FUNDAMENTAL AND FUNDAMENTAL AND TECHNICAL ANALYSIS OF TECHNICAL ANALYSIS OF TOP FIVE NIFTY SHARESTOP FIVE NIFTY SHARES

INTRODUCTIONINTRODUCTION

Financial information of a company is required for fundamental analysis. Fundamental analysis of a company needed to predict, compare and educate the firms earning ability with comparison to other company in the industry. Technical analyst believes that share prices are determined by the demand and supply forces operating in the market. Technical analysts examine the price action of the financial markets instead of the fundamental factors that effect market prices.

COMPANY PROFILE

The Karvy group was formed in 1983 at Hyderabad, India. Karvy ranks among the top player in almost all the fields it operates. Karvy Stock Brokers Limited, member of National Stock Exchange of India and the Bombay Stock Exchange, ranks among the top 5 stock brokers in India with over 600000 active accounts, it ranks among the top 5 Depository Participant in India, registered with NSDL and CDSL.

Karvy Comtrade, member of NCDEX and MCX ranks among the top 3 commodity brokers in the country. Karvy Insurance Brokers is registered with IRDA and ranks among the top 5 insurance agent in the country. Registered with AMFI as a corporate agent. Karvy has 575 offices over 375 locations across India and overseas at Dubai and New York.

TOPIC

FUNDAMENTAL AND FUNDAMENTAL AND TECHNICAL ANALYSIS OF TECHNICAL ANALYSIS OF

TOP FIVE NIFTY SHARESTOP FIVE NIFTY SHARES

S&P CNX Nifty is a well-diversified 50 stock index accounting for 22 sectors of the economy. Nifty is owned and managed by India Index Services and Products Ltd. (IISL), which is a joint venture between NSE and CRISIL. Nifty stocks represent about 67.27% of the total free float market capitalization of the universe of the stocks traded on NSE as on September 28, 2012, The base period selected for S&P CNX Nifty index is November 3, 1995. The value of the index has been set at 1000 and a base capital of Rs.2.06 trillion.

NIFTY

The following are the top five nifty companies selected according to the data released by national stock exchange as on 28 September 2011.

ITCRELIANCE INDUSTRIESINFOSYSICICI BANKHDFC

OBJECTIVES OF THE STUDY

1. To analyze and evaluate the financial performance of the top five NIFTY companies.

2. To technically analyze the share price movements of selected companies

3. To understand how the economic condition could affect the share prices of these companies

4. To find whether these shares are suitable for investment

METHOD OF DATA COLLECTION

SECONDARY DATA

Company WebsitesAnnual report of companiesbooks

LIMITATION OF THE STUDY

Analysis of financial statement restricted to past five years

Number of assumptions made during the study Detailed study of financial statement not possible

because of time constraints With respect to technical analysis the basic factor of

share price movement is considered.

RATIO ANALYSIS

Ratio analysis is a technique used to analyze the fundamentals of the company.Important ratios used are ;Current ratioNet profit marginEarning per shareP/E ratioReturn on equity

FUNDAMENTAL ANALYSIS

YEARS 2008 2009 2010 2011 2012

ITC 1.30 1.45 0.49 1.14 1.20

RELIANCE 1.09 1.03 1.14 1.23 1.30

INFOSYS 3.13 4.30 3.98 4.65 4.34

ICICI 0.10 0.11 0.11 0.10 0.12

HDFC 17.94 7.18 6.41 7.27 2.84

CURRENT RATIO

Year 2008 2009 2010 2011 2012

ITC 20.86 20.57 20.77 22.12 22.98

RELIANCE 14.09 9.78 11.93 7.20 5.43

INFOSYS 26.80 26.48 26.49 23.84 23.41

ICICI 10.0 9.9 15.5 20.3 20.1

HDFC 18.29 17.90 26.22 19.73 30.76

TECHNICAL ANALYSIS

ITC LIMITED

Here the share price of ITC limited showing an increasing trend over five years except for a bit of a slowdown in FY 2009. the five year low of ITC is 77 that touched in 24 Oct. 2008 and five year high of this share is 310.In the period of 2008 and 2009 ITC have a good volume of trade and now the volume is just average. The 52 week high and low of this share is 310 and 200 and now the share price is in 306 (feb4) however, this share is better for investment.

RELIANCE INDUSTRIES

The share price of reliance industries showing a declining trend. In the initial period of 2008 the company is in very strong position but in 24 Oct. 2008 it started to slowdown up to 465 levels due to global economic crisis and then it recoverd.2010 and 2011 is a good period for this share but in 2012 it again started to decline. The 52 week high and low for this share is 955 and 673.now the share price is running on 886(feb4) and this is an average price investors can consider this share for short term and long term investment.

INFOSYS

Here the share price of infosys showing an increasing trend except a slowdown in 2008. Infosys fall to its 5 year low of 1040 in 14 oct. 2008 due to global financial crisis. Thereafter its started to recover and it reached to a good position and in 3rd jan 2011 it reached to its five year high of 3493. The 52 week high and low of this share is 2994 and 2060.Now the share price is running on 2767. Investor can consider this for investment .

ICICI BANK

ICICI BANK started to decline in 2008 from 1100 to 252 levels which is the five year low of this company. From there it slowly recovered and reached to its five year high of 1277 in 9 Oct. 2010. Volume of trade in this share is good.52 week high/low of this share is 1232 and 767. Now the price of this share is 1167. Investors can consider this stock for investment.

HDFC

Here from the diagram we can understand that over five years HDFC shows an up and down trend.It reached its five year low in 2008.From there it recovered and it touched its five year high in 2011.The 52 week high/low of this share is 882 and 610. Now the share is running on 817 and it is a high price however investors can consider this share for long term investment.

FINDINGS HDFC and Infosys is very strong in its liquidity position and reliance and ITC is in a safe position and ICICI is too bad in its liquidity.

The profitability of the five company's is good and HDFC reported higher profit and reliance reported lower profit

In the period of recession prices of all company's was down except ITC

The share price movements of all these company's are influenced by the economic news's.

SUGGESTIONInvestors willing to hold the security for a long period of time can consider investing in reliance, ICICI,ITC and HDFC and short term investors can invest in ITC and ICICI. Infosys is now running in a higher price however investment in this company is advisable.

CONCLUTION From my research I understood that ITC,RIL,INFY,ICICI,HDFC are the top five nifty companies. The fundamental analysis of these companies reveal that their fundamentals are strong and technical analysis of these company's helps to understand when to invest and withdraw the money from these shares. Every company falls and then recovers. Therefore investing in this shares is less risky. All the five shares are good for investment.