Business Research Project

On

A STUDY TO UNDERSTAND THE INVESTMENT BEHAVIOUR

OF INVESTORS AND THE USE OF FUNDAMENTAL
ANALYSIS FOR MAKING INFORMED INVESTMENT
DECISION

Submitted By
Dipesh Deogharkar – 10
Yogesh Ghatvilkar – 17
Tanmay Patil – 45
Aditya Sagvekar – 52
Charchit Thak – 59

MMS-I, Batch: 2022-24

Submitted To
Dr. Balaji Sadavarte

Master of Management Studies (MMS)

 Academic Year: 2022-23

Acknowledgements

I would like to express my sincere gratitude to all those who have contributed to the successful
completion of this business research project.

First and foremost, I extend my heartfelt appreciation to my supervisor Dr. Balaji Sadavarte, for
their invaluable guidance, support, and constructive feedback throughout the course of this
research. Their expertise and insights have greatly enriched the quality of this work.

I am indebted to the participants of this study, who generously shared their time and insights,
without whom this research would not have been possible. Your contributions are deeply
appreciated.

I would like to thank my colleagues for their encouragement and assistance in various stages of
this project. Your support has been invaluable in keeping me motivated and focused.

Thank you all for your contributions, guidance, and encouragement. This project stands as a
testament to the collective effort of many, and I am truly grateful for the opportunities I have been
given.

Dipesh Deogharkar - 10
Yogesh Ghatvilkar - 17
Tanmay Patil - 45
Aditya Sagvekar - 52
Charchit Thak - 59
 Executive Summary

Any investor wants to make money, and taking informed decisions and being disciplined in line
of thought are key traits any investor should hold dear to. Taking informed decisions, both for the
seasoned and amateur investor need to be at the forefront of any investment. And this entails
reading, carrying out research, taking an interest and most importantly taking that initiative of
knowing where people’s own hard-earned money is being invested. More importantly, becoming
accustomed about which factors could impact the value of an underlying investment.

Investment in the stock market comes with a number of risks. A seasoned investor/ trader hedges
his positions in order to avoid making huge losses in the market. Therefore, it is necessary for
investors to make investments in the stock market taking into consideration the information and
data available.

This research focuses on the sources of information available to the investors, the various types of
analysis an investor can undertake before making any investment decision and how fundamental
analysis helps an investor to make an informed investment decision. Be it an investment in a simple
money market instrument and/or a bank term deposit, a short-term investment or a trade for the
longer term, preservation of capital and making money are at the forefront of any investment
decision.

We cover various aspects of investment, the equity market in India, different investment avenues,
and fundamental analysis. Investment involves growing money with specific goals in mind. The
Indian equity market has recently regained its position as the world's fifth-largest due to positive
stock market performance. Investment avenues in India include the equity market, mutual funds,
real estate, fixed income securities, gold, and insurance. Fundamental analysis is a method of
studying businesses to determine their value. It involves analyzing both quantitative (measurable)
and qualitative (non-measurable) aspects of a company to assess its potential future performance
and value in the stock market. The goal of fundamental analysis is to predict future stock prices
and make investment decisions based on the assessment of a company's intrinsic value.

The objectives of our research were to understand the different investment avenues preferred by
the investors in India, the factors which influence investment decisions, the sources of information
available to investors to make informed investment decisions and the use of fundamental analysis
and sources available for conducting fundamental analysis.
Primary research involved well-structured surveys and interviews. Ethical considerations were
maintained in data collection, and analysis was conducted using MS Excel. Secondary research
involved sourcing data from literature, financial news, investment reports, and online platforms.
The research, exploratory in nature, focused on salaried employees, professionals, entrepreneurs,
and retirees engaged in various investment avenues. Cluster random sampling was used to select
100 respondents for analysis.

The study received responses from 101 participants via sample surveys and telephonic
conversations. The data collected was then analyzed based on several factors such as income
groups, age groups, educational qualification, profession, percentage of monthly income invested,
sources of information, number of earning family members, number of family members financially
dependent on the respondent, etc. Overall, the study aimed to uncover patterns and relationships
among these factors and their impact on investment behavior.
 Table of Contents

Chapter No. Particulars Page No.

Chapter 1 Introduction 1
Chapter 2 Project Details
2.1 Literature Review 7
2.2 Research Objectives 12
Chapter 3 Research Methodology 13
Data Presentation, Data Tabulation
Chapter 4 16
and Data Analysis and Findings
Chapter 5 Conclusions, Suggestions, Limitations
25
and Scope for Further Research
Annexures
Bibliography/Webliography 28
Questionnaire 30
Tables/ Charts/Figures 32
 Chapter 1
Introduction

An investment is essentially an asset that is created with the intention of allowing money to grow.
The wealth created can be used for a variety of objectives such as meeting shortages in income,
saving up for retirement, or fulfilling certain specific obligations such as repayment of loans,
payment of tuition fees, or purchase of other assets.

Investment may generate income for you in two ways. One, if you invest in a saleable asset, you
may earn income by way of profit. Second, if Investment is made in a return generating plan, then
you will earn an income via accumulation of gains. In this sense, ‘what is investment’ can be
understood by saying that investments are all about putting your savings into assets or objects that
become worth more than their initial worth or those that will help produce an income with time.

Equity Market of India

The Indian economy has recently reclaimed its position as the world's fifth-largest market, a
notable achievement following a brief setback where it temporarily lost this ranking to France
earlier in the year. This resurgence in status can be attributed to the positive performance of the
Indian stock market, which has been fuelled by a series of factors. Notably, the local equity market
in India has been on a steady rally since March 28, benefiting from consistent foreign investor
interest alongside an improvement in the country's macroeconomic conditions.

Comparatively, the global landscape of market capitalization is led by the United States with a
staggering value of $44.54 trillion, closely followed by China at $10.26 trillion, and Japan at $5.68
trillion. Notably, India's resurgence has pushed it ahead of France, which now holds the sixth
position with a market capitalization of $3.24 trillion.

Confidence in India's economic trajectory is bolstered by foreign brokerage Jefferies, which holds
a positive view of the country's enduring structural narrative. This outlook is rooted in projections
of consistent growth, with the BSE benchmark Sensex potentially surpassing the remarkable
milestone of 1,00,000. This target has not only captured the attention of financial experts but also
the vibrant Indian financial media landscape. Jefferies' projection is built upon the assumption of
a 15 percent earnings per share (EPS) growth over five years and the maintenance of a five-year
average one-year forward price-to-earnings (PE) multiple of 19.8 times.

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As the market awaits the release of gross domestic product (GDP) data for the March quarter,
scheduled for May 31, investors are eager to gain further insights into the Indian economy's state.
This data has the potential to influence market sentiment and investment decisions, providing a
valuable perspective on the ongoing growth trajectory of the Indian economy.

What are the different investment avenues?

The following are the very common investment avenues that Indians prefer:

I. Equity Market:
The Indian equity market is a marketplace for buying and selling ownership shares (stocks) in
publicly listed Indian enterprises. It includes exchanges such as the BSE and NSE. Companies go
public through Initial Public Offering (IPO) in which they sell shares to investors. Stock prices
fluctuate in response to firm performance and market conditions, influencing market capitalization.
Dividends can supplement shareholders' income. Bull and bear markets represent increasing and
declining patterns, respectively. Investors want long-term growth, whereas traders seek short-term
returns. Indices such as the Nifty 50 and Sensex measure overall market performance. Limit orders
define buying/selling prices, whereas market orders execute instantaneously. Before investing,
conduct thorough research and use extreme caution.

II. Mutual Funds:

Mutual funds aggregate funds from different participants in order to invest in a diverse portfolio
of stocks, bonds, or other assets. Individuals may easily access a range of assets through these
professionally managed funds without having to handle them personally. Each investor holds a
number of shares in proportion to their investment. Mutual funds cater to a wide range of risk
profiles and investing objectives, from conservative to aggressive. They promote diversification
by distributing investments over diverse assets, which reduces risk. Returns and risks differ
depending on the fund's strategy. Expense ratios are included in costs. Mutual funds provide
liquidity by allowing investors to purchase and sell shares at their net asset value (NAV). They are
appropriate for investors looking for ease and diversification in their investing path.

III. Real Estate:

Real estate refers to physical property such as land, buildings, and homes It is a tangible asset type
with several investing options. Houses and apartments are examples of residential real estate,
whereas offices, retail spaces, and industrial assets are examples of commercial real estate. Rental
income and property value increase may both benefit investors. Buy-and-hold, fix-and-flip, and
real estate investment trusts (REITs) are some of the tactics used in real estate investing. Location,
economic trends, and market demand are among the factors that influence real estate. It does,
however, necessitate large cash, requires maintenance and supervision, and might be illiquid.
Thorough study and comprehension of local rules are required for profitable real estate investing.

IV. Fixed Income Securities:

Fixed income securities are financial instruments that offer investors consistent, predictable
income. Bonds issued by governments, businesses, and municipalities are among them. When you

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purchase a bond, you are effectively lending money to the issuer in exchange for periodic interest
payments and the return of the principal when the bond matures. Fixed income investments are
less risky than equities and provide portfolio stability. The interest rate, or coupon, is fixed. Bond
prices can change in response to market conditions, influencing yields. Fixed income investment
is influenced by factors such as credit quality, interest rates, and the economic outlook. It is
appropriate for investors seeking consistent income and capital preservation, and it is frequently
employed in retirement planning.

V. Gold:
Gold is a valuable metal with long-term worth and diverse uses. It functions as a value store,
inflation hedge, and safe-haven asset during times of economic turmoil. Gold is purchased by
investors as a hedge against market volatility and currency changes. It is traded on commodity
exchanges, and its price is affected by supply and demand dynamics, geopolitical events, and
central bank policies. Physical gold ownership (coins, bars) or financial instruments (ETFs,
futures) can be obtained. While it does not earn income like stocks or bonds, its value frequently
increases over time. Gold's distinct characteristics make it a popular component of many
investment portfolios.

VI. Insurance:
Insurance as an investment is employing insurance products to generate financial returns while
also protecting against danger. Annuities and whole life insurance are popular alternatives. Whole
life insurance combines a death benefit with a cash value that accumulates over time and allows
for withdrawals or loans. Annuities make monthly payments and can be used to supplement
retirement income. However, as compared to traditional investments, these choices frequently
have greater fees and lower potential returns. Before utilising insurance as an investing strategy,
thoroughly analyse the benefits and downsides, examine your financial goals and risk tolerance,
and get expert guidance.

What is Fundamental Analysis?

Fundamental Analysis (FA) is a holistic approach to study a business. When an investor wishes to
invest in a business for the long term (say 3-5 years) it becomes extremely essential to understand
the business from various perspectives. It is critical for an investor to separate the daily short-term
noise in the stock prices and concentrate on the underlying business performance. Over the long
term, the stock prices of a fundamentally strong company tend to appreciate, thereby creating
wealth for its investors.

Fundamental analysts study anything that can affect the security's value, from macroeconomic
factors such as the state of the economy and industry conditions to microeconomic factors like the
effectiveness of the company's management. The end goal is to arrive at a number that an investor
can compare with a security's current price in order to see whether the security is undervalued or
overvalued.

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This method of stock analysis is considered to be in contrast to technical analysis which forecasts
the direction of prices through an analysis of historical market data such as price and volume.
All stock analysis tries to determine whether a security is correctly valued within the broader
market. Fundamental analysis is usually done from a macro to micro perspective in order to
identify securities that are not correctly priced by the market.

Analysts typically study, in order, the overall state of the economy and then the strength of the
specific industry before concentrating on individual company performance to arrive at a fair
market value for the stock.

Fundamental analysis uses public data to evaluate the value of a stock or any other type of security.
An analyst works to create a model for determining the estimated value of a company's share price
based on publicly available data. This value is only an estimate, the analyst's educated opinion, of
what the company's share price should be worth compared to the current market price. Some
analysts may refer to their estimated price as the company's intrinsic value.

If an analyst calculates that the stock's value should be significantly higher than the stock's current
market price, they may publish a buy or overweight rating for the stock. This acts as a
recommendation to investors who follow that analyst. If the analyst calculates a lower intrinsic
value than the current market price, the stock is considered overvalued and a sell or underweight
recommendation is issued.

Investors who follow these recommendations will expect that they can buy stocks with favourable
recommendations because such stocks should have a higher probability of rising over time.
Likewise, stocks with unfavourable ratings are expected to have a higher probability of falling in
price. Such stocks are candidates for being removed from existing portfolios or added as "short"
positions.

This method of stock analysis is considered to be the opposite of technical analysis which forecasts
the direction of prices through an analysis of historical market data such as price and volume.

Objectives of Fundamental Analysis:

i. The objectives of fundamental analysis of stock market are -

ii. To predict the future price of the share of the company
iii. To do the valuation of the asset of the company
iv. In order to project the performance of the business
v. To measure the credit risk
vi. To evaluate the management’s decisions
vii. In order to find the intrinsic value of the asset
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Categories of Fundamental Analysis:

The problem with defining the word fundamentals is that it can cover anything related to the
economic well-being of a company. They obviously include numbers like revenue and profit, but
they can also include anything from a company's market share to the quality of its management.

The various fundamental factors can be grouped into two categories: quantitative and qualitative.
The financial meaning of these terms isn't much different from their standard definitions. Here is
how a dictionary defines the terms:

• Quantitative - related to information that can be shown in numbers and amounts.

• Qualitative - relating to the nature or standard of something, rather than to its quantity.

Quantitative fundamentals are hard numbers. They are the measurable characteristics of a
business. That's why the biggest source of quantitative data is financial statements. Revenue, profit,
assets, and more can be measured with great precision.

Qualitative fundamentals are less tangible. They might include the quality of a company's key
executives, its brand-name recognition, patents and proprietary technology.

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 Qualitative Fundamentals Quantitative Fundamentals

Management's Background Profitability and its growth

Business Ethics Margins and its growth

Corporate Goveranance Earnings and its growth

Minority Shareholders Matters related to expenses

Share Transacations Operating efficiency

Related Party Transactions Pricing power

Salaries paid to Promoters Tax Matters

Operator Activity in Stocks Dividends Payout

Shareholders Cash Flow from various activities

Political Affiliations Borrowings and debts

Promoter Lifestyle Working Capital Management

Asset Growth

Investments

Source: Zerodha Varsity Fundamental Analysis Modules Financial Ratios

Chart 1: Factors considered for fundamental analysis

The quantitative aspects are matters related to financial numbers. Some of the quantitative aspects
are straightforward while some of them are not. For example, cash held in inventory is straight
forward however ‘inventory number of days’ is not. This is a metric that needs to be calculated.
The stock markets pay a lot of attention to quantitative aspects.

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 Chapter 2.1
Literature Review
1. Dr. H.S. Abzal Basha, M. Yellaiah Naidu and Ramesh Naik Vankadoth - December 2021
- A Study on the Impact of Macroeconomic Factors on Indian Stock Market Indices
(ISBN: 978-93-90631-39-1 135)

Nowadays, the stock market will react immediately to any changes in the economy. The share
market has made a significant contribution to India's economic growth. Indian equity market
expansion or contraction causes enormous changes in the country's economy. Only around 10%
of Indians are directly participating in these markets, but every single person is either directly
or indirectly impacted. If something occurs in these markets, it is evidence of a significant
relationship between the stock markets and the actual economy, both on the surface and at the
core.

In the current situation, it was very clear that stock markets all over the world plummeted,
genuine economic fundamentals started to deteriorate, and that everything combined to cause a
recession. Due to the fact that stock market manipulation is thought to be the cause of the current
recession, as well as the fact that a country can use the stock market to strengthen its genuine
economic fundamentals, this research is even more crucial. Therefore, it is obvious that stock
prices are forward-looking and may constitute a group of potentially helpful indicators of the
future values of macroeconomic and microeconomic variables. In order to better understand
how macroeconomic issues, affect Indian stock market indexes, a study has been conducted.

2. Mr. Sujoy Dhar - 16th June 2013 - Fundamental Analysis-Guideline for Retail Investors

Fundamental security analysis gauges a share's intrinsic value; if market price is lower, it's
considered underpriced and a good buy. The analysis involves economic, industry, and
company assessments. Economic analysis looks at GDP, inflation, interest rates, and more.
Industry analysis categorizes industries and uses models like Michael Porter's Five Forces
Model. Company analysis considers liquidity, profitability, and management.

This article emphasizes how fundamental analysis guides individual investors through
economic, industry and company scrutiny. Economic analysis covers GDP, BOP, inflation,
infrastructure, etc. Industry analysis categorizes into growth, defensive, cyclical industries.
Company analysis utilizes ratio analysis.

3. Mr. Chandra Sekhar - October 2022 - Impact of Systematic Risk on Equity Stocks in
Indian Stock Market

Due to the importance of stock markets to the Indian economy, the capital market pricing of
securities is a topic of discussion. The primary goal of this study is to determine how evaluating
systematic risk in equity stocks across industries may affect trading on the National Stock

7
 Exchange (NSE). Policymakers and investors can use the findings to better understand the
variables affecting stock prices. It gives investors useful data on systematic risk and stock
returns to help them make investing decisions.

The report can be used by market authorities to evaluate NSE performance and boost investor
trust through legal and regulatory actions. The analysis emphasizes how sector betas and returns
interact, underscoring the significant influence that systematic risk has on stock market
outcomes. In the end, market changes that are influenced by fundamental research taking into
account Economic, Industry, and Company (EIC) aspects cause stock values to fluctuate.

4. Sanchari Ghosh – 23rd April 2023 - Should insurance be treated as an investment or an

expense? (LiveMint.com)

To guard against unforeseen disasters in life, insurance is an expense that is required. However,
there are many goods on the market that have the extra benefit of returns, making it unclear
whether they should be viewed as investments or expenses. Even though it may provide a form
of investment for your family in the event of your death, it should be viewed primarily as
insurance. Insurance should be seen as an expense due to its structure. Insurance policies
comprise administrative expenses and mortality charges.
Adding investment components to insurance products makes them inefficient. The expense
structure applies to investments too, reducing returns significantly. Traditional insurance
products like endowment, money-back, and whole-life policies lack transparency regarding
deductions for charges, investments, and mortality.
Insurance is essential for unforeseen events. However, insurance products are not recommended
as investments due to high costs and lack of flexibility. Viewing insurance as an investment is
complex.

5. Vipul Das – 14th October 2022 - Gold vs Equity: Where should investors invest in this
festive season? (LiveMint.com)

Gold and equity are distinct investment options with differing characteristics. Equities
historically outperform inflation over the long term, while gold serves as a hedge against
uncertainty and enhances portfolio diversification. Gold investments are driven by cultural and
sentimental factors but often overlook considerations such as inflation and liquidity. Equities
offer the potential for higher returns, yet they carry market fluctuation risks. Portfolio
diversification involves balancing gold and equity allocations based on individual goals, risk
tolerance, and investment horizon.
Recent performance data shows equities delivering an 11-14% CAGR in the past decade, while
gold achieved a CAGR of approximately 6%. Amidst global geopolitical and economic
uncertainties, gold demand has risen, making Gold ETFs, Gold mutual funds and Sovereign
Gold Bonds appealing for diversification. Equities remain attractive despite market volatility,
offering potential for wealth maximization and inflation protection.

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6. 7th June 2023 - Most Indian investors choose equities after 35 years of age; 60% adopt
long-term approach, reveals ‘Kundli’ survey (LiveMint.com)

The 'Indian Investor Kundli' survey by equity investment advisory brand 'Research & Ranking'
reveals that Indian investors over the age of 35, particularly from non-metro cities, show a
strong inclination towards direct equity investments. More than half of the respondents (52%)
were from non-metropolitan cities, reflecting a growing interest in financial markets beyond
major urban centres.

As investors age, they become more comfortable with lump-sum investments, indicating
increased confidence and risk tolerance. Key findings include the preference for long-term
investments (58%), 43% using Systematic Investment Plans (SIPs), and 31% having an
investible surplus exceeding ₹25 lakhs. Performance-wise, around 30% of investors
underperformed the index, while wealth creation accelerates notably between ages 35 and 49,
with investors over 50 showing a surge in portfolios exceeding ₹1 crore.

Metro city investors exhibit larger portfolios and bullish sentiment for FY24, focusing on early
retirement and robust retirement corpus building, distinct from non-metro investors aiming for
lifestyle upgrades or property purchases.

7. Outlook Money Team - 7th Aug 2023 - India’s New-Age Investors are Moving from
Savings to Wealth-Creation (Outlook.com)

Mutual funds and systematic investment plans (SIPs) are favoured by Indians across age groups
due to their perceived reliability and potential for guaranteed returns. While real estate isn't
among the top choices, mutual funds and equities are seen as safe with medium-high earning
potential. Bank deposits remain the preferred risk-neutral option. The study highlights the
evolving dynamics of investment preferences and perceptions among new-age Indian investors.

The shift in India's retail investors' mindset from savings to wealth creation is evident, with
investment goals now including improving lifestyles and enjoying current gratification while
securing the future. This transformation leads to a larger risk appetite among present investors,
who also adopt a diversified portfolio approach. The survey conducted by Nielsen IQ on behalf
of NSE reveals that investment purposes vary, with 32% aiming for long-term returns, 30% for
wealth multiplication, 28% for higher returns, 25% for retirement, 27% for lifestyle
improvement, and 26% for additional income. Different age groups exhibit varied investment
tendencies, with younger investors focusing on multi-asset investments while older individuals
engage in speculative trading.

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8. Sriyank Levi - July 2021 - Fundamental and Technical Analysis Leads to a Systematic
Investment Decision in Stock Market Equities (ISSN – 0976-2132)

Investments hold a crucial role in generating additional income and mitigating future risks,
particularly evident in the growing prominence of equity investments among Indian portfolio
investors over the last decade. While equities offer opportunities for profit, they also entail the
risk of financial loss. Addressing this concern, researchers have developed various theories,
techniques, and algorithms to aid prudent investment decisions. Fundamental research delves
into identifying and analyzing factors influencing stock prices.

As companies are integral to both industry and the overall economy, factors at these levels can
impact stock prices. Fundamental and technical analyses, focusing on market behavior and
performance indicators, guide buy/sell decisions for optimal profits. Modern advancements,
including machine learning tools like Artificial Neural Networks (ANN) and Support Vector
Machines (SVM), facilitate data processing for decision-making. This paper highlights the
advantages of merging fundamental and technical analysis, utilizing them to evaluate intrinsic
value, patterns, and trends in equities. Through a review of past literature, the study underscores
the potential of an integrated approach to enhance investment decision-making.

9. Shivani Bazaz – 5th May 2022 - Can curated portfolios like Smallcase offer better
returns than mutual funds? (Economic Times)

Many mutual fund investors are talking about curated stock portfolios like Smallcase these
days. If you missed the buzz, these platforms provide baskets of stocks based on various themes,
strategies and allocation processes. They sound much like thematic mutual funds. Basically,
platforms like Smallcase use the RIA model, where registered investment advisors create
baskets of stocks. Just like some mutual funds schemes, these baskets are made based on various
strategies like value, growth, themes, sectors etc. However, these platforms provide a wider
range of options.

The difficulty of managing individual stock portfolios, potential tax complications, and
differences in diversification highlight the importance of mutual funds in streamlining
investments, particularly for novices. Diversification, taxes, fees, and minimum investments
are all distinctions. While beginners are best served by mutual funds until they have a firmer
understanding of the stock market, those making the switch from mutual funds to direct stock
trading benefit from curated portfolios. In essence, while professionally managed stock
portfolios have their appeal, inexperienced investors can still choose from a variety of
accessible, diversified mutual funds depending on their knowledge with the market and interest
in the nuances of stock trading.

10. Gunjan Goel - April 2023 - Real Estate vs Equity: Which will give better returns in the
long term?

Popular long-term wealth-building investments include equities and real estate, each of which
has specific advantages. Stocks offer liquidity and the possibility for growth, while real estate
offers reduced risk, higher returns, and benefits of diversification. Economic and market
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hazards exist for both asset groups. Investing in real estate involves rising property values and
rental revenue, whereas investing in stocks focuses on corporate shares, dividends, and capital
gains. Real estate has little liquidity and costs for upkeep, taxes, and registration, whereas
equities have higher liquidity.

Real estate is subject to capital gains tax, whereas equities are taxed at varied rates depending
on holding periods, so the tax consequences for each are different. Returns fluctuate over
time; historical data indicates that both asset classes outperform conventional investing.
Numerous cities have seen an increase in real estate costs, and over the previous ten years, top
developers' stock values have also increased significantly. However, it is still difficult for both
to forecast exact long-term returns. In general, it has been demonstrated that real estate and
stocks outperform traditional options like fixed deposits.

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 Chapter 2.2
Research Objectives

1. To understand the different investment avenues that investors prefer.

2. To understand how factors such as demographics, financial conditions, etc. affect investment
decisions.
3. To understand the sources of information available to investors.
4. To explore the various sources available for fundamental analysis.
5. To analyze the use of fundamental and technical analysis by investors before investing

The following are the hypothesis for the purpose of our research study:

1. To understand the different investment avenues that investors prefer

H1: There is a significant difference in the preference for investment avenues among
different groups of investors.
H0: There is no significant difference in the preference for investment avenues among
different groups of investors.

2. To understand how factors such as demographics, financial conditions, etc. affect

investment decisions
H1: Demographic and financial factors significantly influence investment decisions.
H0: Demographic and financial factors do not significantly influence investment decisions.

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 Chapter 3
Research Methodology
The purpose of the study was to find out how well fundamental analysis can help investors make
decisions about their investments. A strategy of gaining qualitative insights was used to
accomplish this.

Historical financial information on a few chosen organizations was gathered for the quantitative
part from reliable financial databases. To evaluate the companies' financial performance and
health, important financial ratios and indicators were determined. Relationships between basic
factors and stock returns were established using statistical approaches like regression analysis and
correlation.

In-depth interviews and internet surveys with investors were done throughout the qualitative phase.
The purpose of these surveys was to learn more about what are their preferred investment avenues
and whether fundamental analysis is applied in the interviewees' investment strategies. Participants
were questioned about how they make decisions, the importance they place on different financial
measurements, and any difficulties they may run into when using basic analysis.

To contextualize the findings and compare them with accepted theories and methods in the field
of investment analysis, the research also included a thorough review of pertinent academic
literature and research reports.

The research aimed to provide a thorough understanding of how fundamental analysis is used by
investors to make knowledgeable investment decisions, while also recognizing any limitations and
potential biases in its application.

How was the primary research conducted?

In order to gather first-hand information from people, businesses, or other sources and provide
answers to specific research questions, primary research is an essential technique for discovering
new information and acquiring direct perspectives. A research's effectiveness depends on
meticulous preparation, moral concerns, and in-depth analysis.

We followed the following procedure for carrying out primary research:

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1. We clearly stated the aims, questions, and goals of the research. We decided what precise data
must be collected and why primary research is the best strategy for achieving your objectives.
2. We decided that surveys and interviews will be the most appropriate methods to collect data.
Therefore, we prepared well-structured questionnaires for surveys that include both open-ended
and closed-ended items. We also prepared interview guides with pertinent questions for
interviewees or focus groups.
3. We chose a representative sample from our target population after studying the target
population.
4. Survey questionnaire was shared with the representative sample by using Google Form. We
ensured that the data collected for the purpose of analysis matched with the ethical standards of
the Institute and did not infringe on the privacy of the participants.
5. For the purpose of data cleaning and analysis, we used MS Excel application. The data collected
from the participants was first cleaned and to fix or remove any incorrect, duplicate or
incomplete responses.
6. The data collected was then analyzed using MS Excel. Factors which affect investment
decisions were analyzed and recommendations have been suggested based on the findings.

How was the secondary research conducted?

Data collection is essential to analyze the performance of a business unit, solving a problem and
making assumptions about specific things when required. Secondary data is data collected by
someone other than the actual user. It means that the information is already available, and someone
analyses it. The secondary data includes magazines, newspapers, books, journals, etc. It may be
either published data or unpublished data.

We referred the following sources to gather secondary data for our research:
1. Literature Review: Review of scholarly publications, research papers, and reports on
investor preferences and fundamental analysis sources.
2. Financial News and Media: News pieces about investor trends and preferences in financial
news outlets, business periodicals, and websites.
3. Brokerage and Investment Reports: Reports and analysis from renowned brokerage firms,
investment banks, and financial institutions
4. Reports from Government Agencies and Regulatory authorities:
5. Information on investment patterns as well as the performance of various investment
vehicles.
6. Online Surveys and Databases:
7. Discussions on financial blogs, forums, and social media platforms
8. Academic studies
9. Investor Education tools

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10. Investor surveys
11. Stock Market Analysis Tools

The following is a brief summary of the research:

• Nature of Research: The nature of our research was exploratory.

• Data Collection Method: We have used structured questionnaire for survey along with some
in-depth interviews with the targeted audience who were unable to respond to the survey over
the Google Form.

• Population Size & Characteristics (Target Audience): The population of interest was
primarily salaried employees, entrepreneurs, professionals and retired individuals who make
investments in sources such as equity markets, mutual funds, gold, real estate and fixed income
securities.

• Sampling Design: We have used cluster random sampling method to select respondents for the
survey. The population was divided into categories as per their income sources and professions.
Salaried employees, entrepreneurs, professionals and retired individuals were selected for the
survey.

• Sample Size: The sample size for our analysis is 100 respondents.

15
 Chapter 4
Data Presentation, Data Tabulation and Data Analysis

101 responses were received from the respondents. The data was analyzed taking into
considerations the following factors:

1. Gender - The gender data for the respondents was collected to analyze the preferences of
investments and factors that influence these preferences.

2. Age groups - The respondents were divided into age groups like 15 - 25 years, 26 - 40 years,
41 - 60 years and above 60 years.

3. Educational qualification - The respondents were divided into undergraduates, graduates and
post-graduates.

4. Profession - The respondents were divided into salaried employees, entrepreneurs/

professionals and retired individuals.

5. Annual income - The respondents were divided into income groups such as up to INR 10 lakhs,
INR 10 to 20 lakhs, INR 20 to 50 lakhs and above INR 50 lakhs.

6. Percentage of monthly income that you invest – The respondents were analyzed based on the
percentage of monthly income they are able to invest. We have grouped the respondents as 0-
5%, 5-10%, 10-20% and above 20%.

7. Preferred investment avenues - The respondents were asked if they preferred to invest in
equity market, mutual funds, real estate, fixed income securities, gold, insurance, etc.

8. Source of information for information decision - The respondents were asked if their source
of financial information from financial consultants, news portals, annual reports, research firm
reports and unsolicited tips.

9. Knowledge of fundamental analysis - The respondents were asked if they knew what
fundamental analysis is, financial ratios, sources of fundamental data of the companies, etc.

10. Number of earning members in family - The respondents were asked how many are earning
members in the family.

11. Number of financially dependent members in the family - The respondents were asked how
many family members are financially dependent on them.

16
All the above factors were considered for analysis. The following are the observations:

1. Investment preferences:

No. of % of no. of
SN Investment products
respondents respondents
1 Equity Market 68 67.33%
2 Mutual Funds 67 66.34%
3 Real Estate 16 15.84%
4 Fixed Income Securities 43 42.57%
5 Gold 41 40.59%
6 Insurance 17 16.83%
Table 4.1.1: Investment preferences of respondents

Investments by respondents
68
67
70
No. of respondents

60
43 41
50
40
17
30 16
20
10
0
Equity Mutual Real Fixed Gold Insurance
Market Funds Estate Income
Securities
Investment products

Chart 4.1.1: Investment preferences of respondents

67% of the respondents said they invest in equity markets while 66% of the respondents said
that they invest in mutual funds. 17 % of the respondents considered insurance as an investment
product and had bought insurance policies such as ULIPs to get the double benefit of an
insurance cover along with returns.

17
2. Investments by age groups:

Investment Preferences
Fixed
Age groups Equity Mutual Real
Income Gold Insurance
Market Funds Estate
Securities
15-25 years 29 24 7 12 14 0
25-40 years 21 28 5 12 17 2
41-60 years 10 8 0 7 3 5
60 years and above 8 7 4 12 7 10
Total 68 67 16 43 41 17
Table 4.2.1: Investment preferences of respondents by age groups

Investment preferences by age groups

10
Insurance 5
2
0
7
3
Investment products

Gold 17
14

Fixed Income 12
7
Securities 12
12

Real 4
0
Estate 5
7

Mutual 7
8
Funds 28
24

Equity 8
10
Market 21
29

0 5 10 15 20 25 30 35
No. of respondents

60 years and above 41-60 years 25-40 years 15-25 years

Chart 4.2.1: Investment preferences of respondents by age groups

It is a general practice that investors tend to take higher risks in their early ages when it came
to investment while they follow a conservative approach in their later stages of life. According
to the responses, it was observed that majority of the respondents who invested in equity
markets belonged to the age group of 15-25 years and 25-40 years. Fixed income securities and
gold are a popular investment product amongst the respondents of all age groups. Respondents
also claimed that they try to maintain a balance between equity investments and mutual funds
so as to reap the benefits of higher returns from the market as well as preserve their capital.

18
3. Investments by income groups:

Investment Preferences
Fixed
Equity Mutual Real
Income groups Income Gold Insurance
Market Funds Estate
Securities
Upto INR 10 lakhs 41 38 11 24 24 9
INR 10 to 20 lakhs 17 18 3 11 10 5
INR 20 to 50 lakhs 7 8 0 5 4 2
INR 50 lakhs and above 3 3 2 3 3 1
Total 68 67 16 43 41 17
Table 4.3.1: Investment preferences of respondents by income groups

Investment Preferences
Percentage of monthly Fixed
Equity Mutual Real
income invested Income Gold Insurance
Market Funds Estate
Securities
0 - 5% of income 15 18 6 14 17 5
5 - 10% of income 21 14 4 14 9 6
10 - 20 % of income 14 18 2 7 6 4
Above 20% of income 18 17 4 8 9 2
Total 68 67 16 43 41 17
Table 4.3.2: Investment preferences of respondents by percentage monthly income invested

Investment preferences by income groups

1
Insurance 2
5
9
3
Investment products

Gold 4
10
24
Fixed Income 3
5
Securities 11
24
Real 2
0
Estate 3
11
Mutual 3
8
Funds 18
38
Equity 3
7
Market 17
41
0 5 10 15 20 25 30 35 40 45
No. of respondents

INR 50 lakhs and above INR 20 to 50 lakhs INR 10 to 20 lakhs Upto INR 10 lakhs

Chart 4.3.1: Investment preferences of respondents by income groups

Usually, we see that people with higher income groups are able to invest a higher percentage of
their salaries and invest in multiple investment products while people with lower income invest
a lower percentage of their income. This general trend is due to the fact that the lower income

19
 groups spend a major source of their income on daily necessities, EMIs, etc. According to the
responses, we observed that 48 out of the 65 respondents who earned an income upto INR 10
lakhs invested upto 10% of their income. On the other hand, 5 out of the 12 respondents who
earned more than INR 20 lakhs were able to invest more than 20% of their income.

4. Investments by profession:

Investment Preferences
Fixed
Profession Equity Mutual Real
Income Gold Insurance
Market Funds Estate
Securities
Entrepreneur/ Professional 13 12 2 11 10 6
Retired 4 4 2 8 4 7
Salaried Employee 51 51 12 24 27 4
Total 68 67 16 43 41 17
Table 4.4.1: Investment preferences of respondents by profession

Investment preferences by profession of the respondents

4
Insurance 7
6
Investment products

27
Gold 4
10
Fixed Income 24
8
Securities 11
Real 12
2
Estate 2
Mutual 51
4
Funds 12
Equity 51
4
Market 13

0 10 20 30 40 50 60

No. of respondents

Salaried Employee Retired Entrepreneur/ Professional

Chart 4.4.1: Investment preferences of respondents by profession

As per the responses, 78 out of 101 respondents were salaried employees. We observed that 51
respondents regularly invested in equity markets and mutual funds while 27 respondents said
that they also invested in physical gold. Further, we also received responses from 8 retired
respondents who said that they preferred fixed income securities which guaranteed a fixed

20
 return and safety of their capital. It was further observed that 7 out of the 8 retired respondents
considered insurance as an investment.

5. Investments by no. of earners in the family:

Investment Preferences
No. of income earners in Fixed
Equity Mutual Real
family Income Gold Insurance
Market Funds Estate
Securities
Only one member 17 17 3 13 9 2
Two members 35 29 8 23 22 12
Three or more members 16 21 5 7 10 3
Total 68 67 16 43 41 17
Table 4.5.1: Investment preferences of respondents by no. of income earners in family

Investment preferences by no. of earning members in family

12
Insurance 3
2
Investment products

22
Gold 10
9
Fixed Income 23
7
Securities 13
Real 8
5
Estate 3
Mutual 29
21
Funds 17
Equity 35
16
Market 17

0 5 10 15 20 25 30 35

No. of respondents

Two members Three or more members Only one member

Chart 4.5.1: Investment preferences of respondents by no. of income earners in family

A greater number of income earners in family is generally linked with higher investments in
the family. According to the responses that we gathered, we observed that respondents with
two or more income earners in the family tend to invests in higher number of investment
products as compared to investors with single earner in the family. The reason as per the
responses gathered from the respondents is a higher income is available for investments after
paying off the monthly bills and expenses.

21
6. Investments by no. of family members financially dependent on the respondent:

Investment Preferences
No. of dependent family Fixed
Equity Mutual Real
members Income Gold Insurance
Market Funds Estate
Securities
None 43 39 10 20 25 5
Only one member 11 13 3 10 8 8
Two or three members 12 13 2 11 7 4
Four or more members 2 2 1 2 1 0
Total 68 67 16 43 41 17
Table 4.6.1: Investment preferences of respondents by no. of financially dependent family members

Investment preferences by no. of dependent family members

4
Insurance 8
5
7 8
Investment products

Gold
25
11
Fixed Income 10
Securities 20
2
Real 3
Estate 10
13
Mutual 13
Funds 39
12
Equity 11
Market 43

0 5 10 15 20 25 30 35 40 45
No. of respondents

Two or three members Only one member None

Chart 4.6.1: Investment preferences of respondents by no. of financially dependent family members

As per the responses gathered, we observed that respondents with no financially dependent
members tend to invest heavily in equity markets and mutual funds. 43 out of 68 respondents
who invested in equity markets belonged to the category with no financially dependent family
members. Similarly, 39 out of 67 respondents who invested in mutual funds also belonged to
the category with no financially dependent family members. Further, it was observed that
fixed income securities received equal response from all categories.

22
7. Sources of information to make investment decisions:

No. of
Source of information
respondents
Financial Consultants 63
News Portals 66
Annual Reports 40
Research Firm Reports 37
Unsolicited Tips 8
Table 4.7.1: Sources of information for making investment

Source of information to make investment decisions

Unsolicited Tips 8
Sources of information

Research Firm Reports 37

Annual Reports 40

News Portals 66

Financial Consultants 63

0 10 20 30 40 50 60 70
No. of respondents

Chart 4.7.1: Sources of information for making investment

63% of the respondents said that they used the services of a financial consultant along with
other sources to make investment decisions. The respondents also used information available
online such as annual reports of the companies and research firm reports to make investments
in the equity market.

23
8. Knowledge about analysis techniques:

No. of
Source of information
respondents
Only Fundamental Analysis Techniques 31
Only Technical Analysis Techniques 11
Both 59
Table 4.8.1: Knowledge about analysis techniques

Knowledge about analysis techniques

Both 59

Only Technical Analysis

11
Techniques

Only Fundamental
31
Analysis Techniques

0 10 20 30 40 50 60 70
No. of respondents

Chart 4.8.1: Knowledge about analysis techniques

59% of the respondents said they were aware of both fundamental and technical analysis
techniques. Further, 62% of the respondents who knew about fundamental analysis techniques
said that they have used or use fundamental analysis techniques to make their investment
decisions.

24
 Chapter 5
Conclusions, Suggestions, Limitations and Scope for Further
Research
Stock market is a risky investment avenue. To benefit from such risky investment avenue every
investor needs to take extra care and do investment with patience. Such extra care involves
extensive study of stock, industry and economy of the country. But reality is different from it.

Making an informed investment decision based on fundamental analysis is the need of the day
considering the amount of investment rumours and gossips available on different portals. Investors
from different financial and educational backgrounds need to focus more on conducting their own
fundamental analysis before investing their money in the stock market.

The rise in uninformed investors in stock market post the Covid-19 situation has resulted in
increase in speculations in the stock markets. Also, the stock market has seen an increased activity
by operators which is very dangerous for uninformed investors.

The following are our recommendations:

1. If you have no time for fundamental analysis or cannot afford the services of a financial
advisor, try to replicate the Nifty50 or BSE Sensex index. Nifty50 and BSE Sensex are indices
that measures the performance of a stock market or a subset of a stock market. A stock market
index is constructed by choosing equities from similar companies or those that match a
predetermined set of criteria.
2. Track your portfolio periodically. Track the quarterly and annual results of stocks in your
portfolio. Use apps like Moneycontrol, Investing, Tickertape, Finshots, etc. to keep track of
news about your stocks. We recommend any such app that will allow investors to track their
investments through notifications.
3. Learn how to interpret basic financial statements and interpret financial ratios. Read research
firm reports and do not rely on single source. Make use of multiple sources. Do not invest in
stock because there is positive news or upward movement in the price of the stock. Get
complete information about the reasons for the movement in the stock price from unsolicited
tips and information available on social media platforms like Twitter, Instagram, Telegram
and WhatsApp.
4. It is necessary that you don’t put all your eggs in one basket. Diversify your portfolio, but not
too much, which might result in a below-par return.
5. If you want to invest in infrastructure and gold, you can also draw on options like Real Estate
Investment Trust (REITs), Infrastructure Investment Trust (InvITs) and Sovereign Gold
Bonds (SGB).

25
6. Insurance should not be considered an investment. Investment is the activity of acquiring an
asset with the primary aim of generating income or creating wealth. Therefore, investors
should avoid plans like Unit Linked Insurance Plans (ULIPs), etc. to get full benefits of
insurance and an investment.
7. Start investing in equity at an early age because at an early age you do not have many
responsibilities, which means more income for investing. Also, don’t forget the power of
compounding.
8. Fixed-income securities are less risky, and therefore, they are one of the most popular
investment products when it comes to safe investments. A good investor should always
maintain a balance between equity investments and fixed-income investments.
9. Equity-oriented mutual funds allow an investor to expose himself to equity market risk and
get the opportunity for a higher return. Fundamental analysis is not just limited to equity
investment; an investor can also study the portfolio allocation, fund manager history, expense
ratios, etc. While investing in equity-oriented mutual funds.
10. Equity investment is the best form of investment to get higher returns. But it is necessary that
you conduct research before investing. Always consult an investment advisor with sound
knowledge of investments before making any investment decisions.
11. Use innovative services like Smallcase where Registered Investment Advisors (RIAs) create
portfolios as per your risk appetite and your investment objectives. A Smallcase is an
intelligently weighted basket of up to 50 stocks that reflects a theme, idea or strategy.
12. People with higher incomes are capable of investing a higher percentage of their income as
compared to people with lower or Moderate incomes. Therefore, it is necessary for people
with lower or moderate incomes to not always match the percentage of their income invested
with that of people with higher incomes. Investors should focus on consistent investing and
being in the market for a longer duration. Discipline and perseverance are vital when it comes
to equity market investment.

Limitations of the study:

1. Sampling bias: There is an inherent risk that the choice of participants in the study can
introduce sampling bias if the sample does not accurately represent the broader population of
investors.

2. Recall and reporting bias: Investors might not accurately remember or report their investing
practices or behaviour. This can lead to distorted or incomplete information about their
investing decisions.

3. Social Desirability Bias: Investors might provide responses that they perceive as socially
desirable rather than reflecting their true behaviors or attitudes, which can affect the validity
of the data collected.

26
4. Limited Data Access: Access to comprehensive and accurate investor data might be limited
due to privacy concerns or proprietary restrictions, particularly when studying the behavior of
individual investors.

5. Short-Term Bias: Investor behavior can vary significantly over different time frames. A
short-term study might not capture the long-term patterns and strategies that investors employ.

6. Influence of Current Market Conditions: Investors' behaviors can be influenced by the

prevailing market conditions during the study period. A prolonged bull or bear market might
lead to behaviors that differ from those in more typical market environments.

7. Limited Causality: Establishing causal relationships between certain variables and investor
behavior can be difficult due to the presence of multiple interacting factors.

Scope for further research:

1. Risk perception and risk tolerance: Deepen the understanding of how individuals perceive
and tolerate risk in various investment scenarios. Research the factors that shape risk
preferences and how they evolve over time.

2. Impact of Technology and Fintech: Explore the role of technology, robo-advisors, and
mobile apps in shaping investor behavior. Research the adoption of new technologies and how
they impact investment decisions.

3. Investment duration strategies: Compare the behavior of investors with long-term

investment horizons to those with short-term goals. Study how different investment strategies
are influenced by time frames.

4. Cultural and social influences: Examine how cultural norms, social networks, and cultural
differences affect investment behavior. Investigate whether cultural factors influence risk-
taking tendencies.

5. Behavioural biases and decision-making: Compare the behavior of investors with long-term
investment horizons to those with short-term goals. Study how different investment strategies
are influenced by time frames.

27
 Annexures

Bibliography

• A Study on the Impact of Macroeconomic Factors on Indian Stock Market Indices

(ISBN: 978-93-90631-39-1 135)
https://www.researchgate.net/publication/363250445_A_Study_on_the_Impact_of_Macroeco
nomic_Factors_on_Indian_Stock_Market_Indices

• Fundamental Analysis-Guideline for Retail Investors Sujoy Kumar Dhar. Faculty

Member, IBS Kolkata.
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2267661

• Impact of Systematic Risk on Equity Stocks in Indian Stock Market S. Chandrasekhar

Assistant Professor Department of Management studies KMM Institute of Technology
& Science, Tirupati, A.P
https://www.researchgate.net/publication/364815835_Impact_of_Systematic_Risk_on_Equity
_Stocks_in_Indian_Stock_Market

• Should insurance be treated as an investment or an expense? (23rd April 2023)

https://www.livemint.com/news/india/should-insurance-be-treated-as-an-investment-or-an-
expense-11682091628792.html

• Gold vs Equity: Where should investors invest in this festive season? (14th October 2022)
https://www.livemint.com/money/personal-finance/gold-vs-equity-where-should-investors-
invest-in-this-festive-season-11665751953527.html

• Most Indian investors choose equities after 35 years of age; 60% adopt long-term
approach, reveals ‘Kundli’ survey (7th June 2023)
https://www.livemint.com/market/most-indian-investors-choose-equities-after-35-years-of-
age-60-adopt-long-term-approach-reveals-kundli-survey-11686146625024.html

• India’s New-Age Investors Are Moving from Savings to Wealth-Creation (7th April
2022)
https://www.outlookindia.com/business/india-s-new-age-investors-are-moving-from-savings-
to-wealth-creation-news-190530

• Fundamental and Technical Analysis Leads to a Systematic Investment Decision in

Stock Market Equities (ISSN – 0976-2132)

28
 https://www.researchgate.net/publication/353037474_FUNDAMENTAL_AND_TECHNICA
L_ANALYSIS_LEADS_TO_A_SYSTEMATIC_INVESTMENT_DECISION_IN_STOCK_
MARKET_EQUITIES

• Can curated portfolios like Smallcase offer better returns than mutual funds? (5th May
2022)
https://economictimes.indiatimes.com/mf/analysis/can-curated-portfolios-like-small-case-
offer-better-returns-than-mutual-funds/articleshow/91248419.cms?from=mdr

• Real estate vs equity: Which will give better returns in the long term? (1st June 2023)
https://timesofindia.indiatimes.com/blogs/voices/real-estate-vs-equity-which-will-give-better-
returns-in-the-long-term/

29
 Annexures

Questionnaire

We used the following questionnaire for survey:

1. Which of the following age group do you belong to?

(A) 15-25 years (B) 25-40 years (C) 41-60 years (D) 60 years and above

2. What are your educational qualifications?

(A) Under-Graduate (B) Graduate (C) Post-Graduate

3. Which stream have you completed your educational qualification?

(A) Commerce/ Finance (B) Science (C) Arts

4. Which of the following category do you belong to?

(A) Student (B) Salaried Employee (C) Entrepreneur/ Professional (D) Retired

5. What is your annual income?

(A) Upto INR 10 lakhs (B) INR 10 to 20 lakhs C) INR 20 to 50 lakhs
(D) INR 50 lakhs and above

6. What percentage of your monthly income do you invest?

(A) 0 - 5% (B) 5 - 10% C) 10 - 20 % (D) Above 20%

7. Please specify the number of earning family members?

(A) Only one member (B) Two members (C) Three or more members

8. Please specify the number of family members financially dependent on you?

(A) None (B) Only one member (C) Two to three members D) Four or more members

9. What are your preferred investment avenues?

(A) Equity Market (B) Mutual Funds (C) Real Estate (D) Fixed Income Securities
(E) Gold (F) Insurance

10. What is your source of information for investment decisions?

(A) Financial Consultants (B) News Portals (C) Annual Reports
(D) Research Firm Reports (E) Unsolicited Tips

11. Are you aware about Fundamental and Technical Analysis techniques?
(A) Only Fundamental Analysis Techniques

30
 (B) Only Technical Analysis Techniques
(C) Both

12. Do you use Fundamental Analysis techniques for making investments?

(A) Yes (B) No

13. What according to you is fundamental analysis in investing?

(A) Analyzing the market sentiment
(B) Studying a company’s financials and underlying factors
(C) Predicting short term price movements
(D) Speculating on stock prices

14. What sources does you rely on for gathering fundamental data about a company or
investment opportunity?
(A) Financial news websites and articles
(B) Company’s official website and annual reports
(C) Market research reports and analyst recommendations
(D) Stock Exchange websites

15. Which financial ratios or metrics do you find the most crucial in your analysis process?
(A) Price-to-Earnings Ratio (P/E)
(B) Debt-to-Equity Ratio
(C) Return on Capital Employed (ROCE)
(D) Dividend Yield Ratio

16. Do you compare a company’s financial performance to its competitors or industry

benchmarks?
(A) Yes, always. It's an important part of the analysis.
(B) No, it focuses solely on the company's historical data.
(C) Only for certain industries, not all.

31
 Annexures

Tables, Charts and Figures

Table No. Title of annexure tables Pg. No.

4.1.1. Investment preferences of respondents 17
4.2.1. Investment preferences of respondents by age groups 18
4.3.1. Investment preferences of respondents by income
19
groups
4.3.2. Investment preferences of respondents by percentage
of monthly income invested 19
4.4.1. Investment preferences of respondents by profession 20
4.5.1. Investment preferences of respondents by no. of
income earners in the family 21
4.6.1. Investment preferences of respondents by no. of
financially dependent family members 22
4.7.1. Sources of information for making investments 23
4.8.1. Knowledge about analysis techniques 24

Chart No. Title of annexure charts Pg. No.

1 Factors considered for fundamental analysis 6
4.1.1. Investment preferences of respondents 17
4.2.1. Investment preferences of respondents by age groups 18
4.3.1. Investment preferences of respondents by income
19
groups
4.4.1. Investment preferences of respondents by profession 20
4.5.1. Investment preferences of respondents by no. of
income earners in the family 21
4.6.1. Investment preferences of respondents by no. of
financially dependent family members 22
4.7.1. Sources of information for making investments 23
4.8.1. Knowledge about analysis techniques 24

32