SUMMER TRAINING REPORT ON

“The Fundamental and Technical Analysis of Private Bank Sector ”

SUBMITTED IN THE PARTIAL FULFILLMENT FOR THE

REQUIREMENT OF POST GRADUATE DIPLOMA IN
MANAGEMENT (PGDM)

Submitted to: Submitted by:

Mrs Saniya Chawla Shubham Goyal

ROLL NO: 55/PGDMA

BATCH: 2019-21

JAGANNATH INTERNATIONAL MANAGEMENT

SCHOOL KALKAJI, NEW DELHI
 TABLE OF CONTENTS

S. NO. TITLE PAGE NO.

1 CERTIFICATE

2 DECLARATION

3 ACKNOWLEDGEMENT

4 EXECUTIVE SUMMARY

5 LIST OF TABLES

6 LIST OF CHARTS

CHAPTER TITLE PAGE NO

I INTRODUCTION

1.1 COMPANY PROFILE

1.2 INTRODUCTION TO THE STUDY

II REVIEW OF LITERATURE

III OBJECTIVES OF STUDY

IV DATA ANALYSIS AND INTERPRETATION

V FINDINGS OF THE STUDY

VI 7.1 SUGGESTION AND RECOMMENDATIONS

7.2 CONCLUSION

VII 8.1 LIMITATIONS OF THE STUDY

8.2 SCOPE FOR FURTHER STUDY

BIBLIOGRAPHY

BALANCE SHEET
 INDEX FOR CHARTS AND TABLES
SR NO TITLE PAGE
1. Index calculation Table(1)

2. Index calculation Table (2)

3. Industry p/e ratio Table

4. EPS Ratio and EPS Growth Table

5. Company P/E Ratio Table

6. Analysis of Overvalued and undervalued stocks

7. PEG Ratio Calculation

8. Value Pick Calculation

9. Ratio and their Ranking Table

10. AUM and NAV calculation

11. Types of Mutual Fund

12. Amount allocating Table and Graph

13. NAV & Index in graph and AUM amount chart

14. IDFC Bank Technical Graph

15. Bandhan Bank Technical Graph

17. RBL Bank Technical Graph

18. Axis Bank Technical Graph

19. ICICI Bank Technical Graph

20. HDFC Bank Technical Graph

21. List of shares to buy and hold

22. Everyday NAV calculation and Comparison of NAV&INDEX

 CERTIFICATE

This is to certify that Shubham Goyal pursuing POST GRADUATE DIPLOMA

IN MANAGEMENT from JAGANNATH INTERNATIONAL MANAGEMENT
SCHOOL has completed this project under my supervision and guidance. He
has taken care of all necessary aspect and shown interest and sincerity during
the completion of the project report on “The Fundamental and Technical
Analysis of Private Bank Sector.” to my full satisfaction.

I certify that this project is up to my expectation as per the guidelines laid down by
JAGANNATH INTERNATIONAL MANAGEMENT SCHOOL.

Date: Mrs. Saniya Chawla

(Name of the Internal Mentor)

 CERTIFICATE

This is to certify that Shubham Goyal pursuing POST GRADUATE DIPLOMA

IN MANAGEMENT from JAGANNATH
INTERNATIONAL MANAGEMENT
SCHOOL has completed this project under my supervision and guidance. He
has taken care of all necessary aspect and shown interest and sincerity during
the completion of the project report on “The Fundamental and Technical
Analysis of Private Bank Sector.” to my full satisfaction.

I certify that this project is up to my expectation as per the guidelines laid down by
JAGANNATH INTERNATIONAL MANAGEMENT SCHOOL.

Date: MR. MOHD. YUSUF KHAN

CIRCLE HEAD- MUMBAI (HDFC Life Insurance Co. Ltd.)

(Name of the External Mentor)

 DECLARATION

This is to certify that the research report titled “The Fundamental and Technical
Analysis of Private Bank Sector” is an academic work done by “SHUBHAM
GOYAL” submitted in the partial fulfilment of the requirement for the award of the
Degree of “POST GRADUATE DIPLOMA IN MANAGEMENT” from “JAGANNATH
INTERNATIONAL MANAGEMENT SCHOOL” under the guidance & direction of
Mrs. Saniya Chawla and MR. MOHD. YUSUF KHAN to the best of my knowledge
and belief the data & information presented by me in the project has not been
submitted.
 ACKNOWLEDGEMENT

I would like to express my heartfelt gratitude to our chairman MR. AMIT GUPTA,
JAGANNATH INTERNATIONAL MANAGEMENT SCHOOL, KALKAJI for the
extension of the college facilities which enabled me to complete this project.

I feel obliged to our Director Ashok Sharma, for his support and encouragement.

I owe my achievement to the inspiration and kind guidance to respected Mrs. Saniya
Chawla, Lecturer and my Internal Guide to successfully complete my project.

I express my sincere thanks to my external mentor, MR. MOHD. YUSUF KHAN

for their continuous monitoring and assessment.

I express my deep sense of gratitude to my family members and to my dear friends

for their support and encouragement during the entire course of st
 EXECUTIVE SUMMARY

This Report on fundamental and technical analysis of the private banking sector
shows the performance of the private banking sector in the share market and
changes in the performance of this sector and companies of this sector is due to the
changing economic conditions, changing corporate decisions, change in the oil
prices, and so many other factors which affects the share prices and decisions of
investors. Fundamental analysis finds out the intrinsic value of the shares before
doing the long term investment. For that financial ratios of the private banking
industry are good tool for doing the initial screening of the shares and finding out top
12 companies among those large cap shares and the ratios which plays important
role in this sector, the ratios used are Credit to deposit ratio, return on asset ratio,
cost to income ratio, non- performing assets ratio, capital adequacy ratio. First step
was finding out the closing price of each day and calculating the percentage change
in the prices of the everyday and after calculating the actual change with percentage
change we have calculated the index value of each day with the basic point of 1000
and record each day’s change in the index point which can be increasing or
decreasing depending upon the market conditions and second step was to select the
company and get to know about the company and the companies selected for doing
the research and making the portfolio was the large cap companies which has good
performance record from many years. Then for finding out the behaviour of
customers of different age group towards the mutual funds type and risk and return
of the funds as there are various kinds of the mutual fund with different policies of
investment and our duty was to find out the relationship between risk & return and
customer’s age group. And the technical analysis of shares shows the historical data
of shares
including the volume and price. Technical analysis studies the historical trends with
charts and statistical figures and accordingly suggests which shares are going to
appreciate or depreciate in the future. Fundamental analysis mainly used for the long
term investment decision and technical analysis is mainly used for the intraday
trading or for one-day trading only as it assumes that market has all the information.
In the technical analysis we have got to know what charts and patterns are important
for the good prediction of future prices and explained in the paper. with the help of
both fundamental and technical analysis we can see the changes in the pricing
pattern of the private banking sector shares prices and for long term we can analyse
that is there any good shares to invest for the long term gain as the selected shares
are only 11 shares/company we have found which company to invest for long term
and which share can give us instant return on the shares in the intraday day trading.
Both the techniques are used in financial sector for the better prediction of the long
term as well as short term investment plans, and The motive is to learn the skills on a
financial analyst to improve the probability of getting the profit from the portfolio.
CHAPTER
1
 1. INTRODUCTION
The fundamental analysis as the name suggest is the method of finding out the
intrinsic value of company’s share and industry as a whole. It mainly takes into
account increase or decrease in the top line and the bottom line of the industry and if
the top line will be increasing and bottom line is also increasing a then shares of that
industry should be bought and if the condition is different and one of them is
increasing and other is decreasing then holding the share is good for the investor
and if both is decreasing whether of industry or of one particular company then the
shares should be sold. For finding out the top line and bottom line changes in the
company, the company’s financial condition needs to checked with the help of the
various financial statements like balance sheet, profit and loss account and by
financial ratios of the company and industry as well as the management performance
is checked and with this we can predict that what is going to be in the near future of
the company and industry. Fundamental analysis of the shares is nothing but the
using of the real data for finding out value underlying of the company and predict the
future of the shares and company. While calculating and finding out the top, line and
bottom line there are various economic factors taken into the consideration, like
inflation, budget, taxes and earnings.
Technical analysis is unlike fundamental analysis and it has nothing to do with the
financial performance of the company or industry, it simply studies the trends in the
share prices of the and it also assumes that the market prices are the functions of
the market demand and supply and it determines the actual worth of the company
and historical prices reflects the future trends also. Technical analysis is mostly done
the short term investors those who wants to gain in the short term and fundamental
analysis is used by the long term investors and factors such as day moving
averages, relative strength indices and price trends are some common technical
analysis to observe the shares of the company and industry.
Both fundamental and technical analysis is done for the understanding the current
situation of market and taking the investment decision. The details of the report can
help the potential investors to invest in the private banking industry and banking
company. The details of this final report will show that how the banking sector is
performing and its future potential in the share market by providing details from the
very scratch and it will be easier for the investor to understand and invest
accordingly.
 2. INTRODUCTION TO INSURANCE SECTOR

 Introduction:

Insurance is a contract, drawn by a policy, during which a person or entity receives

money protection or compensation against losses from a non-depository financial
institution. The company pools clients' risks to create payments more cost-effective
for the insured. Insurance policies hedge against the chance of monetary losses,
each massive and little, which will result from injury to the insured or her property, or
from liability for injury or injury caused to a 3rd party.

2.1 Traditional policies:

They offer in-built guarantees and define maturity benefits through variety of
products such as guaranteed maturity value. The investment risk in traditional life
insurance policies is borne by life insurance companies. Additionally, the investment
decisions are regulated to a large extent by IRDAI rules and regulations, ensuring
stable returns with minimal risk.
Investment income is distributed amongst the policy holders through annual bonus.
These policies are ideal for policy holders who are not market savvy and do not wish
to take investment risks.

2.2 Unit Linked Life Insurance Policies (ULIPs):

They provide a combination of risk cover and investment. More importantly they offer
a flexibility to decide the risk taking profile. ULIPs offer a complete selection of high,
medium and low risk investment options under the same policy. One can choose an
appropriate policy according to your risk taking appetite, coupled with the opportunity
to switch between fund options without any additional expense for specified number
of switches.
ULIPs provide the flexibility to choose the sum assured and investment ratio in the
annual targeted premium. It also offers the flexibility of one-time increase in
investment portfolio, through top-ups to avail investment opportunity offered by
external environment or own income flows.
Some special features of Unit Linked Life Insurance Policies (ULIPs)
are: Provides flexibility in investments
Provides flexibility in investments
Liquidity
Disciplined and regular savings
 2.3 Life insurance plans

 Endowment Plans

Endowment Plans are an ideal choice for the risk-averse customer. Endowments are
long-term, regular savings plans with a built-in life cover.
Provided one has paid all the premiums, at the end of the term the policyholder
receives the sum assured plus accrued / guaranteed bonuses that have been
declared over the years, as a lump sum. In case of the unfortunate death during the
term of your plan, the sum assured, will be paid out as a lump sum with the bonuses
that the policy is entitled to.
The benefits of Endowment Plans are as
follows: Available as money back plans
also.
Option to avail a host of additional rider benefits.
Cover your life for a longer period of time.
Loan facility can be availed against most of the plans

 Whole Life Insurance

These plans provide cover throughout your lifetime. The premium could be paid for
as long as a lifetime or for a limited period Unlike endowment plans they do not carry
a maturity value and pay the sum assured to the family in case of the unfortunate
death of the policyholder. A Whole Life Insurance plan assures that your family is
protected against financial loss that could lead to occurrence of death.

 Term Plan

Term Insurance helps the customers in safeguarding their families from financial
worries that arise due to unfortunate circumstances. Term plans are pure risk cover
plans with or without maturity benefits. These pure risk plans cover your life at a
nominal cost Term plans also let’s one avail the benefit to cover your outstanding
debts like mortgage, home loan etc. In case of something happens to you, the
financial burden is borne by the insurance company and not your loved ones.
Term Plan offers the following benefits:
High insurance Cover at lower
costs.
Financial security against loans and
mortgages. Single premium payment option
available.
Available with host of Additional rider benefits.
 Health Insurance

The purpose of health insurance is to help to overcome unforeseen emergencies

without compromising on any other financial goal. Health insurance helps you pay for
all your medical expenses. insurance policy also gives you the benefit of covering
your loved ones under one plan to avoid any financial constraints arising on account
of a medical emergency. The benefits are given below:
Cashless hospitalization in all major hospitals pan
India. Coverage of pre and post hospitalization
expense.
Coverage of all major day care treatments.

 Retirement Plans

These plans make sure that you have support in the twilight years of your life. The
savings you set aside today become your wealth and support in the years to come.
Retirement plans are of two types:

 Immediate Annuity Plans

These plans allow one to convert a sum of money into a guaranteed series of
payments for a definite period or for life.

 Deferred Annuity Plans

This plan allows one to save regular amounts of money for a peaceful retirement.
This type of annuity has two main phases, the accumulation phase which allows you
to invest and save money into your account, and the pay-out phase in which the plan
is converted into regular annuity instalments and payments are received.

Retirement Plans offer benefits such as:

An alternative to superannuation's and provident
fund; Saving Tax
Choice of Open Market Option, i.e., you have the option to purchase an
immediate annuity from your current insurer or from any other life insurer as
recognized by IRDAI.
 2.4 Wealth plans:

Wealth plans invest the premium in to the equity, debt and cash markets by
allocating units, which like any other mutual fund have a NAV. The insurers are free
to switch between one fund to another depending on the risk factor you wish to bear.
They offer better returns than traditional endowment plans and offer a great deal of
flexibility along with great returns making them the finest product offering.
The benefits:
Availability in single premium and regular premiums options Investment funds
ranging from index funds to mid-cap funds and debt market linked funds.
Option to choose from a host of additional rider benefits Tax Benefits as per
existing tax laws.
Flexibility to move from one investment fund to other by the way of switching of
funds.
Option to infuse additional capital by the way of Top Ups to give your
investments a boost.

2.5 Advantages of life insurance

Life Insurance provides the dual benefits of savings and security. The following
benefits explain why this investment tool should be an integral part of your financial
plans.

Risk Cover
Planning for life stage needs
Protection against rising health expenses
Builds the habit of thrift
Safe and profitable long-term investment
Accomplishment of Retirement Goals
Tax Benefits
CHAPTER
2
ABOUT THE COMPANY
HDFC Life Insurance Company Limited, it is a joint venture between HDFC Ltd.,
which is one of India’s leading housing finance institutions and Standard Life
Aberdeen (a company from Scotland), Which is global investment company.

The company established in the 2000, HDFC Life is a long-term life insurance
solutions provider in India, offering a wide range of individual and group insurance
policies that meet various requirements of customers such as Protection, Pension,
Savings, Investment and Health. Till the date March 31st of 2019 the HDFC Life
already had 38 individual and 11 group products in its portfolio, along with option 8
benefits, Covering a wide range of customer requirements.

HDFC Life continues to benefit people from its presence all over the country with 412
branches and additional distribution touchpoints through several partnerships. The
partnerships of company comprise of 265 assurance partners including NBFCs
(Non- Banking Financial Companies), MFIs (Micro Finance Institutions), SFBs (Small
Finance Banks), etc. and 39 partnerships within non-traditional ecosystems. The
Company is strengthened by a strong base of financial consultants for the
organisation.

In Fiscal year 2012, The Company Started its wholly-owned subsidiary, named as
HDFC Pension Management Company Ltd., to operate its pension fund business
under the National Pension Scheme (NPS). And in the Fiscal year 2016, the
Company established its first international wholly-owned subsidiary in the UAE,
HDFC International Life and Company Ltd., to operate its reinsurance business.

 Key persons

The CEO of HDFC Life - Vibha Padalkar

Executive Director- Suresh Badami
Chief Financial Officer- Niraj Shah
Chief Operating Officer - Parvez Mulla
Chief Actuary & Appointed Actuary - Srinivasan Parthasarathy
Chief Investment Officer - Prasun Gajri
Chief Marketing Officer - Pankaj Gupta & Vibhash Nain
  Vision

One of the most successful and admired life insurance company, which means that
we are the one of the most trusted company, the easiest to deal with, offer the best
value for money and set the standards in the industry.
'The most obvious choice for all'.

 Values

Vision and values at work:

Excellence
People Engagement
Integrity
Customer Centricity
Collaboration

 Major Competitor

Life Insurance Corporation

ING Vysya Life Insurance
Max network Life Insurance
Met Life Insurance
Aviva Life Insurance
Bharathi Axa Life Insurance
Bajaj Allianz Life Insurance
Tata AIG Life Insurance
ICICI Prudential Life Insurance
Reliance Life Insurance
Kotak Mahindra Life Insurance.
CHAPTER
3
PURPOSE, SCOPE ,LIMITATION & METHODOLOGY

 Purpose:

The Purpose of doing the fundamental and technical analysis is following:

To understand the share market and complexity involved in the

market.
To let the beginners, understand the market and get better trading knowledge.
To determine the intrinsic value of stocks of private banking sector because
sometimes stocks are overvalued so it can depreciate in near future, and sometimes
stocks undervalued and investing can give good results.
To understand the various ratios useful for decision making.
To develop analytical skill and analyse the future growth prospect for company.
To select the stocks for company and suggest them investment in these stocks.
To make the mutual fund portfolios depending upon the various age groups and
suggest company as well as customers these funds.
To understand the Factors affecting the Top Line and Bottom line of the private
banking sector and find out reasons for change in these.

 Scope

Fundamental analysis of the private banking sector will give the performance
overview of the sector and it will help the company for the generating long term
growth by investing in the created funds of this sector and technical analysis will be
useful for the day trading and for generating wealth by trading intraday. The volume
of trading plays very important role in technical analysis; it validates the trend. Heavy
volumes suggest bullish market because there is tremendous investor interest in the
stock. Low volumes suggest bearish market, where there are few buyers and not
much trading activity. And fundamental analysis is careful reviewing company’s
financial statements, economic factors and other historical data & patterns. Analysis
of both fundamental and technical aspect will give clear picture of both short term
and long term investment ideas and provides clear picture of the coming future of the
company and generating. Also mutual fund and risk analysis will give overall idea
how the different age groups give risk and return related responses. As a beginner it
will also help in drawing conclusion about the industry and it will also help us in
making investments decisions.
  Limitation

Project is Limited to the one sector only.

Few data collected is secondary data which was collected before and cannot totally
based on current market scenario.
Primary data collected is limited to the month of February to April.
Primary data is based on the responses from age group of 25 to50 only.
Report may consist of some Technical words which may not be understood by the
common person.
Responses are collected from the educated and earning persons only.

 Methodology

Methodology followed for making the research paper is the combination of primary
data and the secondary data collection method for the data collection and primary
data is collected through by collecting data by approaching people and with google
forms. And Methodology used for doing the trading is creating online De-mat account
for live trading.
Also data is collected from news hosting websites and print media and then analysed
the future movement of stock. By doing this we were able to do fundamental analysis
which includes analysis of economy, industry and company.
CHAPTER
4
 ANALYSIS AND FINDINGS

BANKING INDUSTRY IN INDIA

In the Indian banking system, there are a total of 12 public sector banks (reduced
from 27 banks w.e.f. 1st April 2020), 21 private banks, 1,562 urban cooperatives,
94,384 rural cooperative banks and, 45 foreign banks, 56 regional rural banks.
Banking is among the fastest-growing sectors in India by serving as the fuel of the
Indian Economy, the banking sector has been pushing forward towards accelerating
expansion. The major players in the banking industry are HDFC Bank, Kotak
Mahindra Bank, Au small finance Bank, ICICI Bank, Federal Bank, and American
Express Bank etc.

Banks in India are increasingly focusing on adopting an integrated approach to risk

management. Total banking sector assets have shown an increase in the CAGR of
6% to US$ 2.2 trillion in the year FY13–18, and total asset value of the banking
sector in India is nearly US$ 270 billion and the total deposits are nearly US$ 220
billion. Banking sector in India has been transformed completely with the latest
inclusions such as Internet banking and Core banking which made banking
operations more user friendly and easy. The liquidity of the Indian banks is controlled
by the Reserve Bank of India (RBI). In August 2019, the government has announced
the mergers of public sector banks consisting United Bank of India and Oriental Bank
of Commerce to be merged with Punjab National Bank, Allahabad Bank is going to
amalgamated with Indian Bank and Andhra Bank and Corporation Bank will be
consolidated with Union Bank of India. Government of India has also taken many
initiatives for the growth of banking sector, plans like Pradhan mantra Jan dhan
yojna, Pradhan mantra jeevan jyoti yojna, and Atal pension yojna has helped Indian
banking industry to grow and it invited.

The covid-19 outbreak originated from Wuhan, a state in china has impacted the
world economy and business adversely and from the month of march. I was working
on the changes in the index prices of the large capital banks and it has shown some
drastic changes after the outbreak of the covid-19 which was not looking good for the
market, and rating agency Moody’s report says that ‘the pandemic has caused
deterioration to the global economy and the 21-day lockdown for the safety of people
will weigh on domestic demand and private investments. Funding & liquidity at large
capital private sector banks is going to be stable, with given well-established
franchises and strong depositor bases. The rating agency says that the rise in
provisions and fall in revenues may hurt the banking industry’s profitability. If
government makes more capital infusions into the public sector units (PSUs), as it
has been in the past few years, it will mitigate capital pressure for PSUs.
 SUMMER INTERNSHIP PROJECT/s
1. Stock market index
I have measured the value of a section of a country’s stock market via weighted
average of selected stocks. These indexes help investors and analyst describe the
market and compare different investments so that they can track these indexes and
can provide suggestions in which stock to invest.
So, I first learnt how an index moves. How Sensex, nifty and another index
fluctuates. Then, I was instructed to create an index based on a chosen sector and
keep a track of it. Like- my sector is Oil and Gas, and I took 1000 as a base to start
my index and then keeping a watch on index and updating it daily.

Following is an example of the index working as I have worked on it from last 3

months with daily index update it is impossible to attach photo of all the calculation in
the word document so following is the random pick of the date

30.07.2020
Bank Market Cap Weight Price as on Price as on No. of % Effect on
(Cr) 29.07.2020 30.07.2020 Shares(cr) change Index

HDFC Bank 584044.28 42.16 1064.60 1050.65 548.60 -1.31 -5.77

Kotak Mahindra 274955.74 19.85 1389.45 1385 197.89 -0.32 -0.66
ICICI Bank 227227.58 16.40 351.00 344.95 647.37 -1.72 -2.95
Axis Bank 124135.36 8.96 440.00 425.8 282.13 -3.23 -3.02
Bandhan Bank 54074.82 3.90 336.00 338.1 160.94 0.63 0.25
Yes Bank 14684.05 1.06 11.70 11.95 1255.05 2.14 0.24
IndusInd Bank 38070.58 2.75 550.00 519.85 69.22 -5.48 -1.57
AU Small Financ 22953.89 1.66 746.40 709.1 30.75 -5.00 -0.86
IDFC First Bank 15996.01 1.15 28.20 27 567.23 -4.26 -0.51
City Union Bank 8941.26 0.65 121.50 122.85 73.59 1.11 0.07
Federal Bank 11111.07 0.80 55.80 54.15 199.12 -2.96 -0.25
RBL Bank 8980.82 0.65 176.65 169 50.84 -4.33 -0.29
13,85,175.48 -15.33
1028.532581
 31.07.2020
Bank Market Cap Weight Price as on Price as on No. of % Effect on
(Cr) 30.07.2020 31.07.2020 Shares(cr) change Index

HDFC Bank 576391.25 42.23 1050.65 1032.80 548.60 -1.70 -7.38

Kotak Mahindra 274075.14 20.08 1385 1365.75 197.89 -1.39 -2.87
ICICI Bank 223310.98 16.36 344.95 346.80 647.37 0.54 0.90
Axis Bank 120129.18 8.80 425.8 431.65 282.13 1.37 1.24
Bandhan Bank 54412.79 3.99 338.1 345.10 160.94 2.07 0.85
Yes Bank 14997.81 1.10 11.95 11.95 1255.05 0.00 0.00
IndusInd Bank 35983.62 2.64 519.85 523.75 69.22 0.75 0.20
AU Small Financ 21806.81 1.60 709.1 740.75 30.75 4.46 0.73
IDFC First Bank 15315.33 1.12 27 26.60 567.23 -1.48 -0.17
City Union Bank 9040.61 0.66 122.85 121.20 73.59 -1.34 -0.09
Federal Bank 10782.51 0.79 54.15 53.90 199.12 -0.46 -0.04
RBL Bank 8591.89 0.63 169 169.55 50.84 0.33 0.02
1364837.94 -6.60
1021.935506

So, my sector consists of only large cap companies i.e. companies which have
market capitalization of more than $5 billion. Tracking the movement of the shares
over time will let me know how each movement is affecting the stock market and with
further notice to the company about the index they would be able to know whether
the sector is going forward or not and whether it’s good to invest or not.
Based on our respective sector, we were taught about fundamental and technical
analysis which gives us understanding in which stocks we need to invest and in
which we shouldn’t. It also tells us which stocks are hidden gems which can give
good returns. Based on the fundamental analysis, we will see that which stocks can
grow and can fetch us return, according to that, we will do asset allocation.
 1.1. FUNDAMENTAL ANALYSIS

This is a method I have opted because I will be able to evaluate securities by

attempting to measure intrinsic value of a stock by analysing business financial
statements, health, competitor and market.
It also includes overall state of economy and factors including interest rates,
production, GDP, employment, earnings, manufacturing etc. It is basically conducted
to see the factors that affect the well-being of an economy, industry and
companies. The goal of most analysis is to forecast and to see the profit movement
of price. At company level, it involves examining the financial data, management,
business concept etc. At industry level, we see the demand and supply of products.
To forecast future stock prices, fundamental analysis focuses on economy, company
and industry analysis to derive stock’s current fair price and forecast future of stock.
The outcome observed by performing fundamental analysis is to produce a value
that an investor can compare with the security’s current price, with the aim of figuring
out what kind of position to take with that security (underpriced= buy or keep,
overpriced= sell or short sell).
So, basically there are four steps to do fundamental
analysis: Finding Sector Price-to-earnings ratio (PE)
Analysis of overvalued and undervalued stock
Finding growth pick
Finding value picks

With completion of Fundamental Analysis, 40% of the equity research has been
completed, rest of the research will be based on hedging and technical analysis of
the sector and further the company will be having complete equity research and
fundamental and technical analysis of Private banking sector submitted by me.
Finding sector P/E:

I have taken the price to earnings ratio because it will help me tell the amount the
investor is willing to pay for every single rupee of earning that is given by the
company. The prices and earning of the shares have been taken from a trusted
webpage.4 It shows whether a company’s stock price is overvalued or undervalued.
So, PE can be calculated as= (market price of share/ EPS) and Sector PE will be the
average of all stock’s PE.

Private Bank
Bank Name P E Ratio
HDFC Bank 23.21
Kotak Mahindra 45.02
ICICI Bank 30.12
Axis Bank 76.98
Bandhan Bank 20.2
Yes Bank -
IndusInd Bank 8.68
AU Small Financ 29.35
IDFC First Bank -
City Union Bank 20.86
Federal Bank 7.03
RBL Bank 18.77
28.022

If stock PE will be more than sector PE, it will be an overvalue stock and if it will be
less than sector PE, it would be considered as undervalue stock. I have selected 12
companies out of which I have found out the overvalued and undervalued shares
which is given below and all the overvalued shares are not good performing
company or shares and not all undervalued shares are bad performing it only
suggest that shares are more than or less than their P/E ratio.
 ANALYSIS OF OVERVALUED AND UNDERVALUED STOCK

We will analyse overvalue stocks

We will analyse undervalue stocks
by PEG ratio i.e. Price to earnings
by assessing their top line and
growth ratio and the stock which
bottom line and those stocks will be
would be selected will be growth
value pick
picks

Top line (Sales)

Bottom line (Profit)

If PEG ratio>1, we will

discard the stock and if
it is less than 1or equal
to1 we will keep it

If both top line

and bottom line is
If both sales and profit is decreasing i.e.
increasing or either one is sales and profit,
increasing, we will keep it we will discard
the stock.
Finding growth picks

We will find Growth pick by PEG Ratio. (Price to earnings growth) I have taken PEG
ratio because I can determine whether the company will be expecting earnings
growth while the stock value is being determined and this would give me more
glance at the stocks that have been shortlisted using P/E ratio.
PEG ratio of 1 gives a perfect correlation between the company's market value and
its unfavourable, telling a stock is overvalued. If it is in between 0-1 the stock is
having a scope to perform well though it is overvalued.

PEG Ratio= Price to Earnings Ratio/ EPS Growth.

BANK ABOVE 28 PE RATIO

BANK NAME Kotak Mahindra ICICI Bank Axis Bank AU Small Financ
P E RATIO 45.02 30.12 76.98 29.35
EPS 30.25 12.25 5.77 22.2
PEG RATIO 1.488264463 2.45877551 13.34142114 1.322072072

*EPS Growth will be calculated by taking this year’s EPS and last year’s EPS and then
we will see the growth rate.
PEG ratio = (P/E ratio)/EPS Growth Rate
EPS Growth rate = {(Current year EPS – Previous year EPS)/Previous year
EPS} *100
If EPS growth rate is negative, then the PEG ratio is N/A

For e.g.: HDFC Bank

EPS for 2018= 67.76
EPS for 2019= 78.65
PS Growth= ((78.65-67.76)/67.76) *100 = 16.07%
PEG Ratio= 19.62/16.07 = 1.22
The PEG ratio is between 0-1, so we select this as our growth pick. Similarly, Axis
Bank
Ltd is also our growth pick and rest of the overvalued stocks are discarded.
Finding value picks
Why we are doing this analysis:
Is the company’s revenue growing?
Is the company making profit?
Can the company beat its competitors in future?
And finally, will the company’s stock a good investment?

BANK UNDER 28 PE RATIO

HDFC Bandhan IndusInd City Union Federal RBL
Bank Bank Bank Bank Bank Bank
23.21 20.2 8.68 20.86 7.03 18.77
Reven 2018- 116597.9 7707.1 27907.87 4281.56 12770.05 7743.0
ue 19 4 8
19-20 138073.4 12434.69 35734.14 4848.55 15142.16 10424.
7 63
Profit 2018- 21078.17 1951.5 3301.1 682.85 1243.89 866.95
19
19-20 26257.32 3023.74 4417.91 476.32 1542.78 505.67

Effect
Revenue Profit Value
HDFC Bank Increase Increase 
Bandhan Bank Increase Increase 
IndusInd Bank Increase Increase 
City Union Bank Increase Increase 
Federal Bank Increase Increase 
RBL Bank Increase Decrease 

So, by the above analysis, we can say that all the stocks revenue and profit is
growing or either is increasing. So, above are 6 value picks we have in our fund. By
this, we can interpret that although the above stocks are undervalued but they can
fetch good returns in the future as these are hidden gem and this is the time when
we should buy it and we can say that these stocks are a good investment for an
investor.

Therefore, we have 6 value picks in our fund and there are 2 growth picks. So, by
doing fundamental analysis, we saw the stocks which are good for our fund and by
using industry specific ratios, we will do asset allocation i.e. we will allocate the fund
Asset allocation
Asset allocation is strategy of investment that aims to balance risk and return by
apportioning a portfolio's assets according to an individual's goals, risk and
investment horizon.
So, according to my industry, there are main 6 ratios which will have an impact on
asset allocation decision:
CASA ratio:

CASA Ratio is the ratio of deposits in current and saving accounts to total deposits.
A higher CASA Ratio indicates a lower cost of funds, because banks do not usually
give any interests on current account deposits and the interest on saving accounts is
usually very low 3-4%.

ROCE (Return on Capital Employed)

ROCE stands for Return on Capital Employed; it is a financial ratio that determines a
company’s profitability and the efficiency the capital is applied. A higher ROCE
implies a more economical use of capital; the ROCE should be higher than
the capital cost.

Return on Asset Ratio:

ROA ratio is frequently applied to the banks because of the cash flow analysis is
more difficult to construct accurately. The ROA ratio is considered to be an important
profitability ratio, profit a company earns on its assets. The ROA ratio is a company's
net or after-tax income divided by its total assets. Since banks are highly leveraged,
even a low ROA of 1 to 2% may represent subsequent revenues and profit for the
bank.

Operating profit margin

The operating margin measures how much profit a company makes on a dollar of
sales, after paying for variable costs of production, such as wages and raw materials,
but before paying interest or tax. It is calculated by dividing a company’s operating
profit by its net sales.

Net Interest Margin & Net Interest Income:

As the interest earned on such assets are primary sources of revenue for a bank, so
this is a good indicator of a bank's overall profitability, generally higher margins
indicate a more profitable bank. There are number of factors which can have
significant impact on NIM, including interest rates charged by the bank and the
source of the bank's assets. NIM is calculated as the total of interest and investment
returns minus all related expenses; then this amount is divided by the average total
of earning assets. Net interest income (NII) is the difference between revenues
generated by interest-bearing assets and the cost of servicing liabilities. For banks,
the assets typically include commercial and personal loans, mortgages, construction
loans and investment securities.
 Ratios Banks
HDFC Bandhan IndusInd City Union Federal RBL
Bank Bank Bank Bank Bank Bank
Casa Ratio 42 36.8 40.5 26 33 25
ROCE 3.33 6.14 3.62 2.78 1.8 3.22
NIM 3.67 6.89 3.92 3.36 2.57 4.07
ROA 1.71 3.29 1.43 0.95 0.85 0.56
Operating Profit 2.6 13.54 -8.8 -4.88 -2.94 -16.49
Margin
NII 4.18 8.93 3.55 3.78 2.81 3.57

Ranking
Banks On On On On On the On Ranks Final
the the the the basis of the Weightage Ranking
basis basis basis basis operating basis
of of of of profit of NII
CASA ROCE NIM ROA margin
Ratio
HDFC Bank 1 3 4 2 2 2 14 2
Bandhan Bank 3 1 1 1 1 1 8 1
IndusInd Bank 2 2 3 3 5 5 20 3
City Union Bank 5 5 5 4 4 3 26 4
Federal Bank 4 6 6 5 3 6 30 6
RBL Bank 6 4 2 6 6 4 28 5
So, based on the rank, we will allocate the fund. The stock with least overall rank is
said to be the best.
We have taken AUM as 10 Crore. Now, we will allocate it keeping in mind the total
rank.

Sector- Private Banking Sector

Bank Name Closing Price No.Of Share Asset Allocation(Cr.) Cash Balance
Bandhan Bank ₹ 370.10 108078 ₹ 3,99,99,666.91 ₹ 333.09
HDFC Bank ₹ 1,080.25 18514 ₹ 1,99,99,751.54 ₹ 248.46
IndusInd Bank ₹ 539.65 18530 ₹ 99,99,713.99 ₹ 286.01
City Union Bank ₹ 127.75 78277 ₹ 99,99,886.30 ₹ 113.70
RBL Bank ₹ 177.90 56211 ₹ 99,99,937.73 ₹ 62.27
Federal Bank ₹ 53.05 188501 ₹ 99,99,978.25 ₹ 21.75
₹ 9,99,98,934.72 ₹ 1,065.28
Cash In Hand ₹ 1,065.28
Total ₹ 10,00,00,000.00

NAV Rs. 10.00

AUM Rs. 10,00,00,000.00

No. of units 10000000
 1.2. TECHNICAL ANALYSIS

This is the second method I have opted because I will be able to evaluate
investment by attempting to reflect the price moves in a trend that are
determined by the changing attitude of investors towards various economic,
monetary and political forces.
This method helps me in identifying a trend reversal at a relatively early stage
and move on that trend until the movement shows or proves the trend has
reversed. In this method I will be evaluating the securities by analysing the
statistics generated by the market activity, such as past price and volume. I will
be using 5 years’ harts of each stock from my asset allocation table and identify
patterns that can suggest future activity. This method is more inclined towards
price movement which helps me understand the chart easily by the standard
tools.

There few assumptions when we opt this method, which can happen at any time:
The market discounts everything
Price moves in trends
History tends to repeat itself

The outcome observed by performing technical analysis is to produce a call that

an investor can take with the security’s current trend, with the aim of figuring out
whether he/she needs to invest more into that stock or just hold on the shares
that have already been purchased.

So, basically there are four steps to do fundamental analysis:

Find the standard pattern in the 5-year chart of the stock
Draw the trend line and find out the Buy/Sell point
Find breakthrough point at the end of the trend line
Anticipate the future trend and provide a recommendation
Types of trends:
Up Trends
Down Trends
Sideways/Horizontal Trends

Types of Patterns:
Rounding Bottom – Sideways to up
Cup with handle – sideways to up
Bump and Run Reversal – Up to down/sideways
Double Top – Sideways to Down
Double Bottom- Sideways to Up
Head & Shoulders – Sideways to up/down
Triple Top – Sideways to downTriple Bottom – Sideways to up

*All these patterns are reversal patterns.

These few basic trends and pattern names which you should know while moving
further into the report to understand the analysis given to each stock with
completion of Technical Analysis, the equity research of the sector has been
completed, further the company will be having complete equity research on
Private Banking sector submitted by me. So now let us see the analysis of each
stock in the report further.
HDFC Bank:

TREND LINE

SIDEWAYS

BUY POINT

Analysis:

The pattern which I identified is ROUNDING BOTTOM which is a reversal pattern

where the trend of the share goes up. Around mid-2017, I have identified an uptrend
and it goes on till last quarter of 2018. We generally have to buy shares when we
see trend like these as there will be an uptrend in future. So with intersection of trend
line (in blue) and rounding bottom pattern I have found the buy point where I need to
buy the shares. But almost at the end of the trend line (in blue) the share price starts
to settle in a specific range which is leading to a sideways trend which can be right
time to hold the shares and not invest money. The company is just two and half
years old so there are high chances of uncertainty. In the long term we can
anticipate this share price to shoot up or go down. So, call for the HDFC Bank stock
as per the trend, is Investor should HOLD the shares if they have any
Kotak Mahindra Bank

DOUBLE TAP

SELL POINT

BREAKTHROUG

Analysis:

The pattern which I identified is DOUBLE TOP which is a reversal pattern where
the trend of the share goes down. We generally have to sell our shares when we
see trend like these as there will be a down trend in future.

So with intersection of trend line (in blue) and double top pattern I have found the sell
point where I need to sell the shares so that I wouldn’t incur any loss. But almost at
the end of the trend line (in blue) the share price starts rising up showing a positive
note and this can be identified as a breakthrough point which can be right time to buy
the shares and invest money. In the long term we can anticipate this share price to
shoot up. So, call for the Kotak Mahindra Bank stock that as per the trend, is
Investors can BUY it
ICICI Bank

DOUBLE TOP
SIDEWAYS
SELL POINT

TREND LINE

Analysis:

The pattern which I identified is DOUBLE TOP which is a reversal pattern where the
trend of the share goes down. Around the start of 2018, I have identified a down
trend and it goes on till first quarter of 2019. We generally have to sell our shares
when we see trend like these as there will be a down trend in future. So with
intersection of trend line (in blue) and double top pattern I have found the sell point
where I need to sell the shares if I am having any so that I wouldn’t incur any loss.
But almost at the end of the trend line (in blue) the share price starts to settle in a
specific range which is leading to a sideways trend which can be right time to hold
the shares and not invest money. In the long term we can anticipate this share price
to shoot up or go down. So, call for the ICICI Bank stock as per the trend, Investor
should HOLD the shares if they have any and shouldn’t buy any extra shares.
Axis Bank

DOWN TREND

DOUBLE TOP

SIDEWAYS

SELL POINT

Analysis:

The pattern which I identified is DOUBLE TOP which is a reversal pattern where the
Trend of the share goes down. Around 2010-2011, I have identified a down trend
and again at the start of 2016 the down trend has been occurring. We generally have
to sell our shares when we see trend like these as there will be a down trend in
future. So with intersection of trend line (in blue) and double top pattern I have found
the sell point where I need to sell the shares if I am having any so that I wouldn’t
incur any loss. But almost at the end of the trend line (in blue) the share price starts
to settle in a specific range which is leading to a sideways trend which can be right
time to hold the shares and not invest money. In the long term we can anticipate this
share price to shoot up or go down. So, call for the Axis bank as per the trend, is
Investor should HOLD the shares if they have any and shouldn’t buy any extra
shares
Bandhan Bank

HEAD & SHOULDERS

TREND LINE

BUY POINT
SELL POINT

BREAKTHROUGH

Analysis:

The pattern which I identified is HEAD & SHOULDERS which is a reversal

pattern where the trend of the share goes down. Around October 2020 I am able
to plot this pattern, we generally have to sell our shares when we see pattern
like these as there will be a down trend in future. So with intersection of trend
line (in blue) and double top pattern I have found the sell point where I need to
sell the shares if I am having any so that I wouldn’t incur any loss. But almost at
the end of the trend line (in blue) the share price starts rising up showing a
positive note and this can be identified as a breakthrough point which can be
right time to buy the shares and invest money. In the long term we can
anticipate this share price to shoot up. So, call for the Bandhan Bank stock as
per the trend, is Investor can BUY it and I assume the share price will again be
hitting the market high price.
RBL Bank:

DOUBLE TOP

SELL POINT

BREAKTHROUGH

Analysis:

The pattern which I identified is DOUBLE TOP which is a reversal pattern where
the trend of the share goes down. Around second quarter of 2019, we generally
have to sell our shares when we see trend like these as there will be a down trend
in future. So with intersection of trend line (in blue) and double top pattern I have
found the sell point where I need to sell the shares if I
am having any so that I wouldn’t incur any loss. But almost at the end of the trend
line (in blue) the share price starts rising up showing a positive note and this can be
identified as a breakthrough point which can be right time to buy the shares and
invest money. In the long term we can anticipate this share price to shoot up. So, call
for the RBL Bank stock as per the trend, is Investor can BUY it.
2. MUTUAL FUNDS
Introduction
A Mutual Fund is arrangement where pool of funds formed by various people coming
together for a common purpose of an investment opportunity to generate returns in
the long run. The Mutual Fund services is offered by an Asset Management
Company (AMC) which is duly managed by a Fund Manager, technical person
having expertise and skill required to make investment decisions of various
companies. To protect the money of the investors, the investment is not only made
into one stock; instead the amount to be invested is divided among the shares of
various companies and stocks in various sectors so that in case of some industry not
performing well, the investor’s money is safe as some other company may give great
returns.
The money collected is then invested into the capital market instruments in the
various kinds of shares, debentures, gold and other securities. The earned income
from investments and appreciation of capital realized is shared by its unit holders in
the proportion of units held by them. Thus it is the most suitable investment option
for the people earning income and less risky investment as it provides an opportunity
to invest into a diversified, professionally managed basket of securities at a low cost.
Mutual Funds focus at minimizing the risk and maximization of returns through
diversification in the investment.
With a desire of making more money with less risk, people tend to invest into shares
of companies, and for that help is required; which is basically the main feature of the
Mutual Fund Industry wherein people from different backgrounds having little or no
knowledge about share or share market but having money to invest come together
for a common goal and pool in their funds to form is known as Mutual Funds.

Types of Mutual Funds Based on Asset Class

Balanced Fund Debt Fund

Equity Fund

Large cap Multi cap fund

Small cap Sector fund
Mid cap Index fund
Contra Fund Foreign fund
Fund of funds ELSS (Equity linked savings scheme)

I have also created questionnaire to collect the information about the risk taking ability
for the people of different age group. And also created the portfolio of the mutual fund.
Private Bank Equity Fund SFIN No-

About The Fund Date Of Inception-13-July-2020

OBJECTIVE:Toprovidelong-termwealthmaximizationbymanagingawell-diversifiedequityportfolio
predominantlycomprisingofdeepvaluestocks with strong price and earnings momentum

STRATEGY: Tobuild andmanage awell-diversifiedequityportfolioofprivate bank drivenstocks by

following aprudentmixofqualitative and quantitativeinvestmentfactors.Thisstrategyhas
outperformedthebroadermarketindicesoverlong-term.Thefundwouldseektoidentifycompanies,
whichhaveattractivebusinessfundamentals,competentmanagementandprospectsofrobustfuture
growthandareyetavailableatadiscounttotheir intrinsic value and display good momentum. The fund
will also maintain reasonable levelsof liquidity

Securities Holding
Equity 100%

Bandhan Bank 40%

Hdfc Bank 20%

Indusland Bank 10%

City Union Bank 10%

RBL Bank 10%

Federal Bank 10%

AUM
Asset Allocation
Bandhan Bank
10%
HDFC Bank
10%
40% IndusInd Bank
10% AUM,
City Union Bank
10% 10, 100%
RBL Bank
20%
Federal Bank
Equity
3. INITIAL PUBLIC OFFERING
An IPO is stands for an Initial Public Offering. It is when a company offers its shares
to the public for the first time. It is also called "going public." An IPO is the first time
when promoters of the company give up part of their ownership to stockholders.
IPOs are issued by smaller companies or start-ups seeking capital to expand their
business, as well as by large private companies looking to expand & become
publicly traded. In an IPOs, when a company lists its securities on a public
exchange, the money is paid by investors for the newly-issued shares which goes
directly to the company (unlike, trading of shares later on the exchange where the
money passes between investors). Therefore, it permits a company to tap a wide
pool of investors to provide it with capital for future development, repayment of debt
and for working capital. The ability to quickly raise large amount of capital from the
market is a key reason why many companies seeks to go public.

Benefits for being a public company are as follows:

1. Diversifying the equity base.

2. Enabling cheaper access to capital.
3. Exposure, prestige and public image of the company.
4. Attracting and holding better management and employee’s retention.
5. Encouraging acquisitions.
6. Making various financing opportunities: equity, convertible debt, cheaper bank
loans, etc.

IPO GRADING
IPO grading is the grade assigned by a Credit Rating Agency, registered with
SEBI, to the initial public offering (IPO) of equity shares or any other security
which may be converted into or exchanged with equity shares at a later date.
The grade represents a relative assessment of the fundamentals of that issue
in relation to the other listed equity securities in India. Such grading is
generally assigned on a five-point scale with a higher score indicating
stronger fundamentals and vice versa as below.
The IPO grades are as follows: -

IPO grade 1: Poor fundamentals

IPO grade 2: Below-average fundamentals
IPO grade 3: Average fundamentals
IPO grade 4: Above-average fundamentals
IPO grade 5: Strong fundamentals

IPO grading has been introduced as an endeavor to make additional

information available for the investors in order to facilitate their assessment of
equity issues offered through an IPO..

The IPO allotted to me was SBI Cards and Payment Services Ltd IPO .The
grading process is shown below

SBI Cards IPO Details

IPO Date Mar 2, 2020 - Mar 5, 2020

Issue Type Book Built Issue IPO

Issue Size 137,193,464 Eq Shares of ₹10

(aggregating up to ₹10,354.77 Cr)

Face Value ₹10 per equity share

IPO Price ₹750 to ₹755 per equity share

Market Lot 19 Shares

Min Order Quantity 19 Shares

Listing At BSE, NSE

P/E (x) 45.8

Market Cap (₹ Cr.) 70890

Analysis of SBI Cards and Payment Services Ltd IPO.
IPO name- SBI CARDS AND PAYMENT SERVICES LTD
PE ratio 56.75
Avg industry PE 32.6
EPS 34
Over valued 1.64
After calculating its PEG ratio i found that the stock is REJECTED.

Peer – Peer Comparison (SBI Cards and Payment Services Ltd IPO)

Banks
Ratios SBI Indian Bank Bank of Baroda Bank Of maharastra PNB
Casa Ratio 44.22 35.4 35.28 48.7 42.97
ROCE 1.79 2.14 1.77 1.73 1.8
NIM 2.48 2.45 2.37 2.53 2.09
ROA 0.36 0.24 0.04 0.23 0.04
Operating Profit Margin -11.94 -11.95 -12.85 -10.96 -16.61

Ranking
Banks On the basis On the On the On the On the basis of To Final
of CASA basis of basis of basis of operating profit ta Ranki
Ratio ROCE NIM ROA margin l ng
SBI 2 4 2 1 2 11 2
Indian 5 1 3 2 3 14 3
Bank
Bank of 4 3 4 4 4 19 4
Baroda
Bank Of 1 2 1 3 1 8 1
maharast
ra
PNB 3 5 5 5 5 23 5
IPO name- SBI CARDS AND PAYMENT - Rejected
SERVICES LTD

Instead of SBI Cards and Payment Services Ltd IPO , I recommend

an investor to go for Bank Of maharastra as it has strong
fundamentals and a good chance of getting good returns.

IPO NAME - SBI Cards and Payment Services Ltd IPO – 2 out of 5
RECOMMENDATION - Bank Of maharastra
 FINDINGS AND CONCLUSION

The findings from the project will be about the results and performance of the
asset allocation that I did initially as a part of fundamental analysis and further
determining whether the stocks should be bought or kept on hold through
technical analysis. The asset allocation and Index has been done on 3rd April
2020 and I have been updating it on every official working by adding the current
share prices and weightages of the stocks of that particular day. Below is the
table which tabulates the INDEX and NAV results of each official working day of
stock exchanges:
DATE INDEX VALUE NAV AUM
13 July 2020 1053.554258 10 99998934.72
14 July 2020 1024.644111 9.582763412 95827634.12
15 July 2020 1021.07826 9.472874703 94728747.03
16 July 2020 1030.3448 9.494578313 94945783.13
17 July 2020 1053.143246 9.725810125 97258101.25
20 July 2020 1072.18771 9.829353848 98293538.48
21 July 2020 1090.49844 9.900074469 99000744.69
22 July 2020 1088.409426 9.774714605 97747146.05
23 July 2020 1096.312332 9.88200642 98820064.2
24 July 2020 1079.671369 9.822564171 98225641.71
27 July 2020 1039.95557 9.822564171 98225641.71
28 July 2020 1052.447107 9.681037972 96810379.72
29 July 2020 1043.858814 9.622149142 96221491.42
30 July 2020 1028.532581 9.494904621 94949046.21
31 July 2020 1021.935506 9.52881205 95288120.5

In a general scenario, if asset allocation is proper distributed by me i.e. the

money has been properly invested into the shares/stocks then the NAV value
should be more than the index value. So here is the line graph which tells the
comparison of the INDEX and NAV values given in the table.
From the above line graph, we can clearly see that the NAV (in red) is above the
INDEX (in blue) which says that my NAV values are beating the INDEX values.
This concludes that though my Sector INDEX starts to fall because of the fall in
share price, my asset allocation would still be having good value. This is
because of the proportion of amount I have allocated for different stocks and
can also say the fundamental and technical analysis performed by me are up to
the mark and will be fetching long term appreciation of the fund that investor will
be investing.

The overall performance HDFC Bank, Kotak Mahindra Bank, IDFC First Bank,
ICICI Bank and Bandhan Bank on the basis of analysis done predicts that the
investment in these stocks will be profitable, thus investors are suggested to buy
these stocks. Whereas the performance of rest of the stocks is steady i.e.
neither increasing nor decreasing on a long term basis due to reasons like weak
asset quality, poor profitability or some other insider reason, therefore for the
time being investors are suggested to hold these stocks as they don’t seem to
be a profitable investment and in coming 2 to 5 years can good for the market
players because as HDFC being large cap but available now at lower cost can
be profitable for investors.

Equity markets are volatile due to its direct relation with many other local,
economic and global dynamics involved. Thus a better understanding by means
of equity research will allow investor to have better insight over the fluctuations
of the equity market and aid in the process of achieving financial objectives.
Thus equity research is of priority and the findings by research analysts are
carefully followed up by all the stakeholders from large companies to individual
investors who invest a part of their capital in the equity market. This fundamental
and technical research project of the private banking sector provides a clear
picture to the investors, who are willing to invest in this sector, regarding their
investment decision and finding an opportunity to make profit.
SUGGESTIONS AND RECOMMENDATIONS TO THE COMPANY

Following are the suggestions made based on study with reference to the
performance of the sector, data analysis and findings:

In Private Banking sector, the volatility of product is so high so the inventory

of the company gets sold so quickly and the returns will be obtained as per
the operating cycle. This can be the primary reason why the company
should look into this sector for investment.

The companies/stocks that are picked by me for the research belong to the
large cap of the sector which gives an added advantage of having large
turnover and quick growth. The proportion in which the investment has
been made by me gives an edge of not making loss and having less risk.
So this research of mine, would help in easing the effort and helps in
making the portfolio of the sector quickly.

Equity market is currently slow but it is growing, if company clients invest

more money in stocks the returns will be good than F.D and real estate.
Company analysts should also add the companies belonging into this
private banking sector in their portfolio.

For clients of the company I would suggest to invest money on research

reports and broker advice, then the chances of risk are low and chance of
return will be high.

It is always better to invest money on long term basis than intraday because
intraday is nothing but speculation.

If the company considers both i.e. fundamental and technical analysis, then
it will be better than mere speculation.

Currently private banking sector is not in boom but continuously growing

and after this pandemic it will grow further so it is better to invest money in
that segment. The share market is being effected by price hikes and
sanction imposed by foreign nations so my suggestion to investors is that
they should not panic and hold the shares if they don’t want it and sell in the
coming future when market will be growing.
 REFRENCES/BIBLIOGRAPHY

1. For graphs and technical of the analysis is t

aken from:
https://kite.zerodha.com/chart/web/ciq/NSE/HDFCBANK/341249
https://kite.zerodha.com/chart/web/ciq/NSE/KOTAKBANK/492033
https://kite.zerodha.com/chart/web/ciq/NSE/BANDHANBNK/579329
https://kite.zerodha.com/chart/web/ciq/NSE/ICICIBANK/1270529
https://kite.zerodha.com/chart/web/ciq/NSE/YESBANK/3050241
https://kite.zerodha.com/chart/web/ciq/NSE/IDFCFIRSTB/2863105
https://kite.zerodha.com/chart/web/ciq/NSE/RBLBANK/4708097
https://kite.zerodha.com/chart/web/ciq/NSE/FEDERALBNK/261889

2. For Important ratios:

https://www.investopedia.com/articles/active-trading/082615/key-
financial-ratios-analyze-retail- banks.asp
https://www.equitymaster.com/detail.asp?
date=03/08/2010&story=2&tit le=Key-ratios-related- to-banks-balance-
sheets

3. For INDEX calculation and NAV calculation:

https://www.moneycontrol.com/stocks/marketinfo/marketcap/
bse/bank-private.html https://tradebrains.in/how-to-do-
fundamental-analysis-on-stocks-in-india/
https://www.ibef.org/industry/private-banking.aspx
https://www.hdfclife.com/about-us/hdfc-life-introduction
https://www.myaccountingcourse.com/accounting-
dictionary/equity-research
https://www.moneycontrol.com/stock-
charts/hdfcbank/charts/hdf01
 WEALTH MANAGEMENT RISK
PROFILE QUESTIONNAIRE
JIMS KALKAJI

Client Name- Account Number-

Advisor- Date-
1. WHICH OF THE FOLLOWING BEST DESCRIBES YOUR CURRENT STAGE OF LIFE?

A. Single with few financial burdens. Ready to accumulate wealth for future short term and
long term goals. (1 points)

B. A couple without children. Preparing for the future by establishing a home. Expecting to
have or already have a high purchase rate of household and consumer items. (3 points)

C. Young family with a home. You have a mortgage and childcare costs and maintain only
small cash balances. (3 points)

D. Mature family. You are in your peak earning years and your mortgage is under control.
You both work and you may or may not have children that are growing up or have left
home. You’re ready to start thinking about your retirement years. (5 points)

E. Preparing for retirement. You own your home and have few financial burdens; you want
to ensure you can afford a comfortable retirement. (7 points)

F. Retired. You rely on existing funds and investments to maintain your lifestyle in
retirement. You may already be receiving a Government pension and/or Superannuation
pension. (9 point)

2. HOW SECURE IS YOUR CURRENT AND FUTURE INCOME FROM SOURCES SUCH AS SALARY,
PENSION OR OTHER INVESTMENTS?

A. Not secure (1 points)

B. Somewhat secure (3 points)

C. Fairly secure (5 points)

D. Very secure (7 points)

3. WHICH OF THE FOLLOWING STATEMENTS BEST DESCRIBES YOUR OBJECTIVE FOR THE
MONEY YOU ARE INVESTING?

A. Preservation of capital (1 points)

B. Growth through a balance of capital gains and income (3 points)

C. Growth through capital gains and some income (5 points)

D. Growth primarily through capital gains (7 point)

4. SUPPOSE THERE ARE 4 INVESTMENT PLANS AVAILABLE FOR YOU WHICH ONE ARE YOU
LIKELY TO CHOOSE?

A. Highest return +5000 highest loss -1500 (1 point)

B. highest return +7500 Highest loss -3500 (3 point)

C. Highest return +11500Highest loss -7000 (5 point)

D. Highest return 15000 Highest loss - 12000 ( 7 point)

5. SUPPOSE YOUR INVESTMENTS DECREASES BY MORE THAN 5% WITHIN A SHORT TIME SO

YOU?

A. Sell all of the remaining investments (1 point)

B. Sell a portion of the remaining investment (3 points)

C. Hold your investments and sell nothing (5 points)

D. Invest more funds. You can tolerate short term losses in expectation of future
growth (7points)

6. IF YOU HAVE ₹1,00,000 TO INVEST, HOW MUCH WOULD YOU INVEST IN A SECURITY WITH
HIGH RETURNS BUT ALSO HIGH RISK

A. All of it (1 point)

B. More than half (3 points)

C. Half (5 points)

D. Less than half (7 points)

E. None (9 points)

7. WHAT PERCENTAGE OF YOUR TAKE HOME INCOME GOES INTO REPAYING LIABILITIES?

A. >50% (1 point)

B. 50% to 30% (3 point)

C. 30% to 20%. (5 point)

D. Less than 20% (7 point)

E. I have enough of surplus (9 point)

8. WHICH OF THE FOLLOWING BEST DESCRIBE YOUR EXPERIENCE AS AN INVESTOR?

A. I have had virtually no experience in investing money. (1 point)

B. I have had little experience in investment. (3 point)

 C. I have had reasonable level of experience (5 point)

D. I am an experienced investor. (7 point)

9. FOR HOW LONG DO YOU PLAN TO INVEST THESE FUNDS BEFORE YOU BEGIN
WITHDRAWING A SUBSTANTIAL PORTION FROM YOUR PORTFOLIO?

A. 1 TO 3YEARS (1 POINT)

B. 4TO 5YEARS (3 POINT)

C. 6 TO 10 (5 POINT)

D. 11 TO 15 (7 POINT)

E. MORE THAN 15YEARS (9 POINT)

10. WHAT BEST DESCRIBES YOUR STANCE TOWARDS INVESTMENT RISK ?

A. I don't want any kind of investment risk for my wealth, even if that minimizes my
chances for real return. (1 POINT)

B. I could bear some investment risk if there is a possibility of a good performance for my
wealth. (3 POINT)

C. I could bear enough investment risk to make my wealth gain superior performance.
(5 POINT)

D. I don't mind on taking investment risk since I understand that risk and return are
inextricably linked. (7 POINT)

11. WHAT IS YOUR APPROACH TO MAKING A FINANCIAL DECISION?

A. Taking a random decision (1 point)

B. Lose sleep over the issue (3 points)

C. Seek friendly advice (5 points)

D. Take an educated guess (7 points)

E. Analyse the various options (9 points)

12. WHAT IS YOUR PRACTICE ON SAVING MONEY ?

A. I don't believe in saving.(1 points)

B. I'd like to save, but my expenses and other financial commitments do not permit to
(3 Points)

C. I try to save whenever and wherever possible.(5 points)

D. I save 15 percent or more of my take-home salary without exception (7 points)

13. ONCE YOU START USING YOUR INVESTED MONEY, HOW LONG WOULD YOU NEED IT TO
LAST?

A. Over a period of 2 years or less .(1 points)

B. Over a period of 3-5 years . (3 Points)

C. Over a period of 6-10 years . (5 points)

D. More than 10 years/retirement . (7 points)

14. HOW WOULD YOU DESCRIBE YOUR OVERALL INCOME STATUS?

A. Just about manage to make ends meet; no monthly savings.(1 point)

B. My PF and other employment benefits are my only source of savings.(3 points)

C. I put aside atleast 10% of my take-home salary every month in savings.(5 points)

D. I save more than 30% of my take-home salary every month.(7 points)

E. My income from my wealth more than adequately provides for my cost of living.(9
points)

15. HOW KNOWLEDGEABLE ARE YOU WITH INVESTMENT?

A. Not at all with investments and do not feel comfortable with complexity. (1 point)

B. Not very knowledgeable when it comes to investments. (3 points)

C. Very little knowledgeable . I don’t fully understand investments. (5 points)

D. Normal knowledge. I am aware of many factors which influence investment

performance. (7 points)

E. Very much knowledgeable. I use fundamental research and other investment

information to make investment decisions. I also focus to the various factors which
influence investment performance. (9 points)
Risk Analysis
Based on your total points from the Risk Tolerance section, your applicable Risk Profile would be: