See discussions, stats, and author profiles for this publication at: https://www.researchgate.

net/publication/371804341

Fundamental Analysis and Descriptive Statistics of Share Price For

Investment Decisions

Article · June 2023

CITATIONS READS

0 174

1 author:

Vandana Lakhotia
Unity college
1 PUBLICATION 0 CITATIONS

SEE PROFILE

All content following this page was uploaded by Vandana Lakhotia on 23 June 2023.

The user has requested enhancement of the downloaded file.

www.ijcrt.org © 2023 IJCRT | Volume 11, Issue 6 June 2023 | ISSN: 2320-2882

Fundamental Analysis and Descriptive Statistics of

Share Price For Investment Decisions

1Vandana Lakhotia Ladha, 2Dr. Anilkumar Nirmal

1. Vandana Lakhotia Ladha
Research Scholar
1Research Scholar, 2Research Guide
2. Dr. Anilkumar Nirmal
Research Guide
1Parul University,

2Parul University

Abstract:

Trading, gambling, and investing all involve risk and chance to some extent. But they differ from one
another. Even though stock trading is subject to the vagaries of the market, it is based on a database of
financial data which serves as a backbone for both traders and investors. It is not incorrect to compare
uninformed investing to gambling. Investors must have a solid understanding of the company's fundamentals
because doing so makes it easier to distinguish between good and bad stocks. The purpose of the study is to
evaluate a company's fundamentals and quantify how closely they relate to the share price using descriptive
statistics. The study discusses all crucial ratios, including the 10 crucial ratios known as F_Decile (solvency
ratios, profitability ratios, valuation ratios, debt ratios, and efficiency ratios). To assess the degree of
correlation between the company's fundamentals and changes in the share price, the F_Decile score is
correlated with the change in share price determined on a daily basis from 2017–18 to 2021–22. The
research's findings also assist traders and investors in differentiating between companies with the potential to
generate abnormal profits and those with meagre or non-existent returns over time. In order to forecast the
future share price for investment purposes, descriptive statistics such as range, sum, mean, and standard
deviation are applied to the fluctuating share price on a daily basis. These statistics help to determine the
movement and magnitude of the share price over a period of five years.

Keywords: Abnormal profits, Correlation, Investing, Trading, F_Decile

IJCRT2306678 International Journal of Creative Research Thoughts (IJCRT) www.ijcrt.org f904

www.ijcrt.org © 2023 IJCRT | Volume 11, Issue 6 June 2023 | ISSN: 2320-2882

INTRODUCTION

Trading and investing don't have to be like gambling, which is a zero-sum game. Burton Malkiel put forth
the Random Walk Theory in his 1973 book ‘A Random Walk Down Wall Street’. The idea was supported by
the notion that the stock market fluctuates erratically. The theory opposed the use of any information or
analysis prior to investing. The reasoning runs counter to the fundamental assumption of the stock market,
which was created to allow investors to make investments in companies with promising futures and high
rates of return, which would be reflected in rising share values. Investors who believe a company's earnings
will rise in the long run or who believe a stock is undervalued may be willing to pay a higher price for stock
in advance, regardless of the company's current financial status. The investor relies on the information
generated from the company's financial reports. Fundamental analysis is a tool that assists an investor in
analyzing a company’s future profitability based on its business environment and financial performance to
access its future growth and profit potential. The research focuses on the degree of relationship between
fundamental factors and share price.

For any investor, understanding the top-down strategy which includes the economy, industry and company
adopted by Mr. Suresh A. S. (2013) and Bassam A. Elbialy (2019) and how it affects the share price is
crucial. For ordinary investors, however, keeping track of the economy, industry, and company is a laborious
task. It is important to remember that there is always some broad knowledge about the business world and
economy available. The financial health of a company can be precisely determined through fundamental
analysis. A more thorough understanding of a company's future prospects can be obtained by using numerous
ratios and comparing them with the performance of the prior years. The study's primary objective is to
evaluate the company's financial health using ratios of profitability, solvency, value, efficiency, and debt.

LITERATURE REVIEW

Benjamin Graham and David Dodd (1934) pioneered fundamental analysis by incorporating macroeconomic
and microeconomic analysis. Thus, fundamental analysis extends beyond corporate financial data to include
macroeconomic data.

Ball and Brown's (1968) analysis of accounting data, notably the change in net income and its effect on stock
prices, was explored by G.P. Kourtis, E.P. Kourtis, M.P. Kourtis, and P.G. Curtis (2017) The Efficient
Market Hypothesis, which claims that any information made available to the public is useless for earning
anomalous profits, is challenged by the author.

Bettman, (2000) when utilized concurrently to comprehend the fundamentals of a company, the author's
F_score, which contains nine fundamental elements, is a beneficial tool for gaining an advantage over other
investors in terms of attaining better returns and reducing risks.

In his essay "In Defence of Fundamental Analysis" (2005), Frank Shostak claims that the stock market does
not have a life of its own. In the majority of cases, the success or failure of the firm itself will ultimately
determine whether stock investing is successful or unsuccessful. Because of this, the author formulated a
hypothesis to examine how the company's fundamentals affect the share price. The claim that fundamental
research cannot significantly improve the performance of a portfolio of Baltic company stock was proven to
be false. The results of the study showed that neither of the ratios suggested contributed in the creation of a
portfolio whose performance would surpass that of the market. The sole exception was the price to earnings
ratio, which demonstrated that investors seem to prefer investing in inexpensive companies. Equity investors
largely ignored the financial status of the company (profitability, stability of balance sheets), concentrating
instead on evaluating their growth prospects and business model appeal. So, while choosing a company,
investors tended to be prospective. As a result, businesses with little room for expansion or complete
business model erosion suffered greatly in terms of performance.
IJCRT2306678 International Journal of Creative Research Thoughts (IJCRT) www.ijcrt.org f905
www.ijcrt.org © 2023 IJCRT | Volume 11, Issue 6 June 2023 | ISSN: 2320-2882

According to Staffan Bülow's data from (2017), a portfolio with a high F-score earned 18.3% yearly, whereas
a portfolio with a low F_score earned 4% annually. This means that fundamental analysis can be utilised to
distinguish between winning and losing stocks. Additionally, the author emphasised the behavioural finance
perspective. He asserts that investors frequently place an undue emphasis on past results. When investors
combine value equities' low historical performance with their overemphasis on the past, they take on a
negative outlook. Investors often appreciate good firms and focus on their past performance, which creates
an overly gloomy and too optimistic viewpoint. Value stocks are neglected, and only if exploited by a
fundamental strategy like f-score, it will give the correct picture rather than a behavioural outlook in an
unbiased way.

Symon Kibet Kiprop and Joseph Kurwo Chelimo (2017) Establishing the impact of dividend policy on the
share price performance of listed insurance firms at NSE Kenya was the study's main goal. As a result of
these findings, the study draws the conclusion that management's dividend policy decisions have an impact
on the share price since they cause stock prices to fluctuate. Since the majority of NSE investors base their
bets on quick profits.

RESEARCH METHOD

The research methods comprise tools for data collection, calculation of fundamental score, calculation of
change in share price daily and descriptive statistics.

DATA COLLECTION

Secondary data was collected from the company websites and the financial data providing sites like Morning
Star and Yahoo Finance.

Sample Selection

The sample was chosen through convenience sampling. Different Nifty 50 sectors were chosen because
investors prioritise the Nifty 50 based on its market capitalisation when making investment selections. There
are a total of nine companies, which represent the FMCG, construction materials, and automobile industries.
Secondary data was collected over five years, from 2017-18 to 2021-22.

DATA ANALYSIS

Financial Performance Signal

Finding the degree of correlation between the fundamental factors and change in the share price is the major
goal of the study. The Piotroski score, which was developed by Joseph Piotroski in 2000 utilised nine
fundamental signals encompassing an organization's profitability, leverage, and operational efficiency, and
served as the foundation for my study of fundamental analysis. Along with the aforementioned three
domains, my study also focused on valuation and debt ratios. F_Decile is used in place of F_Score to show
the analysis of the financial position of the company using ten key ratios. The ten ratios included changes in
valuation ratios such as price-to-earnings ratio, price-to-book-value ratio, dividend yield ratio, profitability
ratios such as earnings per share and net profit margin ratios, solvency ratios such as current ratio, debt
ratio such as debt-equity ratio and interest coverage ratio, and efficiency ratio such as total asset turnover
ratio and inventory turnover ratio.

IJCRT2306678 International Journal of Creative Research Thoughts (IJCRT) www.ijcrt.org f906

www.ijcrt.org © 2023 IJCRT | Volume 11, Issue 6 June 2023 | ISSN: 2320-2882

Calculation Of Fundamental Score

The calculation method of Piotroski is applied. For Dividend Yield, Return on Equity, Net Profit Margin,
Current Ratio, Inventory Turnover Ratio, Total Asset Turnover Ratio, and Interest Coverage Ratio, every
increase in the ratio on a yearly basis plus 1, and a decrease in the ratio is 0. Similarly for the Price to
Earnings Ratio, Price to Book Ratio and Debt Equity Ratio, every decrease in ratio plus 1 otherwise 0. The
table 1 given below is an example of the calculation of the F_Decile score.

Table 1: Fundamental Score (F_Decile) of UltraTech Cement Ltd.

Source: morning star.com

Calculation Of Share Price

The change in share price is calculated using the closing price every day for five years, from 1 April 2017 to
31 March 2022. Descriptive statistical tools are applied, such as range, sum, average, and standard deviation
on the changed share price.

Statistical Tools Used

The various descriptive statistics tools employed in my study have various functions. The spread of the share
price change over a year was displayed by the range between the lowest and highest value. The sum of the
altered prices revealed whether the share price was more likely to move downward or upward. The stock has
moved downward if the sum is negative. The mean represents the full value to determine the association of
share price with fundamental elements. The standard deviation illustrates the prices' variation from their
mean, which when compared with the sum represents the positive or negative deviation and the degree of
deviation.

IJCRT2306678 International Journal of Creative Research Thoughts (IJCRT) www.ijcrt.org f907

www.ijcrt.org © 2023 IJCRT | Volume 11, Issue 6 June 2023 | ISSN: 2320-2882

ANALYSIS & INTERPRETATION

Descriptive Statistics for Construction Materials Sector

Descriptive statistics for the companies in the Construction materials Sector was used. Major players like
Grasim Industries Ltd., Larson and Toubro Ltd., Ultra Tech Cement were considered for the analysis.

Table 2: Descriptive Statistics of Construction materials Sector

Descriptive Statistics (Constructional Materials Sector)

(Grasim Industries Ltd.)

Year ∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv. ∆F_Decile

2018 323.05 1.90 0.0077 25.37072 3

2019 408.50 -192.95 -0.7749 24.74786 5

2020 157.50 -381.85 -1.5460 19.25580 5

2021 139.65 974.45 3.9135 17.38546 4

2022 202.55 213.45 0.8607 29.21374 8

∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv.

Pearson
Correlation-
∆F_Decile -0.206 -0.086 -0.085 0.542

Sig.(2-tailed) 0.740 0.891 0.892 0.346

(Larson & Toubro Ltd.)

Year ∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv. ∆F_Decile

2018 650.55 -264.00 -1.0732 40.65336 6

2019 123.95 74.40 0.3000 17.89098 8

2020 257.65 -576.80 -2.3352 26.99034 4

2021 178.10 610.40 2.4514 22.10276 5

IJCRT2306678 International Journal of Creative Research Thoughts (IJCRT) www.ijcrt.org f908

www.ijcrt.org © 2023 IJCRT | Volume 11, Issue 6 June 2023 | ISSN: 2320-2882

2022 235.85 348.75 1.4006 28.12341 6

∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv.

Pearson
Correlation-
∆F_Decile -0.126 0.260 0.262 -0.258

Sig.(2- 0.840 0.672 0.670 0.675

tailed)

(Ultra Tech Cement Ltd.)

Year P_Range P_Sum P_Mean P_Stdv. F_Decile

2018 445.15 -34.75 -0.1413 57.10676 4

2019 425.50 -4.50 -0.0181 66.32853 5

2020 926.80 -753.50 -3.0506 92.21670 5

2021 692.25 3493.10 14.0285 91.83279 5

2022 751.90 -169.95 -0.6825 115.45923 8

∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv.

Pearson
Correlation-
∆F_Decile 0.398 -0.144 -0.144 0.853

Sig.(2-tailed) 0.507 0.817 0.817 0.066

Source: NSE Website

The fundamental scores of Grasim and Ultra Tech Ltd. have increased in the above table, and L&T is also
showing a positive trajectory beyond 2020. While the range of Ultratech Cement's share price changes
reveals a positive, albeit weak, link, the range of L&T and Grasim's share price changes shows a negative
relationship with F_Decile. The sum of the absolute number and mean, which represents the daily change
and decline in share price, also reveals a negative correlation for Utratech and Grasim and a positive
relationship for L&T, or 0.260 and 0.262, respectively. Given that the share price has not increased in
accordance with the strengthening fundamentals, the standard deviations of Ultratech Cement and Grasim
Ltd. both have the potential to generate abnormal profits in the future. It is questionable whether the share
price of L&T will increase in the future due to the negative range and standard deviation.

IJCRT2306678 International Journal of Creative Research Thoughts (IJCRT) www.ijcrt.org f909

www.ijcrt.org © 2023 IJCRT | Volume 11, Issue 6 June 2023 | ISSN: 2320-2882

Descriptive Statistics for Auto and Automobile Sector

Indian Auto and automobile sector has been of the sectors that is growing with faster pace. Given below is
the descriptive statistical analysis for the some well-known companies in Auto and Automobile sector:

Table 3: Descriptive statistics ( Auto and Automobile sector)

Descriptive Statistics (Auto and Automobile sector)

(Mahindra & Mahindra Ltd.)

Year ∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv. ∆F_Decile

2018 855.40 -548.00 -2.2276 53.14909 9

2019 322.05 -65.00 -0.2590 20.31715 2

2020 90.30 -388.95 -1.5747 11.96266 1

2021 121.10 510.30 2.0494 16.03887 5

2022 219.80 11.30 0.0452 18.05433 7

∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv.

Pearson
Correlation-
∆F_Decile 0.684 -0.094 -0.097 0.736

Sig.(2-tailed) 0.203 0.881 0.877 0.157

(Bajaj Auto Ltd.)

Year ∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv. ∆F_Decile

2018 283.45 -60.75 -0.2470 36.62555 6

2019 421.65 166.40 0.6710 44.75318 4

2020 497.15 -888.75 -3.5982 51.18516 6

2021 573.30 1648.25 6.6195 62.22601 5

IJCRT2306678 International Journal of Creative Research Thoughts (IJCRT) www.ijcrt.org f910

www.ijcrt.org © 2023 IJCRT | Volume 11, Issue 6 June 2023 | ISSN: 2320-2882

2022 360.85 -37.55 -0.1520 52.97501 4

∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv.

Pearson
Correlation-
∆F_Decile -0.004 -0.292 -0.294 -0.260

Sig.(2-tailed) 0.995 0.633 0.631 0.673

(Maruti Suzuki India Ltd.)

Year ∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv. ∆F_Decile

2018 903.65 2845.40 11.5667 95.93496 6

2019 950.90 -1959.15 -7.9640 124.54624 6

2020 1479.05 -2384.25 -9.6528 152.42924 2

2021 1101.05 2570.90 10.3249 141.62586 4

2022 1214.80 702.10 2.8197 149.21476 5

∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv.

Pearson
Correlation-
∆F_Decile -0.921 0.376 0.377 -0.726

Sig.(2-tailed) 0.026 0.533 0.532 0.165

In the above table, the fundamental score is not very attractive, it has declined for all three companies from
2018 to 2022, though it showed little improvement in Maruti Suzuki and M & M 2021 onwards. There is a
strong negative correlation between the range and standard deviation of change in share price and
fundamental factors of Maruti Suzuki. The relationship between range, mean, sum and standard deviation
with the fundamental score of Bajaj Auto are negatively correlated which raises a question on the reliability
of the fundamentals of a company for forecasting the future share price. The range and standard deviation of
M & M are strongly related to the fundamentals and mean and sum are negatively related but very negligible
thus indicating further query before investing. The above figure points out that the fundamentals of a
company and the change in share price are not very strongly correlated both fundamental score and
descriptive statistics can help in determining the future trend of the share price when analysed separately.

IJCRT2306678 International Journal of Creative Research Thoughts (IJCRT) www.ijcrt.org f911

www.ijcrt.org © 2023 IJCRT | Volume 11, Issue 6 June 2023 | ISSN: 2320-2882

Descriptive Statistics (FMCG Sector)

Another sector considered for the analysis was the FMCG sector as it has been considered as one of the
critical sectors in the Indian economy. Table 3 provides the descriptive analysis of few companies of FMCG
sector.

Table 4: Descriptive Statistics (FMCG sector)

Descriptive Statistics (FMCG Sector)

(Hindustan Unilever Ltd.)

Year ∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv. ∆F_Decile

2018 75.20 421.60 1.7138 13.23427 4

2019 152.60 363.95 1.4616 22.37076 9

2020 395.40 591.70 2.3955 36.19138 4

2021 409.65 133.00 0.5341 38.19785 5

2022 240.55 -385.10 -1.5591 30.84918 5

∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv.

Pearson
Correlation-
∆F_Decile -0.303 -0.002 -0.006 0.760

Sig.(2-tailed) 0.621 0.997 0.992 0.800

(ITC Ltd.)

Year ∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv. ∆F_Decile

2018 59.45 -24.80 -0.1008 4.65119 6

2019 75.35 41.75 0.1670 5.12175 8

2020 86.95 -125.55 -0.5063 5.88812 7

2021 24.75 46.80 0.1880 3.70774 3

IJCRT2306678 International Journal of Creative Research Thoughts (IJCRT) www.ijcrt.org f912

www.ijcrt.org © 2023 IJCRT | Volume 11, Issue 6 June 2023 | ISSN: 2320-2882

2022 40.50 32.15 0.1291 3.92372 5

∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv.

Pearson
Correlation-
∆F_Decile 0.928 -0.394 -0.395 0.838

Sig.(2-tailed) 0.023 0.512 0.511 0.076

(Nestle India Ltd.)

Year ∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv. ∆F_Decile

2018 657.60 1522.90 6.1907 82.07289 8

2019 1130.65 2686.90 10.8781 167.52055 4

2020 2226.05 5339.65 21.6180 245.12073 3

2021 2883.60 864.60 3.4723 289.71415 3

2022 1189.10 215.35 0.8683 207.86904 8

∆P_Range ∆P_Sum ∆P_Mean ∆P_Stdv.

Pearson
Correlation-
∆F_Decile -0.788 -0.575 -0.574 -0.690

Sig.(2-tailed) 0.113 0.310 0.312 0.197

The fundamental score in the preceding table is not changing in any specific way. ITC Ltd.'s F_Decile
indicates a decline in its F_Decile, the range is highly correlated and also indicates a decline, and the sum
and mean are negatively correlated, indicating that the price increase does not correspond to the company's
fundamentals. The fundamental score for Nestle Limited is not very encouraging, but it has increased in
2022. However, range, sum, and mean are not improving at the same rate as fundamentals. With 5339.65 and
21.6180 as the sum and mean, the F_Decile was at its lowest point at 3. Similar results to those of Nestle
were also demonstrated by HUL, raising concerns about the use of fundamental indicators because the mean
and sum are high while the fundamental score is low.

IJCRT2306678 International Journal of Creative Research Thoughts (IJCRT) www.ijcrt.org f913

www.ijcrt.org © 2023 IJCRT | Volume 11, Issue 6 June 2023 | ISSN: 2320-2882

FINDINGS

The fundamental indicators provide insight into a company's future potential. The rising trend in the
fundamental indices of organisations such as Grasim Industries Ltd. and Ultratech Cement Ltd. increases the
dependability of investment. Similarly, companies such as Maruti Suzuki Ltd, Nestle India Ltd, L & T Ltd,
and M & M Ltd have shown an increase in their fundamentals from 2019-2020 to 2021-2022, indicating
strong prospects in the future. The decline in Bajaj Auto Ltd.’s fundamentals necessitate a closer examination
of the company's operations and future intentions before investing.

The range and standard deviation are useful indicators for short-term traders and those interested in short
selling though it is not free from risk. High abnormal profit is always `accompanied by high risk. The mean
and the sum of the changed share price help long-term investors by giving information about the extent of
change in the share price from 2017-18 to 2021-22.

Figure 1: Range of companies from 2018-2022

∆P_RANGE FROM 2018 - 2022

9000 8087
8000
7000
5649.45
6000
5000
4000 3241.6
3000 2136.4
2000 1446.1 1608.65 1273.4
1231.25
1000 287
0
Total

Sum of GRASIM Sum of L&T Sum of ULTRACEMCO

Sum of M&M Sum of BAJAJ-AUTO Sum of MARUTI
Sum of HUL Sum of ITC Sum of NESTLEIND

The range of Nestle, Maruti and Ultratech Cement has increased by 3241.6, 5649.45 and 8087 respectively.
It sends a green signal to short-term investors who are well-versed in trading, signalling good trading profits.
The aforementioned number is an absolute value that takes both price increase and price decrease into
account while ignoring the market price per share of different companies in the study. The question of why
Grasim, ITC, and Hindustan Unilever will have the smallest range calls for additional investigation of the
businesses to clarify the situation.

IJCRT2306678 International Journal of Creative Research Thoughts (IJCRT) www.ijcrt.org f914

www.ijcrt.org © 2023 IJCRT | Volume 11, Issue 6 June 2023 | ISSN: 2320-2882

Figure 2: Changes in share price of companies from 2018-2022

∆P_SUM FROM 2018 - 2022

12000 10629.4
10000
8000
6000
4000 2530.4
1775
2000 615 827.6 1125.15
192.75
0
-2000 -480.35 Total -29.65

Sum of GRASIM Ltd Sum of L&T Sum of ULTRACEMCO

Sum of M&M Sum of BAJAJ-AUTO Sum of MARUTI
Sum of HUL Sum of ITC Sum of NESTLEIND

In contrast to Range, Ultratech Cement has better positive returns of 2530.5 compared to Maruti Suzuki, with
practically identical per share price. This means that Ultratech Cement would provide better returns for
traders and investors who are looking to make short-term investments. The leader is still Nestle. Based on its
price per share and potential for strong gains, Grasim & Hindustan Unilever also provides a favourable
indicator for trading as middle-range equities.

Figure 3: Mean of FMCG companies from 2018-2022

∆P_MEAN FROM 2018 - 2022

50
43.0274
40

30

20
10.136
10 7.0945
2.461 3.2933 4.5459
0.7436
0
-1.9667 Total -0.123
-10

Sum of GRASIM Ltd. Sum of L&T Sum of ULTRACEMCO

Sum of M&M Sum of BAJAJ-AUTO Sum of MARUTI
Sum of HUL Sum of ITC Sum of NESTLEIND

IJCRT2306678 International Journal of Creative Research Thoughts (IJCRT) www.ijcrt.org f915

www.ijcrt.org © 2023 IJCRT | Volume 11, Issue 6 June 2023 | ISSN: 2320-2882

Figure 4: Standard Deviation of FMCG companies from 2018-2022

∆P_STDV. FROM 2018 - 2022

1200
992.29736
1000
800 663.75106
600
422.94401
400 247.76491
200 115.97358 135.76085 119.5221 140.84344
23.29252
0
Total

Sum of GRASIM Ltd. Sum of L&T Sum of ULTRACEMCO

Sum of M&M Sum of BAJAJ-AUTO Sum of MARUTI
Sum of HUL Sum of ITC Sum of NESTLEIND

The standard deviation indicates the deviation of the data from the mean. The chances to earn an abnormal
profit increase with the size of the deviation of the data from its mean. For short-term dealers and sellers, it is
better. Maruti's shares have shown a declining trend from 2018 till 2020 and an improvement in its
fundamentals thereafter also the sum and mean is not as good as Ultratech but its range and standard
deviation are high, so short-term traders should keep an eye on Maruti's shares. Ultratech cement's standard
deviation is lesser than Maruti's, but its sum and mean are larger which gives a better prospect for earning in
the long term. With the range and standard deviation in the grey, Bajaj Auto and Hindustan Unilever are
providing an indicator that more investing research is required before investing. Nestle is a winner with high
range, sum, mean and standard deviation and the fundamental score in 2021-22 has also improved to 8 out of
10 thus worth tracking for long-term investment.

Limitations

1. The study is conducted on a few industries.

2. For descriptive statistics, variation in market price per share of different companies has been omitted
which can affect the interpretation.

CONCLUSION:

The study concludes that there is very little to no correlation between F_Decile and market price movement
calculated using descriptive statistics, but when both F_Decile and Statistics are examined separately, they
provide information about the past performances and potential of the companies. The study emphasises the
fact that trading or investing only based on a company's fundamentals would not produce the desired profits,
and potential investors should therefore conduct additional research before making an investment. Investors
examine a variety of technical analysis techniques as a result of the descriptive statistics of the change in
share price, which also provide indications about share price fluctuations.

The fact that the strong fundamental of a company is a prerequisite that cannot be ignored thus the F_Decile
used in the study is a very helpful tool for traders and investors to select the least risky company and
safeguard their investments. The study has left room for further research into the technical and statistical
analysis and the degree of relationship between them to determine the future change in the share price.

IJCRT2306678 International Journal of Creative Research Thoughts (IJCRT) www.ijcrt.org f916

www.ijcrt.org © 2023 IJCRT | Volume 11, Issue 6 June 2023 | ISSN: 2320-2882

The study also included some statistical analysis of how market prices fluctuate daily. The range made it
easier to understand how the share price fluctuated annually. The sum and mean assisted in identifying the
share that has the most potential to generate abnormal returns, and the standard deviation assisted in
identifying the degree of price variation. The more deviation there is in the changing share price, the higher
the earnings will be, particularly for short-term profit booking. Descriptive statistics are thus a helpful tool to
gauge how the share price has changed.

REFERENCES

Bülow, S. (2017). The effectiveness of fundamental analysis on value stocks–an analysis of Piotroski’s f-
score.

Burton, N. (2018). An analysis of Burton G. Malkiel's A random walk down Wall Street. CRC Press.

Chelimo, J. K., & Kiprop, S. K. (2017). Effect of dividend policy on share price performance: a case of listed
insurance companies at the Nairobi securities exchange, Kenya. International Journal of Accounting, Finance
and Risk Management, 2(3), 98-106.

Elbialy, B. A. (2019). The effect of using technical and fundamental analysis on the effectiveness of
investment decisions of traders on the Egyptian stock exchange. International Journal of Applied
Engineering Research, 14(24), 4492-4501.

Graham, B., Dodd, D. L. F., & Cottle, S. (1934). Security analysis (Vol. 452). New York: McGraw-Hill.

Kourtis, G. P., Κourtis, E. P., Kourtis, M. P., & Curtis, P. G. (2017). Fundamental analysis, stock returns and
high B/M companies.

Malkiel, B. G. (1999). A random walk down Wall Street: including a life-cycle guide to personal investing.
WW Norton & Company.

Shostak, F. (1997). In defense of fundamental analysis: A critique of the efficient market hypothesis. The
Review of Austrian Economics, 10(2), 27-45.

Suresh, A. S. (2013). A study on fundamental and technical analysis. International Journal of Marketing,
Financial Services & Management Research, 2(5), 44-59.

IJCRT2306678
View publication stats
International Journal of Creative Research Thoughts (IJCRT) www.ijcrt.org f917