A Study of Fundamental Analysis on Selected Stocks Project

NEED OF STUDY:

Fundamental value or intrinsic value is very important in doing an investment. The intrinsic value of the stock does not refer to market value but refers to the natural value of the stock. Through fundamental analysis, we can arrive at the fundamental value of the stock which enhances the understanding of different stock to investors. Fundamental value or intrinsic value is the actual value of the stock which can be derived from fundamental analysis and this value is very important at the time of investment to take a rational decision in investing in a stock. Fundamental analysis of stock also brings in elements like discounting, future projected projects are discounted in relation to the time value of money to find out the actual value of the stock. While investing in different stocks clear analysis is a need, without clear and rational analysis decision making will become very complex, to make it more easy and accurate fundamental analysis can be used.

STATEMENT OF THE PROBLEM:

Investment is a major decision in an organization because it involves financial input and there is a certain return expected out of it. investment should give a return which is good and satisfy the expectation of the investor. The Stock meeting the expectations of the investor depends on the investment pattern the investor is using. There are multiple stocks to analyze before taking an investment decision, this analyzing process is tedious and needs a lot of standards and proven expertise and if this proven technique is not used accordingly can be misleading can lead the investor to invest in a non-performing stock. Fundamental analysis brings out the true value of a stock when used procedurally that is the intrinsic value of the stock to support the investment decision of the investor rationally. Stocks are very complex to understand and they are highly fluctuating depending on the market, to analyze them and compare them to come to decision for investment is challenging and needs a lot of expertise.

OBJECTIVES OF THE STUDY

  1. To know how fundamental analysis tools are used to predict the future behavior of the stocks
  2. To analyze the performance of selected stocks.
  3. To determine economic value added and market value added.
  4. To offer suggestions based on the analysis of the study.

SCOPE OF THE STUDY

The study is totally dependent on the data collected from the secondary sources. The study is totally dependent on the accuracy of the data collected from the secondary sources, the study will give the investors in detail analysis of the stock.

SAMPLE SIZE

BANKING SECTOR IT SECTOR FMCG SECTOR
CANARA INFOSYS ITC
HDFC WIPRO DABUR INDIA LIMITED
AXIS ORACLE HUL
SBI MPHASIS BRITANNIA
ICICI HCL AMUL

CHAPTER SCHEME 

Chapter 1 – INTRODUCTION

This part of the study gives a picture about the introduction of the topic.

Chapter 2 – REVIEW OF LITERATURE AND RESEARCH DESIGN

This part of the study contains the view of old literature on the topic and the research methodology adopted.

Chapter 3 – PROFILE OF SELECTED ORGANISATION AND        RESPONDENTS

This figure outs the type of organization and its transaction.

Chapter 4 – DATA ANALYSIS AND INTERPRETATION

It includes the calculation and interpretation of the data.

Chapter 5 – FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

This describe about the findings and conclusions about the topic and the recommendation for the study.

MBA Project on Working Capital Management

INTRODUCTION

Many finance managers, who are quite at home and competent in dealing with long term decisions, such as capital investments experience difficulties when they have to scout for funds to meet the day to day working needs. With bank finance getting increasingly scare, regulated and expensive the emphasis has shifted to closer attention to internal generation of funds and the development of the enterprises ability to raise funds in the market.

WORKING CAPITAL MANAGEMENT AND POLICY

Working capital can be defined as the amount at funds, which a Company must have to finance tits day-to-day operations. It can also be regarded as that proportion of the companies’ total capital, which is employed in “current liabilities” which are short term assets that are normally expected to get converted into cash within a year. Current liabilities are short term liabilities maturing for the payment within a short period say one year, and they partly support the investment in current assets. In other words they serve as a source of working capital.

Net working capital is defined as the difference between current assets And current liabilities, and represents the extent to which current assets are financed by long-term funds.

Working capital management is the process of administration of current assets and current liabilities within the policy guidelines of the company.

Working capital policy is concerned with basic policy decisions regarding. The target levels each category of current assets.

The methods of financing the current assets

Current assets in many cases constitute more than half of the total Assets employed In business and therefore, it is essential to evolve an appropriate working capital policy to suit the specific needs of the firm an manage its working capital accordingly. Current liabilities that are specifically financing current assets come under the preview of working capital policy.

These are distinct from current liabilities which are consequences of past long term financing decisions, such as current maturates of long term debt or those in nature of temporary financing of capital projects which will be subsequently funded by long term sources off finance.

The aim in working capital management and policy is to maintain a proper balance between the magnitude of working capital and the general scale of operations of the company and to determine, with reference therefore, the appropriate levels of components of current assets to be maintained and the pattern of financing them.

IMPORTANCE OF WORKING CAPITAL MANAGEMENT

The importance of working capital management can be. Traced to the following main considerations.

a) Current assets constitute the dominant segment of the total assets employed in most business and, therefore, require more intense and careful managerial attention.

b) The investment in current assets and level of current liabilities are very sensitive to changes in sale and the funds requirements shifts rapidly, demanding quick short-term decisions to sustain smooth operations.

C) Through profitability and proper selection of investments are essential for the long fun prosperity of the business, its short-term survival depends on its liquidity or ability to meet short-term obligations fully and promptly. The precondition for liquidity is efficient management of the elements of working capital and the ability to raise sufficient short and long-term finance. The finance managers of companies will have to devote considerable time and energy in arranging short term financing obtaining favorable credit terms from the suppliers of goods and services, deciding on credit policies for credit sales, keeping n chech on the funds blocked in inventories and monitoring and directing the movement of cash in the business.

OBJECTIVES OF THE STUDY:

• The objective of the study is to know the short term financial position of the Cement Company with Working Capital Management.
• To, identify the limitations in management of the Cement Company and suggestions to overcome those limitations.
• To provide a conceptual frame work and theoretical perception about the performance of Cement Company.
• To provide credit facilities to the customers
• To pay wages and salaries to the employees working in the organization.
• To know the day-to-day expenses.

METHODOLOGY:

For, the purpose of the study, the data collected from primary and Secondary has sanitized edited and presented in the form of tables and statements. The analysis of the data has been made with the help of certain mathematical techniques lie percentages etc. Where ever feasible and appropriate graphs and diagrams are used.

The collection of data is done through two principles sources viz

1. Primary Data
2. Secondary Data

PRIMARY DATA

It is the information collected directly without any reference. In the study, it mainly interviews with concerned officers and staff either individually or collectively. Some of the information had been verified or supplemented with personal observation, the data collected through conducting personal interview with the officer of the Cement Company.

SECONDARY DATA

When an investigator uses the data which is already been collected by other, that data is called secondary data. Such as pamphlets annual reports, return and internal records.

The data includes:

1. Collection of required data from annual report of Cement Company.
2. Reference from text book and journals relating to financial management.
3. Articles published in business dailies like economic times, Business world, and etc.

LIMITATIONS OF THE STUDY:

The limitations of present study are as follows:

1. Due to the time constraint the study is confined to the assessment of working capital management only.
2. Data collected for 5 years which is limited.
3. The study is confined to the secondary source of data and figures are taken from the annual reports and suggestions of various accountants.
4. The data which is used in this project are taken from the annual reports, published at the end of the year.
5. The study is limited to the period of 5 Years.