % CHANGE
50
39.8
40

30 22.5
20

10 4.7
-1.8 -1.3
0
2010-11 2011-12 2012-13 2013-14 2014-15
-10

INTERPRETATION

From the table it is clear that export growth showed a decreasing trend in the last 5 years.
Export growth % showed a decreasing trend from the year 2010-11 to 2012-13 and in the year
2013-14 it showed a slight increase but it again dropped in the year 2014-15. Export growth
showed highest of 39.8% in the year 2010-11 and lowest of -1.8% in the year 2012-13

30
IMPORT GROWTH

The rate at which the amount of an economy's imports raises (or declines) over a period of
time. Net imports are one factor in GDP, the import rate gives to whole development or
deterioration in an economy

Table 4.4 showing Import rate

YEAR IMPORT % CHANGE

2010-11 28.2
2011-12 32.3
2012-13 0.3
2013-14 -8.3
2014-15 -0.6

Chart 4.4 showing Import rate

IMPORT % CHANGE
35 32.3
28.2
30
25
20
15
10
5 0.3 -0.6
0
-5 2010-11 2011-12 2012-13 -8.3
2013-14 2014-15
-10
-15

INTERPRETATION

From the table it is clear that Import growth showed a decreasing trend in the last 5 years.
Import growth showed an increasing trend in the initial year but after that it decreased drastically.
In the year 2011-12 it increased to 32.3% from 28.2% in the year 2010-11, then it dropped to 0.3%
in the year 2012-13 and again in the year 2013-14 it decreased to -8.3% but slightly increased in
the year 2014-2015 to -0.6%.

31
FOREIGN DIRECT INVESTMENT

A foreign direct investment (FDI) is an investment made by a business in one country, into
an entity in another country.

Table 4.5 showing Foreign Direct Investment

YEAR FDI (US$ bn)

2010-11 36
2011-12 46.6
2012-13 34.3
2013-14 36
2014-15 44.3

Chart 4.5 showing Foreign Direct Investment

FDI (US$bn)
60

46.6
44.3

40 36 34.3 36

20

0
2010-11 2011-12 2012-13 2013-14 2014-15

INTERPRETATION

From the table it is clear that Foreign Direct Investment of Indian economy showed a
fluctuating trend. In the year 2011-12 it increased to 46.6 from 36 of 2010-11 then in the year
2012-13 it again decreased to 34.3 and increased to 36 in the year 2013-14 and 44.3 in the year
2014-15.

32
Industry Analysis

DEPOSIT GROWTH

The Deposit Growth Rate relates the amount of deposits held by a monetary institution in
a period to the amount of deposits in an earlier time. The growing rate is measured by dividing the
change among aggregate present deposits and total deposits in an earlier time by aggregate deposits
in that earlier time.

TABLE 4.6 showing Deposit growth

YEAR DEPOSIT GROWTH%
2010-11 15.91
2011-12 13.5
2012-13 14.2
2013-14 14.1
2014-15 10.7
CHART 4.6 showing Deposit growth

DEPOSIT GROWTH%
18 15.91
16 14.2 14.1
13.5
14
12 10.7
10
8
6
4
2
0
2010-11 2011-12 2012-13 2013-14 2014-15

INTERPRETATION

From the table it is clear that Deposit Growth of Indian banking sector showed a decreasing
trend in the last 5 years. In the last 5 years Deposit growth was highest in the year 2010-11, i.e.
15.91% and showed the lowest of 10.7% in the year 2014-15. Deposit growth ranged between
13.5% and 14.2% in the years 2012, 2013 and 2014.

33
CREDIT GROWTH

A bank credit is the quantity of credit existing to a business or individual from the banking
system. It is the total of the sum of moneys monetary institutions are agreeable to offer to an
individual or institute.

TABLE 4.7 showing Credit growth

YEAR CREDIT GROWTH %
2010-11 21.48
2011-12 16.99
2012-13 14.1
2013-14 13.9
2014-15 9

CHART 4.7 showing Credit growth

CREDIT GROWTH %
25
21.48

20
16.99

14.1 13.9
15

9
10

0
2010-11 2011-12 2012-13 2013-14 2014-15

INTERPRETATION

From the table it is clear that Credit growth of Indian banking sector showed a decreasing trend
in the last 5 year. In the year 2011-12 it decreased to 16.99% from 21.48% of 2010-11 then it again
decreased to 14.1% in the year 2012-13 and 13.9 in the 2013-14 and the least of 9% was showed
in the year 2014-15.

34
 NET INTEREST MARGIN GROWTH

Net interest margin (NIM) is a degree of the change among the interest revenue created by
banks and the quantity of interest funded out to their financiers (for example, deposits),
comparative to the sum of their (interest-earning) assets.

𝐼𝑛𝑣𝑒𝑠𝑡𝑚𝑒𝑛𝑡 𝑅𝑒𝑡𝑢𝑟𝑛𝑠 − 𝐼𝑛𝑡𝑒𝑟𝑒𝑠𝑡 𝐸𝑥𝑝𝑒𝑛𝑠𝑒𝑠

𝑁𝑒𝑡 𝐼𝑛𝑡𝑒𝑟𝑒𝑠𝑡 𝑀𝑎𝑟𝑔𝑖𝑛 =
𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝐸𝑎𝑟𝑛𝑖𝑛𝑔 𝐴𝑠𝑠𝑒𝑡𝑠

TABLE 4.8 showing Net Interest Margin growth

YEAR Net Interest Margin %
2010-11 3.1
2011-12 2.86
2012-13 2.72
2013-14 2.64
2014-15 2.57

CHART 4.8 showing Net Interest Margin growth

Net Interest Margin %

3.5 3.1
2.86
3 2.72 2.64 2.57
2.5
2
1.5
1
0.5
0
2010-11 2011-12 2012-13 2013-14 2014-15

INTERPRETATION

From the table it is clear that Net Interest Margin growth of Indian banking sector showed a
decreasing trend for the last 5 years. Highest NIM growth of 3.1% was in the year 2010-11 and
then in the year 2011-12 it decreased to 2.86% after that again in 2012-13 and 2013-14 it decreased
to 2.72% and 2.64% respectively and the least of 2.57% was marked in the year 2014-15.

35
RETURN ON TOTAL ASSET

The return on assets ratio called the return on total assets, is a profitability ratio which
calculates the net income created by total assets throughout a period by relating net income to the
average total assets.

𝑁𝑒𝑡 𝐼𝑛𝑐𝑜𝑚𝑒
𝑅𝑒𝑡𝑢𝑟𝑛 𝑜𝑛 𝐴𝑠𝑠𝑒𝑡 =
𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑇𝑜𝑡𝑎𝑙 𝐴𝑠𝑠𝑒𝑡

TABLE 4.9 showing Return on Total Asset

YEAR RETURN ON TOTAL ASSETS %
2010-11 1.28
2011-12 1.01
2012-13 0.95
2013-14 0.73
2014-15 0.71

CHART 4.9 showing Return on Total Asset

RETURN ON TOTAL ASSETS

1.4 1.28

1.2
1.01
0.95
1
0.73 0.71
0.8
0.6
0.4
0.2
0
2010-11 2011-12 2012-13 2013-14 2014-15

INTERPRETATION

From the table it is clear that Return on Total Assets of Indian banking sector showed a
decreasing trend. Highest ROA of 1.28% was showed in the year 2010-11 and lowest of 0.71%
was showed in the year 2014-15.

36
Company Analysis

SBI is one of the biggest company in the India having 222,133 workers as on 31 March
2015, in that there were 45,131womanworkers and 2,610 workers with incapacities. SBI had
42,749 Schedule Caste and 17,249 Schedule Tribe workers. The percentage of Generals, juniors
and Sub-workers was 35%, 45% and 20% respectively: 1,779Subordinates and 1,394 Generals
entered the Bank in 2014-15, for development of the division system and to alleviate workforce
scarcity, mostly at countryside and semi-town divisions. Workforce efficiency of each worker
contributed net income of Rs.4.85 lakhs.

Table 4.10showingthe share holding pattern of SB

37
Key Ratios for Analysis of Bank

RETURN ON EQUITY RATIO

This ratio calculate the profitability of equity funds spent in the firm. It discloses how
profitably of the owners’ funds have been utilized by the firm. ROE shows the capacity of an
organization to make earnings from the investor’s outlay in the business.

Net Profit After Tax

Return On Equity  X 100
Networth

Table 4.11 Showing Return on Equity

Net profit Net worth Return on Equity

Year (in Crs) (in Crs)

2010-2011 10,684.95 83,471.25 12.80

2011-2012 15,343.10 106,230.01 14.44

2012-2013 17,916.23 125,033.02 14.33

2013-2014 14,173.77 147,370.53 9.62

2014-2015 16,994.30 161,387.54 10.53

38
 Chart 4.10 Showing Return on Equity

RETURN ON EQUITY
16 14.44 14.33
14 12.8

12 10.53
9.62
10
8
6
4
2
0
2011 2012 2013 2014 2015
YEAR

INTERPRETATION

The above table shows that SBI’s Return on Equity has increased from 12.8 to 14.44
in the year 2011 and 2012 and in the year 2013 it decreased to 14.33 and then in the year 2014 it
again decreased to 9.62 but increased to 10.53 in the year 2015.

With reference to the above table ROE showed maximum of 14.44% in the year 2012
and minimum of 9.62 in the year 2014.From the above table it is clear that ROE for the past 5
years are fluctuating. Compared to 2014 ROE has increased in 2015 this mainly due to increase in
the net profit and shareholder’s equity.

39
DEBT-EQUITY RATIO

The debt to equity ratio compares company's total liabilities with total shareholders' equity. It
measures how much moneylenders, producers and creditors have obligation to the company
against the shareholders have committed. The lesser the ratio, lesser the debt and greater the equity
of shareholders.

𝑇𝑜𝑡𝑎𝑙 𝐿𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠
𝐷𝑒𝑏𝑡 − 𝐸𝑞𝑢𝑖𝑡𝑦 𝑅𝑎𝑡𝑖𝑜 =
𝑆ℎ𝑎𝑟𝑒ℎ𝑜𝑙𝑑𝑒𝑟 ′ 𝑠 𝐸𝑞𝑢𝑖𝑡𝑦

Table4.12 Showing Debt-Equity Ratio

Debt-Equity
Debt Equity
Ratio
Year
(in Crs) (in Crs)

2010-2011 1,255,562.48 83,471.25 15.04

2011-2012 1,414,689.40 106,230.01 13.32

2012-2013 1,627,402.61 125,033.02 13.02

2013-2014 1,838,852.36 147,370.53 12.48

2014-2015 2,052,960.79 161,387.54 12.72

40
 Chart 4.11 Showing Debt-Equity Ratio

DEBT-EQUITY RATIO
16
15.04
14
13.32 13.02
12.48 12.72
12

10

0
2011 2012 2013 2014 2015
YEAR

INTERPRETATION

The above table shows that SBI’s Debt-Equity has decreased from 15.04 to 13.32 in
the year 2011 and 2012 and it again decreased to 13.02 in the year 2013 and 12.48 in the year 2014
but increased to 12.72 in the year 2015.

With reference to the above table ROE showed maximum of 15.04 in the year 2011
and minimum of 12.48 in the year 2014.From the above table it is clear that Debt-equity ratio
shows a decreasing trend. Compared to other years debt-equity ratio has increased in 2015, this
due to increase in both the debt and equity.

41
EARNINGS PER SHARE

Earnings per share (EPS) are the worth of income from every unpaid common
stocks of a firm. Generally, EPS is measured on per share base. The greater the proportion,
greater will be the income from the stocks.

𝑁𝑒𝑡 𝑃𝑟𝑜𝑓𝑖𝑡
𝐸𝑎𝑟𝑛𝑖𝑛𝑔𝑠 𝑃𝑒𝑟 𝑆ℎ𝑎𝑟𝑒 =
𝑁𝑜. 𝑜𝑓 𝑠ℎ𝑎𝑟𝑒𝑠 𝑜𝑢𝑡𝑠𝑡𝑎𝑛𝑑𝑖𝑛𝑔

Table 4.13 Showing Earnings per Share

Net Profit No: of Shares EPS

Year (Rs) (Rs)
In Crs In Crs

2010-2011 10,684.95 63,499.00 0.17

2011-2012 15,343.10 67,104.00 0.23

2012-2013 17,916.43 68,403.00 0.26

2013-2014 14,173.77 74,657.00 0.19

2014-2015 16,994.30 74,657.00 0.23

42
 Chart 4.12 Showing Earnings per Share

EARNINGS PER SHARE

0.3

0.26
0.25
0.23 0.23

0.2
0.19
0.17
0.15

0.1

0.05

0
2011 2012 2013 2014 2015

INTERPRETATION

The above table shows that SBI’s Earnings per Share has increased from 0.17 to 0.23
in the year 2011 and 2012 and in the year 2013 it again increased to 0.26 and then in the year 2014
it decreased to 0.19 but increased to 0.23 in the year 2015.

With reference to the above table EPS showed maximum of 0.26 in the year 2013
and minimum of .17 in the year 2011.From the above table it is clear that Earnings per Share shows
a fluctuating trend. Compared to 2014 earnings per share has increased in 2015, this is due to
increase in the net income.

43
DIVIDEND PER SHARE

The total dividends allowed for each normal share allotted. Dividend per share (DPS) is the
total dividends paid over a year divided by the number of unsettled shares.

𝐷𝑖𝑣𝑖𝑑𝑒𝑛𝑑𝑠
𝐷𝑖𝑣𝑖𝑑𝑒𝑛𝑑 𝑃𝑒𝑟 𝑆ℎ𝑎𝑟𝑒 =
𝑁𝑜. 𝑜𝑓 𝑠ℎ𝑎𝑟𝑒𝑠

Table 4.14 Showing Dividend per Share

Dividend No: of Shares DPS

Year (in Crs.) (in Crs.)

2010-2011 1,905.00 63,499.00 0.03

2011-2012 2,348.66 67,104.00 0.04

2012-2013 2,838.74 68,403.00 0.04

2013-2014 2,236.80 74,657.00 0.03

2014-2015 2,662.48 74,657.00 0.04

44
 Chart 4.13 Showing Dividend per Share

DIVIDEND PER SHARE

0.045

0.04 0.04 0.04 0.04

0.035

0.03 0.03 0.03

0.025

0.02

0.015

0.01

0.005

0
2011 2012 2013 2014 2015

INTERPRETATION

The above table shows that SBI’s Dividend per Share has increased from 0.03 to 0.04
in the year 2011 and 2012 and in the year 2013 it remained the same and then in the year 2014 it
decreased to 0.03 but increased to 0.04 in the year 2015.

With reference to the above table DPS showed maximum of 0.040 in the year 2013
and minimum of 0.03 in the year 2011 and 2014.From the above table it is clear that Earnings per
Share shows a fluctuating trend. Compared to 2014 Dividend per share has increased in 2015 as
the dividend has increased in the year 2015.

45
DIVIDEND PAYOUT RATIO

The dividend payout ratio says about how much cash a concern is repaying to its shareholders,
against cash kept on hand as reserves, to reinvest in growth and to pay off debt.

𝐷𝑖𝑣𝑖𝑑𝑒𝑛𝑑 𝑝𝑒𝑟 𝑠ℎ𝑎𝑟𝑒

𝐷𝑖𝑣𝑖𝑑𝑒𝑛𝑑 𝑃𝑎𝑦𝑜𝑢𝑡 𝑅𝑎𝑡𝑖𝑜 =
𝐸𝑎𝑟𝑛𝑖𝑛𝑔𝑠 𝑝𝑒𝑟 𝑠ℎ𝑎𝑟𝑒

Table 4.15 Showing Dividend Payout ratio

DPS EPS DPOR

Year

0.17 0.18
2010-2011 0.03
0.04 0.23 0.15
2011-2012
0.04 0.26 0.16
2012-2013

2013-2014 0.03 0.19 0.16

0.04 0.23 0.16

2014-2015

46
 Chart 4.14 Showing Dividend Payout ratio

DIVIDEND PAYOUT RATIO

0.185

0.18 0.18

0.175

0.17

0.165

0.16 0.16 0.16 0.16

0.155

0.15 0.15

0.145

0.14

0.135
2011 2012 2013 2014 2015

INTERPRETATION

The above table shows that SBI’s Dividend Payout Ratio has decreased from 0.18 to
0.15 in the year 2011 and 2012 and in the year 2013 it increased to 0.16 and remain the same till
2015.

With reference to the above table DPOR showed maximum of 0.18 in the year 2011
and minimum of 0.15 in the year 2012.From the above table it is clear that Dividend Payout Ratio
decreased in the year 2012 to 0.15 from 0.18 in the year 2011 and from 2013 to 2015 DPOR
showed a consistent ratio of 0.16.

47
PRICE EARNING RATIO

P/E is the proportion of a firm's stock price to its per-share earnings. To calculate the P/E, one
should take the share price of a firm and divide by its earnings per share (EPS):

𝑀𝑎𝑟𝑘𝑒𝑡 𝑝𝑟𝑖𝑐𝑒
𝑃𝑟𝑖𝑐𝑒 𝑒𝑎𝑟𝑛𝑖𝑛𝑔𝑠 𝑟𝑎𝑡𝑖𝑜 =
𝐸𝑃𝑆

Table 4.16 Showing Price Earnings Ratio

Market Price EPS PER

Year

0.17 16433.75
2010-2011 2,765.30
2,096.30 0.23 9168.30
2011-2012
2,072.80 0.26 7913.73
2012-2013

2013-2014 1,917.70 0.19 10101.03

267.05 0.23 1173.17

2014-2015

48
 Chart 4.15 Showing Price Earnings ratio

PRICE EARNING RATIO

18000

16000 16433.75

14000

12000

10000 10101.03
9168.3
8000 7913.73
6000

4000

2000
1173.17
0
2011 2012 2013 2014 2015

INTERPRETATION

The above table shows that SBI’s Price Earnings Ratio has decreased from 16433.75
to 9168.3 in the year 2011 and 2012 and in the year 2013 it again decreased to 7913.73 and then
in the year 2014 it increased to 10101.03 but decreased to 1173.17 in the year 2015.

With reference to the above table, PER showed maximum of 16433.75 in the year
2011 and minimum of 1173.17 in the year 2015.From the above table it is clear that Price Earnings
Ratio shows a fluctuating trend. The main reason for fluctuation of the ratios are the fluctuating
market prices.

49
4.2 TECHNICAL ANALYSIS

SIMPLE MOVING AVERAGE

A simple moving average (SMA) is a simple, or arithmetic, moving

average which is measured after totaling final price of the share of different period and then divide
this aggregate by the number of period. Short-range averages react speedily to variations in the
price of the basic, while long-term averages are sluggish to respond.

Table 4.17 showing the moving average for 3 months’ time period

Date Price SMA

1-Jan-10 205.66
1-Feb-10 197.43
1-Mar-10 207.82 203.64
1-Apr-10 230.07 211.77
1-May-10 226.88 221.59
1-Jun-10 230.20 229.05
1-Jul-10 250.29 235.79
1-Aug-10 276.64 252.38
1-Sep-10 324.05 283.66
1-Oct-10 315.06 305.25
1-Nov-10 299.22 312.78
1-Dec-10 281.19 298.49
1-Jan-11 264.24 281.55
1-Feb-11 263.05 269.49
1-Mar-11 276.53 267.94
1-Apr-11 280.46 273.35
1-May-11 229.79 262.26
1-Jun-11 240.47 250.24

50
1-Jul-11 234.48 234.91
1-Aug-11 197.38 224.11
1-Sep-11 191.10 207.65
1-Oct-11 190.63 193.04
1-Nov-11 176.25 185.99
1-Dec-11 161.91 176.26
1-Jan-12 206.16 181.44
1-Feb-12 224.75 197.61
1-Mar-12 209.63 213.51
1-Apr-12 213.81 216.06
1-May-12 205.60 209.68
1-Jun-12 215.90 211.77
1-Jul-12 200.51 207.34
1-Aug-12 183.74 200.05
1-Sep-12 224.06 202.77
1-Oct-12 211.03 206.28
1-Nov-12 217.03 217.37
1-Dec-12 238.55 222.20
1-Jan-13 243.80 233.13
1-Feb-13 208.09 230.15
1-Mar-13 207.28 219.72
1-Apr-13 226.43 213.93
1-May-13 204.68 212.80
1-Jun-13 195.38 208.83
1-Jul-13 170.84 190.30
1-Aug-13 151.90 172.71
1-Sep-13 161.49 161.41
1-Oct-13 179.68 164.36
1-Nov-13 181.94 174.37
1-Dec-13 176.65 179.42

51
1-Jan-14 152.38 170.32
1-Feb-14 153.32 160.78
1-Mar-14 191.77 165.82
1-Apr-14 207.86 184.32
1-May-14 254.22 217.95
1-Jun-14 268.62 243.57
1-Jul-14 243.93 255.59
1-Aug-14 246.07 252.87
1-Sep-14 244.57 244.86
1-Oct-14 270.28 253.64
1-Nov-14 321.4 278.75
1-Dec-14 311.85 301.18
1-Jan-15 308.95 314.07
1-Feb-15 301.65 307.48
1-Mar-15 267.05 292.55
1-Apr-15 269.75 279.48
1-May-15 278.15 271.65
1-Jun-15 262.75 270.22
1-Jul-15 270.05 270.32
1-Aug-15 247.35 260.05
1-Sep-15 237.15 251.52
1-Oct-15 237.05 240.52
1-Nov-15 250.2 241.47
1-Dec-15 224.45 237.23
1-Jan-16 179.9 218.18

52
INTERPRETATION

Chart 4.16 Three months Moving Average

Sell PointSIMPLE MOVING AVERAGE

350.00
300.00
250.00
200.00
150.00
100.00 Falling Trend Rising Trend
50.00
0.00 Buy Point
01/May/10

01/May/11

01/May/12

01/May/13

01/May/14

01/May/15
01/Sep/10

01/Sep/11

01/Sep/12

01/Sep/13

01/Sep/14

01/Sep/15
01/Jan/10

01/Jan/11

01/Jan/12

01/Jan/13

01/Jan/14

01/Jan/15

01/Jan/16
Price SMA

 In the above chart upward movement indicates the bullish trend which means the price will
be moving higher, it’s the time when we sell the scrip. Hence sell signal generate in
September 2010, January 2013, October 2013, May 2014,November 2014, November
2015.

 Hence the downward movement indicates the bearish trend which means the price will be
moving lower ,it is the time in which we buy the scrip, hence the buy signal generated in
January 2010, December 2011, August 2012, September 2013, February 2014, September
2015, January 2016.

53
EXPONENTIAL MOVING AVERAGE

Exponential moving average is measured by means of the formula given below.

𝐸𝑀𝐴 = ([(𝑐𝑢𝑟𝑟𝑒𝑛𝑡 𝑐𝑙𝑜𝑠𝑖𝑛𝑔 𝑝𝑟𝑖𝑐𝑒 − 𝑝𝑟𝑒𝑣𝑖𝑜𝑢𝑠 𝐸𝑀𝐴) × 𝑓𝑎𝑐𝑡𝑜𝑟] + 𝑃𝑟𝑒𝑣𝑖𝑜𝑢𝑠 𝐸𝑀𝐴)

2
Where, 𝐹𝑎𝑐𝑡𝑜𝑟 = (𝑛+1)

A moving average denotes the underlying trend in the price movement of the shares.
The period of the average indicate the kind of trend being recognized. The moving averages are
represented on the price charts.

Table 4.18 showing the exponential moving average for 3 months period

Date Price EMA

1-Jan-10 205.66
1-Feb-10 197.43
1-Mar-10 207.82 203.6367
1-Apr-10 230.07 216.8533
1-May-10 226.88 221.8667
1-Jun-10 230.20 226.0333
1-Jul-10 250.29 238.1617
1-Aug-10 276.64 257.4008
1-Sep-10 324.05 290.7254
1-Oct-10 315.06 302.8927
1-Nov-10 299.22 301.0564
1-Dec-10 281.19 291.1232
1-Jan-11 264.24 277.6816
1-Feb-11 263.05 270.3658
1-Mar-11 276.53 273.4479
1-Apr-11 280.46 276.9539
1-May-11 229.79 253.372

54
1-Jun-11 240.47 246.921
1-Jul-11 234.48 240.7005
1-Aug-11 197.38 219.0402
1-Sep-11 191.10 205.0701
1-Oct-11 190.63 197.8501
1-Nov-11 176.25 187.05
1-Dec-11 161.91 174.48
1-Jan-12 206.16 190.32
1-Feb-12 224.75 207.535
1-Mar-12 209.63 208.5825
1-Apr-12 213.81 211.1963
1-May-12 205.60 208.3981
1-Jun-12 215.90 212.1491
1-Jul-12 200.51 206.3295
1-Aug-12 183.74 195.0348
1-Sep-12 224.06 209.5474
1-Oct-12 211.03 210.2887
1-Nov-12 217.03 213.6593
1-Dec-12 238.55 226.1047
1-Jan-13 243.80 234.9523
1-Feb-13 208.09 221.5212
1-Mar-13 207.28 214.4006
1-Apr-13 226.43 220.4153
1-May-13 204.68 212.5476
1-Jun-13 195.38 203.9638
1-Jul-13 170.84 187.4019
1-Aug-13 151.90 169.651
1-Sep-13 161.49 165.5705
1-Oct-13 179.68 172.6252
1-Nov-13 181.94 177.2826

55
1-Dec-13 176.65 176.9663
1-Jan-14 152.38 164.6732
1-Feb-14 153.32 158.9966
1-Mar-14 191.77 175.3833
1-Apr-14 207.86 191.6216
1-May-14 254.22 222.9208
1-Jun-14 268.62 245.7704
1-Jul-14 243.93 244.8502
1-Aug-14 246.07 245.4601
1-Sep-14 244.57 245.0151
1-Oct-14 270.28 257.6475
1-Nov-14 321.4 289.5238
1-Dec-14 311.85 300.6869
1-Jan-15 308.95 304.8184
1-Feb-15 301.65 303.2342
1-Mar-15 267.05 285.1421
1-Apr-15 269.75 277.4461
1-May-15 278.15 277.798
1-Jun-15 262.75 270.274
1-Jul-15 270.05 270.162
1-Aug-15 247.35 258.756
1-Sep-15 237.15 247.953
1-Oct-15 237.05 242.5015
1-Nov-15 250.2 246.3508
1-Dec-15 224.45 235.4004
1-Jan-16 179.9 207.6502

56
INTERPRETATION

Chart 4.17 Showing Exponential Moving Average for 3 months

Sell Point EXPONENTIAL MOVING AVERAGE

Rising Trend
350.00
300.00
250.00
200.00
150.00
100.00 Falling Trend
50.00 Buy Point
0.00
01/May/10

01/May/11

01/May/12

01/May/13

01/May/14

01/May/15
01/Sep/10

01/Sep/11

01/Sep/12

01/Sep/13

01/Sep/14

01/Sep/15
01/Jan/10

01/Jan/11

01/Jan/12

01/Jan/13

01/Jan/14

01/Jan/15

01/Jan/16
Price EMA

 In the above chart the upward movement indicates the bullish trend means the price is
moving higher i.e. the time when we sell the scrip. Hence the sell signal has been generated
in September 2010, March 2011, April 2011, February 2012, January 2013, April 2013,
June 2014, and November 2014.
 Hence the downward movement indicates, it is bearish which means the price will be
moving lower i.e. it is the time in which we buy the scrip, hence the buy signal has been
generated in March 2010, December 2011, September 2013, February 2014, and January
2016.

57
RELATIVE STRENGTH INDEX

The relative strength index (RSI) is a technical momentum pointer which relates the degree
of latest gains to latest losses in an effort to conclude overbought and oversold situations of a
share. It is measured by means of the method below:

100
𝑅𝑆𝐼 = 100 − 1+𝑅𝑆

Average of x days up closes

Where, 𝑅𝑆 =
Average of x days down closes

Table 4.19 showing the relative strength index for 12 months period

Date Price Upward Downwar Average Average Relative RSI

Movem d Upward Downward Strength
ent Movement Movement Movement
12 12
1-Jan-10 205.66
1-Feb-10 197.43 0 8.23
1-Mar-10 207.82 10.39 0
1-Apr-10 230.07 22.25 0
1-May- 226.88 0 3.19
10
1-Jun-10 230.20 3.32 0
1-Jul-10 250.29 20.09 0
1-Aug-10 276.64 26.35 0
1-Sep-10 324.05 47.41 0
1-Oct-10 315.06 0 8.99
1-Nov-10 299.22 0 15.84
1-Dec-10 281.19 0 18.03
1-Jan-11 264.24 0 16.95 10.8175 5.93583333 1.822406 64.56924
1-Feb-11 263.05 0 1.19 9.91604167 5.54034722 1.789787 64.15497
1-Mar-11 276.53 13.48 0 10.2130382 5.07865162 2.010974 66.78816
1-Apr-11 280.46 3.93 0 9.68945168 4.65543065 2.081322 67.5464
1-May- 229.79 0 50.67 8.88199737 8.4899781 1.046174 51.12831
11
1-Jun-11 240.47 10.68 0 9.03183092 7.78247992 1.160534 53.71514
1-Jul-11 234.48 0 5.99 8.27917835 7.6331066 1.084641 52.0301
1-Aug-11 197.38 0 37.1 7.58924682 10.088681 0.752254 42.93064
1-Sep-11 191.10 0 6.28 6.95680958 9.77129096 0.711964 41.58756

58
1-Oct-11 190.63 0 0.47 6.37707545 8.99618338 0.708865 41.48161
1-Nov-11 176.25 0 14.38 5.8456525 9.44483476 0.618926 38.23065
1-Dec-11 161.91 0 14.34 5.35851479 9.8527652 0.543859 35.22724
1-Jan-12 206.16 44.25 0 8.59947189 9.03170143 0.952143 48.77425
1-Feb-12 224.75 18.59 0 9.4320159 8.27905965 1.139262 53.2549
1-Mar-12 209.63 0 15.12 8.64601457 8.84913801 0.977046 49.41949
1-Apr-12 213.81 4.18 0 8.27384669 8.11170984 1.019988 50.49476
1-May- 205.60 0 8.21 7.58435947 8.11990069 0.934046 48.29492
12
1-Jun-12 215.90 10.3 0 7.81066285 7.4432423 1.049363 51.20435
1-Jul-12 200.51 0 15.39 7.15977428 8.10547211 0.883326 46.90245
1-Aug-12 183.74 0 16.77 6.56312642 8.8275161 0.743485 42.64362
1-Sep-12 224.06 40.32 0 9.37619922 8.09188976 1.158716 53.67616
1-Oct-12 211.03 0 13.03 8.59484928 8.50339894 1.010755 50.26743
1-Nov-12 217.03 6 0 8.37861184 7.79478236 1.0749 51.80491
1-Dec-12 238.55 21.52 0 9.47372752 7.14521717 1.325884 57.00559
1-Jan-13 243.80 5.25 0 9.12175023 6.5497824 1.39268 58.20586
1-Feb-13 208.09 0 35.71 8.36160438 8.97980054 0.931157 48.21757
1-Mar-13 207.28 0 0.81 7.66480401 8.29898383 0.923583 48.01369
1-Apr-13 226.43 19.15 0 8.62190368 7.60740184 1.133357 53.12552
1-May- 204.68 0 21.75 7.9034117 8.78595169 0.899551 47.35598
13
1-Jun-13 195.38 0 9.3 7.24479406 8.82878905 0.820588 45.07268
1-Jul-13 170.84 0 24.54 6.64106122 10.1380566 0.655063 39.57932
1-Aug-13 151.90 0 18.94 6.08763946 10.8715519 0.55996 35.89581
1-Sep-13 161.49 9.59 0 6.37950283 9.96558925 0.640153 39.03008
1-Oct-13 179.68 18.19 0 7.36371093 9.13512348 0.806088 44.6317
1-Nov-13 181.94 2.26 0 6.93840169 8.37386319 0.828578 45.31271
1-Dec-13 176.65 0 5.29 6.36020155 8.11687459 0.783578 43.93291
1-Jan-14 152.38 0 24.27 5.83018475 9.46296837 0.616105 38.12284
1-Feb-14 153.32 0.94 0 5.42266935 8.67438768 0.625136 38.46668
1-Mar-14 191.77 38.45 0 8.17494691 7.95152204 1.028098 50.69273
1-Apr-14 207.86 16.09 0 8.83453467 7.2888952 1.212054 54.79315
1-May- 254.22 46.36 0 11.9616568 6.68148727 1.790269 64.16116
14
1-Jun-14 268.62 14.4 0 12.164852 6.12469666 1.986197 66.51259
1-Jul-14 243.93 0 24.69 11.1511144 7.67180527 1.453519 59.24221
1-Aug-14 246.07 2.14 0 10.4001882 7.03248817 1.478877 59.65916
1-Sep-14 244.57 0 1.5 9.53350583 6.57144749 1.450747 59.19611
1-Oct-14 270.28 25.71 0 10.881547 6.02382686 1.806418 64.36738
1-Nov-14 321.4 51.12 0 14.2347514 5.52184129 2.577899 72.05064
1-Dec-14 311.85 0 9.55 13.0485221 5.85752118 2.227653 69.01773

59
1-Jan-15 308.95 0 2.9 11.9611453 5.61106108 2.131708 68.06855
1-Feb-15 301.65 0 7.3 10.9643832 5.75180599 1.906251 65.5914
1-Mar-15 267.05 0 34.6 10.0506846 8.15582216 1.232332 55.20381
1-Apr-15 269.75 2.7 0 9.43812754 7.47617031 1.262428 55.7997
1-May- 278.15 8.4 0 9.35161691 6.85315612 1.364571 57.70903
15
1-Jun-15 262.75 0 15.4 8.5723155 7.56539311 1.133096 53.11978
1-Jul-15 270.05 7.3 0 8.46628921 6.93494369 1.220816 54.9715
1-Aug-15 247.35 0 22.7 7.76076511 8.24869838 0.940847 48.47611
1-Sep-15 237.15 0 10.2 7.11403468 8.41130685 0.84577 45.82208
1-Oct-15 237.05 0 0.1 6.52119846 7.71869794 0.844857 45.79527
1-Nov-15 250.2 13.15 0 7.07359859 7.07547311 0.999735 49.99338
1-Dec-15 224.45 0 25.75 6.48413204 8.63168369 0.751201 42.89634
1-Jan-16 179.9 0 44.55 5.9437877 11.6248767 0.511299 33.83176

INTERPRETATION

Chart 4.18 Showing RSI for 12 months period

RELATIVE STRENGTH INDEX Sell Point

Falling Trend
80
70
60
50
40
30
20 Rising Trend
10
Buy point
0
01/Jun/11
01/Jun/10

01/Jun/12

01/Mar/13
01/Jun/13

01/Jun/14

01/Jun/15
01/Dec/14
01/Mar/10

01/Sep/10
01/Dec/10
01/Mar/11

01/Sep/11
01/Dec/11
01/Mar/12

01/Sep/12
01/Dec/12

01/Sep/13
01/Dec/13
01/Mar/14

01/Sep/14

01/Mar/15

01/Sep/15
01/Dec/15

RSI

 Overbought is a situation when it reaches above 70 and oversold is a situation when it is

below 30, here there is an overbought situation in the year November 2014, this was the
best time to sell the stocks.
 In this chart there has not been an oversold situation and most of the fluctuations had
happened when the stock price ranges from 40 to 60.

60
RATE OF CHANGE

The Rate-of-Change (ROC) meter, which is as well denoted to as simply

Momentum, is a momentum oscillator that calculates variation of prices in different period. The
ROC links the recent price with the price “n” days before. The plot formulate an oscillator that
swings up and down the zero line as the Rate-of-Change changes from positive to negative.

𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑝𝑟𝑖𝑐𝑒
𝑅𝑂𝐶 =
𝑝𝑟𝑖𝑐𝑒 𝑛 𝑝𝑒𝑟𝑖𝑜𝑑𝑠 𝑎𝑔𝑜 − 1

Table 4.20 showing rate of change for 6 months period

Date Price ROC

1-Jan-10 205.66
1-Feb-10 197.43
1-Mar-10 207.82
1-Apr-10 230.07
1-May-10 226.88
1-Jun-10 230.20 11.93232
1-Jul-10 250.29 26.77405
1-Aug-10 276.64 33.1152
1-Sep-10 324.05 40.84844
1-Oct-10 315.06 38.86636
1-Nov-10 299.22 29.98262
1-Dec-10 281.19 12.34568
1-Jan-11 264.24 -4.48236
1-Feb-11 263.05 -18.8243
1-Mar-11 276.53 -12.2294
1-Apr-11 280.46 -6.26963
1-May-11 229.79 -18.2795
1-Jun-11 240.47 -8.99561
1-Jul-11 234.48 -10.8611
1-Aug-11 197.38 -28.6226

61
1-Sep-11 191.10 -31.8619
1-Oct-11 190.63 -17.0416
1-Nov-11 176.25 -26.706
1-Dec-11 161.91 -30.9493
1-Jan-12 206.16 4.448272
1-Feb-12 224.75 17.60858
1-Mar-12 209.63 9.966952
1-Apr-12 213.81 21.31064
1-May-12 205.60 26.98413
1-Jun-12 215.90 4.724486
1-Jul-12 200.51 -10.7853
1-Aug-12 183.74 -12.3503
1-Sep-12 224.06 4.793976
1-Oct-12 211.03 2.641051
1-Nov-12 217.03 0.52339
1-Dec-12 238.55 18.97162
1-Jan-13 243.80 32.68749
1-Feb-13 208.09 -7.12756
1-Mar-13 207.28 -1.777
1-Apr-13 226.43 4.331198
1-May-13 204.68 -14.1983
1-Jun-13 195.38 -19.8605
1-Jul-13 170.84 -17.9009
1-Aug-13 151.90 -26.7175
1-Sep-13 161.49 -28.6799
1-Oct-13 179.68 -12.2142
1-Nov-13 181.94 -6.8789
1-Dec-13 176.65 3.400843
1-Jan-14 152.38 0.315997
1-Feb-14 153.32 -5.05914

62
1-Mar-14 191.77 6.728629
1-Apr-14 207.86 14.24645
1-May-14 254.22 43.91169
1-Jun-14 268.62 76.28298
1-Jul-14 243.93 59.09862
1-Aug-14 246.07 28.31517
1-Sep-14 244.57 17.66093
1-Oct-14 270.28 6.317363
1-Nov-14 321.4 19.64857
1-Dec-14 311.85 27.84405
1-Jan-15 308.95 25.5537
1-Feb-15 301.65 23.33892
1-Mar-15 267.05 -1.19506
1-Apr-15 269.75 -16.0703
1-May-15 278.15 -10.8065
1-Jun-15 262.75 -14.9539
1-Jul-15 270.05 -10.4757
1-Aug-15 247.35 -7.3769
1-Sep-15 237.15 -12.0853
1-Oct-15 237.05 -14.7762
1-Nov-15 250.2 -4.7764
1-Dec-15 224.45 -16.8858
1-Jan-16 179.9 -27.2691

63
INTERPRETATION

Chart 4.19 Showing ROC for 6 months period

RATE OF CHANGE
Over Bought
100

80
Rising Trend
Falling Trend
60

40

20

0
01/Apr/10

01/Apr/11

01/Apr/12

01/Apr/13

01/Jan/14
01/Apr/14

01/Apr/15
01/Jan/10

01/Jan/11

01/Jan/12

01/Jan/13

01/Jan/15

01/Jan/16
01/Oct/14
01/Oct/10

01/Oct/11

01/Oct/12

01/Oct/13

01/Oct/15
01/Jul/10

01/Jul/11

01/Jul/12

01/Jul/13

01/Jul/14

01/Jul/15
-20

-40

ROC
Over sold

 In the above chart, scrip’s ROC reaches the highest value in the year June 2014, the scrip
is in the overbought region and there might be fall in the value .In June 2014, the investor
can sell the scrip.
 Similarly, scrip ROC reaches the lowest value on the year of January 2016, the scrip is in
oversold region and there might be a rise in the value of the scrip. In January 2016, the
investor can buy the scrip.

64
 CHAPTER V
FINDINGS, SUGGESTIONS & CONCLUSION
 Chapter V Findings, Suggestions & Conclusion

5.1 FINDINGS
Indian economy has observed an important economic development in the previous year,
rising by 7.3% in 2015 as contrary to 6.9 % in 2014. Indian Inflation showed a decreasing trend
and Foreign Direct Investment showed an increasing trend, both inflation and FDI shows a positive
sign for the economy. India’s businesses are losing competitiveness as both export and import
growth for the last 5 years decreases.

The growth in the Indian banking sector remained under pressure in FY15. Credit growth
reduced down to 9% in FY15 from 13.9% recorded in FY14.Similarly, the growth in deposits at
10.7% in FY15 was much lower than the growth at 14.1% in the previous financial year. The net
interest margins observed marginal decline in FY15 from 2.64% to 2057 %. Banks reported a
decline in RoA from 0.73% to 0.71% in the year 2015.

When comes to the 5 year Ratio Analysis Of the company it is clear that there is decrease
in overall performance of the bank but when compared to last year, i.e. 2014, bank’s performance
has been increased. Return on Asset was highest in the year 2011-12 as there was a good Net-
worth and Net Profit in that year and the lowest was in the year 2013-2014 as the Net Profit was
low. Debt Equity ratio decreased as the Equity increased. Earnings per share showed a fluctuating
trend as the Net Profit was fluctuating. As the dividend was fluctuating Dividend per share also
fluctuated. Dividend Payout ratio was highest in the yearb2010-2011 after that it started
decreasing. Price Earnings ratio showed a decreasing trend as the market price decreased.

The 3 months moving average offers a note to the investor that now it is an accurate phase
to purchase the Share because the trend of the Moving Average line has been reduced. In case of
EMA the sell signal was shown on September 2010, March 2011, April 2011, February 2012,
January 2013, April 2013, June 2014, and November 2014.and buy signal was shown on in March
2010, December 2011, September 2013, February 2014, and January 2016. In case of RSI the
correct time to trade the share was November 2014, as the RSI was above 70 & it had touched its
topmost level. The correct time to purchase the share was January 2016 since the RSI was low. In
case of ROC it reaches the highest value in the year June 2014, the scrip is in the overbought region

65
and there will be fall in the value. ROC reaches the lowest value in the year of January 2016, the
scrip is in oversold region and there will be a rise in the value of the scrip.

66
5.2 SUGGESTIONS

 Before investing, a shareholder must have correct and sufficient information of capital
market.
 It is good to go for Long-range Venture than the Short-range Venture. Because it is less
dangerous and also offers adequate profit.
 Basically, stock market actions are very uncertain. So, shareholders must be cautious when
investing.
 In case of half information about share market is very risky. So, every time an individual
wishes to spend in share market he must take essential advices from the specialists or
Technical Specialists.
 Fundamental analysis of State Bank of India reflects SBI bank is the leading bank in Public
sector. Fundamental Analysis strongly finds a huge growth in SBI bank.
 Technical Analysis of State Bank of India shows a decreasing trend in the recent year.
Investors can buy the shares now because the price is estimated to increase in the future.
 From the study I strongly suggest investors to buy shares and if already has then hold the
share.

67
5.3 CONCLUSION
Fundamental analysis can be valued, but it must be move toward with care. Every individual have
private prejudices and all expert has some kind of prejudice. Nothing is wrong in this and the study
can still be of fair worth. One of the main problem in valuation is that there are too many models
to value an asset. Selecting the correct model to use in estimation is as important to arrive at a
reasonable value as understanding how to use the model. It is crucial to utilize the methods that
are very comfortable with and which will relate to your trading viewpoint.

Investor should not forget Technical Analysis is only a predicting tool. As any other estimates, it
must be repeatedly examined, measured and informed when new situations occur. Technical
Analysis is the predicting of upcoming monetary price actions on the basis of an inspection of
historical price actions. Technical Analysis cannot predict absolute results like weather
forecasting. But, technical analysis aid shareholders to predict what is "likely" to occur to prices.

68
BIBLIOGRAPHY

1. Investment Analysis & Portfolio Management, By, Reilly and Brown, 2006, Cengage
Publishers
2. Security Analysis And Portfolio Management, By, Donald E.Fisher and Ronald.J.Jordan,
Pearson India Publishers
3. Investment Analysis & Portfolio Management, By Prasanna Chandra, 2008, 3rd edition,
Tata McGraw Hill publishers.
WEBLIOGRAPHY

 www.nseindia.com
 www.stockchart.com
 www.sbi.com
 www.investopedia.com
 www.moneycontrol.com
 www.equitymaster.com
ANNEXURE
Profit & Loss for State Bank of India

(Rs in Cr)
Mar' 15 Mar' 14 Mar' 13 Mar' 12 Mar' 11
Income :
Operating Income 207,974.34 189,062.43 167,978.14 147,197.39 113,636.44
Expenses
Material Consumed 0.00 0.00 0.00 0.00 0.00
Manufacturing Expenses 0.00 0.00 0.00 0.00 0.00
Personnel Expenses 31,117.61 29,868.36 24,401.09 22,084.03 20,711.03
Selling Expenses 0.00 0.00 0.00 0.00 0.00
Administrative Expenses 41,148.91 31,557.95 26,841.21 23,400.40 24,426.43
Expenses Capitalised 0.00 0.00 0.00 0.00 0.00
Cost Of Sales 205,445.16 182,905.35 158,060.22 134,803.98 113,223.86
Operating Profit 51,844.35 44,039.21 42,499.62 42,084.99 34,620.06
Other Recurring Income 49,315.17 37,882.13 32,581.70 29,691.58 34,207.48
Adjusted PBDIT 234,338.16 203,400.38 181,899.23 161,096.13 136,913.94
Financial Expenses 133,178.64 121,479.04 106,817.91 89,319.55 68,086.40
Depreciation 1,581.49 1,942.43 1,577.49 1,371.61 1,380.55
Other Write offs 0.00 0.00 0.00 0.00 0.00
Adjusted PBT 75,169.74 59,207.67 58,463.52 54,160.53 54,127.23
Tax Charges 8,337.20 6,836.07 7,558.83 8,639.50 8,739.81
Adjusted PAT 66,832.54 52,371.60 50,904.69 45,521.03 45,387.42
Non-Recurring Items 0.00 0.00 0.00 0.00 0.00
Other Non-Cash 0.00 0.00 0.00 0.00 0.00
adjustments
Reported Net Profit 16,994.30 14,173.77 17,916.23 15,343.10 10,684.95
Earnings Before 68,864.91 53,794.14 51,797.43 46,043.96 45,446.00
Appropriation
Equity Dividend 2,662.48 2,236.80 2,838.74 2,348.66 1,905.00
Preference Dividend 0.00 0.00 0.00 0.00 0.00
Dividend Tax 542.06 380.13 480.72 388.46 353.55
Retained Earnings 65,660.37 51,177.21 48,477.97 43,306.84 43,187.45
Balance Sheet for State Bank of India

(Rs in Cr)
Mar' 15 Mar' 14 Mar' 13 Mar' 12 Mar' 11
SOURCES OF
FUNDS
Owners' Fund
Equity Share 746.57 746.57 684.03 671.04 635.00
Capital
Share Application 0.00 0.00 0.00 0.00 0.00
Money
Preference Share 0.00 0.00 0.00 0.00 0.00
Capital
Reserves & 160,640.97 146,623.96 124,348.99 105,558.97 82,836.25
Surplus
Loan Funds
Secured Loans 0.00 0.00 0.00 0.00 0.00
Unsecured Loans 2,052,960.79 1,838,852.36 1,627,402.61 1,414,689.40 1,255,562.48
Total 2,214,348.33 1,986,222.89 1,752,435.63 1,520,919.41 1,339,033.74
USES OF
FUNDS
Fixed Assets
Gross Block 12,379.30 10,559.78 8,693.50 7,026.67 6,141.13
Less: Revaluation 0.00 0.00 0.00 0.00 0.00
Reserve
Less: 0.00 0.00 0.00 0.00 0.00
Accumulated
Depreciation
Net Block 12,379.30 10,559.78 8,693.50 7,026.67 6,141.13
Capital Work-in- 0.00 0.00 676.43 381.30 345.70
progress
Investments 695,691.75 578,793.09 519,393.19 460,949.14 419,066.45
Net Current
Assets
Current Assets, 91,241.07 61,190.71 66,559.46 70,338.03 60,615.96
Loans &
Advances
Less : Current 235,601.11 181,089.86 172,745.65 147,319.73 163,416.58
Liabilities &
Provisions
Total Net Current -144,360.04 -119,899.15 -106,186.18 -76,981.69 -102,800.62
Assets
Miscellaneous 0.00 0.00 0.00 0.00 0.00
Expenses not
written
Total 563,711.01 469,453.72 422,576.93 391,375.41 322,752.66
Note
Book Value 216.17 1,973.97 1,827.88 1,583.05 1,314.51
Market Value of 0.00 0.00 0.00 0.00 0.00
Quoted
Investment
Contingent 1,296,309.20 1,262,762.67 1,136,690.27 1,017,565.55 921,621.06
liabilities
Number of Equity 74,657.00 7,465.70 6,840.34 6,710.45 6,349.99
shares
outstanding (in
Lacs)