ASSIGNMENT 1:

SECUTRITIES ANALYSIS & PORTFOLIO MANAGEMENT

PRESENTED TO,

Prof. Akshay Damani

PRESENTED BY,

Sneha Aggarwal

Alpa Bhansali

PG-Finance

ROLL NO- 02 & 06

14th July, 2010

Q1) List 10 reasons for movement in Sensex, Nifty, Sector or an
Individual share price up or down supported by examples.

Example: A stable pro – reform government in the centre leads to an increase in

share price

Example: A huge order to a company can increase its share price, etc

Ans :
Various reasons for the movement in Sensex, Nifty, Sector or Individual share
price up or down are as follows:
 Slowdown in foreign fund flow.

 Heavy selling pressure continued.

 Huge investment by FII's – because in expectation of interest rate cut in US.

 Announcement of banking reforms on – acquisition, revision of SLR and

CRR & rising of dividend ceiling.

 FII's restarts pumping investment in to Indian stock market.

 Corporate governance issue of Reliance Company

 Increase and Decrease in FDI allowable margin in particular sector.

 Demand and supply forces prevailing in the market.

 Change in monetary reform and regulatory system of the country.
 Fluctuation in like gold, crude oil, etc.

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Q2) Classify the 30 shares in the SENSEX and 50 shares in NIFTY into
relevant sectors.
Ans:

30 shares in the SENSEX

Company Name Industry

ACC Cement - Major

Bharti Airtel Telecommunications - Service
BHEL Engineering - Heavy
Cipla Pharmaceuticals
DLF Construction & Contracting - Real
Estate
HDFC Finance - Housing
HDFC Bank Banks - Private Sector
Hero Honda Auto - 2 & 3 Wheelers
Hindalco Aluminium
HUL Personal Care
ICICI Bank Banks - Private Sector
Infosys Computers - Software
ITC Cigarettes
Jaiprakash Asso Construction & Contracting - Civil
Jindal Steel Steel - Sponge Iron
Larsen Engineering - Heavy
Mah and Mah Auto - Cars & Jeeps
Maruti Suzuki Auto - Cars & Jeeps
NTPC Power - Generation/Distribution
ONGC Oil Drilling And Exploration
Reliance Refineries
Reliance Comm Telecommunications - Service
Reliance Infra Power - Generation/Distribution
SBI Banks - Public Sector
Sterlite Ind Metals - Non Ferrous
Tata Motors Auto - LCVs/HCVs
Tata Power Power - Generation/Distribution
Tata Steel Steel - Large
TCS Computers - Software
Wipro Computers - Software
http://finance.indiamart.com/markets/bse/bse30.html

List of NIFTY 50 stocks in NSE along with Equity Capital

50 shares in NIFTY
NSE Code Company Industry
     
ELECTRICAL
ABB ABB Ltd. EQUIPMENT
CEMENT AND CEMENT
ACC ACC Ltd. PRODUCTS
CEMENT AND CEMENT
AMBUJACEM Ambuja Cements Ltd. PRODUCTS
AXISBANK Axis Bank Ltd. BANKS
TELECOMMUNICATION
BHARTIARTL Bharti Airtel Ltd. – SERVICES
Bharat Heavy ELECTRICAL
BHEL Electricals Ltd. EQUIPMENT
Bharat Petroleum
BPCL Corporation Ltd. REFINERIES
OIL EXPLORATION
CAIRN Cairn India Ltd. /PRODUCTION
CIPLA Cipla Ltd. PHARMACEUTICALS
DLF DLF Ltd. CONSTRUCTION
GAIL GAIL (India) Ltd. GAS
CEMENT AND CEMENT
GRASIM Grasim Industries Ltd. PRODUCTS
COMPUTERS –
HCLTECH HCL Technologies Ltd. SOFTWARE
Housing Development
Finance Corporation
HDFC Ltd. FINANCE – HOUSING
HDFCBANK HDFC Bank Ltd. BANKS
Hero Honda Motors AUTOMOBILES – 2 AND
HEROHONDA Ltd. 3 WHEELERS
HINDALCO Hindalco Industries Ltd. ALUMINIUM
HINDUNILVR Hindustan Unilever Ltd. DIVERSIFIED
ICICIBANK ICICI Bank Ltd. BANKS
TELECOMMUNICATION
IDEA Idea Cellular Ltd. – SERVICES
Infrastructure
Development Finance FINANCIAL
IDFC Co. Ltd. INSTITUTION
Infosys Technologies COMPUTERS –
INFOSYSTCH Ltd. SOFTWARE
ITC I T C Ltd. CIGARETTES
Jindal Steel & Power STEEL AND STEEL
JINDALSTEL Ltd. PRODUCTS
Jaiprakash Associates
JPASSOCIAT Ltd. DIVERSIFIED
LT Larsen & Toubro Ltd. ENGINEERING
Mahindra & Mahindra AUTOMOBILES – 4
M&M Ltd. WHEELERS
Maruti Suzuki India AUTOMOBILES – 4
MARUTI Ltd. WHEELERS
NTPC NTPC Ltd. POWER
Oil & Natural Gas OIL EXPLORATION
ONGC Corporation Ltd. /PRODUCTION
PNB Punjab National Bank BANKS
Power Grid Corporation
POWERGRID of India Ltd. POWER
Ranbaxy Laboratories
RANBAXY Ltd. PHARMACEUTICALS
Reliance TELECOMMUNICATION
RCOM Communications Ltd. – SERVICES
RELCAPITAL Reliance Capital Ltd. FINANCE
RELIANCE Reliance Industries Ltd. REFINERIES
Reliance Infrastructure
RELINFRA Ltd. POWER
RPOWER Reliance Power Ltd. POWER
Steel Authority of India STEEL AND STEEL
SAIL Ltd PRODUCTS
SBIN State Bank of India BANKS
ELECTRICAL
SIEMENS Siemens Ltd. EQUIPMENT
STER Sterlite Industries METALS
 (India) Ltd.
Sun Pharmaceutical
SUNPHARMA Industries Ltd. PHARMACEUTICALS
ELECTRICAL
SUZLON Suzlon Energy Ltd. EQUIPMENT
AUTOMOBILES – 4
TATAMOTORS Tata Motors Ltd. WHEELERS
TATAPOWER Tata Power Co. Ltd. POWER
STEEL AND STEEL
TATASTEEL Tata Steel Ltd. PRODUCTS
Tata Consultancy COMPUTERS –
TCS Services Ltd. SOFTWARE
UNITECH Unitech Ltd. CONSTRUCTION
COMPUTERS –
WIPRO Wipro Ltd. SOFTWARE
http://nse2rich.com/list-of-nifty-50-stocks-in-nse-along-with-equity-capital/

Q3) what are A group shares, B group shares, T, Z and Penny stocks.

Ans:

Group A: Shares in this category have a high Liquidity, Market Capitalization and
Capital Appreciation.
Group B1 and B2: Similar to A, but with a slightly lower Market Capitalization
and Appreciation but good liquidity. There are financially healthy stocks.
Group C: It includes the odd lots of Categories of A, B1 and B2. As u may be
aware, Shares/Stocks are sold in Lots, any ODD lot remaining among the A, B1,
B2 Groups, are put under C Category.
Group F: It is a Debt Market Segment (Note A. B1.B2 are all only Equities)
Group T: Their settlement needs to be done by DELIVERY only. Trading under
"T", means, actual delivery of Scripts is warranted.
Group Z: Suspended Lots of Shares. They are suspended due to non-compliance
of SEBI Norms.

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What Does Penny Stock Mean?

A stock that trades at a relatively low price and market capitalization, usually
outside of the major market exchanges. These types of stocks are generally
considered to be highly speculative and high risk because of their lack of liquidity,
large bid-ask spreads, small capitalization and limited following and disclosure.
They will often trade over the counter through the OTCBB and pink sheets. 

http://www.investopedia.com/terms/p/pennystock.asp

Q4) what is a Mutual Fund. Explain types of Mutual Funds, example

balanced funds

Ans:

A mutual fund is just the connecting bridge or a financial intermediary that allows
a group of investors to pool their money together with a predetermined investment
objective. The mutual fund will have a fund manager who is responsible for
investing the gathered money into specific securities (stocks or bonds). When you
invest in a mutual fund, you are buying units or portions of the mutual fund and
thus on investing becomes a shareholder or unit holder of the fund.

Mutual funds are considered as one of the best available investments as compare to
others they are very cost efficient and also easy to invest in, thus by pooling money
together in a mutual fund, investors can purchase stocks or bonds with much lower
trading costs than if they tried to do it on their own. But the biggest advantage to
mutual funds is diversification, by minimizing risk & maximizing returns.
http://www.mutualfundsindia.com/mfbasic.asp#types

Types of mutual funds are:

Value stocks
Stocks from firms with relative low Price to Earning (P/E) Ratio usually pay
good dividends. The investor is looking for income rather than capital gains.
Growth stock
Stocks from firms with higher low Price to Earning (P/E) Ratio usually pay
small dividends. The investor is looking for capital gains rather than income.
Based on company size, large, mid, and small cap
Stocks from firms with various asset levels such as over $2 Billion for large;
in between $2 and $1 Billion for mid and below $1 Billion for small.
Income stock
The investor is looking for income which usually comes from dividends or
interest. These stocks are from firms which pay relative high dividends. This
fund may include bonds which pay high dividends. This fund is much like
the value stock fund, but accepts a little more risk and is not limited to
stocks.
Index funds
The securities in this fund are the same as in an Index fund such as the Dow
Jones Average or Standard and Poor's. The number and ratios or securities
are maintained by the fund manager to mimic the Index fund it is following.
Enhanced index
This is an index fund which has been modified by either adding value or
reducing volatility through selective stock-picking.
Stock market sector
 The securities in this fund are chosen from a particular marked sector such
as Aerospace, retail, utilities, etc.
Defensive stock
The securities in this fund are chosen from a stock which usually is not
impacted by economic down turns.
International Stocks from international firms.
Real estate
Stocks from firms involved in real estate such as builder, supplier, architects
and engineers, financial lenders, etc.
Socially responsible
This fund would invest according to non-economic guidelines. Funds may
make investments based on such issues as environmental responsibility,
human rights, or religious views. For example, socially responsible funds
may take a proactive stance by selectively investing in environmentally-
friendly companies or firms with good employee relations. Therefore the
fund would avoid securities from firms who profit from alcohol, tobacco,
gambling, pornography etc.
Balanced funds
The investor may wish to balance his risk between various sectors such as
asset size, income or growth. Therefore the fund is a balance between
various attributes desired.
Tax efficient
Aims to minimize tax bills, such as keeping turnover levels low or shying
away from companies that provide dividends, which are regular payouts in
cash or stock that, are taxable in the year that they are received. These funds
still shoot for solid returns; they just want less of them showing up on the
tax returns.
Convertible
Bonds or Preferred stock which may be converted into common stock.
Junk bond
Bonds which pay higher that market interest but carry higher risk for failure
and are rated below AAA.
Mutual funds of mutual funds
This funds that specializes in buying shares in other mutual funds rather than
individual securities.
Closed end
This fund has a fixed number of shares. The value of the shares fluctuates
with the market, but fund manager has less influence because the price of the
underlining owned securities has greater influence.
Exchange traded funds (ETFs)
Baskets of securities (stocks or bonds) that track highly recognized indexes.
Similar to mutual funds, except that they trade the same way that a stock
trades, on a stock exchange.

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Q5) what are proportions in an IPO for Retail investors, Institutional

investors, QIB, etc.
Ans:
Securities and Exchange Board of India (Sebi) has finally become democratic by
treating all types of investors in the same league. It has done away with the
discretion of merchant bankers in allotment of shares to qualified institutional
buyers (QIBs) in book-built initial public offerings (IPO). Henceforth, QIBs, like
retail investors, will be made proportionate allotments when the issue is
oversubscribed.
The move is also welcomed by the mutual fund (MF) industry. Sebi has specified
that QIBs will have to cough up a 10% margin on their IPO bids. While retaining
the 50% quota for QIBs, Sebi has carved out 5% for MFs, which will also be
allowed to compete for the remaining 45%.investors evolved into three categories
namely QIBs, non-institutional investors and retail investors with their proportions
fixed at 60%, 15% and 25%, respectively. With such policies, the equity markets
experienced a slowdown in the growth in retail investments. The fall in retail
investment was followed by a rise in FII investments. Foreign non-promoter
holding in the Sensex stocks stands at 2.84% as compared to 2.17% for Indian non-
promoter holding.

Q6) List the names of INDEX`s the following countries:

Ans:

COUNTRY EXCHANGES
Germany Deutsche Börse
UK London Stock Exchange
France Euronext Paris (CAC 40)
Australia Australian Securities Exchange
Japan Tokyo Stock Exchange
NewZealand New Zealand Exchange Limited (NZX)
Moscow Interbank Currency Exchange
Russia (MICEX)
China Shenzhen Stock Exchange
Brazil BM&F Bovespa
Canada Toronto Stock Exchange
South Africa JSE Limited
Bahrain Bahrain Stock Exchange(BSE)
Zimbabve Zimbabwe Stock Exchange (ZSE)
Bolsa de Valores de Caracas (Caracas Stock
Venezuela Exchange) (BVC
Saudi Arabia Tadawul (TASI)
 South Korea Korea Exchange
Singapore Singapore Exchange (SGX)
Honkong Hong Kong Stock Exchange
Iceland Iceland Stock Exchange (Kauphöll Islands)
Portugal Euro next Lisbon (PSI-20)
Greece Athens Stock Exchange (General)
Spain BME Spanish Exchanges

Q7) List the exchange rates of the above countries vis-a-vis Indian
Rupee.

Ans:

Exchange rate vis-à-vis Indian

COUNTRY Rupee
Germany 58.76243 INR
UK 70.18596 INR
France 58.76243 INR
Australia 40.81793 INR
Japan 0.526854 INR
NewZealand 33.15259 INR
Russia 1.515521 INR
China 6.9214 INR
Brazil 26.602 INR
Canada 45.14595 INR
South Africa 6.134457 INR
Bahrain 47.57566 INR
Zimbabwe 0.12672 INR
Venezuela 0.01103 INR
Saudi Arabia 12.64697 INR
South Korea 0.03813 INR
Singapore 33.917 INR
Honkong 20.62 INR
Iceland 0.3745 INR
Portugal 59.078 INR
Greece 0.16795 INR
Spain 0.34449 INR
Q8) Prepare a trend line of the Crude prices and Gold prices, Sensex for
last 5 years.

Ans:

Crude oil

Gold price

Sensex
Q9) Give India’s GDP, Inflation, Fiscal deficit, IIP nos., Forex reserves,
balance of Payment and Interest rates trend from 2005 to 2010 on a
yearly basis.

Ans: GDP

Years GDP - real growth rate

2005 6.20%
2006 8.40%
2007 9.20%
2008 9.00%
2009 7.40%
2010 6.50%

INFLATION

Item 2006 2007 2008 2009 2010

January
All 4.82 4.82 9.12 2.01 8.54
commodities
Non-food 4.72 4.54 9.55 -1.76 4.53
commodities
Food 6.83 7.02 6.64 12.32 17.41
 articles
Food 2.55 3.43 9.8 13.79 22.55
products
Food 5.09 5.6 7.87 12.9 19.42
commodities
(3 and 4)
 Food grains 9.71 6.27 6.37 14.14 17.89
 Cereals 6.63 6.97 7.2 12.96 13.69
 Pulses 32.05 2.14 1.3 21.81 45.62
 Rice 2.13 6.05 8.97 15.96 12.02
 Wheat 12.99 6.77 5.06 6.83 14.86
 Oilseeds -3.96 26.58 17.46 0.92 10.05
 Fruits and 2.24 6.49 5.94 11.77 8.33
vegetables
 Dairy 4.2 6.08 8.38 6.12 12.87
products
 Milk group 4.48 8.17 7.87 8.93 13.99
 Egg, fish 6.72 6.38 3.75 14.44 30.71
and meat
 Edible oils 1.23 13.11 12.52 -6.59 -1.17
 Sugar 4.83 -14.69 5.62 36.34 58.94

Industrial Production Growth

Industrial production
Year growth rate (%)
2000 6
2001 7.5
2002 4.7
2003 6
2004 6.5
2005 7.4
2006 7.9
 2007 7.5
2008 8.5
2009 4.8

2009- 2008- 2007- 2006-

  IIP General Index 2005-06
10 09 08 07
    348.5 305.9 304.9 289.1 251.9
S.1)  Manufacturing 374.9 326.9 327.9 310.3 267.4
S.1.01)  Food products 222.7 176.8 276.2 274.3 215.1
 Beverages, Tobacco
S.1.02) 604.2 599.2 516.3 457.4 442.7
and related Products
S.1.03)  Cotton Textiles 175.9 163.3 164.5 164.7 136.5
 Wool, silk and man-
S.1.05) made fibre textiles 295.6 309.7 323.8 285.8 254.6
(1993-94)
 Jute and other
vegetable fibre Textiles
S.1.06) 109.3 120.9 123.2 75.7 121.5
(except cotton) (1993-
94)
 Textile Products
S.1.07) (including Wearing 354.8 356 305 308.7 266.7
Apparel)
 Wood and Wood
S.1.08) Products, Furniture and 140.6 120.3 146.1 144.3 67.4
Fixtures
 Paper & Paper
Products and Printing,
S.1.09) 299.3 277.5 266.9 259.2 235.1
Publishing & Allied
Industries
 Leather and Leather &
S.1.10) 149.8 133.7 163.4 144 156.3
Fur Products
 Basic
Chemicals&Chemical
S.1.11) Prods.(excpt prods.of 371.4 351.6 306.6 300.1 258.7
Petroleum&Coal)(1993-
94)
 Rubber, Plastic,
S.1.12) Petroleum and Coal 320.3 279.1 261.6 250.7 212.7
Products
 Non-Metallic Mineral
S.1.14) 395.9 374.1 354.6 355.3 322.2
Products
 Basic Metal and Alloy
S.1.15) 391.7 337.7 353.6 335 271.3
Industries
  Metal Products and
Parts (except
S.1.17) 247.5 173.8 199 269 181.8
Machinery and
Equipment) (1993-94)
 Machinery and
equipment other than
S.1.18) 656.7 532.6 529.8 455.7 401.3
transport equipment
(1993-94)
 Transport Equipment
S.1.21) 593.7 482.2 433.1 429.7 378.4
and Parts
 Other Manufacturing
S.1.22) 508.8 364.3 457 350 397.3
Industries
S.2)  Mining & Quarrying 234.5 209.8 205.8 196.2 181.6
S.3)  Electricity 260 241.3 227.1 219.1 203

TABLE 258 : SECTOR-WISE INDEX NUMBERS OF INDUSTRIAL PRODUCTION

(Base : 1980-81 = 100)
                         
                         
Year Apr. May Jun. Jul. Aug Se Oct. N Dec Jan. F M
. . p. ov. . eb. ar.
1 2 3 4 5 6 7 8 9 10 11 12 13
Mining & quarrying
(Weight : 11.46)
1990- 211. 214. 207. 206. 195. 188.0 186. 219.1 240. 250. 245.0 291.3
91 3 5 2 6 1 1 2 0
1991- 204. 206. 200. 198. 194. 186.0 215. 221.0 243. 260. 260.3 278.4
92 0 1 2 7 6 7 9 8
1992- 203. 207. 198. 196. 191. 195.5 210. 223.3 247. 257. 252.3 302.0
93 3 3 7 1 5 3 4 2
1993- 206. 206. 208. 206. 204. 200.9 217. 231.7 258. 270. 257.4 309.4
94 1 4 5 8 2 6 5 1
1994- 204. 218. 207. 213. 220. 246.0 244. 255.0 281. 289. 277.8 328.6
95 3 7 0 8 6 3 0 0
1995- 234. 252. 244. 244. 243. 238.0 251. 266.7 288. 306. 297.4 341.4
96 1 0 6 5 7 0 2 0
1996- 248. 259. 240. 243. 237. 241.0 266. 271.8 289. 299. 288.3 335.0
97 7 4 7 0 9 5 3 0
1997- 267. 275. 255. 255. 248. 251.6 274. 284.0 303. 317. 307.4 339.8
98 3 7 0 7 0 0 0 0
Manufacturing
(Weight : 77.11)
1990- 190. 195. 198. 196. 196. 195.6 193. 197.8 218. 218. 216.0 276.3
91 0 9 9 2 8 0 1 7
1991- 188. 187. 192. 200. 191. 195.6 189. 193.5 215. 228. 224.9 267.7
92 0 5 0 5 0 4 3 9
1992- 201. 195. 201. 196. 197. 213.6 200. 209.9 222. 216. 215.0 257.9
93 9 4 1 2 5 4 3 6
1993- 197. 197. 203. 209. 214. 221.0 216. 223.1 249. 242. 235.5 270.7
94 6 8 3 6 8 6 8 0
1994- 213. 214. 229. 236. 237. 237.4 242. 247.0 266. 266. 261.0 293.5
95 7 5 1 8 3 4 1 2
1995- 250. 250. 247. 258. 265. 278.3 269. 281.4 302. 304. 304.5 332.2
96 3 5 2 9 4 7 2 8
1996- 282. 290. 290. 290. 298. 294.4 299. 292.7 321. 315. 318.7 339.5
97 6 0 3 0 4 9 8 3
1997- 305. 301. 300. 308. 304. 310.4 303. 320.0 330. 325. 321.8 331.1
98 7 6 7 5 2 2 9 8
Electricity
(Weight : 11.43)
1990- 229. 225. 228. 233. 232. 223.0 228. 232.2 252. 258. 234.6 262.1
91 7 9 7 4 6 0 6 9
1991- 247. 249. 232. 251. 251. 254.1 268. 251.4 267. 273. 256.8 278.8
92 4 9 8 8 7 1 1 6
1992- 264. 262. 247. 256. 258. 263.6 278. 267.6 283. 294. 268.6 293.6
93 4 1 5 6 0 4 4 4
1993- 281. 286. 272. 275. 292. 278.1 284. 285.6 301. 309. 287.1 325.1
94 4 9 0 4 3 7 9 2
1994- 297. 310. 290. 295. 305. 303.6 318. 310.5 341. 335. 318.7 346.8
95 3 7 6 8 9 3 7 1
1995- 330. 347. 332. 332. 332. 326.0 334. 332.0 353. 354. 338.5 366.4
96 8 3 9 3 5 2 8 5
1996- 346. 359. 327. 343. 343. 338.2 357. 351.1 370. 375. 343.4 385.4
97 9 4 1 0 6 1 3 5
1997- 359. 373. 356. 373. 373. 369.7 375. 361.1 381. 412. 380.7 414.9
98 3 4 6 1 6 3 8 2
General
(Weight : 100.00)
1990- 197. 201. 203. 201. 200. 197.8 196. 204.2 224. 226. 221.5 276.1
91 0 4 2 6 7 2 6 9
1991- 196. 196. 197. 206. 198. 201.2 201. 203.3 224. 237. 232.6 270.2
92 6 8 6 2 4 4 5 7
1992- 209. 204. 206. 203. 203. 217.2 210. 218.0 232. 230. 225.4 267.0
93 2 4 1 1 7 4 2 1
1993- 208. 209. 211. 216. 222. 225.2 224. 231.2 256. 252. 243.9 281.3
94 2 0 8 8 4 5 8 9
1994- 222. 225. 233. 240. 243. 246.0 251. 255.2 276. 276. 269.5 303.6
95 2 9 6 9 2 3 4 7
1995- 257. 261. 256. 265. 270. 279.1 274. 285.5 306. 310. 307.6 337.2
96 6 7 7 6 6 9 5 6
1996- 286. 294. 288. 290. 296. 293.3 302. 297.0 323. 320. 318.0 344.2
97 1 4 8 7 6 6 6 3
1997- 307. 306. 301. 309. 305. 310.4 308. 320.6 333. 334. 326.9 341.7
98 4 8 8 8 7 1 5 7

FISCAL DEFICIT
 TABLE 107 : CENTRE’S GROSS FISCAL DEFICIT AND ITS FINANCING
(Rupees crore)
Financi
Financi
Gros Financi Financin Financin ng of
ng of
GFD GFD s ng of g of GFD - g of GFD - GFD -
GFD -
Year receipt expenditur fiscal GFD - Market Other Draw
Total
s e defici External borrowing borrowing down of
Internal
t finance s s cash
finance
balances
2004- 12579
05 310415 436209 4 14753 50940 68231 -8130 111041
2005- 14643
06 348658 495093 5 7472 106241 53610 -20888 138963
2006- 14257
07 434921 577494 3 8472 114801 14782 4518 134101
2007- 12691
08 580659 707571 2 9315 130600 -39597 26594 117597
2008- 32651
09 564740 891255 5 9603 266539 110740 -60367 316912
2009- 40099
10 615617 1016613 6 16047 397957 -13008 0 384949
                 

Notes : 1) Data for 2008-09 are Revised Estimates and data for 2009-10 are Budget Estimates.
2) GFD Receipts includes revenue receipts and disinvestments proceeds from 1991-92 onwards and only revenue
receipts for all other years.
3) GFD Expenditure includes revenue expenditure, capital outlay and loans and advances net of recoveries.
4) DrawDown of Cash Balances represent variation in ad hoc treasury bills issued net of changes in cash balances
with RBI up to March 31,1997.
5) Market Borrowing include dated securities and 364-day treasury bills.
6) Other borrowings comprise small savings, state provident fund, special deposits, reserve funds, treasury bills
excluding 364-day treasury bills, etc.
7) Market Borrowing of 2004 - 05 ,2005-2006,2006-07 and 2007-2008 is Exclusive of amount raised under Market
Stabilisation Scheme.
Also see Notes on Tables.

Source: Budget documents of the Government of India.

FOREX

   
Foreign Exchange Reserves (Increase - /
Decrease +)
2000-01:Q1 Credit 4560
  Debit 0
  Net 4560
2000-01:Q2 Credit 1882
  Debit 0
  Net 1882
2000-01:Q3 Credit 0
  Debit 19438
  Net -19438
2000-01:Q4 Credit 0
  Debit 14532
  Net -14532
2001-02:Q1 Credit 0
  Debit 6857
  Net -6857
2001-02:Q2 Credit 0
  Debit 2285
  Net -2285
2001-02:Q3 Credit 0
  Debit 17387
  Net -17387
2001-02:Q4 Credit 0
  Debit 30064
  Net -30064
2002-03:Q1 Credit 0
  Debit 8137
  Net -8137
2002-03:Q2 Credit 0
  Debit 23943
  Net -23943
2002-03:Q3 Credit 0
  Debit 29349
  Net -29349
2002-03:Q4 Credit 0
  Debit 20608
  Net -20608
2003-04:Q1 Credit 0
  Debit 25711
  Net -25711
2003-04:Q2 Credit 0
  Debit 39526
  Net -39526
2003-04:Q3 Credit 0
  Debit 33187
  Net -33187
2003-04:Q4 Credit 0
  Debit 45569
  Net -45569
2004-05:Q1 Credit 0
  Debit 33986
  Net -33986
2004-05:Q2 Credit 2926
  Debit 0
  Net 2926
2004-05:Q3 Credit 0
  Debit 29648
  Net -29648
2004-05:Q4 Credit 0
  Debit 55199
  Net -55199
2005-06:Q1 Credit 0
  Debit 5437
  Net -5437
2005-06:Q2 Credit 0
  Debit 22964
  Net -22964
2005-06:Q3 Credit 21209
  Debit 0
  Net 21209
2005-06:Q4 Credit 0
  Debit 58704
  Net -58704
2006-07:Q1 Credit 0
  Debit 29006
  Net -29006
2006-07:Q2 Credit 0
  Debit 10526
  Net -10526
2006-07:Q3 Credit 0
  Debit 33761
  Net -33761
2006-07:Q4 Credit 0
  Debit 90341
   Net -90341
2007-08:Q1 Credit 0
  Debit 46183
  Net -46183
2007-08:Q2 Credit 0
  Debit 118479
  Net -118479
2007-08:Q3 Credit 0
  Debit 105515
  Net -105515
2007-08:Q4 Credit 0
  Debit 99512
  Net -99512
2008-09:Q1 Credit 0
  Debit 9310
  Net -9310
2008-09:Q2 Credit 20725
  Debit 0
  Net 20725
2008-09:Q3 Credit 87193
  Debit 0
  Net 87193
2008-09:Q4 Credit 0
  Debit 1493
  Net -1493
     

G.n.i.e. : Government not included elsewhere.

Note: Data for the quarter 2008-09: Q4 are
preliminary and for 2007-08: Q4 to 2008-09: Q3 are  
partially revised.
Also see Notes on Tables.

INTEREST RATES
Cal
l/N Annual
oti (Gross)
Prime Lending Units of
ce Redemption
Rates of Term UTI
  Mo Commercial Bank Rates
Lending (July-
Yield of
ne Government
Institutions June)
y of India
Rat Securities
es
    Deposit Lending Rates I I I IIB SF Divi Yie  
Rates D F C I/ Cs den ld
 I
B C IR d Ra
C
I I BI Rate te
I
Y Key
e Len
ar din
Key
Key g
Len
Len Rat
din
din es
g
g as
Rat
Rat Pre
es
es scri
as
as bed
Pre
Pre by
scri
scri RBI
bed
bed (All
by Lo
O by Co
RBI Me ng
ve RBI mm Sh
S (All di -
r3 (All erci ort
A BI Co u Te
1 yr Co al -
bo Ad mm m- rm
to s. mm Ba Te
ve va erci Te (15
  3 & erci nks               rm
5 nc al rm yr
yr up al incl (1-
yr e Ba (5- s.
s. to Ba udi 5y
s. Ra nks 15 &
5 nks ng rs.
te incl yr Ab
yr incl SBI )
udi s.) ov
s. udi )-
ng e)
ng Min
SBI
SBI imu
)-
)- m
Min
Ceil Rat
imu
ing e
m
Rat Sel
Rat
e ecti
e
Ge ve
Ge
ner Cre
ner
al dit
al
Co
ntr
ol
4. 5. 5. 1
20 00 25 25 10.2 8 2 9.5 3.9 4.4 5.4
03 - - - 5- . . 0- 3- 1- 4-
- 4.6 5. 5. 5. 10. 11.0 9 5 8.5 14. 7.1 6.7 7.7
04 2 25 50 50 25 - 0 Free 0 0 - 0 51 - - 6 8 2
5. 5. 5. 1
20 25 75 75 10.2 2 9.5 4.3 4.7 5.4
04 - - - 5- . 0- 2- 1- 3-
- 4.6 5. 6. 6. 10. 10.7 5 8.5 14. 8.1 7.7 7.8
05 5 50 25 25 25 - 5 Free - 0 - 0 51 - - 4 3 3
6. 6. 6. 1
20 00 25 25 10.2 2 9.5 2.8 6.4 7.0
05 - - - 5- . 0- 4- 9- 8-
- 5.6 6. 7. 7. 10. 10.7 5 8.5 13. 8.5 7.9 7.8
06 0 50 00 00 25 - 5 Free - 0 - 0 00 - - 7 2 5
20 7.2 7. 7. 7. 12. - 12.2 Free - - - - 9.5 - - 6.2 6.6 7.4
06 2 50 75 75 25 5- 0- 3- 1- 7-
 - - -
- 9. 9. 9. 12.5 14. 11. 8.6 10.
07 00 00 00 0 50 37 7 00
8. 7. 7.
20 25 50 50 12.2 9.5 6.9 6.8 6.1
07 - - - 5- 0- 5- 7- 7-
- 6.0 8. 9. 9. 12. 12.7 15. 9.9 10. 8.8
08 7 75 00 00 25 - 5 Free - - - - 00 - - 3 55 8
8. 7. 7.
20 00 75 75 11.5 4.6 5.5 6.2
08 - - - 0- 1- 0- 7-
- 7.0 8. 8. 8. 12. 12.5 11. 10. 8.2
09 6 75 50 50 25 - 0 Free - - - - - - - 09 69 6
6. 6. 6.
20 50 75 75 11.0
09 - - - 0-
- 3.2 7. 8. 8. 11. 12.0
10 2 25 00 00 75 - 0 - - - - - - - - - - -
                                     
Note : 1) Data for 2009-10 for Call/Notice Money Rate are average of April-July 09.
2) For the year 1995-96, interest rate on deposits of maturity above 3 years, and from 1996-97
onwards, interest rates on deposit for all the maturities refer to the deposit rates of 5 major public
sector banks as at end-March.
3) From 1994-95 onwards, data on minimum general key lending rates prescribed by RBI refers to the
prime lending rates of 5 major public sector banks.
4) For 2009-10, data on deposit rates and prime lending rates of 5 major public sector banks refer to
the period up to July 24, 2009.
5) Data for dividend rate and yield rate for units of UTI are based on data received from Unit Trust of
India.
6) Data on annual (gross) redemption yield of Government of India securities are based on
redemption yield which is computed from 2000-01 as the mean of the daily weighted average yield of
the transactions in each traded security. The weight is calculated as the share of the transaction in a
given security in the aggregated value.
7) Data on prime lending rates for IDBI, IFCI and ICICI for the year 1999-00 relates to long-term prime    
lending rates in January 2000.
8) Data on prime lending rates for State Financial Corporation for all the years and for other term
lending institutions from 2002-03 onwards relate to long-term (over 36-month) PLR.
9) Data on prime lending rate of IIBI/ IRBI from 2003-04 onwards relate to single PLR effective July
31, 2003.
10) IDBI ceased to be term lending institution on its conversion into a banking entity effective October
11, 2004.
11) ICICI ceased to be a term-lending institution after its merger with ICICI Bank.
12) Figures in brackets indicate lending rate charged to small-scale industries.
13) IFCI has become a non-bank financial company.
14) IIBI is in the process of voluntary winding up.
Also see Notes on Tables.

Source : Respective financial institutions and Reserve Bank of India.

http://dbie.rbi.org.in/InfoViewApp/listing/main.do?
appKind=InfoView&service=/InfoViewApp/common/appService.do

http://www.rbi.org.in/scripts/AnnualPublications.aspx?head=Handbook%20of%20Statistics%20on
%20Indian%20Economy

Q10) which 20 countries have the highest GDP in the world.

Ans:

GDP (millions of
Rank Country USD)
— World 58,133,309
1 United States 14,256,300
Euro symbol.svg
3 Euro zone 12,455,979
2 Japan 5,067,526
People's Republic
3 of China 4,909,280
4 Germany 3,346,702
5 France 2,649,390
6 United Kingdom 2,174,530
7 Italy 2,112,780
8 Brazil 1,571,979
9 Spain 1,460,250
10 Canada 1,336,067
11 India 1,296,085
12 Russia 1,230,726
13 Australia 924,843
14 Mexico 874,902
15 South Korea 832,512
16 Netherlands 792,128
17 Turkey 617,099
18 Indonesia 540,277
19 Switzerland 500,260
20 Belgium 468,522

Q11) what are GILTS.

Ans:

Long-term fixed income debt security (bond) issued by the UK government and
traded on the London stock exchange (or LSE, now called the International stock
exchange of the United Kingdom and Republic of Ireland or ISE). Its name comes
from the past practice of gilding the edges of a security's pages. See also treasuries.

http://www.businessdictionary.com/definition/gilt.html

Q12) what is sovereign debt?

Ans:

Government debt. Under the doctrine of sovereign immunity, the repayment of

sovereign debt cannot be forced by the creditors and it is thus subject to
compulsory rescheduling, interest rate reduction, or even repudiation. The only
protection available to the creditors is threat of the loss of credibility and lowering
of the international standing (the sovereign debt rating) of the country which may
make it much more difficult to borrow in the future.

http://www.businessdictionary.com/definition/sovereign-debt.html

Q13) what is Fiscal deficit

Ans:

Fiscal deficit is an economic phenomenon, where the Government's total

expenditure surpasses the revenue generated. It is the difference between the
government's total receipts (excluding borrowing) and total expenditure. Fiscal
deficit gives the signal to the government about the total borrowing requirements
from all sources.

Components of fiscal deficit

The primary component of fiscal deficit includes revenue deficit and capital
expenditure.

Revenue deficit: It is an economic phenomenon, where the net amount received

fails to meet the predicted net amount to be received.

Capital expenditure: It is the fund used by an establishment to produce physical

assets like property, equipments or industrial buildings. Capital expenditure is
made by the establishment to consistently maintain the operational activities.

In India, the fiscal deficit is financed by obtaining funds from Reserve Bank of
India, called deficit financing. The fiscal deficit is also financed by obtaining funds
from the money market (primarily from banks).

Q14) what is EURODOLLAR, EUROLIBOR

Ans:

Euro LIBOR

London Interbank Offer Rate denominated in Euros. This is the interest rate that
banks offer each other for large short-term loans in Euros. The rate is fixed once a
day by a small group of large London banks but fluctuates throughout the day. This
market makes it easier for banks to maintain liquidity requirements because they
are able to quickly borrow from other banks that have surpluses. The Euro LIBOR
is based on the average lending rates of 16 banks. These bank rates are available to
the public through the British Bankers' Association. Euro LIBOR exists mainly for
continuity purposes in swap contracts dating back to pre-euro times and is not very
commonly used.

http://www.investopedia.com/terms/e/eurolibor.asp

Euro Dollar

U.S.-dollar denominated deposits at foreign banks or foreign branches of American

banks. By locating outside of the United States, Eurodollars escape regulation by
the Federal Reserve Board. Originally, dollar-denominated deposits not subject to
U.S. banking regulations were held almost exclusively in Europe; hence the name
Eurodollars. These deposits are still mostly held in Europe, but they're also held in
such countries as the Bahamas, Canada, the Cayman Islands, Hong Kong, Japan,
the Netherlands Antilles, Panama, and Singapore. Regardless of where they are
held, such deposits are referred to as Eurodollars.

Since the Eurodollar market is relatively free of regulation, banks in the Eurodollar
market can operate on narrower margins than banks in the United States. Thus, the
Eurodollar market has expanded largely as a means of avoiding the regulatory
costs involved in dollar-denominated financial intermediation.

http://www.investopedia.com/terms/e/eurodollar.asp

Q15) what is P/E ratio. Explain its significance and its upward
downward movement

Ans:

P/E ratio - It is a valuation ratio of a company's current share price compared to its
per-share earnings.
Calculated as:

http://www.investopedia.com/terms/p/price-earningsratio.asp

Significance of P/E ratio:

In general, a high P/E suggests that investors are expecting higher

earnings growth in the future compared to companies with a lower P/E. However,
the P/E ratio doesn't tell us the whole story by itself. It's usually more useful to
compare the P/E ratios of one company to other companies in the same industry, to
the market in general or against the company's own historical P/E. It would not be
useful for investors using the P/E ratio as a basis for their investment to compare
the P/E of a technology company (high P/E) to a utility company (low P/E) as each
industry has much different growth prospects

Movement of P/E ratio

P/E is best viewed over time, looking for a trend. A company with a steadily
increasing P/E is being viewed by the investment community as becoming more
and more speculative .And the company’s P/E ratio changes every time the stick
prices fluctuates.

Firstly the common rule for evaluating a company’s share price is that a company’s
P/E ratio should be comparable to that of the company’s growth rate. If the ratio is
much higher, then the stock price is high compared to history, if much lower, then
the stock price is low compared to the history.

If the company has been growing at 10% per year over the past 5 years but has a
P/E ratio of 75 then the conventional wisdom would say that the shares are
expensive.
It is important to consider the P/E ratio for industry sector. For example, consumer
products companies will probably have very different P/E ratios than internet
service providers

Q16) what is stop loss. What are Circuit and its types? How are Circuits
calculated for each type of Category of shares like A group, B group, etc.

Ans :

Stop loss is an order placed with a broker to buy or sell once the stock reaches a
certain price. A stop loss is designed to limit an investor’s loss on security position.
For e.g. if a person shorts his position in Wipro ltd at the price of Rs 392 he can
keep a stop loss at any price above 392 and vice versa if he is holding a long
position . There is no hard and fast rule about the price at which the stop loss has to
be placed. a stop loss thus helps to reduce an investor’s loss

However care must be taken of price fluctuations for eg a stock fluctuates in a

range of 5-10% a stop loss of around 3% will not make sense. As it will get
triggered for sure and the speculators will suffer losses.

Circuit filter sets the limit to fluctuations of stock prices. Circuit filters are set by
stock exchanges to stop any unduly rising or falling of a stock price

They are numeric percent limits set on individual scripts. NSE and BSE define
circuit filters in 5 categories including 2%, 5%, 10%, 20% and no circuit filter

If circuit filter set for equity is 10 %, stock price cannot move further +10% to
lower -10%

Circuit filter changes every day and stock keeps moving between one circuit filter
categories to other based on previous day’s closing price
Types of circuit filters

Buyer’s circuit: it will have more number of buyers than sellers; the investor can
easily sell his stock at the circuit price. However new investors trying to buy that
particular stock will have to wait for the buyers circuit to open when many
investors will buy the stock and equivalent number of buyers are satisfied

Seller’s circuit: it will have large numbers of sellers than the buyers and the
investor can easily buy a stock at the circuit price. The traders trying to sell a
particular share will have to wait for the seller’s circuit to open when many
investors will sell their stocks.

HOW ARE CIRCUITS ARE CALCULATED

Circuit filters for shares belonging to any group is calculated as per the closing
price of the stock as per the previous week eg the closing price of a stock is Rs 100
then 5% circuit filter it will move in the range of 95-105 where 95 being seller
circuit price and 105 being the buyer circuit price

Q17) what ratios are important for decision making to invest in a Script
of a listed company.

Ans :

Different ratios that are important for investing in a script

The following ratios are important for decision making to invest in a script of a
listed company

1. ROI = NP before tax and interest

Total capital employed

2. RONW= PAT-Preference dividend *100

 Net worth

3. EPS = PAT – Preference dividend

No of equity shares

4. Debt equity ratio = long term debt

Total net worth (equity + PC)

5. Debt service coverage ratio = NPBIT

Interest + loan repayment

6. Interest coverage ratio = NPBIT

Interest

7. Current ratio = Current asset , loans and advances

Current Liabilities and provisions

8. Fixed asset turnover ratio = Net sales

Net block of fixed assets

9. Net profit ratio = PAT *100

Sales

10. P/E ratio = Market price of equity share

EPS

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explore/

Q18) Enlist all possible avenues of Investments in India and in the Rest
of the World.
Ans:

The following are the investment avenues in India

1. Investment in government securities or unit trust of India: NRI’s are

permitted to invest in government securities through primary dealers. They
are also permitted to invest in units of UTI, either through authorized dealer
or directly from the unit trust of India. these investments are freely
transferable and saleable through the dealers and maturity proceeds can be
repatriated , provided these are purchased out of funds from abroad or from
NRE/FCNR accounts

2. Investment in bonds, company Deposits and commercial papers: NRI’s are

permitted to purchase non-convertible debentures of the Indian companies.
They also place their funds in fixed deposits of public limited companies
.NRI’s are also allowed to invest in commercial papers issued by the Indian
companies.

3. Investment in mutual funds: NRI’s are permitted to invest in mutual funds

both on repatiable as well as non- repatriable basis. The investment in
Money Market Mutual Fund can also be made only on non-reptriable basis.
There is no limit for investment in domestic mutual funds.

4. Investment in shares or convertible debentures of Indian companies: NRI’s

can make investments in shares and convertible debentures of the company.
the NRI’s can make investment in both primary as well as the secondary
market

5. Investment in immovable property: General permission is available to a NRI

to invest in immovable property in India provided the funds are if from
outside India or through NRE/FCNR accounts. In the case of residential
property , the repatriation of sales proceeds is restricted to not more than two
such properties

Q19) what are the commodity indexes and exchanges in INDIA called
as. Explain the top 5 frequently traded commodities in INDIA.
1. National Commodity & Derivatives Exchange Limited
(NCDEX) : National Commodity & Derivatives Exchange
Limited (NCDEX) located in Mumbai is a public limited company
incorporated on April 23, 2003 under the Companies Act, 1956
and had commenced its operations on December 15, 2003.This is
the only commodity exchange in the country promoted by national
level institutions. It is promoted by ICICI Bank Limited, Life
Insurance Corporation of India (LIC), National Bank for
Agriculture and Rural Development (NABARD) and National
Stock Exchange of India Limited (NSE). It is a professionally
managed online multi commodity exchange. NCDEX is regulated
by Forward Market Commission and is subjected to various laws
of the land like the Companies Act, Stamp Act, Contracts Act,
Forward Commission (Regulation) Act and various other
legislations

2. Multi Commodity Exchange of India Limited (MCX) :

Headquartered in Mumbai Multi Commodity Exchange of India
Limited (MCX), is an independent and de-mutualised exchange
with a permanent recognition from Government of India. Key
shareholders of MCX are Financial Technologies (India) Ltd.,
State Bank of India, Union Bank of India, Corporation Bank, Bank
of India and Canara Bank. MCX facilitates online trading, clearing
and settlement operations for commodity futures markets across
the country.

MCX started offering trade in November 2003 and has built

strategic alliances with Bombay Bullion Association, Bombay
Metal Exchange, Solvent Extractors’ Association of India, Pulses
Importers Association and Shetkari Sanghatana.
 3. National Multi-Commodity Exchange of India Limited
(NMCEIL) : National Multi Commodity Exchange of India
Limited (NMCEIL) is the first de-mutualised, Electronic Multi-
Commodity Exchange in India. On 25th July, 2001, it was granted
approval by the Government to organize trading in the edible oil
complex. It has operationalised from November 26, 2002. It is
being supported by Central Warehousing Corporation Ltd., Gujarat
State Agricultural Marketing Board and Neptune Overseas
Limited. It got its recognition in October 2002.

Commodity exchange in India plays an important role where the

prices of any commodity are not fixed, in an organized way.
Earlier only the buyer of produce and its seller in the market
judged upon the prices. Others never had a say. Today, commodity
exchanges are purely speculative in nature. Before discovering the
price, they reach to the producers, end-users, and even the retail
investors, at a grassroots level. It brings a price transparency and
risk management in the vital market.

A big difference between a typical auction, where a single

auctioneer announces the bids and the Exchange is that people are
not only competing to buy but also to sell. By Exchange rules and
by law, no one can bid under a higher bid, and no one can offer to
sell higher than someone else’s lower offer. That keeps the market
as efficient as possible, and keeps the traders on their toes to make
sure no one gets the purchase or sale before they do.
The trading is done in 45 commodities that are integral to India’s economy

The top 5 frequently traded commodities include

1. Gold
2. Silver
3. Crude-oil
4. Rice
5. other agricultural products and Base Metals
http://finance.indiamart.com/markets/commodity/commodity_exchanges
.html

BIBLIOGRAPHY:

Websites:

www..rbi.org.in

http://www.scribd.com

http://www.citehr.com

http://www.hrparadise.com/

http://www.thinkwiseinc.com
www.ccl.org

http://cab.org.in