Professional Documents
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IN
INTER CONNECTED STOCK EXCHANGE
A Project report submitted to Jawaharlal Nehru Technological University,
Hyderabad, in partial fulfillment of the requirements for the award of the
degree of
MASTER OF BUSINESS ADMINISTRATION
By
K.RADHIKA DEVI
Reg. No. 10241E0021
Under the Guidance of
Dr.P.B.APPA RAO
Professor
CERTIFICATE
This is to certify that the project entitled A STUDY ON TECHNICAL
ANALYSIS ON EQUITY SHARES has been submitted by Ms. K.RADHIKA DEVI
(Reg. No. 10241E0021) in partial fulfillment of the requirements for the award of the
Degree of Master of Business Administration from Jawaharlal Nehru Technological
University, Hyderabad. The result embodied in the project has not been submitted to any
other University or Institution for the award of any other Degree or Diploma.
Internal guide
Head of Department
Dr.P.B.APPA RAO
Professor
Department of Management Studies
GRIET
K.V.S. RAJU
Professor & HOD
Department of Management Studies
GRIET
S. RAVINDRA CHARY
Project Coordinator
Associate Professor
Department of Management Studies
GRIET
DECLARATION
K.RADHIKA DEVI
(10241E0021)
MBA, GRIET
HYDERABAD
ACKNOWLEDGEMENTS
Firstly I would like to express our immense gratitude towards our institution
Gokaraju Rangaraju Institute of Engineering & Technology, which created a great
platform to attain profound technical skills in the field of MBA, thereby fulfilling our
most cherished goal.
I would thank all employees of INTER CONNECTAD STOCK EXCHANGE and
Ms. SIRISHA, for guiding and helping me in successful completion of the project.
I sincerely express my gratitude to the principal Dr. J. N. MURTHY and for his
inspiration and timely support in successful completion of my project work.
I am very much thankful to Dr. P.B.APPA RAO, Professor of Management
Studies, for extending his guidance and cooperation in doing this project.
I am also thankful to our project coordinator Mr. S. Ravindra Chary for
extending his cooperation in completion of Project.
I convey my thanks to my beloved parents, friends and my faculty who helped
me directly or indirectly in bringing this project successfully.
K. RADHIKA DEVI
(10241E0021)
CONTENTS
LIST OF TABLES
LIST OF FIGURES
ii
CHAPTERS
1
PARTICULARS
INTRODUCTION
1.1 INTRODUCTION TO THE TOPIC
1.2 OBJECTIVES OF THE STUDY
1.3 SCOPE AND LIMITATION OF THE STUDY
SUBJECT LITERATURE
INDUSTRY PROFILE
COMPANY PROFILE
PAGE NO.
LIST OF FIGURES
S.NO
PARTICULARS
9,10
11,12
13,14
15
CALCULATION OF BETA
PAGE
NO.
LIST OF FIGURES
SNO
PARTICULARS
1.
2.
CO-RELELATION BETWEEN
BANKS(SBI,ICICI,HDFC) AND MARKET
3.
PAGE NO.
CHAPTER - 1
INTRODUCTION
Just as there are many investment styles on the fundamental side, there are
also many different types of technical traders. Some rely on chart patterns; others use
technical indicators and oscillators, and most use some combination of the two. In any
case, technical analysts exclusive use of historical price and volume data is what
separates them from their fundamental counterparts. Unlike fundamental analysis,
technical analysts dont care whether a stock is undervalued the only thing that matters
is a securitys past trading data and what information this data can provide about where
the society might move in the future.
To analyze the price movements of shares of SBI, ICICI, and HDFC interpret the
corrections and trends by using Technical Analysis tools.
To forecast the future trends and provide suitable suggestions to the investors.
The study covers a period of six months from January 2012 to June 2012.
The study helps to find out the future trends in the prices of SBI, ICICI, HDFC equity
shares. Valuable hints can be identified by the investors for their future buying and
selling.
Because of these methods are so widely spread and there is so much money riding on
the methods, some also claim that technical analysis has become self-fulfilling prophecy,
as people trend to enter the market and put their stops on the same places, increasing the
volatility towards the technical analysis method being correct.
Technical analysis systems usually do not take into account correlation between
different markets. If you are analyzing several markets and they all give similar signals,
they may have close correlations, meaning that the risk profile for each is very similar,
and that the prices of the assets move in close steps with each other.
Research Methodology:
Research methodology is a way to systematically solve the research problem. It
may be understood as a science of studying how research is done scientifically. The
various steps that are generally adopted by a researcher in studying research problem
along with the logic behind them. It is necessary for the researcher to know not only the
research methods/ techniques but also the methodology.
Analytical Research:
Research Design was based on analytical research, on the other hand, the
researcher has to use facts or information already available, and analyze these
to make these to make a critical evaluation of the material.
Sources of Data:
The main sources of data are collected through website, various
Publication books, magazines, newspaper and reports prepared by research
Scholars etc.
Data Collection:
Data required for the purpose of the study have been collected from the
Websites of the banks concerned.
Data Analysis:
The data required so collected have been analyzed by using MS-EXCEL.
In the process of analysis Average rate of return, Standard deviation,
Co-efficient of correlation, Covariance and beta values have been collected
Pt = current price
Po = previous price
Standard Deviation:
1. A measure of the dispersion of a set of data from its mean. The more spread apart the
data, the higher the deviation. Standard deviation is calculated as the square root of
variance.
2. In finance, standard deviation is applied to the annual rate of return of an investment to
measure the investment's volatility. Standard deviation is also known as historical
volatility and is used by investors as a gauge for the amount of expected volatility.
Beta:
Measures volatility or systemic risk compared to the market or the benchmark index
Beta Value Calculated as follows:
CHAPTER - 2
REVIEW OF LITERATURE
EQUITY SHARES
Equity represents an ownership position in a corporation. It is residual claim in
the sense that creditors and preference shareholders must be paid as scheduled before
equity shareholders can receive payment. In bankruptcy equity holders are principle
entitled only to assets remaining after all prior claimants has been satisfied. Thus risk is
highest with equity shares and so must be its expected return. When investors buy equity
shares, they receive certificates of ownership as proof of their being part owners of the
company. The certificate states the number of shares purchased and their par value. The
attitude towards equity shares varied from extreme pessimism to optimism from time to
time.
Potential for Profit : The potential for profit is greater in equity shares than in any
other investment security. Current dividends yield may be low but potential of
capital gains is great. The total yield or yields to maturity may be substantial over
a period of time.
Hedge against Inflation: The equity share is good hedge against inflation though it
does not fully compensate for the declining purchasing power as it is subject to
money-rate risk. But when interest rates are high, shares tend to be less attractive,
and prices tend to be depressed.
Tax Advantage: Equity shares also offers tax advantage to the investors. The
larger yield on equity shares results from an increase in principal of capital gains,
which are taxed at lower rate than other incomes in most of the countries.
Issued Capital: Issued capital is the part of the authorized capital that has been
issued for cash, property, or service.
Paid up Capital: Fully paid shares are those shares for which the corporation
has received full payment up to the par-value, or up to the amount established
as the selling price of no-par-shares. Partly paid shares are those shares that
have been issued for less than par-value or the agreed subscription.
Evidence of Ownership: When investor buys equity shares, they receive certificates
of ownership as a proof of their part as owners of the company. This certificates state the
number of shares purchased, their par value, if any, and usually the transfer agent. When
equity shares are purchased on the market (that when it is not a new issue which is
purchased from the company).
Maturity of Equity Shares: Equity shares have no maturity date. Their life is limited
by the length of time stated in the corporate charter know as Memorandum of
Association. The corporate life might be for stated or limited period, or it might be
perpetual. Most corporations have a perpetual character. The date on which the equity is
sold by the investor is the maturity date, and the price at which the equity is sold is called
the maturity period that the equity is owned.
Par Value: Par value is the face value of the share. Equity shares have par value, a
nominal stated value. The par value of an equity shares indicates the amount of capital
originally subscribed by the shareholders. New shares cannot be sold less than par value.
If the equity shares are sold for more than par, the excess is transferred to Share
Premium Account.
Net Asset Value and Book Value: Distrust of present value formulae, the quest for
objectivity and perhaps even nostalgia lead some analyst to place greater emphasis on the
asset value factor when evaluating investment worth of a companys equity shares. Net
assets or net worth can be calculated from either the asset of liability side of balance
sheet.
Financial Analysis and Accounting Data: The historical numbers that analyst uses
to prepare rates and forecasting equations are generally based on figures that have been
taken from the published financial statements of the firm being analyzed. Although these
statements may have been prepared according to generally accept accounting
principles, there may be significant variation in real economic meaning of financial
reports.
Despite high crude oil prices, its weak demand for gasoline that holds back oil
stock prices. Supply and demand is an important factor in determining price of
stocks. Corrections is natural part of stock market cycle.
Bull and Bear stock market are the two sides of same coin:
Poll results show confidence in stocks: The results of a poll on where the sensex
be at the end of 2009 show stock investors are positive.
To decide which type of broker is right for you, you need to use these resources to
find the brokerage arrangement that best fits your needs.
Thirteen of the top online stock trading sites offer investors a wide variety of
services including research and advice.
Brokers offer different levels of service. A broker fills in the gaps in knowledge
and experience.
Stock prices are driven by the relationship between buyers and sellers. Attractive
stocks have more buyers than sellers, which drives up prices, while less attractive
stocks feel the reverse effect.
The better stock screens offer similar characteristics that give you greater
flexibility when looking for investment candidates and eliminate other
companies.
Stock screens will save time and help to build a thoughtful portfolio by
focusing on those companies that meet your investing requirements.
Stock screens can help any investor make better stock selections by reducing
the number of companies to research.
Dividend ratios can tell much about a stock and its future payout prospects.
After-hours trading of stocks may seem like a great idea, but it is full of risks
for the average investor.
Technical Analysis
Technical analysis is a security analysis discipline for forecasting the future
direction of prices through the study of past market data, primarily price and volume.
History
The principles of technical analysis derive from the observation of financial
markets over hundreds of years. The oldest known hints of technical analysis appear in
Joseph de la Vega's accounts of the Dutch markets in the 17th century. In Asia, the oldest
example of technical analysis is thought to be a method developed by Homma Munehisa
during early 18th century which evolved into the use of candlestick techniques, and is
today a main charting tool.
Dow Theory is based on the collected writings of Dow Jones co-founder and
Editor Charles Dow, and inspired the use and development of modern technical analysis
from the end of the 19th century. Other pioneers of analysis techniques include Ralph
Nelson Elliott and William Delbert Gann who developed their respective techniques in
the early 20th century.
Many more technical tools and theories have been developed and enhanced in
recent decades, with an increasing emphasis on computer-assisted techniques.
General Description
Technical analysts seek to identify price patterns and trends in financial markets
and attempt to exploit those patterns. While technicians use various methods and tools,
the study of price charts is primary.
Technicians especially search for archetypal patterns, such as the well-known head and
shoulders or double top reversal patterns, study indicators such as moving averages, and
look for forms such as lines of support, resistance, channels, and more obscure
formations such as flags, pennants or balance days.
Technical analysts also extensively use indicators, which are typically
mathematical transformations of price or volume. These indicators are used to help
determine whether an asset is trending, and if it is, its price direction. Technicians also
look for relationships between price, volume and, in the case of futures, open interest.
Examples include the relative strength index, and MACD. Other avenues of study include
correlations between changes in options (implied volatility) and put/call ratios with price.
Other technicians include sentiment indicators, such as Put/Call ratios and Implied
Volatility in their analysis.
Technicians seek to forecast price movements such that large gains from
successful trades exceed more numerous but smaller losing trades, producing positive
returns in the long run through proper risk control and money management.
There are several schools of technical analysis. Adherents of different schools (for
example, candlestick charting, Dow Theory, and Elliott wave theory) may ignore the
other approaches, yet many traders combine elements from more than one school. Some
technical analysts use subjective judgment to decide which pattern a particular instrument
reflects at a given time, and what the interpretation of that pattern should be. Some
technical analysts also employ a strictly mechanical or systematic approach to pattern
identification and interpretation.
Technical analysis is frequently contrasted with fundamental analysis, the study
of economic factors that influence prices in financial markets. Technical analysis holds
that prices already reflect all such influences before investors are aware of them, hence
the study of price action alone. Some traders use technical or fundamental analysis
exclusively, while others use both types to make trading decisions.
Users of technical analysis are most often called technicians or market
technicians. Some prefer the term technical market analyst or simply market analyst. An
older term, chartist, is sometimes used, but as the discipline has expanded and
modernized the use of the term chartist has become less popular.
Characteristics
Technical analysis employs models and trading rules based on price and volume
transformations, such as the relative strength index, moving averages, regressions, intermarket and intra-market price correlations, cycles or, classically, through recognition of
chart patterns.
Technical analysis stands in contrast to the fundamental analysis approach to
security and stock analysis. Technical analysis "ignores" the actual nature of the
company, market, currency or commodity and is based solely on "the charts," that is to
say price and volume information, whereas fundamental analysis does look at the actual
facts of the company, market, currency or commodity. For example, any large brokerage,
trading group, or financial institution will typically have both a technical analysis and
fundamental analysis team.
Technical analysis is widely used among traders and financial professionals, and
is very often used by active day traders, market makers, and pit traders. In the 1960s and
1970s it was widely dismissed by academics. In a recent review, Irwin and Park reported
that 56 of 95 modern studies found it produces positive results, but noted that many of the
positive results were rendered dubious by issues such as data snooping so that the
evidence in support of technical analysis was inconclusive; it is still considered by many
academics to be pseudoscience. Academics such as Eugene Fama say the evidence for
technical analysis is sparse and is inconsistent with the weak form of the efficient market
hypothesis. Users hold that even if technical analysis cannot predict the future, it helps to
identify trading opportunities.
In the foreign exchange markets, its use may be more widespread than
fundamental analysis. While some isolated studies have indicated that technical trading
rules might lead to consistent returns in the period prior to 1987, most academic work has
focused on the nature of the anomalous position of the foreign exchange market. It is
speculated that this anomaly is due to central bank intervention. Recent research suggests
that combining various trading signals into a Combined Signal Approach may be able to
increase profitability and reduce dependence on any single rule.
Principles
Technicians say that a market's price reflects all relevant information, so their
analysis looks at the history of a security's trading pattern rather than external drivers
such as economic, fundamental and news events. Price action also tends to repeat itself
because investors collectively tend toward patterned behavior hence technicians' focus
on identifiable trends and conditions.
Technical analysis is not limited to charting, but it always considers price trends.
For example, many technicians monitor surveys of investor sentiment. These surveys
gauge the attitude of market participants, specifically whether they are bearish or bullish.
Technicians use these surveys to help determine whether a trend will continue or if a
reversal could develop; they are most likely to anticipate a change when the surveys
report extreme investor sentiment. Surveys that show overwhelming bullishness, for
example, are evidence that an uptrend may reverse the premise being that if most
investors are bullish they have already bought the market (anticipating higher prices).
And because most investors are bullish and invested, one assumes that few buyers
remain. This leaves more potential sellers than buyers, despite the bullish sentiment. This
suggests that prices will trend down, and is an example of contrarian trading.
CHAPTER 3
INDUSTRY PROFILE
Ensuring equal access to investors all over the country through an appropriate
communication network.
Enabling shorter settlement cycles and book entry settlements systems, and
The standards set by NSE in terms of market practices and technology, have become
industry benchmarks and are being emulated by other market participants. NSE is more
than a mere market facilitator. It's that force which is guiding the industry towards new
horizons and greater opportunities.
grievances whether against the companies or its own member-brokers. It also strives to
educate and enlighten the investors by conducting investor education programmers and
making available to them necessary informative inputs.
A Governing Board having 20 directors is the apex body, which decides the
policies and regulates the affairs of the Exchange. The Governing Board consists of 9
elected directors, who are from the broking community (one third of them retire ever year
by rotation), three SEBI nominees, six public representatives and an Executive Director
& Chief Executive Officer and a Chief Operating Officer.
The Executive Director as the Chief Executive Officer is responsible for the dayto-day administration of the Exchange and the Chief Operating Officer and other Heads
of Department assist him.
The Exchange has inserted new Rule No.126 A in its Rules, Byelaws pertaining
to constitution of the Executive Committee of the Exchange. Accordingly, an Executive
Committee, consisting of three elected directors, three SEBI nominees or public
representatives, Executive Director & CEO and Chief Operating Officer has been
constituted. The Committee considers judicial & quasi matters in which the Governing
Board has powers as an Appellate Authority, matters regarding annulment of
transactions, admission, continuance and suspension of member-brokers, declaration of a
member-broker as defaulter, norms, procedures and other matters relating to arbitration,
fees, deposits, margins and other monies payable by the member-brokers to the
Exchange, etc.
Capital adequacy norms have been laid down for the members of various
stock exchanges depending upon their turnover of trade and other factors.
All recognized stock exchanges will have to inform about transactions within
24 hrs.
deed to the register or transfer agent of the company. If it is bought in the DEMAT form,
the broker has to give a matching instruction to his depository participant to transfer
shares bought to the investors account. The investor should be account holder in any of
the depository participant. In the case of sale of shares on receiving payment from the
purchasing broker, the broker effects the payment to the investor.
Share groups:
The scripts traded on the BSE have been classified into A,B1,B2,C,F and
Z groups. The A group represents those, which are in the carry forward system. The
F group represents the debt market segment (fixed income securities). The Z group
scripts are of the blacklisted companies. The C group covers the odd lot securities in
A, B1&B2 groups.
Activities on T+1:
Conformation of the institutional trades by the custodian is sent to the stock
exchange by 11.00 am. A provision of an exception window would be available for late
confirmation. The time limit and the additional changes for the exception window are
dedicated by the exchange.
The exchanges/clearing house/ clearing corporation would process and download the
obligation files to the brokers terminals late by 1.30 p.m on T+1. Depository participants
accept the instructions for pay in securities by investors in physical form up to 4 p.m and
in electronic form up to 6 p.m. the depositories accept from other DPs till 8p.m for same
day processing.
Activities on T+2:
The depository permits the download of the paying in files of securities and funds
till 10.30 am on T+2 from the brokers pool accounts. The depository processes the pay
in requests and transfers the consolidated pay in files to clearing House/clearing
Corporation by 11.00am/on T+2. The exchange/clearing house/clearing corporation
executes the pay-out of securities and funds latest by 1.30 p.m on T+2 to the depositories
and clearing banks. In the Demat mode net basis settlement is allowed. The buy and sale
positions in the same scrip can be settled and net quantity has to be settled
The analysis makes a separation between operating and financing items in the
financial statements. This is inspired by the Modigliani and Miller notion that it is the
operating activities that generate value, not the (zero net-present-value) financing
activities. The separation also arises from an appreciation that financial assets and
liabilities are typically close to market value in the balance sheet and thus are already
valued, but not so the operating assets and liabilities.
But, correspondingly, unrealized gains and losses are now recognized in comprehensive
income and these, like all income line items, have to be considered in a ratio analysis.
No thought was given to the identification; indeed there was no justification that
earnings changes are the appropriate attribute to forecast for valuation. The approach here
also contrasts to that in Lev and Thiagarajan (1993) who defer to expert judgment and
identify ratios that analysts actually use in practice.
1. Sauda details
A. Cash segments:
In this reports client will get transaction statement for settlement and exchange wise. First
select the date of transactions then exchange by doing drop down and then GO to get
the reports.
B. Derivatives segments:
In this reports client will get transaction statement for the day and exchange. First select
the date of transactions then exchange by doing drop down and then GO to get the
Reports.
2. Delivery details:
A. Delivery information:
In this reports client will get pay in or payout for all the scrip. Whether its NSDL, CDSL
or PHYSICAL entry.
3. Demats details:
In this reports client will get the Demat confirmation. We have also defined the meaning
and colour description on header.
4. Clients bills:
A. Cash Segment:
In this reports client will get the bill confirmation for cash segments. First select the date
of transactions then exchange by doing drop down and then GO to get the reports.
While zooming in this report, client can get the cash transaction for that particular bill.
B. Derivatives Segment:
In this reports client will get the bill confirmation for Derivatives segments. First select
the date of transactions then exchange by doing drop down and then go to get the reports.
While zooming in these reports, client can get the Derivatives transaction for that
particular bill.
5. Financial statement:
In this reports client will get the financial statement for the entire year. Client can get the
statement date wise, exchange wise, including margin, across the company after selecting
start and end date, selecting exchange, clicking on include margin, ignore firm number
respectively. While zooming client can get the details for that particular bills, receipt,
payment and voucher. Green highlights show u the entry is unreconcile on that bank.
CHAPTER - 4
COMPANY PROFILE
COMPANY PROFILE
Inter-connected stock exchange of India limited [ISE] has been promoted by 14
Regional stock exchanges to provide cost-effective trading linkage/connectivity to all the
members of the participating Exchanges, with the objective of widening the market for
the securities listed on these Exchanges. ISE aims to address the needs of small
companies and retail investors with the guiding principle of optimizing the existing
infrastructure and harnessing the potential of regional markets, so as to transform these
into a liquid and vibrant market through the use of state-of-the-art technology and
networking.
The participating Exchanges of ISE in all about 4500 stock brokers, out of which
more than 200 have been currently registered as traders on ISE. In order to leverage its
infrastructure and to expand its nationwide reach, ISE has also appointed around 450
Dealers across 70 cities other than the participating Exchange centers. These dealers are
administratively supported through the regional offices of ISE at Delhi [north], kolkata
[east], Coimbatore, Hyderabad [south] and Nagpur [central], besides Mumbai.
ISE has also floated a wholly-owned subsidiary, ISE securities and services
limited [ISS], which has taken up corporate membership of the National Stock Exchange
of India Ltd. [NSE] in both the Capital Market and Futures and Options segments and
The Stock Exchange, Mumbai In the Equities segment, so that the traders and dealers of
ISE can access other markets in addition to the ISE markets and their local market. ISE
thus provides the investors in smaller cities a one-stop solution for cost-effective and
efficient trading and settlement in securities.
With the objective of broad basing the range of its services, ISE has
started offering the full suite of DP facilities to its Traders, Dealers and their clients.
Create a liquid and vibrant national level market for all listed companies in
general and small capital companies in particular.
Provide clearing and settlement facilities to the Traders and Dealers across the
Country at their doorstep in a decentralized mode.
SAILENT FEATURES
Network of intermediaries:
As at the beginning of the financial year 2003-04, 548 intermediaries (207
Traders and 341 Dealers) are registered on ISE. A broad of members forms the bedrock
for any Exchange, and in this respect, ISE has a large pool of registered intermediaries
who can be tapped for any new line of business.
2. Shri V. Shankar
Managing Director
3. Dr. S. D. Israni
4. Dr. M. Y. Khan
5. Mr. P. J. Mathew
Shareholder Director
6. M. C. Rodrigues
Shareholder Director
Shareholder Director
Shareholder Director
9. Mr. K. D. Gupta
Shareholder Director
Shareholder Director
History:
The roots of the State Bank of India rest in the first decade of 19th century, when
the Bank of Calcutta, later renamed the Bank of Bengal, was established on 2 June 1806.
The Bank of Bengal and two other Presidency banks, namely, the Bank of Bombay
(incorporated on 15 April 1840) and the Bank of Madras (incorporated on 1 July 1843).
All three Presidency banks were incorporated as joint stock companies, and were the
result of the royal charters. These three banks received the exclusive right to issue paper
currency in 1861 with the Paper Currency Act, a right they retained until the formation of
the Reserve Bank of India.
The Presidency banks amalgamated on 27 January 1921, and the reorganized
banking entity took as its name Imperial Bank of India. The Imperial Bank of India
continued to remain a joint stock company.
Pursuant to the provisions of the State Bank of India Act (1955), the Reserve
Bank of India, which is India's central bank, acquired a controlling interest in the
Imperial Bank of India. On 30 April 1955 the Imperial Bank of India became the State
Bank of India. The Govt. of India recently acquired the Reserve Bank of India's stake in
SBI so as to remove any conflict of interest because the RBI is the country's banking
regulatory authority
Branches
The corporate center of SBI is located in Mumbai. In order to cater to different functions,
there are several other establishments in and outside Mumbai, apart from the corporate
center. The bank boasts of having as many as 14 local head offices and 57 Zonal Offices,
located at major cities throughout India. It is recorded that SBI has about 10000 branches;
well networked to cater to its customers.
ATM Services
SBI provides easy access to money to its customers through more than 8500
ATMs in India. The Bank also facilitates the free transaction of money at the ATMs of
State Bank Group, which includes the ATMs of State Bank of India as well as the
Associate Banks State Bank of Bikaner & Jaipur, State Bank of hyd, State Bank of
Indore, etc. You may also transact money through SBI Commercial and International
Bank
Ltd
by
using
the
ATM-cum-Debit(Cash+Plus)card.
Subsidiaries
The State Bank Group includes a network of eight banking subsidiaries and
several non-banking subsidiaries. Through the establishments, it offers various services
including merchant banking services, fund management, factoring services, primary
dealership in govt securities, credit cards and insurance.
History
ICICI Bank was originally promoted in 1994 by ICICI Limited, an Indian
financial institution, and was its wholly-owned subsidiary. ICICI's shareholding in ICICI
Bank was reduced to 46% through a public offering of shares in India in fiscal 1998, an
equity offering in the form of ADRs listed on the NYSE in fiscal 2000, ICICI Bank's
acquisition of Bank of Madura Limited in an all-stock amalgamation in fiscal 2001, and
secondary market sales by ICICI to institutional investors in fiscal 2001 and fiscal 2002.
ICICI was formed in 1955 at the initiative of the World Bank, the Government of India
and representatives of Indian industry.
The merger would enhance value for ICICI Bank shareholders through a large
capital base and scale of operations, seamless access to Icecaps strong corporate
relationships built up over five decades, entry into new business segments, higher market
share in various business segments, particularly fee-based services, and access to the vast
talent pool of ICICI and its subsidiaries.
In October 2001, the Boards of Directors of ICICI and ICICI Bank approved the
merger of ICICI and two of its wholly-owned retail finance subsidiaries, ICICI Personal
Financial Services Limited and ICICI Capital Services Limited, with ICICI Bank. The
merger was approved by shareholders of ICICI and ICICI Bank in January 2002, by the
High Court of Gujarat at Ahmadabad in March 2002, and by the High Court of
Judicature at Mumbai and the Reserve Bank of India in April 2002. Consequent to the
merger, the ICICI group's financing and banking operations, both wholesale and retail,
have been integrated in a single entity. ICICI Bank has formulated a Code of Business
Conduct and Ethics for its directors and employees
History
Housing Development Finance Corporation Limited, more popularly known as
HDFC Bank Ltd, was established in the year 1994, as a part of the liberalization of the
Indian Banking Industry by Reserve Bank of India (RBI). It was one of the first banks to
receive an 'in principle' approval from RBI, for setting up a bank in the private sector.
The bank was incorporated with the name 'HDFC Bank Limited', with its registered
office in Mumbai. The following year, it started its operations as a Scheduled
Commercial Bank. Today, the bank boasts of as many as 1412 branches and over 3275
ATMs across India.
Amalgamations
In 2002, HDFC Bank witnessed its merger with Times Bank Limited (a private
sector bank promoted by Bennett, Coleman & Co. / Times Group). With this, HDFC and
Times became the first two private banks in the New Generation Private Sector Banks to
have gone through a merger. In 2008, RBI approved the amalgamation of Centurion
Bank of Punjab with HDFC Bank. With this, the Deposits of the merged entity became
Rs. 1,22,000 crore, while the Advances were Rs. 89,000 crore and Balance Sheet size
was Rs. 1,63,000 crore.
Tech-Savvy
HDFC Bank has always prided itself on a highly automated environment, be it in
terms of information technology or communication systems. All the braches of the bank
boast of online connectivity with the other, ensuring speedy funds transfer for the clients.
At the same time, the bank's branch network and Automated Teller Machines (ATMs)
allow multi-branch access to retail clients. The bank makes use of its up-to-date
technology, along with market position and expertise, to create a competitive advantage
and build market share.
Capital Structure
At present, HDFC Bank boasts of an authorized capital of Rs 550 crore (Rs5.5
billion), of this the paid-up amount is Rs 424.6 crore (Rs.4.2 billion). In terms of equity
share, the HDFC Group holds 19.4%. Foreign Institutional Investors (FIIs) have around
28% of the equity and about 17.6% is held by the ADS Depository (in respect of the
bank's American Depository Shares (ADS) Issue). The bank has about 570,000
shareholders. Its shares find a listing on the Stock Exchange, Mumbai and National Stock
Exchange, while its American Depository Shares are listed on the New York Stock
Exchange (NYSE), under the symbol 'HDB'.
Products & Services
Personal Banking
Savings Accounts
Salary Accounts
Current Accounts
Fixed Deposits
Demat Account
Safe Deposit Lockers
Loans
Credit Cards
Debit Cards
Prepaid Cards
Investments & Insurance
Forex Services
Payment Services
NetBanking
InstaAlerts
MobileBanking
InstaQuery
ATM
PhoneBanking
NRI Banking
CHAPTER 5
DATA ANALYSIS
AND
INTERPRETATION
Table: 01
Month-Wise Market Prices
January 2012
Closing
Date
Return
Price
02
03
04
05
06
07
09
10
11
12
13
16
17
18
19
20
23
24
25
27
30
31
5785.83
5942.39
5934.43
5934.77
5934.4
5942.19
5947.54
6080.88
6110.26
6097.16
6146.5
6155.78
6258.4
6227.93
6311.34
6344.09
6346.06
6444.56
6497.43
6554.58
6417.22
6549.31
2.5484
2.7059
-0.134
0.0057
-0.0062
0.1313
0.09
2.2419
0.4832
-0.2144
0.8092
0.151
1.6671
-0.4869
1.3393
0.5189
0.0311
1.5521
0.8204
0.8796
-2.0956
2.0584
February 2012
Closing
Date
Return
Price
01
02
03
06
07
08
09
10
13
14
15
16
17
21
22
23
24
27
28
29
6605
6650.48
6717.47
6779.41
6738.02
6788.91
6847.44
6825.15
6839.78
6878.82
7023.11
7032.08
7076.99
7129.67
6960.61
6933.15
6871.91
6678.83
6831.83
6857.28
0.8503
0.6886
1.0073
0.9221
-0.6105
0.7553
0.8621
-0.3255
0.2144
0.5708
2.0976
0.1277
0.6386
0.7444
-2.3712
-0.3945
-0.8833
-2.8097
2.2908
0.3725
March 2012
Closing
Date
Return
Price
01
02
03
05
06
07
09
12
13
14
15
16
19
20
21
22
23
26
27
28
2930
6809.48
6836.27
6826.9
6807.03
6697.43
6635.39
6730.09
6838.04
6887.91
6997.7
6953.12
6866.66
6796.42
6698.24
6722.51
6842.24
6708.88
6729.12
6683.31
6660.81
6575.18
6647.77
-0.6971
0.3934
-0.1371
-0.2911
-1.6101
-0.9263
1.4272
1.604
0.7293
1.594
-0.6371
-1.2435
-1.0229
-1.4446
0.3623
1.781
-1.9491
0.3017
-0.6808
-0.3367
-1.2856
1.104
Table: 02
Month-Wise Market Prices
April 2012
Date
02
03
04
09
10
11
12
13
16
17
18
19
20
23
24
25
26
27
28
30
Closing
Price
6806.09
6864.24
6835.13
6730.78
6734.03
6707.13
6760.98
6689.94
6718.82
6788.99
6806.86
6833.46
6777.81
6662.83
6679.96
6650.58
6629.67
6622.89
6650.25
6698.51
May 2012
Return
2.3816
0.8544
-0.4241
-1.5267
0.0483
-0.3995
0.8029
-1.0507
0.4317
1.0444
0.2632
0.3908
-0.8144
-1.6964
0.2571
-0.4398
-0.3144
-0.1023
0.4131
0.7257
Date
02
03
04
07
08
09
10
11
14
15
16
17
18
21
22
23
24
25
28
29
30
31
Closing
Price
6687.94
6622.15
6496.99
6534.95
6406.07
6358.22
6348.82
6300.73
6262.7
6306.76
6214.37
6222.92
6241.2
6263.56
6209.65
6176.39
6263.39
6272.97
6350.89
6352.29
6290.01
6280.04
June 2012
Return
-0.1578
-0.9837
-1.89
0.5843
-1.9722
-0.7469
-0.1478
-0.7575
-0.6036
0.7035
-1.4649
0.1376
0.2938
0.3583
-0.8607
-0.5356
1.4086
0.153
1.2422
0.022
-0.9804
-0.1585
Date
01
04
05
06
07
08
11
12
13
14
15
18
19
20
21
22
25
26
27
28
29
Closing
Price
6177.22
6178.64
6194.73
6345.26
6406.54
6429.05
6407.76
6476.48
6481.45
6399.89
6487.13
6396.6
6440.74
6474.67
6530.9
6513.78
6483.63
6500.12
6525.5
6530.99
6682.47
Return
-1.6373
0.023
0.2604
2.43
0.9658
0.3514
-0.3312
1.0724
0.0767
-1.2584
1.3631
-1.3955
0.6901
0.5268
0.8685
-0.2621
-0.4629
0.2543
0.3905
0.0841
2.3194
Table: 03
Month-Wise SBI Prices
January 2012
Date
02
03
04
05
06
07
09
10
11
12
13
16
17
18
19
20
23
24
25
27
30
31
Closing
Price
1629.65
1706.5
Return
1637.75
0.6267
4.7157
0.6651
0.2035
0.9192
0.3818
1.9165
1702.05
1725.75
3.9261
1.3924
1760.7
2.0252
1777.15
0.9343
1816.65
2.2227
1842.85
1863.6
1883.7
1.4422
1.126
1.0786
1931.8
2.5535
0.4581
1695.15
1691.7
1676.15
1669.75
1940.65
2041.3
2056.6
2042.6
1990.7
2061.05
5.1864
0.7495
0.6807
2.5409
3.5339
February 2012
Date
01
02
03
06
07
08
09
10
13
14
15
16
17
21
22
23
24
27
28
29
Closing
Price
Return
2077.1
2072.65
0.7787
-0.2142
2103.1
1.4691
2163.05
2.8506
2152.05
-0.5085
2175.4
1.085
2181.95
0.3011
2172.5
2129
-0.4331
-2.0023
2198.45
3.2621
2250.5
2.3676
2349.05
4.379
2416.75
2451.75
2257.8
2.882
1.4482
-7.9107
2261.25
2206.8
0.1528
-2.408
2125.1
2229.55
-3.7022
4.9151
2243.4
0.6212
March 2012
Date
01
02
03
05
06
07
09
12
13
14
15
16
19
20
21
22
23
26
27
28
2930
Closing
Price
2219.75
2245.7
2250.75
Return
1.0542
1.1691
2141.05
0.2249
3.4033
1.0648
0.4626
2222.3
3.7949
2310.25
2327.65
3.9576
0.7532
2351.5
1.0246
2.2135
3.1094
3.0656
1.1344
2.2617
3.2661
0.2152
2.1683
0.5429
2.2843
0.9394
1.6201
2174.15
2151
2299.45
2227.95
2159.65
2184.15
2233.55
2160.6
2165.25
2118.3
2129.8
2081.15
2061.6
2095
Table: 04
Month-Wise SBI Prices
April 2012
Date
02
03
04
09
10
11
12
13
16
17
18
19
20
23
24
25
26
27
28
30
Closing
Price
2129.4
2170.9
2164.3
2101.3
2151
2160.3
2224.1
2211.45
2265.4
2299.95
2289.6
2271.3
2260.45
2192.1
2188.45
2171.7
2159.2
2125.7
2131.05
2137.95
May 2012
Return
1.642
1.9489
-0.304
-2.9109
2.3652
0.4324
2.9533
-0.5688
2.4396
1.5251
-0.45
-0.7993
-0.4777
-3.0237
-0.1665
-0.7654
-0.5756
-1.5515
0.2517
0.3238
Date
02
03
04
07
08
09
10
11
14
15
16
17
18
21
22
23
24
25
28
29
30
31
Closing
Price
2139.45
2085.2
1993.6
2026.15
1958.95
1887.6
1843.75
1852.2
1840.2
1859.95
1829.2
1848.1
1942
2007.4
1938.5
1956.45
1970.8
2005
2100.35
2120.3
2097.5
2055.6
June 2012
Return
0.0702
-2.5357
-4.3929
1.6327
-3.3166
-3.6423
-2.3231
0.4583
-0.6479
1.0733
-1.6533
1.0332
5.0809
3.3677
-3.4323
0.926
0.7335
1.7353
4.7556
0.9498
-1.0753
-1.9976
Date
01
04
05
06
07
08
11
12
13
14
15
18
19
20
21
22
25
26
27
28
29
Closing
Price
2026.2
2046.2
2080.25
2159.45
2167.85
2180.05
2164.55
2206.9
2222.25
2154.25
2182.8
2087.65
2103.1
2116.7
2177.95
2156.75
2114.9
2116.1
2113.4
2095.45
2159.15
Return
-1.4302
0.9871
1.6641
3.8072
0.389
0.5628
-0.711
1.9565
0.6955
-3.06
1.3253
-4.3591
0.7401
0.6467
2.8937
-0.9734
-1.9404
0.0567
-0.1276
-0.8493
3.0399
Table: 05
Month-Wise ICICI Prices
January 2012
Closing
Date
Return
Price
02
03
04
05
06
07
09
10
11
12
13
16
17
18
19
20
23
24
25
27
30
31
696.45
725.4
743
1.7309
4.1568
2.4262
747.25
0.572
751.35
745.45
745.75
0.5487
0.7853
0.0402
774.45
3.8485
779.6
781.55
0.665
0.2501
789.65
1.0364
791.55
769.35
0.2406
0.7517
2.0685
796.35
3.5095
842.65
5.814
857.8
1.7979
886.15
878.6
3.305
-0.852
888.1
1.0813
4.0705
5.8748
785.6
851.95
902
February 2012
Closing
Date
Price Return
01
888.2 1.5299
02
1.565
902.1
03
914.8 1.4078
06
07
08
09
10
13
14
15
16
17
21
22
23
24
27
28
29
927.85
1.4265
936.9
928.2
0.9754
1.8092
2.136
1.2133
934.6
942.15
0.6895
0.8078
980.1
968.85
4.028
1.1478
981.55
1.3108
991.05
0.9679
3.4206
1.3948
1.2926
4.7982
2.6891
0.4666
919.95
939.6
957.15
943.8
931.6
886.9
910.75
906.5
March 2012
Closing
Date
Return
Price
01
884.35 2.4435
02
902.75 2.0806
03
905.55 0.3102
05
870.45 3.8761
06
853.2 1.9817
07
09
12
13
14
15
16
19
20
21
22
23
26
27
28
2930
861.1
914.7
0.9259
6.2246
929.65
1.6344
0.0054
2.6086
2.4742
1.4243
929.6
953.85
930.25
917
908.6
907.55
935.4
899.45
911
-0.916
0.1156
3.0687
3.8433
859.1
1.2841
4.2975
0.476
1.9292
856.05
887.25
-0.355
3.6446
871.85
876
Table: 06
Month-Wise ICICI Prices
April 2012
Date
02
03
04
09
10
11
12
13
16
17
18
19
20
23
24
25
26
27
28
30
Closing
Price
890.85
907.55
890.45
870.05
864.45
864.9
878.15
864.65
873.45
885.65
882.15
877.8
860.5
843.45
847.5
838.65
841.55
860.75
868.9
881.45
May 2012
Return
0.4057
1.8746
-1.8842
-2.291
-0.6436
0.0521
1.532
-1.5373
1.0178
1.3968
-0.3952
-0.4931
-1.9708
-1.9814
0.4802
-1.0442
0.3458
2.2815
0.9468
1.4444
Date
02
03
04
07
08
09
10
11
14
15
16
17
18
21
22
23
24
25
28
29
30
31
Closing
Price
881.7
857.55
833.95
847.7
830.3
821.8
812.8
812.95
799.1
816.7
794.1
787.25
805.05
810.8
800.85
795.7
819.9
815.9
834.55
838.95
817
784.3
June 2012
Return
0.0284
-2.739
-2.752
1.6488
-2.0526
-1.0237
-1.0952
0.0185
-1.7037
2.2025
-2.7672
-0.8626
2.261
0.7142
-1.2272
-0.6431
3.0413
-0.4879
2.2858
0.5272
-2.6164
-4.0024
Date
01
04
05
06
07
08
11
12
13
14
15
18
19
20
21
22
25
26
27
28
29
Closing
Price
781.7
790.3
790.25
807.1
829.95
829
825.5
838.8
849.1
819.4
844.9
816.7
826.4
833.3
850.55
852.05
847.35
845.45
852.45
856.5
899.6
Return
-0.3315
1.1002
-0.0063
2.1322
2.8311
-0.1145
-0.4222
1.6111
1.2279
-3.4978
3.112
-3.3377
1.1877
0.8349
2.0701
0.1764
-0.5516
-0.2242
0.828
0.4751
5.0321
Table: 07
Month-Wise HDFC Prices
January 2012
Closing
Date
Return
Price
02
03
04
05
06
07
09
10
11
12
13
16
17
18
19
20
23
24
25
27
30
31
427.2
439.15
443.25
442.55
452.5
451.1
454.9
0.0351
2.7973
0.9336
0.1579
2.2483
0.3094
0.8424
459.45
462.25
466.6
1.0002
0.6094
469.3
461.15
0.5787
1.7366
467.25
480.3
1.3228
2.7929
485
0.9786
488.7
483.9
0.7629
0.9822
488.5
0.9506
490.1
479.05
0.3275
1.3263
0.9409
490.9
2.4736
483.6
0.941
February 2012
Closing
Date
Price
Return
01
02
03
06
07
08
09
10
13
14
15
16
17
21
22
23
24
27
28
29
496.7
497.8
506.35
1.1815
0.2215
1.7176
506.7
0.0691
509.65
0.5822
508
522.15
-0.3238
2.7854
516.2
522
517.7
-1.1395
1.1236
532.95
2.9457
526.2
-1.2665
527.55
531.1
0.2566
0.6729
531.75
0.1224
531.8
0.0094
524.5
-1.3727
513.3
-2.1354
530.2
3.2924
517.8
-2.3387
-0.8238
March 2012
Closing
Date
Return
Price
01
514.15 0.7049
02
518.3 0.8072
03
518.9 0.1158
05
511.3 1.4646
06
507.6 0.7236
07
09
12
13
14
15
16
19
20
21
22
23
26
27
28
2930
515.3
522.85
519.85
524.8
527.05
510.95
507.7
498.65
504.85
515.4
502.6
513.85
510.55
518.05
1.5169
1.4652
0.5738
0.9522
0.4287
3.0547
0.6361
1.7825
1.2434
2.0897
2.4835
2.2384
0.6422
510.7
1.469
0.9169
0.5065
520.05
1.8308
513.3
Table: 08
Month-Wise HDFC Prices
April 2012
Date
02
03
04
09
10
11
12
13
16
17
18
19
20
23
24
25
26
27
28
30
Closing
Price
527.1
529.8
526.6
522.95
524.5
526.25
530.4
530.25
529.6
530.85
536.9
554.2
551.1
544.9
541.7
546.9
540.55
540.55
543.15
542.2
May 2012
Return
1.3556
0.5122
-0.604
-0.6931
0.2964
0.3337
0.7886
-0.0283
-0.1226
0.236
1.1397
3.2222
-0.5594
-1.125
-0.5873
0.9599
-1.1611
0
0.481
-0.1749
Date
02
03
04
07
08
09
10
11
14
15
16
17
18
21
22
23
24
25
28
29
30
31
Closing
Price
549.8
552.55
536.75
532.15
515.45
512.45
516.75
510.8
500.5
499.05
495.15
497.35
500.45
497.45
489.05
487
499.05
500.35
507.95
504.6
500.65
505.95
June 2012
Return
1.4017
0.5002
-2.8595
-0.857
-3.1382
-0.582
0.8391
-1.1514
-2.0164
-0.2897
-0.7815
0.4443
0.6233
-0.5995
-1.6886
-0.4192
2.4743
0.2605
1.5189
-0.6595
-0.7828
1.0586
Date
01
04
05
06
07
08
11
12
13
14
15
18
19
20
21
22
25
26
27
28
29
Closing
Price
491.45
496.8
501.8
519.35
537.25
538.3
539.55
549.55
542.7
534.4
547.85
533
537.1
534.5
543
544.15
537.25
544.1
548.7
547
563.5
Return
-2.8659
1.0886
1.0064
3.4974
3.4466
0.1954
0.2322
1.8534
-1.2465
-1.5294
2.5168
-2.7106
0.7692
-0.4841
1.5903
0.2118
-1.268
1.275
0.8454
-0.3098
3.0165
BANKS
AVG
RETURNS
0.2525
0.2388
0.2290
SBI
ICICI
HDFC
STANDARD
DEVIATION
2.28
2.18
1.45
2.5
1.5
AVG
RETURNS
STANDARD DEVIATION
1
0.5
0
SBI
ICICI
HDFC
Fig: 1 Bank wise half yearly average rate of return and standard deviation
INTERPRETATION:
An average rate of return of SBI bank ltd is 0.25. Where as the risk (i.e. standard
deviation) is 2.28. The risk is higher than that of the returns.
An average rate of return of ICICI bank ltd is 0.24. Where as the risk (i.e.
standard deviation) is 2.08. The risk is higher than that of the returns.
An average rate of return of SBI bank ltd is 0.23. Where as the risk (i.e. standard
deviation) is 1.45. The risk is higher than that of the returns.
Table: 09
Month-Wise SBI Bank and Market Returns
January 2012
SBI
MRK
Date
Return Return
02
0.6267 0.1237
03
4.7157 2.7059
04
-0.665 -0.134
05
-0.204 0.0057
06
-0.919 -0.006
07
-0.382 0.1313
09
-1.916
0.09
10
3.9261 2.2419
11
1.3924 0.4832
12
2.0252 -0.214
13
0.9343 0.8092
16
2.2227 0.151
17
1.4422 1.6671
18
1.126 -0.486
19
1.0786 1.3393
20
2.5535 0.5189
23
0.4581 0.0311
24
5.1864 1.5521
25
0.7495 0.8204
27
-0.681 0.8796
30
-2.541 -2.095
31
3.5339 2.0584
February 2012
SBI
MRK
Date
Return Return
1
0.7787 0.8503
2
-0.214 0.6886
3
1.4691 1.0073
6
2.8506 0.9221
7
-0.509 -0.611
8
1.085 0.7553
9
0.3011 0.8621
10
-0.433 -0.326
13
-2.002 0.2144
14
3.2621 0.5708
15
2.3676 2.0976
16
4.379 0.1277
17
2.882 0.6386
21
1.4482 0.7444
22
-7.911 -2.371
23
0.1528 -0.395
24
-2.408 -0.883
27
-3.702 -2.81
28
4.9151 2.2908
29
0.6212 0.3725
March 2012
SBI
MRK
Date
Return Return
1
-1.0542 -0.697
2
1.16905 0.3934
3
0.22487 -0.137
5
-3.4033 -0.291
6
-1.0648 -1.610
7
-0.4626 -0.926
9
3.79487 1.4272
12 3.95761 1.604
13 0.75317 0.7293
14
1.0246 1.594
15
-2.2135 -0.637
16
-3.1094 -1.243
19
-3.0656 -1.022
20 1.13444 -1.444
21 2.26175 0.3623
22
-3.2661 1.781
23 0.21522 -1.949
26
-2.1683 0.3017
27 0.54289 -0.680
28
-2.2843 -0.336
29- -0.9394 -1.285
30
1.6201 1.104
Table: 10
Month-Wise SBI Bank and Market Returns
April 2012
SBI
MRK
Date
Return Return
02
1.642 2.3816
03
1.9489 0.8544
04
-0.304 -0.424
09
-2.910 -1.527
10
2.3652 0.0483
11
0.4324 -0.399
12
2.9533 0.8029
13
-0.568 -1.051
16
2.4396 0.4317
17
1.5251 1.0444
18
-0.45 0.2632
19
-0.799 0.3908
20
-0.477 -0.814
23
-3.023 -1.696
24
-0.166 0.2571
25
-0.765
-0.44
26
-0.575 -0.314
27
-1.551 -0.102
28
0.2517 0.4131
30
0.3238 0.7257
May 2012
SBI
MRK
Date
Return Return
02
0.0702 -0.157
03
-2.536 -0.983
04
-4.393
-1.89
07
1.6327 0.5843
08
-3.317 -1.972
09
-3.642 -0.746
10
-2.323 -0.147
11
0.4583 -0.757
14
-0.648 -0.603
15
1.0733 0.7035
16
-1.653 -1.464
17
1.0332 0.1376
18
5.0809 0.2938
21
3.3677 0.3583
22
-3.432 -0.860
23
0.926 -0.535
24
0.7335 1.4086
25
1.7353
0.153
28
4.7556 1.2422
29
0.9498
0.022
30
-1.075 -0.980
31
-1.998 -0.158
June 2012
SBI
MRK
Date
Return Return
01
-1.43 -1.637
04
0.9871
0.023
05
1.6641 0.2604
06
3.8072
2.43
07
0.389 0.9658
08
0.5628 0.3514
11
-0.711 -0.331
12
1.9565 1.0724
13
0.6955 0.0767
14
-3.06 -1.258
15
1.3253 1.3631
18
-4.359 -1.396
19
0.7401 0.6901
20
0.6467 0.5268
21
2.8937 0.8685
22
-0.973 -0.262
25
-1.94 -0.463
26
0.0567 0.2543
27
-0.128 0.3905
28
-0.849 0.0841
29
3.0399 2.3194
Table: 11
Month-Wise ICICI Bank and Market Returns
Date
02
03
04
05
06
07
09
10
11
12
13
16
17
18
19
20
23
24
25
27
30
31
January 2012
ICICI
MRK
Return Return
1.7309 0.1237
4.1568 2.7059
2.4262
-0.134
0.572 0.0057
0.5487
-0.006
-0.785 0.1313
0.0402
0.09
3.8485 2.2419
0.665 0.4832
0.2501
-0.214
1.0364 0.8092
0.2406
0.151
-0.752 1.6671
-2.068
-0.486
3.5095 1.3393
5.814 0.5189
1.7979 0.0311
3.305 1.5521
-0.852 0.8204
1.0813 0.8796
-4.07
-2.095
5.8748 2.0584
February 2012
ICICI
MRK
Date
Return Return
01
-1.53 0.8503
02
1.565 0.6886
03
1.4078 1.0073
06
1.4265 0.9221
07
0.9754
-0.611
08
-1.809 0.7553
09
2.136 0.8621
10
-1.213
-0.326
13
0.6895 0.2144
14
0.8078 0.5708
15
4.028 2.0976
16
-1.148 0.1277
17
1.3108 0.6386
21
0.9679 0.7444
22
-3.421
-2.371
23
-1.395
-0.395
24
-1.293
-0.883
27
-4.798
-2.81
28
2.6891 2.2908
29
-0.467 0.3725
March 2012
ICICI
MRK
Date
Return Return
01
-2.4435
-0.697
02 2.08062 0.3934
03 0.31016
-0.137
05
-3.8761
-0.291
06
-1.9817
-1.610
07 0.92593
-0.926
09
6.2246 1.4272
12 1.63442
1.604
13
-0.0054 0.7293
14 2.60865
1.594
15
-2.4742
-0.637
16
-1.4243
-1.243
19
-0.916
-1.022
20
-0.1156
-1.444
21
3.0687 0.3623
22
-3.8433
1.781
23 1.28412
-1.949
26
-4.2975 0.3017
27
0.476
-0.680
28
-1.9292
-0.336
29-0.355
-1.285
30 3.64465
1.104
Table: 12
Month-Wise ICICI Bank and Market Returns
April 2012
ICICI MRK
Date
Return Return
02
0.4057 2.3816
03
1.8746 0.8544
04
-1.884
-0.424
09
-2.291
-1.527
10
-0.643 0.0483
11
0.0521
-0.399
12
1.532 0.8029
13
-1.537
-1.051
16
1.0178 0.4317
17
1.3968 1.0444
18
-0.395 0.2632
19
-0.493 0.3908
20
-1.970
-0.814
23
-1.981
-1.696
24
0.4802 0.2571
25
-1.044
-0.44
26
0.3458
-0.314
27
2.2815
-0.102
28
0.9468 0.4131
30
1.4444 0.7257
May 2012
ICICI
MRK
Date
Return Return
02
0.0284
-0.157
03
-2.739
-0.983
04
-2.752
-1.89
07
1.6488 0.5843
08
-2.053
-1.972
09
-1.024
-0.746
10
-1.095
-0.147
11
0.0185
-0.757
14
-1.704
-0.603
15
2.2025 0.7035
16
-2.767
-1.464
17
-0.863 0.1376
18
2.261 0.2938
21
0.7142 0.3583
22
-1.227
-0.860
23
-0.643
-0.535
24
3.0413 1.4086
25
-0.488
0.153
28
2.2858 1.2422
29
0.5272
0.022
30
-2.616
-0.980
31
-4.002
-0.158
June 2012
ICICI
MRK
Date
Return Return
01
-0.332
-1.637
04
1.1002
0.023
05
-0.006 0.2604
06
2.1322
2.43
07
2.8311 0.9658
08
-0.114 0.3514
11
-0.422
-0.331
12
1.6111 1.0724
13
1.2279 0.0767
14
-3.498
-1.258
15
3.112 1.3631
18
-3.338
-1.396
19
1.1877 0.6901
20
0.8349 0.5268
21
2.0701 0.8685
22
0.1764
-0.262
25
-0.552
-0.463
26
-0.224 0.2543
27
0.828 0.3905
28
0.4751 0.0841
29
5.0321 2.3194
Table: 13
Month-Wise HDFC Bank and Market Returns
January 2012
HDFC MRK
Date
Return Return
02
0.0351 0.1237
03
2.7973 2.7059
04
0.9336 -0.134
05
-0.158 0.0057
06
2.2483 -0.006
07
-0.309 0.1313
09
0.8424
0.09
10
1.0002 2.2419
11
0.6094 0.4832
12
0.941
-0.214
13
0.5787 0.8092
16
-1.737
0.151
17
1.3228 1.6671
18
2.7929 -0.486
19
0.9786 1.3393
20
0.7629 0.5189
23
-0.982 0.0311
24
0.9506 1.5521
25
0.3275 0.8204
27
-1.326 0.8796
30
-0.941 -2.095
31
2.4736 2.0584
February 2012
HDFC MRK
Date
Return Return
01
1.1815 0.8503
02
0.2215 0.6886
03
1.7176 1.0073
06
0.0691 0.9221
07
0.5822 -0.611
08
-0.324 0.7553
09
2.7854 0.8621
10
-1.14
-0.326
13
1.1236 0.2144
14
-0.824 0.5708
15
2.9457 2.0976
16
-1.267 0.1277
17
0.2566 0.6386
21
0.6729 0.7444
22
0.1224 -2.371
23
0.0094 -0.395
24
-1.373 -0.883
27
-2.135
-2.81
28
3.2924 2.2908
29
-2.339 0.3725
Date
01
02
03
05
06
07
09
12
13
14
15
16
19
20
21
22
23
26
27
28
29
30
March 2012
HDFC MRK
Ret
Return
-0.7049 -0.697
0.8071 0.3934
0.1157 -0.137
-1.4646 -0.291
-0.7236 -1.610
1.5169 -0.926
1.4651 1.4272
-0.5738 1.604
0.9522 0.7293
0.4287 1.594
-3.0547 -0.637
-0.6361 -1.243
-1.7825 -1.022
1.2433 -1.444
2.0897 0.3623
-2.4835 1.781
2.2383 -1.949
-0.6422 0.3017
1.469 -0.680
-0.9169 -0.336
-0.5065 -1.285
1.83082 1.104
Table: 14
Month-Wise HDFC Bank and Market Returns
May 2012
April 2012
MRK
Date HDFC
Return Return
02
1.3556 2.3816
03
0.5122 0.8544
04
-0.604 -0.424
09
-0.693 -1.527
10
0.2964 0.0483
11
0.3337 -0.399
12
0.7886 0.8029
13
-0.028 -1.051
16
-0.122 0.4317
17
0.236 1.0444
18
1.1397 0.2632
19
3.2222 0.3908
20
-0.559 -0.814
23
-1.125 -1.696
24
-0.587 0.2571
25
-0.44
0.9599
26
-1.161 -0.314
27
0 -0.102
28
0.481 0.4131
30
-0.174 0.7257
Date
02
03
04
07
08
09
10
11
14
15
16
17
18
21
22
23
24
25
28
29
30
31
HDFC
Return
1.4017
0.5002
-2.859
-0.857
-3.138
-0.582
0.8391
-1.151
-2.016
-0.29
-0.781
0.4443
0.6233
-0.599
-1.689
-0.419
2.4743
0.2605
1.5189
-0.66
-0.783
1.0586
June 2012
MRK
Date
Return
-0.157
-0.983
-1.89
0.5843
-1.972
-0.746
-0.147
-0.757
-0.603
0.7035
-1.464
0.1376
0.2938
0.3583
-0.860
-0.535
1.4086
0.153
1.2422
0.022
-0.980
-0.158
01
04
05
06
07
08
11
12
13
14
15
18
19
20
21
22
25
26
27
28
29
HDFC
Return
-2.866
1.0886
1.0064
3.4974
3.4466
0.1954
0.2322
1.8534
-1.246
-1.529
2.5168
-2.711
0.7692
-0.484
1.5903
0.2118
-1.268
1.275
0.8454
-0.31
3.0165
MRK
Return
-1.637
0.023
0.2604
2.43
0.9658
0.3514
-0.331
1.0724
0.0767
-1.258
1.3631
-1.396
0.6901
0.5268
0.8685
-0.262
-0.463
0.2543
0.3905
0.0841
2.3194
SBI-MARKET
0.7232
ICICI-MARKET
0.6898
HDFC-MARKET
0.599
Series1
0.3
0.2
0.1
0
SBI-MRK
ICICI-MRK
HDFC-MRK
INTERPRETATION:
From the above graph it is observed that all the banks i.e., SBI, ICICI, HDFC
Showing positive values and they are positively correlated. This means that,
If one bank prices increases than automatically other bank prices also increases.
If one bank prices decreases than other bank prices also decreases.
SBI-MARKET
1.7232
ICICI-MARKET
1.6087
HDFC-MARKET
0.8698
CALCULATION OF BETA
Beta: Measures volatility or systemic risk compared to the market
BANKS
SBI
ICICI
HDFC
BETA
1.46
1.33
0.60
BETA
1.6
1.4
1.2
1
0.8
BETA
0.6
0.4
0.2
0
SBI
ICICI
HDFC
BANKS
INTERPRETATION:
Beta of 1 Indicates that the securities price will move with the market .A beta less
than 1 means that the security will be less volatile than the market .A beta of greater
than 1 indicates that the securities price will be more volatile than the market.
From the above graph it is clearly showing that SBI and ICICI prices are more
Volatile than the market and HDFC prices are less volatile than the market.
High beta stocks are supposed to be riskier but provide a potential for higher return
And low beta stocks poses less risk but also lower returns.
CHAPTER 6
FINDINGS, SUGGESTIONS AND CONCLUSION
6.1 FINDINGS
The following facts were found out during the project work
It observed that an average rate of return of SBI Bank is 0.25, and ICICI Bank is
0.24. Where as the risk (i.e. standard deviation) is 0.28 and 0.24 .That means the
risk is higher and the returns are low. Where as HDFC bank has an average rate
of return of 0.23 and the risk is 1.45. When compare to three banks HDFC bank
having low risk.
All the banks i.e., SBI, ICICI, HDFC are positively correlated, which means if
prices of one bank increases means other banks prices also increases and vice
versa.
Beta values of SBI bank is 1.44 and ICICI bank is 1.33 which is more
volatile than the market and they are riskier but they provide a high returns.
Where as Beta value of HDFC bank is 0.60 which is less volatile than the
market, and they are less risky with less return.
6.2 SUGGESTIONS
When we want the high returns, we have to bear high risk. But if we bear high
risk it is meaningless to invest our hard earned income. In this present project the
highest earned income is obtained by the bank SBI which is 0.25
But it is posing this degree of risk of 2.28. So in order to get the more returns
from minimum risk we have to analysis the factor like company back ground
,performance, market value and historical data. It is suggested to all investors to
analyze fundamental as well as technical.
But among all the securities, HDFC Ltd is best with its minimum returns and low
risk as compared to SBI and ICICI Bank Ltd.
6.3 CONCLUSION
Investment is financial asset require a great concentration since they are involved
a great volatility. Risk is uncertainty in the future returns when one invests in financial
assets. To reduce this risk component in the returns one has to be careful enough in
estimating the future of their investment returns. This project has been undertaken to
study the returns of securities listed on stock exchanges. These equities are analyzed in
terms of risk and return. The present study reveals the process of expecting the returns
which the investor can use investment process.
BIBLIOGRAPHY
BOOKS:
Financial Management
-Prasanna chandra
WEBSITES:
www.nseindia.com
www.bseindia.com
www.hdfc.com
www.icici.com
www.sbi.com