Report

PERFORMANCE OF PORTFOLIO
EXECUTIVE SUMMARY
The core objective of the study is to test the performance of portfolio of selected stock in compression with market index. One of the most important features of the portfolio management is to minimize the risk and maximize the return. One of the most important functions of the market index is to show, in which direction the set of scripts are heading towards. The market index as a bench mark against which, the investor evaluate the performance of their own or institutional portfolio. In this study CNX NIFTY is the bench mark for evaluation of portfolio performance for a period of one month. The study is of one month from 1st April 2010 to 30st April 2010. The monthly closing price of seven companies of seven different industries was taken for the calculation of risk and return and various analysis techniques like standard deviation, correlation, co-efficient of variation, beta, portfolio risk, CAPM etc to analysis the performances of stocks and portfolios. Objectives of the study: To study the technique associated with the security Analysis and portfolio management. Construction of portfolio for different categories of investors (i.e. aggressive, conservative and moderate)understanding the performance of portfolio with selected securities in comparison with market index.
RJS Institute Of Management Studies Bangalore - 34
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Method of data collection: The study requires both primary and secondary data. Primary data will be collected from the investors, fund managers and financial advisors. Secondary data will be collected from News papers, Websites Textbooks and journals.\ Analytical techniques used for testing the selected stocks and portfolio performance are correlation, beta, coefficient of variation, return and risk. Limitation the study:
Difference in definitions. Performance of the portfolio is considered only for a period of one month. The research work does not considered other type of securities such as Debentures, short term and long term loans etc. Accuracy of testing the performance of selected securities in comparison with market index depends on the experience of the researcher. Here the researcher lacks in it.
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CHAPTER-I INTRODUCTION
Now a days investing in market is like playing with money. So investor should take appropriate precautions before investing in the market. They should do some kind of analysis like calculating risk and return from available information in the market. During economy slow down, most of the investor did not know why it has happen, how it has happened, simple they lost their money. Most of investor not aware of much basic information relating to financial maker functions which has made them to burn their fingers. Financial market main function is to mobilize the resource where it has plenty and lend the same to need people for effective use. So investment opportunities are more but selecting appropriate one is very important. If we keep our whole saving in bank, we will get 3.5% p.a which less than the inflation; it means we are loosing our purchasing power every day. Investing in financial market is still very attractive if we do systematic planning and implementation. INTRODUCTION TO PORTFOLIO MANAGEMENT Portfolio: In finance, a portfolio is an appropriate mix of or collection of investments held by an institution or a private individual. Holding a portfolio is part of an investment and risklimiting strategy called diversification. By owning several assets, certain types of risk (in particular specific risk) can be reduced. The assets in the portfolio could include stocks, bonds, options, warrants, gold certificates, real estate, futures contracts, production facilities, or any other item that is expected to retain its value.
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PERFORMANCE OF PORTFOLIO Portfolio Management:
Portfolio management involves deciding what assets to include in the portfolio, given the goals of the portfolio owner and changing economic conditions. Selection involves deciding what assets to purchase, how many to purchase, when to purchase them, and what assets to divest. These decisions always involve some sort of performance measurement, most typically expected return on the portfolio, and the risk associated with this return (i.e. the standard deviation of the return). Typically the expected returns from portfolios of different asset bundles are compared. The unique goals and circumstances of the investor must also be considered. Some investors are more risk averse than others
Statement of the problem:

To minimize the risk and maximize the return As there are no of alternatives are available to an investor, the question arises here is where, When and how much to invest to get the maximum returns wit minimum risk. Ultimately everything depends up on the risk bearing capacity of the investor.
Several investors have gained as well as lost in the stock market. One way to determine the stock price is fundamental analysis, which in turn is composed of economy, industry and company. The other way is technical analysis, which says that the past trends will repeat in the future. The question that arises here is that weather security movies with the market index, so that losses and gains can be estimated with the movement of the market index. The security analysis is done by calculating Mean, Standard Deviation, and C.V to know whether security is feasible to buy or sell. The relationship between the security and market index is done by moving average tests.
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Objectives of the study:

The main objective of the study is to test the performance of the portfolio for a period of one month with different number of securities of different sectors. Mean while to know the opinion of the investors about the performance of their own portfolio during recession period and their expectations on their portfolio. With the above all objectives the study has even the following objectives. To study the technique associated with the security Analysis. Construction of portfolio for different categories of investors Understanding the performance of portfolio with selected securities in comparison with market index. To study the investors perception towards portfolio. Application of theories of portfolio.
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Scope of the study:

One of the most important features of the portfolio management is to minimize the risk and maximize the return. One of the most important functions of the market index is to show, in which direction the set of scripts are heading towards. The market index as a bench mark against which, the investor evaluate the performance of their own or institutional portfolio. Market indices are one of the economic indicators, if the index is heading upwards, it shows that economy is on boom, investors purchasing power is high, and market is bullish. If index is heading downwards, it signifies slack period in the economy, in this period investor is bearish. If the historical data is projected it shows future trends, by the help of this, investor can forecast and take decisions accordingly to buy or to sell or to hold the securities. This research seeks to investigate and constructively contribute to help: Investors to have efficient portfolio. Highlight the Importance of the diversification of portfolio. It serves as a reference for further research.
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CHAPTER II RESEARCH DESIGN TITLE OF THE STUDY

EVALUATION OF PORTFOLIO PERFORMANCE AGAINST INDIVIDUAL STOCK PERFORMANCE AND CNX NIFTY PERFORMANCE
SCOPE OF THE STUDY

The scope of the study is restricted to only one months. Dialy closing price has been taken into account for analysis the performance of portfolio, individuals stock and Nifty. Only 7 sectors has been considered. The following are the 7 companies selected. State Bank of India - Banking Sector Ambuja Cement Cement Sector Ranbaxy Laboratories Pharmaceuticals Sector Delhi Land and Finance (DLF) Real Estate Mahindra and Mahindra Automobiles Hindustan Unilever Ltd (HUL) FMCG Tata Consultancy Services Information Technology OBJECTIVE OF THE STUDY: The core objective of the study is to test the performance of portfolio of selected stock in comparison with market index. One of the most important features of the portfolio management is to minimize the risk and maximize the return. Mean while to know the opinion of the investors about the performance of their own portfolio during recession period and their expectations on their portfolio. RJS Institute Of Management Studies Bangalore - 34 Page 7
PERFORMANCE OF PORTFOLIO One of the most important functions of the market index is to show, in which direction the set of scripts are heading towards. The market index as a bench mark against which, the investor evaluate the performance of their own or institutional portfolio. In this study CNX NIFTY is the bench mark for evaluation of portfolio performance for a period of one month. The following are the objectives; To study the technique associated with the security Analysis. Construction of portfolio for different categories of investors Understanding the performance of portfolio with selected securities in comparison with market index. To study the investors perception towards portfolio. Application of theories of portfolio.
Methodology:
1. Method of data collection The study requires both primary and secondary data. Primary data will be collected from the investors, fund managers and financial advisors. Secondary data will be collected from News papers, Websites Textbooks and journals. The study covers data collection period from 1st April2010 to 30st April2010. Based on the data various analysis are performed. The weekly closing price of seven companies of seven different industries was taken for the calculation of risk and return. 2. Analytical Techniques used for calculation Mean (return) Standard deviation Coefficient of variation Correlation Beta Risk
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3. Period of the study The period of the study will be one month. The portfolio duration will be for one month therefore the data of one month will be taken into consideration for the calculation.
4. Limitation Sincere attempts have been made during the research work, certain limitations cannot be avoided, and they are: Difference in definitions. Performance of the portfolio is considered only for a period of one month. The research work does not considered other type of securities such as Debentures, short term and long term loans etc. Risk Measurement cannot assure of cent percent accuracy because risk is caused by numerous factors such as social, political, economic and managerial efficiency. Measurement provides an approximate quantification of risk. Accuracy of testing the performance of selected securities in comparison with market index depends on the experience of the researcher. Here the researcher lacks it.
Expected conclusion
Total analysis of the project is aimed at the following conclusions. 1. When and which stock should buy in current market condition. 2. How different technique will be helpful for calculating risk and return. 3. How portfolio investment will be beneficial in minimizing risk and maximizing return. 4. What are the precautions should be taken into account before investing in any stock. 5. Why stock prices fluctuates daily in market.
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CHAPTER III COMPANY PROFILE

A Brief about PARSOLI CORPORATION Limited Parsoli groups online resource of information for its global activities. Parsoli Corporation Ltd is a public limited company listed on Bombay Stock Exchange & Ahmadabad Stock Exchange. It is a corporate member of the National Stock Exchange of India Ltd. Parsoli Corporation Ltd. was established on 21 November 1990 as Parsoli Investments & Trading Company Pvt. Ltd. to provide retail stock broking & financial services. The prime motivation to setup the company was to tap the vast and untapped potential Muslim investments in India. Parsoli Corporation Ltd is a public limited company listed on the Bombay Stock Exchange Ltd. The market capitalization of Parsoli Corporation Ltd is around USD 8 million to USD 10 million as on march 2010. Parsoli Corporation Ltd. (PCL) is approved by the Reserve Bank of India to carry on business of non banking financial company (without accepting public deposits). Parsoli is also a corporate member of the National Stock Exchange of India Ltd. and the Bombay Stock Exchange Ltd., providing Stock Broking and Stock Advisory services to its clients. It is also a Depository Participant (DP) with the Central Depository Services (India) Ltd. providing depository services to its clients. The business of the company has grown in leaps and bounds since its inception. Revenue of the company grew 15 times from FY03 to FY07. During the same period, profits of the company grew 146 times.
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MISSION To become a global service provider of Islamic Financial Solutions GOAL To create products and services designed to serve the special financial needs of the Muslims. Parsoli Corporation Ltd. is a Securities and Exchange Board of India (SEBI) registered Stock Broker. It is a Corporate member of the National Stock Exchange (NSE) of India Ltd. and the Bombay Stock Exchange Ltd. It is registered as Depository Participant (DP) of the Central Depository Services (India) Ltd. It is registered as a Non-Banking Finance Company (NBFC) with the Reserve Bank of India (RBI) It is also an RBI registered Full Fledged Money Changer It is Member of the Multi Commodities Exchange of India Ltd. (MCX) Parsoli Corporation Ltd. is a Public Limited Company listed on The Bombay Stock Exchange (BSE) Ltd. since 1995.
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The companys business strategy is: The Proposition
To Project Parsoli as an one-stop investment destination
The Positioning

The Muslim Community in India The Non-Resident Indian Muslims The Muslim Community around the World who are already active into investments in the Stock Market but rarely invest in India due to their lack of awareness of the Indian Market
The Plan

Building the brand on the existing goodwill of Parsoli Corporation. Developing the Community feeling. Building alliances with various partners like Mutual Fund Companies, Housing Finance Companies, Car Financing Companies. Educating Indian Muslims in relation to Stock Market investments, which are Sheridan Compliant.
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The team:
A committed and formidable management team anchors the company towards its goal and provides direction in diverse areas of business strategy, operating management, regulatory reporting, human resources development, product development etc.
LIST OF THE DIRECTORS AS ON 31-01- 2010 Sr. No 1 2 3 4 5 6 7 Name of Directors Designation Zafar Sareshwala Managing Director, CEO Uves Sareshwala Jt. Managing Director Talha Sareshwala Non Executive Director Mahesh Bhatt Non Executive Director Mohamad Iqbal Hava Non Executive Director Mushtaq Al Saleh Non Executive Director Sanjay D Shah Non Executive Director
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CHAPTER IV
THEORETICAL BACKGROUND OF DISCUSSION AND RESULTS
Fundamental analysis
Fundamental analysis of a business involves analyzing its financial statements and health, its management and competitive advantages, and its competitors and markets. The term is used to distinguish such analysis from other types of investment analysis, such as quantitative analysis and technical analysis. Fundamental analysis is performed on historical and present data, but with the goal of making financial forecasts. There are several possible objectives:

To conduct a company stock valuation and predict its probable price evolution, To make a projection on its business performance, To evaluate its management and make internal business decisions, To calculate its credit risk.
The intrinsic value of an equity share depends on a multitude factors. The earning of the company, the growth rate and the risk exposure of the company has a direct bearing on the price of the share. These factors in turn rely on the host of others factors like economic environment in which they function, the industry they belong to, and finally companys own performance. The study of Fundamental Analysis can be made by dividing into three factors. They are Economic Analysis Industry Analysis Company Analysis
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ECONOMIC ANALYSIS: The level of economic activity has an impact on investment in many ways. If the economy grows rapidly, the industry can also be expected to show rapid growth and vice versa. When the level of economic activity is low, stock rice are low and when the level of economic activity is high, stock price are high reflecting the prosperous outlook for sales and profits of the firms. The analysis of macroeconomic environment is essential to understand the behavior of the stock prices. Following are the factors: Gross domestic product (GDP) Savings and Investment Inflation Interest rates Budget The tax structure The balance of payment Monsoon and agriculture Infrastructure facilities Economic Forecasting INDUSTRY ANALYSIS Following are the factors that should be taken into account while analyzing the industries to predict future course of action would be undertaking in the particular sector. They are listed below: 1. Growth of the Industry 2. Cost structure and profitability 3. Nature of the product 4. Nature of the competition RJS Institute Of Management Studies Bangalore - 34 Page 15
PERFORMANCE OF PORTFOLIO 5. Government policies 6. Labor 7. Research and development COMPANY ANALYSIS: In the company analysis the investors assimilates several bits of information related to the company and evaluates the present and future value of the stock. The risk and return associated with the purchase of the stock is analyzed to take better investment decision. The valuation process depends upon the investors ability to elicit information from the relationship and inter-relationship among the company related variables. Factors that affects Present and Future values of share 1. The competitive edge of the company 2. Earning of the company 3. Capital structure 4. Management 5. Financial Analysis 6. Analysis of financial statement. TECHNICAL ANALYSIS: Technical analysis is a security analysis technique that claims the ability to forecast the future direction of prices through the study of past market data, primarily price and volume. In its purest form, technical analysis considers only the actual price and volume behavior of the market or instrument. Technical analysts, sometimes called "chartists", may employ models and trading rules based on price and volume transformations, such as the relative strength index, moving averages, regressions, inter-market and intra-market price correlations, cycles or, classically, through recognition of chart patterns.
Technical Tools:
1) Dow Theory: Dow developed his theory to explain the movement of the indices of Dow Jones Average. He developed the theory on the basis of certain hypothesis is that; no single individual or buyer can influence the major trend of the market. His RJS Institute Of Management Studies Bangalore - 34 Page 16
PERFORMANCE OF PORTFOLIO second hypothesis is that the market discounts everything. His third hypothesis is that the theory is not infallible. It is not a tool to beat the market but provides a way to understand it better. Primary Trend: The security price trend may either increasing or deceasing, when the market exhibits the increasing trend. It is called bull market. The reverse is true with the bear market. The Secondary Trend: The Secondary trend or the intermediate trend moves against the main trend and leads to correction. In the bull market the secondary trend would reset in fall of about 33-66% of the earlier rise. In the bear market, the secondary trend earlier the price upward and corrects the main trend. The correction would be 33%-66% of the earlier fall. Minor trend: Minor trends moves are called random wriggles. They are simply the daily price fluctuations. Minor trend tries to correct the secondary trend movement. 2) Moving Average: The market indices do not rise or fall in straight line. The upward and down ward movements are interrupted by counter moves. The underlying trend can be studied by smoothening of the data. To smooth the data moving average technique is used. The word moving means that the body of data moves ahead to include the recent observation. Charts: Charts are the valuable and easiest tools in the technical analysis. The graphical presentation of the data helps the investors to find out the trend of the price without any difficulty.
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CONSTRUCTION OF PORTFOLIO:
Portfolio is a combination of securities such as stocks, bonds and money market instrument.
The process of blending together the board asset classes so as to obtain optimum return with minimum risk is called portfolio construction. Diversification of investments helps to spread risk over many assets. A diversification of securities gives the assurance of obtaining the anticipated return on portfolio. In a diversified portfolio, some securities may not perform as expected, but others may exceed the expectation and making the actual return of the portfolio reasonably close to the anticipated one. Keeping a portfolio of single security may lead to a greater likelihood of the actual return somewhat different form that of the expected return? Hence, it is a common practice to diversify securities in the portfolio. APPROACHES IN PORTFOLIO CONSTRUCTION: Commonly, there are two approaches in the construction of the portfolio of securities viz. traditional approach and Markowitz efficient frontier approach. In the traditional approach, investors needs in terms of income and capital appreciation are evaluated and appropriate securities are selected to meet the needs of investor. The common practice in the traditional approach is to evaluate the entire financial plan of the individual. In the modern approach, portfolios are constructed to maximize the expected return for given level of risk. It views portfolios are constructed to maximizes the expected return and to minimize the risk associated with obtaining the expected return.
Steps involved in portfolio construction

Analysis of constraints Determination of objectives Selection of portfolio Assessment of risk and return Diversification
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Chart showing steps in portfolio construction
Analysis of constrains
Determination of Objectives
Selection of Portfolio
Bond and Common stock
Bond
Common stock
Assessment of risk and return

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Diversification
Analysis of constraints: The constraints normally discussed are, income needs, liquidity, time horizon, safety, tax considerations and the temperament.
Income needs The income depend on the for income in constant rupees and current
rupees. The need for income in current rupees arises from the investors need to meet all or part of the living expenses. At the same time information may erode the purchasing power, the investor may to offset the effect of the inflation and so, needs income in constant rupees. Liquidity: Liquidity need of the investment is high quality individualistic of the investor. If the investor prefers to have high liquidity, then funds should be inverted in high quality short term debt maturity issues such as money market funds, commercial papers and shares that are widely traded. Keeping the funds in shares that are poorly trader or stocks in closely held business and real estate lack liquidity. Then investor should plan his cash drain and the need for net cash inflows during the investment period. Safety of the principal: Another serious constraint to be the considered by the investor is the safety of the principal value at the time of liquidation. Investing in bonds and debenture is safer than investing in the stocks. Even among the stocks, the money should be invested in regularly traded companies of longstanding. Investing money in the unregistered finance companies may not provide adequate safety. Time horizon Time horizon is the investment-planning period of the individuals. This varies from individual to individual. Individuals risk and preferences are often described in terms of his Life cycle The stages of the life cycle determine the nature of investment.
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PERFORMANCE OF PORTFOLIO Tax consideration Investor in the income tax paying group consider the tax concessions they could get from their investments. For all practical purpose, they would like to reduce the taxes. For income tax purpose, interest and dividends are taxed under the head income from other source. The capital appreciation is taxed under the head capital gains only when the investor sells the realizes the gain. Temperament The temperament of the investor himself poses a constraint on framing his investment objectives. Some investors are risk lovers or takers who like to take up higher risk even for low return. While some investors are risk averse, who may not be willing to undertake higher level of risk even for higher level of return. DETERMINATION OF OBJECTIVES Portfolios have the common objectives of financing present and future expenditures from a large pool of assets. The return that the investor requires and the degree of risk he is willing to take depend upon the constraints. The objectives of portfolio range from income to capital appreciation. The common objectives are stated below Current income Growth in income Capital appreciation preservation of capital SELECTION OF PORTFOLIO The selection of portfolio depends on the various objectives of the investor. The selections of portfolio under different objectives are dealt subsequently. Objectives and asset mix If the main objective is getting adequate of current income, sixty percent of the investment is made on debts and 40 percent on equities. The proportions of investments on debt and equity differ according to the individuals preferences. Growth of income and asset mix Here the investor a certain percentage of growth in the income received from his investment. The investors portfolio may consist of 60 to 100 RJS Institute Of Management Studies Bangalore - 34 Page 21
PERFORMANCE OF PORTFOLIO percent equities and 0 to 40 percent debt instrument. The debt portion of the portfolio may consist of concession regarding tax exemption.
Capital appreciation and asset mix Capital appreciation means that the value of the original investment increases over the years. Investment in real estate like land and house may provide a faster rate of capital appreciation but they lack liquidity. In the capital market, the values of the shares are much higher than their original issue prices. Safety of principal and asset mix Usually, the risk averse investors are very particular about the stability of principal. According to the life cycle theory, people in the third stage of life also give more importance to the safety of the principal. Risk and return analysis The traditional approach to portfolio building has some basic assumptions. First, the individual prefers larger to smaller returns from securities. To achieve this goal, the investor has to take more risk. The ability to achieve returns is dependent upon his ability to judge risk and his ability to take specific risks. The risks are namely interest rate risk, purchasing power risk, financial risk and market risk. Diversification Once the asset mix is determined and the risk and return are analyzed, the final step is the diversification of portfolio. Financial risk can be minimized by commitments to top-quality bonds, but these securities offer poor resistance to inflation. Stocks provide better inflation protection than bonds but are more vulnerable to financial risks.
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Portfolio Diversification
in finance is a risk management technique, related to hedging, that mixes a wide variety of investments within a portfolio. Because the fluctuations of a single security have less impact on a diverse portfolio, diversification minimizes the risk from any one investment. There are three primary strategies used in improving diversification: 1. Spread the portfolio among multiple investment vehicles , such as stocks, mutual funds, bonds, and cash. 2. Vary the risk in the securities. A portfolio can also be diversified into different mutual fund investment strategies, including growth funds, balanced funds, index funds, small cap, and large cap funds. When a portfolio includes investments with varied risk levels, large losses in one area are offset by other areas. 3. Vary your securities by industry, or by geography . This will minimize the impact of industry- or location-specific risks.
Horizontal diversification
Horizontal diversification is when a portfolio is diversified between same-type investments. It can be a broad diversification (like investing in several NASDAQ companies) or more narrowed (investing in several stocks of the same branch or sector). In the example above, the move to invest in both umbrellas and sunscreen is an example of horizontal diversification. As usual, the broader the diversification the lower the risk from any one investment.
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Vertical diversification
Vertical diversification is investment between different types of securities. Again, it can be a very broad diversification, like diversifying between bonds and stocks, or a more narrowed diversification, like diversifying between stocks of different branches.
STATE BENK OF INDIA (SBI)

Industry CEO Face value : finance-bank-public sector : Om Prakash Bhatt : 10 Business group : SBI group
On 1st July State Bank of India was constituted under the State Bank of India Act 1955, for the purpose of taking over the undertaking and business of the Imperial Bank of India. The Imperial Bank of India was founded in 1921 under the Imperial Bank of India Act 1920. The Bank transacts general banking business of every description including, foreign exchange, merchant banking and mutual funds. Today, it has a branch network of over 9000 branches, an aggregate deposit base of nearly Rs196821 crore (US$45,121mm) and a total balance sheet size of Rs.261504 crore (US59, 950 mm). Together with its 7 Associate Banks, SBI commands about 30% of the market share in banking. State Bank of India: Yearly High lows Year 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 High 1376.4 2540 2475.25 1378.7 952.85 689.2 552.25 306 276 293 Low 1031.05 991.1 845 684.15 552.5 399.95 266.65 182.7 139.85 155.1 Page 24
PERFORMANCE OF PORTFOLIO State Bank of India has rolled out a micro insurance scheme 'Grameen Shakti', for its Self Help Group (SHG) members. The product was launched on Nov 26 at the Tamil Nadu Agricultural University.
AMBUJA CEMENT
Industry Business Group CEO Face Value : Cement Major : Ambuja Group : Mr. Suresh Neotia :2
The Company was incorporated on 17th June 1982, and the Certificate of Commencement of Business was obtained on 11th February, 1983. It was promoted by Modi Industrial House and Madhya Pradesh Audyogik Vikas Nigam Ltd (MPAVN). The Company manufactures cement. The Company had under taken to set up a project to manufacture Portland cement in Madhya Pradesh. The main plant and machinery was obtained from Polysius Ltd U K and their Indian associates Buckau Wolf India Ltd. consultancy services. 1991 The Company's plan to expand the capacity from 11.5 lakh tonnes to 18 lakh tonnes. Subject to necessary approvals being obtained, the company proposed to issue 458, 00,920 rights equity shares of Rs. 10 each at a premium not exceeding of Rs. 2 per share in the proportion 1:1. In addition to the above rights issue, 5% of the rights issue at a premium not exceeding Rs. 2 per share was to be offered to the employees, etc., AMBUJA CEMENT Yearly High lows:
Year 2009 2008 2007 2006 2005 2004 2003 High 79.20 149.85 160.90 148.00 468.80 407.00 315.00 Low 65.55 43.00 99.80 77.00 49.40 250.00 147.00
The Company entered into a foreign
collaboration agreement with Blue Circle Industries PC., U.K. (BCI) for technical
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2002 2001 254.00 216.50 146.00 136.30
RANBAXY LABORATORIES LTD

Industry CEO Face Value : Pharmaceuticals : Mr. Atul Sobti :5 Business Group : Ranbaxy Group
The Company was incorporated on 16th June, 1961 at Delhi. The Company Manufacture drugs, medicines, cosmetics and chemical products. The company also markets a wide range of products including a number of life saving antibiotics. The shareholders of the Company offered for sale to the public during October simultaneously with the public issue of shares 63,535 equity shares of Rs 10 each of the Company at par. The Company had set up a joint venture company with local participation in Nigeria. The equipments to be supplied against the Companys contribution to the equity capital were ordered. These were shipped during 1978 and were received and installed in Nigeria. Production commenced in early 1980. Ranbaxy Laboratories Ltd.: Yearly High lows Year 2009 2008 2007 2006 2005 2004 2003 2002 2001 High 257.70 613.70 490.00 530.00 1265.00 1300.00 1146.00 936.95 774.90 Low 161.15 164.30 305.50 317.10 340.05 860.00 581.50 485.05 412.00
DELHI LAND AND FINANCE PRIVATE LIMITED (DLF)

Industry CEO Face Value
: Construction and Contracting - Real Estate : Mr. Pua Seck Guan :2
Business Group : DLF Group
It was founded by the late Mr. Raghvendra Singh and our Promoter, Mr. K P Singh. It has a history of over 6 decades, commencing with the incorporation of Raisina Cold Storage and Ice Company Private Limited on 16.03.1946 and Delhi Land and Finance Private Limited on 18.09.1946. Pursuant to the order of the Delhi High Court dated 26.10.1970, Delhi Land and Finance Private Limited and Raisina Cold Storage and Ice Company Private Limited along with another group company, DLF Housing and Construction Private Limited, merged with DLF United Private Limited with effect from 30.09.1970. In the year 2007 DLF enters into a joint venture with Prudential Insurance to establish a joint venture company to undertake life insurance business in India.
Yearly High lows: Year 2009 2008 2007 High 310.00 1225.00 1099.00 Low 145.00 158.00 505.60
MAHINDRA & MAHINDRA (M&M)

Industry : Auto - Cars & Jeeps Page 27 RJS Institute Of Management Studies Bangalore - 34
PERFORMANCE OF PORTFOLIO Business Group : M & M Group CEO Face Value : Mr.Anand G Mahindra :10
The Company was incorporated in 1945 and converted into Public Limited in 1955 at Mumbai. The Company Manufacture Jeep type vehicles, petrol industrial engines, industrial process control instruments and flow meters. Trading in steel and manufacture of professional grade electronic components. Jeeps are manufactured under a license and an agreement with Willys Motors Inc., Toledo, Ohio, U.S.A., for whom the Company also acts as exclusive distributors for the whole of India for their entire range of vehicles including utility vans, cargo/personnel carriers and pick-up trucks With effect from 1st April, the wholly owned subsidiary Mahindra Engineering Co. Ltd., was merged with the Company. International Tractor Company of India Ltd., was merged with the Company effective from 1st November 1977.The name was changed from Mahindra Van Wijk & Visser Ltd. to Mahindra & Mahindra Ltd. This was merged with the Indian National Diesel Engine Co., Ltd., during 1977-78. M&M Yearly High lows Year 2009 2008 2007 2006 2005 2004 2003 2002 High 330.00 872.00 1002.00 909.95 730.50 558.00 390.25 140.00 Low 258.80 235.50 608.00 488.00 345.00 358.00 94.15 78.75
HINDUSTAN UNILEVER LTD (HUL)
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PERFORMANCE OF PORTFOLIO Industry CEO Face Value : FMCG : Mr.Nitin Paranjpe :1
Business Group : MNC Associate
Incorporated on 17th October 1933, under the name of a Lever Brothers (India) Pvt., Ltd. (LBIL) was the wholly owned subsidiary of Unilever Ltd. London, UK. 1888, less than four years after William Hesketh Lever launched Sunlight Soap in England, his newly-founded company, Lever Brothers, started exporting the revolutionary laundry soap to India. By the time the company merged with the Netherlands-based Margarine Unie in 1930 to form Unilever, it had already carved a niche for itself in the Indian market. Coincidentally, Margarine Unie also had a strong presence in India, to which it exported Vanaspati (hydrogenated edible fat). On 27th October, the Co. was converted into a Public Ltd. Co. On 1st November, Hindustan Vanaspati Mfg. Co. Pvt. Ltd., William Gossage & Sons (India) Pvt. Ltd. and Joseph Crosfield & Sons Unilever Ltd. were amalgamated with LBIL and the name was changed to Hindustan Lever Ltd. Yearly High lows:
Year High Low
2009 2008 2007 2006 2005 2004
267.00 267.00 230.40 296.00 186.00 218.00
239.10 170.00 166.00 179.90 126.30 104.00
TATA CONSULTANCY SSERVICES (TCS)

Industry : Computers - Software
Business Group : Tata Group RJS Institute Of Management Studies Bangalore - 34 Page 29
PERFORMANCE OF PORTFOLIO CEO Face Value : N. Chandrasekaran :1
TCS has spread its operations into the Asia-Pacific by setting up a regional headquarters in Singapore to focus primarily on the emerging infocomm industry in the region. TATA Consultancy Services (TCS), the global software solutions and consulting services major, has entered into a multi-year collaborative agreement with the Hyderabad-based Centre for DNA Fingerprinting and Diagnostics (CDFD), a leading R&D laboratory under the Department of Biotechnology. Tata Consultancy Services (TCS) becomes country's first IT Company to cross the billion mark as it closed fiscal 2005 with Rs 9,748.47 crore in revenues. At Rs 1,976.90 crore in net profit, it is also the first software giant to cross 0 million in net profit. Tata Consultancy Services made its debut on the two premier stock exchanges on August 25, closing around 16 per cent higher than the issue price of Rs 850 per share discovered through book building on a price range of Rs 775 to Rs 900 per share Yearly High lows:
Year High Low
2009 2008 2007 2006 2005 2004
556.90 1078.00 1399.00 2099.00 1505.00 1338.00
466.20 418.00 935.00 900.00 1091.00 958.55
DEFINITION OF CONCEPTS
Stock market: The financial market for small, medium and long term securities.
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PERFORMANCE OF PORTFOLIO Market index: A stock index is a number that helps measure the levels of the market. Stock index is a derivative asset because it derives its existence and value from independent stocks issued by corporations
Portfolio: A combination of assets. In finance, a portfolio is an appropriate mix of or collection of investments held by an institution or a private individual.
Risk: Risk is a concept that denotes the precise probability of specific eventualities. Expressing the risk of a stock in quantitative terms makes it comparable with other stocks. Measurement cannot assured of cent percent accuracy because risk is caused by numerous factors such as social, political, economic and managerial efficiency. Measurement provides an approximate quantification of risk. The statistical tool used to measure and used as a proxy for risk is the standard deviation.
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Standard Deviation: SD is the statistical tool often used to measure and used as a proxy for risk. It is the measure of the values of the variables around its mean or it is the square root of the sum of the squared deviations from the mean divided by the number of observations. Formula used to calculate SD is as follows. Standard deviation= Correlation Analysis: It is the statistical tool used to describe the degree to which one variable is linearly related to another. It can be calculated by using the following formula.
Coefficient of variation: coefficient of variation is the indicator of variations in the stock prices. The stock with more variations in the prices is considered as the more risky stock. The formula used to find out CV is as follows.
Beta: Beta is the slope of the characteristic regression line. Beta describes the relationship between the stocks return and index return = n XY-(x) (y) nX2-(X) 2
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S no
Beta
Description
Indication
One percent change in market index It indicates that the stock moves 1. +1 return causes exactly 1% change in in tandem with the market the stock return. One percent change in market return The 2. + 0.5 return. One percent change in market return The stock is more volatile. 3. + 2.0 causes 2% change in stock return. stock is less volatile
causes 0.5% change in the stock compared to the market.
Stock with a Negative beta of -1 The stock moves in the opposite 4. would provide a return of 10%, if the direction to the market return. -1.0 market return declines by 10% and vice versa.
Aggressive portfolio: The aggressive portfolio consists of common stocks which yield high return with high risk. The aggressive portfolios returns more volatile because the prices generally fluctuate.
Conservative portfolio: The conservative portfolio consists of common stocks which yield low return with low risk.
Moderate portfolio: The moderate portfolio consists of stocks with moderate return and risk.
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CHAPTER-V ANALYSIS AND INTERPRETATION

TABLE SHOWING THE PERFORMANCE OF SBIN (For the month of April) Date 01-Apr-10 05-Apr-10 06-Apr-10 07-Apr-10 08-Apr-10 09-Apr-10 12-Apr-10 13-Apr-10 15-Apr-10 16-Apr-10 19-Apr-10 20-Apr-10 21-Apr-10 22-Apr-10 23-Apr-10 26-Apr-10 27-Apr-10 28-Apr-10 29-Apr-10 30-Apr-10 Index return S&P CNX NIFTY 4586.9 4429.9 4550.95 4655.25 4637.7 4583.4 4484 4517.8 4356.15 4251.4 4313.6 4235.25 4247 4292.95 4241.85 4375.5 4390.95 4291.1 4340.9 4348.85 Close price of SBIN 2,102.60 2,138.25 2,056.00 2,076.00 2,095.90 2,106.10 2,092.00 2,093.95 2,054.05 2,047.70 2,032.45 2,098.35 2,105.80 2,115.40 2,200.60 2,251.55 2,217.80 2,232.20 2,274.00 2,350.70 42,741.40 Y=y-2137.07 -34.47 1.18 -81.07 -61.07 -41.17 -30.97 -45.07 -43.12 -83.02 -89.37 -104.62 -38.72 -31.27 -21.67 63.53 114.48 80.73 95.13 136.93 213.63 Y 1188.181 1.3924 6572.345 3729.545 1694.969 959.1409 2031.305 1859.334 6892.32 7986.997 10945.34 1499.238 977.8129 469.5889 4036.061 13105.67 6517.333 9049.717 18749.82 45637.78 143903.9
Table No. 1
Chart No1 Analysis and Interpretation of SBI

PERFORMANCE OF PORTFOLIO Mean = 2137.07 Standard deviation = 84.82 Co-efficient of Variation = -3.28 Correlation= -0.27 Return= 11.7996 Beta= -0.36 Mean: The average closing price is 2137.07 for the month of April. There is no high fluctuation in the closing prices other than 19th, 26th, 29th and 30th of April. Standard deviation: Standard deviation is the indicator of the risk associated with the return of the shares, in this standard deviation is 84.82.The reason being, the deviation of prices of share, from the mean. Co-efficient of Variation: The CV is -3.28; this shows that the prices are not fluctuating to a greater extent compared to the variation in the price of other shares in the portfolio. We can see more fluctuation only on 19th, 26th, 29th and 30th of these days and in remaining days it has less variation. Correlation: this stock is negatively correlated with the index. Return: The return is 11.7996%. This shows that it is giving Moderate returns in the portfolio. Beta: Beta -0.36 indicates that the stock moves in the opposite direction to the market return. Suitability: These kinds of stocks are preferable for Aggressive investors. Because it has moderate return and high risk.As most of the investors choose the stock on the basis of risk and return.
TABLE SHOWIGN THE PERFORMANCE OF M&M
(For the month of April) RJS Institute Of Management Studies Bangalore - 34 Page 35
PERFORMANCE OF PORTFOLIO Index return S&P CNX NIFTY 4586.9 4429.9 4550.95 4655.25 4637.7 4583.4 4484 4517.8 4356.15 4251.4 4313.6 4235.25 4247 4292.95 4241.85 4375.5 4390.95 4291.1 4340.9 4348.85 Close price of M&M 374.95 374.5 371 376.15 372.15 375.75 379.4 375.5 374 374.95 380.75 388.5 395.8 406.2 417.35 437.6 445.55 447.1 440.9 468.25 7976.35
Date 01-Apr-10 05-Apr-10 06-Apr-10 07-Apr-10 08-Apr-10 09-Apr-10 12-Apr-10 13-Apr-10 15-Apr-10 16-Apr-10 19-Apr-10 20-Apr-10 21-Apr-10 22-Apr-10 23-Apr-10 26-Apr-10 27-Apr-10 28-Apr-10 29-Apr-10 30-Apr-10
Y=y-398.81 -23.8675 -24.3175 -27.8175 -22.6675 -26.6675 -23.0675 -19.4175 -23.3175 -24.8175 -23.8675 -18.0675 -10.3175 -3.0175 7.3825 18.5325 38.7825 46.7325 48.2825 42.0825 69.4325
Y 569.6575563 591.3408063 773.8133063 513.8155563 711.1555563 532.1095563 377.0393063 543.7058063 615.9083063 569.6575563 326.4345563 106.4508063 9.10530625 54.50130625 343.4535562 1504.082306 2183.926556 2331.199806 1770.936806 4820.872056 19249.16638
Table No. 2
Chart No 2
Analysis and Interpretation of M&M

Mean = 398.81 Standard deviation = 31.02 Co-efficient of Variation = -12.14 RJS Institute Of Management Studies Bangalore - 34 Page 36
PERFORMANCE OF PORTFOLIO Correlation= -0.45 Return= 24.83 Beta= -1.33 Mean: The average closing price of this stock is 398.81. There is no fluctuation except 30 th of the April month. Standard deviation: It has SD of 31.02. This indicates that the stock is risky. Co-efficient of Variation: CV is -12.1394 this indicates that, this stock has much variation. It has high fluctuations in all the days of the month except 20th, 21st & 22nd of April. Correlation: The correlation is -0.4674. This stock is negatively correlated with the index. Return: Return is 24.83. This stock is giving highest returns among the securities giving positive returns. Beta: Beta -1.33 indicates that the stock moves in the opposite direction to the market return. Suitability: This kind of stock is most preferable for Aggressive investors. It is suitable for them in all the angles, risk, return, beta and variation.
TABLE SHOWIGN THE PERFORMANCE OF HUL (For the month of April) Index return S&P Close price of Y=y-225.51 CNX NIFTY HUL 4586.9 230.4 4.8845 4429.9 229.1 3.5845
Date 01-Apr-10 05-Apr-10
Y 23.8583402 12.8486402
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06-Apr-10 07-Apr-10 08-Apr-10 09-Apr-10 12-Apr-10 13-Apr-10 15-Apr-10 16-Apr-10 19-Apr-10 20-Apr-10 21-Apr-10 22-Apr-10 23-Apr-10 26-Apr-10 27-Apr-10 28-Apr-10 29-Apr-10 30-Apr-10 4550.95 4655.25 4637.7 4583.4 4484 4517.8 4356.15 4251.4 4313.6 4235.25 4247 4292.95 4241.85 4375.5 4390.95 4291.1 4340.9 4348.85 219.1 225 214.3 221.35 215.4 213 225.45 227 224.75 227.8 232.85 219.43 220.1 227.41 229.5 231.43 235.6 241.34 4510.31 -6.4155 -0.5155 -11.2155 -4.1655 -10.1155 -12.5155 -0.0655 1.4845 -0.7655 2.2845 7.3345 -6.0855 -5.4155 1.8945 3.9845 5.9145 10.0845 15.8245 41.1586403 0.26574025 125.78744 17.3513903 102.32334 156.63774 0.00429025 2.20374025 0.58599025 5.21894025 53.7948902 37.0333103 29.3276403 3.58913025 15.8762402 34.9813102 101.69714 250.4148 1014.9587
Table No. 3
Chart No 3
Analysis and Interpretation of HUL

Mean = 225.51 Standard deviation = 7.12 Co-efficient of Variation = -4.29 Correlation= -0.42 Return= 4.74 Beta= -0.47 Mean: The average closing price of this stock is 225.51. There is no much fluctuation at all.
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PERFORMANCE OF PORTFOLIO Standard deviation: It has SD of 7.12. This indicates that the stock is low risky. Co-efficient of Variation: CV is -4.29 this indicates that, this stock has more variation. Correlation: The correlation is -0.4212. This stock is negatively correlated with the index. Return: Return is 4.7483. This stock is giving lowest returns among the securities giving positive returns. Beta: Beta -0.4724 indicates that the stock moves in the opposite direction to the market return. Suitability: This kind of stock is most preferable for conservative investors. It is suitable for them in all the angles, risk, return, beta and variation all these are preferable for conservative investors.
TABLE SHOWIGN THE PERFORMANCE OF DLF (For the month of April)

Date 01-Apr-10 05-Apr-10 06-Apr-10 07-Apr-10 08-Apr-10 09-Apr-10 12-Apr-10 13-Apr-10 Index return S&P CNX NIFTY 4586.9 4429.9 4550.95 4655.25 4637.7 4583.4 4484 4517.8 Close price of DLF 321.7 335.6 328.75 331.6 342.8 347 351.68 349 Y=y-328.829 -7.129 6.771 -0.079 2.771 13.971 18.171 22.851 20.171 Y 50.822641 45.846441 0.006241 7.678441 195.18884 330.18524 522.1682 406.86924
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15-Apr-10 16-Apr-10 19-Apr-10 20-Apr-10 21-Apr-10 22-Apr-10 23-Apr-10 26-Apr-10 27-Apr-10 28-Apr-10 29-Apr-10 30-Apr-10 4356.15 4251.4 4313.6 4235.25 4247 4292.95 4241.85 4375.5 4390.95 4291.1 4340.9 4348.85 343.7 330.25 325.6 325.9 330.4 325.35 337.4 322.95 316.05 306.95 301.5 302.4 6576.58 14.871 1.421 -3.229 -2.929 1.571 -3.479 8.571 -5.879 -12.779 -21.879 -27.329 -26.429 221.14664 2.019241 10.426441 8.579041 2.468041 12.103441 73.462041 34.562641 163.30284 478.69064 746.87424 698.49204 4010.8926
Table No. 4
Chart No 4 Analysis and Interpretation of DLF

Mean = 328.829 Standard deviation = 14.16 Co-efficient of Variation = 4.53 Correlation= 0.38 Return= -5.99 Beta= 0.50 Mean: The average closing price of this stock is 328.829. There is no fluctuation except 28 th, 29th & 30th of the month. Standard deviation: It has SD of 14.16%. This indicates that the stock is low risky. RJS Institute Of Management Studies Bangalore - 34 Page 40
PERFORMANCE OF PORTFOLIO Co-efficient of Variation: The CV is 4.5353. This stock has comparatively very less variations among the stocks of the portfolio. Correlation: this correlation is 0.38. This indicates that the prices of this stock and NIFTY are moving in the same direction to the extent of 38% and 62% in the opposite direction. Return: It has the negative return of -5.9993 for the month of April. It gave a positive return of 2.19 for the last month. It will be positive sign for the next month. Beta: Beta of this stock is 0.4989. This indicates that if there 1% change in the NIFTY returns; it causes 0.4989% change in the stock return. This indicates that the stock is less volatile. It is called as defensive stocks Suitability: This stock is preferable for long term investor. Even though the stock is giving negative return of -5.99 for the month of April, it had a positive return of 5.697 for last month; therefore these kinds of stocks are not preferable for short term investors.
TABLE SHOWIGN THE PERFORMANCE OF Ranbaxy (For the month of April)

Date 01-Apr-10 05-Apr-10 06-Apr-10 07-Apr-10 08-Apr-10 09-Apr-10 12-Apr-10 13-Apr-10 Index return S&P CNX NIFTY 4586.9 4429.9 4550.95 4655.25 4637.7 4583.4 4484 4517.8 Close price of RANBAXY 456.2 483.3 476.2 476.05 466.25 467.5 463.9 459.75 Y=y-459.82 -3.62 23.48 16.38 16.23 6.43 7.68 4.08 -0.07 Y 13.1044 551.3104 268.3044 263.4129 41.3449 58.9824 16.6464 0.0049
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15-Apr-10 16-Apr-10 19-Apr-10 20-Apr-10 21-Apr-10 22-Apr-10 23-Apr-10 26-Apr-10 27-Apr-10 28-Apr-10 29-Apr-10 30-Apr-10 4356.15 4251.4 4313.6 4235.25 4247 4292.95 4241.85 4375.5 4390.95 4291.1 4340.9 4348.85 454.6 449.7 446 443.2 450.7 455.05 455.05 445.15 447.05 443.1 467.35 490.3 9196.4 -5.22 -10.12 -13.82 -16.62 -9.12 -4.77 -4.77 -14.67 -12.77 -16.72 7.53 30.48 27.2484 102.4144 190.9924 276.2244 83.1744 22.7529 22.7529 215.2089 163.0729 279.5584 56.7009 929.0304 3582.242
Table No. 5
Chart No Analysis and Interpretation of Ranbaxy

Mean = 459.82 Standard deviation = 13.38 Coefficient of variation= 4.82 Correlation= 0.51 Return= 7.47 Beta= 0.53 Mean: The average closing price of this stock is 459.82. This is not having more fluctuations. Standard deviation: It has SD of 3.1304. This indicates that the stock is less risky. RJS Institute Of Management Studies Bangalore - 34 Page 42
Co-efficient of Variation: The CV is 4.82. This stock has comparatively less variations among the stocks of the portfolio. Correlation: The correlation is 0.51. This indicates that the prices of this stock and NIFTY are moving in the same direction to the extent of 51% and remaining 49% in the opposite direction. Return: Return is 7.47. This stock is giving moderate returns among the securities giving positive returns. Beta: Beta of this stock is 0.53. This indicates that if there is 1% change in the NIFTY return, it causes 53% change in the stock return. This indicates that the stock is less volatile. Suitability: This kind of stock is most preferable for conservative and moderate investors. It is suitable for them in all the angles, risk, return, beta and variation all these are preferable for conservative and moderate investors.
TABLE SHOWIGN THE PERFORMANCE OF AMBUJA (For the month of April)

Date 01-Apr-10 05-Apr-10 06-Apr-10 07-Apr-10 08-Apr-10 09-Apr-10 12-Apr-10 13-Apr-10 15-Apr-10 Index return S&P CNX NIFTY 4586.9 4429.9 4550.95 4655.25 4637.7 4583.4 4484 4517.8 4356.15 Close price of AMBUJA 118.1 118.8 116.95 109.4 119.6 112.9 107.8 111.6 119.6 Y=y-117.47 0.6275 1.3275 -0.5225 -8.0725 2.1275 -4.5725 -9.6725 -5.8725 2.1275 Y 0.393756 1.762256 0.273006 65.16526 4.526256 20.90776 93.55726 34.48626 4.526256
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16-Apr-10 19-Apr-10 20-Apr-10 21-Apr-10 22-Apr-10 23-Apr-10 26-Apr-10 27-Apr-10 28-Apr-10 29-Apr-10 30-Apr-10 4251.4 4313.6 4235.25 4247 4292.95 4241.85 4375.5 4390.95 4291.1 4340.9 4348.85 104.6 109.6 117.18 113.23 114.5 116.8 121.85 115.7 123.8 136.7 140.74 2349.45 -12.8725 -7.8725 -0.2925 -4.2425 -2.9725 -0.6725 4.3775 -1.7725 6.3275 19.2275 23.2675 165.7013 61.97626 0.085556 17.99881 8.835756 0.452256 19.16251 3.141756 40.03726 369.6968 541.3766 1454.063
Table No. 6
Chart No 6 Analysis and Interpretation of AMBUJA CEMENT

Mean = 117.47 Standard deviation = 8.52 Co-efficient of Variation = -2.99 Correlation= -0.14 Return= 19.17 Beta= -0.33 Mean: The average closing price is 117.47 for the month of April. There is not having more fluctuations. Standard deviation: the SD is 8.52 which is not much riskier compared to other stocks.
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PERFORMANCE OF PORTFOLIO Co-efficient of Variation: The CV is -2.99. There is no high fluctuation in the closing prices. And the stock has the moderate fluctuations in the month. Correlation: The correlation is -0.14. This stock is negatively correlated with the index Return: the return is 19.1701%. And the risk associated with this stock is 8. 52% which is giving higher returns and moderate risk compare to other stocks of the portfolio. Beta: beta of this stock is -0.3299 indicates that the stock moves in the opposite direction to the market return. Suitability: This kind of stock is most preferable for Aggressive and moderate investors. This stock has moderate risk and high return. .
TABLE SHOWING THE PERFORMANCE OF TCS (For the month of April)

Date 01-Apr-10 05-Apr-10 06-Apr-10 07-Apr-10 08-Apr-10 09-Apr-10 12-Apr-10 13-Apr-10 Index return S&P CNX NIFTY 4586.9 4429.9 4550.95 4655.25 4637.7 4583.4 4484 4517.8 Close price of TCS 807.8 803.35 796.05 798.05 799.45 791.6 798.1 820.85 Y=y-792.09 15.71 11.26 3.96 5.96 7.36 -0.49 6.01 28.76 Y 246.8041 126.7876 15.6816 35.5216 54.1696 0.2401 36.1201 827.1376
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15-Apr-10 16-Apr-10 19-Apr-10 20-Apr-10 21-Apr-10 22-Apr-10 23-Apr-10 26-Apr-10 27-Apr-10 28-Apr-10 29-Apr-10 30-Apr-10 4356.15 4251.4 4313.6 4235.25 4247 4292.95 4241.85 4375.5 4390.95 4291.1 4340.9 4348.85 821.7 815.1 811.95 789.5 785 785.95 780.2 785.1 787.3 770.3 759.75 734.7 15841.8 29.61 23.01 19.86 -2.59 -7.09 -6.14 -11.89 -6.99 -4.79 -21.79 -32.34 -57.39 876.7521 529.4601 394.4196 6.7081 50.2681 37.6996 141.3721 48.8601 22.9441 474.8041 1045.8756 3293.6121 8265.238
Table No. 7
Chart No 7 Analysis and Interpretation of TCS

Mean = 792.09 Standard deviation = 20.33 Co-efficient of Variation= 2.12 Correlation= 0.29 Return= -9.05 Beta= 0.23 Mean: The average closing price of this stock is 792.09. This is not having more fluctuations. Except 30th of April. Standard deviation: The SD is 20.33. This indicates that the stock is risky. RJS Institute Of Management Studies Bangalore - 34 Page 46
PERFORMANCE OF PORTFOLIO Co-efficient of Variation: The CV is 2.12. This stock has comparatively less variations among the stocks of the portfolio. Correlation: The correlation is 0.29. This indicates that the prices of this stock and NIFTY are moving in the same direction to the extent of 29% and remaining 71% in the opposite direction. Return: It has the negative return of -9.0492 for the month of April. It gave a positive return of 1.5479 for the last month. It will be showing a positive sign for the next month Beta: Beta of this stock is 0.68. This indicates that if there is 1% change in the NIFTY return, it causes 0.68% change in the stock return. This indicates that the stock is less volatile. Suitability: This stock is preferable for long term investor. Even though the stock is giving negative return of -9.0492 for the month of April, it had a positive return of 1.5479 for last month, there for these kinds of stocks are not preferable for short term investors.
TABLE SHOWING THE CALCULATION OF MONTHLY RETURNS OF EACH STOCK & PORTFOLIO
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Table No. 8
S NO 1 2 3 4 5 6 7
COMPANY SBI M&M HUL DLF Ranbaxy Abuja cement TCS S&P CNX NIFTY
PRICE ON 1-APR-10 2,102.60 374.95 230.4 321.7 456.2 118.1 807.8
PRICE ON 30-APR-10 2,350.70 468.25 241.34 302.4 490.3 140.74 734.7
CHANGE IN PRICE 248.10 93.3 10.94 -19.3 34.1 22.64 -73.1
% GAIN/LOSS 11.79 24.88 4.75 -5.99 7.47 19.17 -9.05 7.57
Total /portfolio return 4586.9 4348.85 -238.05
-5.19
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Chart No 8 PORTFOLIO 1: Table showing the risk and return of moderate portfolio
S NO 1. 2. 3. 4. 5. 6. 7. Company SBI M&M HUL DLF Ranbaxy Abuja TCS Total Proportion of stock (Equal) 14.29% 14.29% 14.29% 14.29% 14.29% 14.29% 14.29% 100 Total Risk of stock 84.82 31.02 7.12 14.16 13.38 8.52 20.33 Proportional Risk 12.12 4.43 1.02 2.02 1.912 1.22 2.91 25.63 Total Return of stock 11.81 24.83 4.74 -5.99 7.47 19.17 -9.05 Return of stock (to the given proportion) 1.68 3.55 0.67 -0.85 1.06 2.74 -1.29 7.57
Table No. 9
Chart No 9
Portfolio Return = 7.57 Portfolio Risk = 25.63 RJS Institute Of Management Studies Bangalore - 34 Page 49
PORTFOLIO 2: Table showing the risk and return of aggressive portfolio

Proportion S NO Company of stock (in %) 1. 2. 3. 4. 5. 6. 7. SBI M&M HUL DLF Ranbaxy Abuja TCS Total 29.51 109.02 38.52 -41.8 -43.47 27.04 -18.85 100 Total Total Risk of stock 84.82 31.02 7.12 14.16 13.38 8.52 20.33 Proportional Risk 25.03 33.82 2.74 -5.92 -5.81 2.31 -3.83 48.33 Table No. 10 Return of stock (in %) 11.79 24.88 4.75 -5.99 7.47 19.17 -9.05 Return of stock (to the given proportion)(in %) 3.48 27.13 1.829 2.51 -3.25 5.18 1.71 38.59
Chart No 10
Portfolio Return = 38.59 Portfolio Risk = 48.33
PORTFOLIO 3:
Table showing the risk and return of conservative portfolio

Proportion S NO 1. 2. 3. 4. 5. 6. 7. Company SBI M&M HUL DLF Ranbaxy Abuja TCS Total of stock (in %) -18.85 -43.44 -41.81 38.52 109.02 27.05 29.51 100 Total Risk of stock 84.82 31.02 7.12 14.16 13.38 8.52 20.33 Proportional Risk -15.99 -13.47 -2.97 5.455 14.58 2.31 5.99 -4.09 Total Return of stock (in %) 11.799 24.883 4.7482 -5.999 7.4747 19.171 -9.049 Return of stock (to the given proportion) (in %) -2.22 -10.81 -1.98 -2.31 8.148 5.18 -2.67 -6.67
Table No. 11
Chart No 11
Portfolio Return = -6.67 Portfolio Risk = -4.09
Table showing risk and return of all three types of portfolio

S no 1. 2. 3.
Portfolio Aggressive Moderate conservative
Risk 48.33 25.63 -4.09
Return 38.59 7.57 -6.67
Table No. 12
Chart No 12
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PORTFOLIO EVALUATION
An investor should evaluates her/his portfolio performance and identify the sources of strength and weakness. The evaluation of portfolio provides a feed back about the performance to evolve better management strategy. Even though evaluation of portfolio performance is considered to be the last stage of investment process, it is continuous process.
SHARPES PERFOMANCE INDEX

Sharpes performance index gives a single value to be used for the performance ranking of various funds or portfolios. Sharpe index measures the risk premium of the portfolio relative to total amount of risk in the portfolio. This risk premium is the difference between the portfolios average rate of return and the riskless rate of return. The standard deviation of the portfolio indicates the risk. The index assigns the highest values to asset that have best risk-adjusted average rate of return. Sharp index = portfolio average return- risk free rate of return Standard deviation
Portfolio evaluation using sharps performance index:

PORTFOLIOS SBI M&M HUL DLF Ranbaxy Abuja TCS S&P CNX NIFTY (Rm) Risk free rate (Rf) Monthly Return(Rp) % 11.81 24.83 4.74 -5.99 7.47 19.17 -9.05 -5.189 6 SD 84.82 31.02 7.12 14.16 13.38 8.52 20.33 Return risk free rate of return/ SD (11.81-6)/84.82 (24.83-6)/31.02 (4.74-6)/7.16 (-5.99-6)/14.16 (7.47-6)/13.38 (19.17-6)/8.52 (-9.05-6)/20.33 Sp 0.068 0.607 -0.177 -0.847 0.109 1.546 -0.741 RANK IV II V VII III I VI
TREYNORS PERFORANCE INDEX:

To understand the neither trey nor index, an investor should know the concept of characteristic line. The relationship between a given market return and the funds is given by the characteristic line. The funds performance is measured in relation to the market performance. The ideal fund return rises at a faster rate than the general market performance went the market is moving upwards and its rate of return declines slowly than the market return. The ideal fund may place its fund in the treasury bills or short sell the stock during the decline and earn positive return. Treynor index = portfolio average return- risk free rate of return Beta coefficient
p = (p * corr(X,Y))/m
Portfolio evaluation using Trey ors performance index:
PORTFOLIOS SBI M&M HUL DLF Ranbaxy Abuja TCS S&P CNX NIFTY (Rm) Risk free rate (Rf) Monthly Return(Rp) % 11.81 24.83 4.74 -5.99 7.47 19.17 -9.05 -5.189 6 -0.345 -0.211 -0.045 0.081 0.103 -0.018 0.089 (Return risk free rate of return)/ Beta (11.81-6)/(-0.345) (24.83-6)/(-0.221) (4.74-6)/(-0.045) (-5.99-6)/0.081 (7.47-6)/0.103 (19.17-6)/(-0.089) (-9.05-6)/0.089 IT -16.841 -89.543 27.969 -147.914 14.299 -732.918 -169.448 RANK III IV I V II VII VI
JENSENS PERFORMANCE INDEX

PERFORMANCE OF PORTFOLIO The absolute risk adjusted return measures were developed by Michael Jeans and commonly known as Jensens measures. It is mentioned as measures of absolute performance because a definite standard is set and against that the performance is measured. The standard is based on the investors predictive ability. Successful prediction of security price would unable the investor to earn higher returns than the ordinary investor expects to earning a given level of risk.
Jensen's Measure = Rp-[Rf+p (Rm-Rf)] p = (p * corr(X,Y))/m

Portfolio evaluation using Jensens performance index:
PORTFOLIOS SBI M&M HUL DLF Ranbaxy Abuja TCS S&P CNX NIFTY (Rm) Risk free rate (Rf) Monthly Return(Rp) % 11.81 24.83 4.74 -5.99 7.47 19.17 -9.05 -5.189 6 -0.345 -0.211 -0.045 0.081 0.103 -0.018 0.089 Rp-[Rf+p(Rm-Rf)] 11.81-[(6-0.345(-5.189-6)] 24.83-[(6-0.211(-5.189-6)] 4.74-[(6-0.045(-5.189-6)] 5.99+[(6+0.081(-5.189-6)] 7.47-[(6+0.103(-5.189-6)] 19.17-[(6-0.018(-5.189-6)] 9.05+[(6+0.089(-5.189-6)] JM 1.94947547 16.47690971 1.764096368 -11.0829502 2.620298553 12.96892785 -14.0561527 RANK IV I V VI III II VII
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ANALYSIS: From all the three measures, it shows that TCS and DLF stocks are poorly performing because; TCS occupies VI rank in both Sharpe index and Treynor index and occupies VII rank Jensens index.
Ranbaxy and SBI are moderately performing. In case of the M&M Even though it occupies IV rank in Treynor index and II rank in Sharpe index but it achieved I rank in Jensen's Measure. So it is well performing. Ambuja also performing well because it occupies I and II rank in Sharpe index and Jensen's Measure respectively.
HUF is poorly performing in both Sharpe index and Jensen's Measure.
Capital Asset Pricing Model
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PERFORMANCE OF PORTFOLIO The capital asset pricing model (CAPM)is used to determine a theoretically appropriate required rate of return of an asset, if that asset is to be added to an already well-diversified portfolio, given that assets non-diversifiable risk. The model takes into account the assets sensitivity to non-diversifiable risk(also known as systematic risk or market risk), often represented by the quantity beta() in the financial industry , as well as the expected return of the market and the expected return of the theoretical risk-free asset. The CAPM is a model for pricing an individual security or a portfolio. For individual securities, we made use of security market line(SML) and its relation to expected return and systematic risk(beta)to show how the market must price individual securities in relation to their security risk class. Assumptions of CAPM All investors: Aim to maximise economic utility Are rational risk averse Are price takers, i.e. they cannot influence prices Can lend and borrow unlimited under the risk free rate of interest Trade without transaction or taxation costs Deal with securities that are all highly divisible in to small parcels Assume all information is at the same time available to all investors Shortcomings of CAPM The model assumes that the variance of returns is an adequate measurement of risk. This might be justified under the assumption of normally distributed returns, but for general returns distributions other risk measures will likely reflects the investors preferences more adequately The model does not appear to adequately explain the variation in stock returns. Empirical studies show that low beta stocks may offer higher returns than the model would predict. The model assumes that all the investors have access to the same information and agree about the risk and expected returns. RJS Institute Of Management Studies Bangalore - 34 Page 57
PERFORMANCE OF PORTFOLIO The model assumes that there are no taxes or transaction costs, although this assumption may be relaxed with more complicated versions of the model. The market portfolio consists of all assets in all markets, were each asset is weighted by its market capitalization. This assumes no preference between market and assets for individual investors and that investor choose asset slowly as a function of their risk- return profile. Ri = Rf + (Rm-Rf) Table showing the required rate of return using CAPM model
Required rate return Using CAPM 10.0284 20.8827 11.2593 0.2931 0.0693 9.6927 3.4263
Company
stock return 11.81 24.83 4.74 -5.99 7.47 19.17 -9.05
Remarks Underpriced Underpriced overpriced overpriced underpriced overpriced underpriced
Decision BUY BUY SELL SELL BUY SELL SELL
SBI M&M HUL DLF Ranbaxy Abuja TCS
Table No. 13
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Chart No 13
If required (as computed by CAPM) return is less than actual return (calculated using any other factor) it would mean than the stock is underpriced. This is because the stock gives more return than what it should give hence such stock should be brought. If required (as computed by CAPM) return is more than actual return (calculated using any other factor) it would mean than the stock is overpriced. This is because the stock gives less return than the expected return hence such stock should be sold.
CHAPTER VI FINDINGS, SUGGESTION AND CONCLUSION

FINDINGS: SBIN:
After the study, it was found that, there were no major fluctuations in the prices of this stock. The average price is 2137.07 with the CV of -3.28. This stock is negatively correlated with the market index. It has a return of 11.7996% for the month of April, with 84.82 Risk and beta of -0.36. M&M: This stock has high risk and high return. It has a return of 24.83% with 31.02 risk, the stock is risky. There were no high fluctuations in the beginning of the month except 30th of the month. It is negatively correlated with the market index. The CV and Beta of the stock are -12.14 & -1.33 respectively. HUL: The average price of this stock is 225.51. This is not having more fluctuations. The stock is comparatively less risky it has the risk of 7.12. The CV is -4.29. It has a return of 4.74 with the beta of -0.47. Its negatively correlation with market index. DLF: It has the negative return of -5.99 for the month of April. It gave a positive return of 5.697 for the last month. It is showing a positive sign for the next month. The average price of this stock is 328.829. This is not having more fluctuations the CV is 4.53. Beta of this stock is 0.50. This stock is correlated with the market index to the extent of 49%. RANBAXY: The return on this stock is 7.47 with the risk of 13.38. Its average price is 459.82. This is not having more fluctuations the. The CV and Beta of the stock are 4.82 & 0.53 respectively. The correlation between this stock and the market index is 53%. It was also found that, this is the stock with conservative and moderate risk and return. AMBUJA CEMENT:
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PERFORMANCE OF PORTFOLIO Ambuja Cement has performed very well during the month of April; it has a return of 19.17% with 8.52 risks. There is not having more fluctuations. It is negatively correlated with the market index to the extent. The CV and Beta of the stock are -2.99 & -0.33 respectively TCS: It has the negative return of -9.05 for the month of April. It gave a positive return of 1.5479 for the last month.. It is showing a positive sign for the next month. The average price of this stock is 792.09. This is not having more fluctuations Except 30 th of April. The CV is 2.12. Beta of this stock is 0.23. This stock is correlated with the market index is 29%. MODERATE PORTFOLIO: It was found that the moderate portfolio of seven different stocks gave the return of 7.57 with the risk of 25.63. Stocks giving Less return in the portfolio are M&M, AMBUJA CEMENT and SBI followed by RANBAXY and HUL. DLF and TCS are the stocks giving negative returns in the portfolio. AGGRESSIVE PORTFOLIO: The aggressive portfolio has a return of 38.59 with the risk of 48.33. The majority of returns of the portfolio were contributed by M&M, AMBUJA CEMENT and SBI. CONSERVATIVE PORTFOLIO: This portfolio has the return of -6.67. The risk associated with this stock is -4.09. M&M, AMBUJA CEMENT, RANBAXY, SBI & HUL are the stocks giving positive return DLF, & TCS these two stocks are giving negative return.
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SUGGESTION: SBI
The volatility is less in this stock, it has performed well during the month and variations are also less except 19th, 26th, 29th and 30th of April. This is preferable for Aggressive investors. Because it has moderate return and high risk.As most of the investors choose the stock on the basis of risk and return.
M&M
As this stock is more volatile, these kinds of stocks are more preferable for aggressive investors. Investors having high risk bearing capacity only can hold these kinds of stocks. When Beta is -1.33, if market declines by 10% the stock will decline by 20%. Therefore this stock can be held with major portion only in aggressive portfolio.
HUL
This kind of stock is most preferable for conservative investors. It is suitable for them in all the angles, risk, return, beta and variation. Stocks with these features are preferable for conservative investors.
DLF
This stock is preferable for long term investor. Even though the stock is giving negative return of -5.99 for the month of April, it had a positive return of 5.697 for last month; therefore these kinds of stocks are not preferable for short term investors.
Ranbaxy
This kind of stock is most preferable for conservative and moderate investors. It is suitable for them in all the angles, risk, return, beta and variation all these are preferable for conservative and moderate investors.
AMBUJA CEMENT
This kind of stock is most preferable for Aggressive and moderate investors. This stock has moderate risk and high return.
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TCS
This stock is preferable for long term investor. Even though the stock is giving negative return of -9.04 for the month of April, it had a positive return of 1.54 for last month, there for these kinds of stocks are not preferable for short term investors. MODERATE PORTFOLIO: For an effective moderate portfolio the investor should choose such stocks which are less volatile and which have average risk and return. This is most preferable for the investors who expect the portfolio return equaling to the market return. AGGRESSIVE PORTFOLIO: Stocks like SBI, M&M and AMBUJA CEMENTS are most preferable for aggressive portfolio. As these stocks are more volatile and yielding high return. Return expected from the aggressive portfolio will be more than the market return. Therefore this is suitable for the investors seeking high return and having high risk bearing capacity. CONSERVATIVE PORTFOLIO: Conservative portfolios normally give return less than the market return, investors who expects low risk and low return can prefer for the stocks like RANBAXY & HUL which are less volatile and have low return and low risk.
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CONCLUSION:
The individual performance of the stocks during the month was good except few stocks like TCS and DLF as they have shown negative return during the month. But, M&M, AMBUJA CEMENT, SBI, RANBAXY, and HUL have performed well. This was all about the individual performance of the stocks. When we look at the portfolio performance, Two portfolios (Aggressive & Moderate) have given positive return during the month But one portfolio (Conservative) giving negative return. Even though some of the stocks havent performed during the month the loss from those stocks was compensated against the returns of the stocks in the portfolio. While choosing the stocks for the portfolio, the investor should take relevant information whether the market is bullish or bearish. The investors should try to analyze the risk and return of each stock. The analysis like fundamental and technical are very important to take better decision of buying and selling of shares. The investor should also focus on the number of stocks to be held in the portfolio, as the number of stocks increases the risk of the portfolio will be reduced to a greater extent. As the object of constructing the portfolio itself is to minimize the risk, therefore diversification plays a predominant role here.
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PERFORMANCE OF PORTFOLIO BIBLIOGRAPHY BOOKS: Security analysis and portfolio management. Punithavathy Pandian, Vikas Publishing House Pvt Ltd. Investment analysis and portfolio management. Prasanna Chandra. Ninth edition, Tata McGraw-Hill publishing Co Ltd., New Delhi. JOURNALS: Portfolio. Corporate India. Emerging trends in financial markets. Outlook- money. DAILIES: Business Line. Economic Times. Financial Express. WEBSITES: www.nseindia.com www.moneycontrol.com www.parsoli.com www.investsmartindia.com www.Wikipedia.com www.stock-market-investors.com
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PERFORMANCE OF PORTFOLIO

RJS Institute Of Management Studies Bangalore - 34

RJS Institute Of Management Studies Bangalore - 34

RJS Institute Of Management Studies Bangalore - 34

PERFORMANCE OF PORTFOLIO Portfolio Management:

Statement of the problem:

RJS Institute Of Management Studies Bangalore - 34

Objectives of the study:

RJS Institute Of Management Studies Bangalore - 34

Scope of the study:

RJS Institute Of Management Studies Bangalore - 34

CHAPTER II RESEARCH DESIGN TITLE OF THE STUDY

SCOPE OF THE STUDY

RJS Institute Of Management Studies Bangalore - 34

RJS Institute Of Management Studies Bangalore - 34

CHAPTER III COMPANY PROFILE

RJS Institute Of Management Studies Bangalore - 34

RJS Institute Of Management Studies Bangalore - 34

The companys business strategy is: The Proposition

To Project Parsoli as an one-stop investment destination

RJS Institute Of Management Studies Bangalore - 34

RJS Institute Of Management Studies Bangalore - 34

RJS Institute Of Management Studies Bangalore - 34

RJS Institute Of Management Studies Bangalore - 34

Steps involved in portfolio construction

RJS Institute Of Management Studies Bangalore - 34

Chart showing steps in portfolio construction

Bond and Common stock

Assessment of risk and return

RJS Institute Of Management Studies Bangalore - 34

RJS Institute Of Management Studies Bangalore - 34

RJS Institute Of Management Studies Bangalore - 34

STATE BENK OF INDIA (SBI)

RJS Institute Of Management Studies Bangalore - 34

The Company entered into a foreign

RJS Institute Of Management Studies Bangalore - 34

RANBAXY LABORATORIES LTD

DELHI LAND AND FINANCE PRIVATE LIMITED (DLF)

Industry CEO Face Value

: Construction and Contracting - Real Estate : Mr. Pua Seck Guan :2

Business Group : DLF Group

MAHINDRA & MAHINDRA (M&M)

HINDUSTAN UNILEVER LTD (HUL)

RJS Institute Of Management Studies Bangalore - 34

PERFORMANCE OF PORTFOLIO Industry CEO Face Value : FMCG : Mr.Nitin Paranjpe :1

Business Group : MNC Associate

2009 2008 2007 2006 2005 2004

267.00 267.00 230.40 296.00 186.00 218.00

239.10 170.00 166.00 179.90 126.30 104.00

TATA CONSULTANCY SSERVICES (TCS)

PERFORMANCE OF PORTFOLIO CEO Face Value : N. Chandrasekaran :1

2009 2008 2007 2006 2005 2004

556.90 1078.00 1399.00 2099.00 1505.00 1338.00

466.20 418.00 935.00 900.00 1091.00 958.55

RJS Institute Of Management Studies Bangalore - 34

RJS Institute Of Management Studies Bangalore - 34

RJS Institute Of Management Studies Bangalore - 34

causes 0.5% change in the stock compared to the market.

RJS Institute Of Management Studies Bangalore - 34

CHAPTER-V ANALYSIS AND INTERPRETATION

Chart No1 Analysis and Interpretation of SBI

TABLE SHOWIGN THE PERFORMANCE OF M&M

Analysis and Interpretation of M&M