INDEX

1. Executive Summary…………………………………………………1 – 6
2. Company Profile …….………………………………………….......7
 Profile……………………………………………………. 8 -10
 Products and Services…………………………………...11 - 17
3. Overview of Stock Market…………………………………….......18 - 24
4. Introduction to Fundamental & Technical Analysis........................25 - 38
5. EIC Analysis………………...………………………………….....39
 Economic Analysis……………………………………...40 - 43
 Industry Analysis………………………………………..44 - 53
 Company analysis……………………………………….54 - 61
6. Technical Analysis……………….………………………………..62
 Relative Strength Index(RSI)…………………………...63 – 76
 Moving Average………………………………………...77 – 90
 Japanese Candlestick Chart……………………………...91 - 92
7. Findings…………………………………………………………….93 - 95
8. Conclusion………………………………………………………….96
9. Suggestions……………………………………………………......97
10. Bibliography……………………………………………………....98 - 99
 EXECUTIVE SUMMARY

CHAPTER 1
EXECUTIVE SUMMARY

I. TITLE OF THE PROJECT:

“Fundamental & Technical Analysis of Automobile Sector Undertaken at Geojit Financial

Services Ltd.”

II. ABOUT THE COMPANY:

Name & Address of the Company: - “Geojit Financial Services Ltd.”

Bhavani Arcade, 2nd floor, No. 127-A,
‘B’ Block, New Cotton Market
Hubli – 580029

III. SCOPE OF THE STUDY:

 This study is most important because both fundamental and technical analysis helps investors in
better understanding the markets and gauges the direction in which their investments might be headed and
it’s utility helps in estimating the future trends of the stock prices and to make a decent profit out of it.
DEFINITIONS OF TECHNICAL ANALYSIS:

A method of evaluating securities by relying on the assumption that market data, such as charts, of

price, volume, and open interest, can help predict future (usually short-term) market trends. Unlike

fundamental analysis, the intrinsic value of the security is considered. Technical analysts believe that they

can accurately predict the future price of a stock by looking at its historical prices and other trading

variables. Technical assumes that market psychology influences trading in a way that enables predicting

when a stock will rise or fall. For that reason, many technical analysts are also market timers, who believe

that technical analysis can be applied just as easily to the market as a whole as to an individual stock.

The study of the relationships among the security market variables such as price levels, trading

volumes, and price movements so as to gain insights into the supply and demand for securities. Rather than

concentrating on earnings, the economic outlook, and other business-related factors that influence a

security's value, technical analysis attempts to determine the market forces at work on a certain security or

on the securities market as a whole. Compare fundamental analysis

A method of evaluating securities by analyzing statistics generated by market activity, such as past

prices and volume. Technical analysts do not attempt to measure a security's intrinsic value, but instead use

charts and other tools to identify patterns that can suggest future activity.

Technical analysts believe that the historical performance of stocks and markets are indications of

future performance.

In a shopping mall, a fundamental analyst would go to each store, study the product that was being

sold, and then decide whether to buy it or not. By contrast, a technical analyst would sit on a bench in the

mall and watch people go into the stores. Disregarding the intrinsic value of the products in the store, the

technical analyst's decision would be based on the patterns or activity of people going into each store.
 Technical analysis is the study of a stock, or the market as a whole, strictly by using the price and

volume history of a stock. Technical analysis uses little or no information about the actual business behind

the stock. The common belief is that a stock price represents all known information about a

stock. Technical analysis is an alternative to fundamental analysis.

Technical Analysis is a method of forecasting prices of stocks, bonds, futures contracts, indices, or

other financial instruments. The goal of technical analysis is to predict future price level or direction. It tends

not to be the goal of technical analysis to explain why prices behave as they do; that would be fundamental

analysis. Technical analysis primarily studies the action of a financial market.

The working principle behind technical analysis is that any influence on the market is already

reflected in current price levels. Followers of technical analysis believe that: 1) prices move in trends, 2)

history repeats itself, and 3) the market discounts everything. Technical analysis involves the use of different

kinds of charts, or other market indicators such as moving averages, volume and open interest, oscillators,

Japanese candlesticks, Elliott Wave Theory, and cycle analysis.

LITERATURE REVIEW

Brown and Jennings (1989)

Brown and Jennings (1989) showed that technical analysis has value in a model in which prices are

not fully revealing and traders have rational conjectures about the relation between prices and signals.

Neftci (1991)

Neftci (1991) showed that a few of the rules used in technical analysis generate well-defined

techniques of forecasting, but even well-defined rules were shown to be useless in prediction if the
economic time series is Gaussian. However, if the processes under consideration are non-linear, then the

rules might capture some information. Tests showed that this may indeed be the case for the moving average

rule.

Taylor and Allen (1992)

Taylor and Allen (1992) report the results of a survey among chief foreign exchange dealers based in

London in November 1988 and found that at least 90 per cent of respondents placed some weight on

technical analysis, and that there was a skew towards using technical, rather than fundamental, analysis at

shorter time horizons. In a comprehensive and influential study Brock, Lakonishok and LeBaron (1992)

analysed 26 technical trading rules using 90 years of daily stock prices from the Dow Jones Industrial

Average up to 1987 and found that they all outperformed the market.

Blume, Easley and O’Hara (1994)

Blume, Easley and O’Hara (1994) show that volume provides information on information quality

that cannot be deduced from the price. They also show that traders who use information contained in market

statistics do better than traders who do not. Neely (1997) explains and reviews technical analysis in the

foreign exchange market.

Neely, Weller and Dittmar (1997)

Neely, Weller and Dittmar (1997) Use genetic programming to find technical trading rules in foreign

exchange markets. The rules generated economically significant out-of-sample excess returns for each of six

exchange rates, over the period 1981–1995. Lui and Mole (1998) report the results of a questionnaire survey

conducted in February 1995 on the use by foreign exchange dealers in Hong Kong of fundamental and
technical analyses. They found that over 85% of respondents rely on both methods and, again, technical

analysis was more popular at shorter time horizons.

Neely (1998)

Neely(1998) reconciles the fact that using technical trading rules to trade against US intervention in

foreign exchange markets can be profitable, yet, longterm, the intervention tends to be profitable.

LeBaron (1999)

LeBaron(1999) shows that, when using technical analysis in the foreign exchange market, after

removing periods in which the Federal Reserve is active, exchange rate predictability is dramatically

reduced.

Lo, Mamaysky and Wang (2000)

Lo, Mamaysky and Wang (2000) examines the effectiveness of technical analysis on US stocks from

1962 to 1996 and finds that over the 31-year sample period, several technical indicators do provide

incremental information and may have some practical value. Fernandez-Rodr´ıguez, Gonz´alez-Martel and

Sosvilla-Rivero (2000) apply an artificial neural network to the Madrid Stock Market and find that, in the

absence of trading costs, the technical trading rule is always superior to a buyand- hold strategy for both

‘bear’ market and ‘stable’ market episodes, but not in a ‘bull’ market. One criticism I have is that beating the

market in the absence of costs seems of little significance unless one is interested in finding a signal which

will later be incorporated into a full system. Secondly, it is perhaps naïve to work on the premise that ‘bull’

and ‘bear’ markets exist. Lee and Swaminathan (2000) demonstrate the importance of past trading volume.

Neely and Weller (2001)

 Neely and Weller (2001) use genetic programming to show that technical trading rules can be

profitable during US foreign exchange intervention. Cesari and Cremonini (2003) make an extensive

simulation comparison of popular dynamic strategies of asset allocation and find that technical analysis only

performs well in Pacific markets.

Kavajecz and Odders-White (2004)

Kavajecz and Odders-White (2004) show that support and resistance levels coincide with peaks in depth on

the limit order book 1 and moving average forecasts reveal information about the relative position of depth

on the book. They also show that these relationships stem from technical rules locating depth already in

place on the limit order book

Jim rogers:

Stock futures are contracts where the buyer is long, i.e., takes on the obligation to buy on the contract

maturity date, and the seller is short, i.e., takes on the obligation to sell. Stock index futures are generally not

delivered in the usual manner, but by cash settlement.

According to Hutchinson:

In finance, a futures contract is a standardized contract, traded on a futures exchange, to buy or sell a certain
underlying instrument at a certain date in the future, at a specified price. The future date is called the
delivery date or final settlement date. The pre-set price is called the futures price. The price of the
underlying asset on the delivery date is cal Review of Literature

Review of Literature refers to the collection of the results of the various researches relating to the present
study. It takes into consideration the research of the previous researchers which are related to the present
research in any way. Here are the reviews of the previous researches related with the present study:

Bollen (1999) conducted a study on Ratio Variables on which he found three different uses of ratio variables
in aggregate data analysis: (1) as measures of theoretical concepts, (2) as a means to control an extraneous
factor, and (3) as a correction for heteroscedasticity. In the use of ratios as indices of concepts, a problem
can arise if it is regressed on other indices or variables that contain a common component. For example, the
relationship between two per capita measures may be confounded with the common population component
in each variable. Regarding the second use of ratios, only under exceptional conditions will ratio variables
be a suitable means of controlling an extraneous factor. Finally, the use of ratios to correct for
heteroscedasticity is also often misused. Only under special conditions will the common form forgers soon
with ratio variables correct for heteroscedasticity. Alternatives to ratios for each of these cases are discussed
and evaluated.

Cooper (2000) conducted a study on Financial Intermediation on which he observed that the quantitative
behavior of business-cycle models in which the intermediation process acts either as a source of fluctuations
or as a propagator of real shocks. In neither case do we find convincing evidence that the intermediation
process is an important element of aggregate fluctuations. For an economy driven by intermediation shocks,
consumption is not smoother than output, investment is negatively correlated with output, variations in the
capital stock are quite large, and interest rates are procyclical. The model economy thus fails to match
unconditional moments for the U.S. economy. We also structurally estimate parameters of a model economy
in which intermediation and productivity shocks are present, allowing for the intermediation process to
propagate the real shock. The unconditional correlations are closer to those observed only when the
intermediation shock is relatively unimportant.

Gerrard (2001) conducted a study on The Financial Performance on which he found that Using ratio
analysis the financial performance of a sample of independent single-plant engineering firms in Leeds is
examined with regard to structural and locational differences in establishments. A number of determinants of
performance are derived and tested against the constructed data base. Inner-city engineering firms perform
relatively less well on all indicators of performance compared with outer-city firms. The study illustrates the
importance of using different measures of performance since this affects the magnitude and significance of
the results. Financial support is necessary to sustain engineering in the inner city in the long run.

Schmidgall (2003) conducted a study on Financial Analysis Using the Statement of Cash Flows on which
he observed that Managers use many financial ratios to judge the health of their businesses. With the recent
requirement of a statement of cash flow (SCF) by the Financial Accounting Standards Board, managers now
have a new set of ratios that will give a realistic picture of the business. The ratios include cash flow-interest
coverage, cash flow-dividend coverage, and cash flow from operations to cash flow in investments. These
ratios are particularly useful because they show changes in a hotel or restaurant's cash position over time,
rather than at a given moment, as is the case with many other ratios.

Murinde (2003) ) conducted study on Corporate Financial Structures on which he observed that the
financial structure of a sample of Indian non-financial companies using a new and unique dataset consisting
of a panel containing the published accounts of almost 900 companies that published a full set of accounts
every year during 1989-99. In a new departure in the literature, the dataset includes quoted and unquoted
companies. We compare the sources-uses approach to analyzing company financial structures with the asset-
liability approach. We use both approaches to characterize and to compare the financial structures of Indian
companies over time; between quoted and unquoted companies; and between companies which belong to a
business group and those that do not. Finally, we compare our results to those obtained previously for India
and for the industrial countries.

McMahon (2005) conducted a study on Financial Information on which he found that financial statements
mean little to the uninitiated. This paper, explains, in layman's terms, how to understand financial
information. It covers measures of profitability. The second article will cover measures of company liquidity
and the use of financial ratios. This paper continues to explain how to interpret and understand financial
information. It deals with measures of liquidity, solvency and fund flows and describes how to establish
standards against which a company's financial ratios can be compared.

Lee (2008 conducted a study on Financial Risk on which he observed that Financial researchers, including
those concentrating on the lodging industry, use various financial risk measures for their studies. Examples
of those risk measures are beta, earnings variability, bankruptcy probability, debt-to-equity ratio and book-
to-market ratio. The purpose of this study is, first, to descriptively investigate various financial risk measures
used in the lodging financial literature by performing factor analysis and identifying four distinct risk
groups. Second, this study examines the predictive ability of the four risk groups for lodging firm
performance. The findings of this study suggest that strategic and stock performance risk factors better
represent a lodging firm's financial risk than do bankruptcy and firm performance risk factors, and also,
ROA than ROE better estimates lodging firm performance in terms of their relationships with financial risk
factors.

Johnson (2009) conducted a study on Financial Ratio patterns on which he found that the properties and
characteristics of financial ratios have received considerable attention in recent years with interest primarily
focused on determining the predictive ability of financial ratios and related financial data. Principal areas of
investigation have included the prediction of corporate bond ratings , and the anticipation of financial
impairment]. Related studies have examined the characteristics of merged firms the differences in financial
ratio averages among industries whether firms seek to adjust their financial ratios toward industry averages
the relationship between accounting-determined and market-determined risk measures, and the influence of
financial ratios on analysts' judgments about impending bankruptcy The general conclusion to emerge from
these various research efforts is that a number of financial ratios have predictive and descriptive utility when
properly employed.
To summarize the literature , Ratio analysis is a key dimension of financial management, suggesting a
relationship between profit and loss as mentioned in the balance sheet of an organization. Its appropriate use
will go toward giving a true picture of the financial health of the unit. Its benefits can be seen in areas of
management, production, marketing, personnel management etc

led the settlement price.

Interpretation:

Here, In this case, Moving Average is above the Actual line. So it indicates that it is a right time to
buy the security. In this Graph, we can see that the moving average of Tata Motors Stock has been
decreased. So, it is giving clear picture of future movement of the scrip. This Graph provides a message to
the investor that it is a right time to buy the Stock of Tata Motors.

Here, in this case, the actual Stock price of Tata Motors is just below its moving average line. It
indicates that investors are becoming increasingly bullish on the Stock Price of Tata Motors.

Moreover, Stock price and moving Average of Tata Motors has been decreased. It indicates that
investors are becoming increasingly bullish from bearish pattern on the Stock Price of Tata Motors.

TECHNICAL ANALYSIS: [By Using Candle Stick Charting]

Company Name: Maruti Suzuki Ltd.

Candle Stick of Maruti Suzuki scrip

1400

1200

1000
Stock Prices

800 Opening Price

High Price
600 Low Price
Closing Price
400

200

0
4/2/2007

5/2/2007

6/2/2007

7/2/2007

8/2/2007

9/2/2007

1/2/2008

2/2/2008

3/2/2008
10/2/2007

11/2/2007

12/2/2007

Dates

Interpretation:
 Japanese Candle Stick is used to analyze the pattern of stock movement. Candle is same as bar chart
but the color is different red candle is used to indicate the bearish trend and green candle is a indicator of
bullish trend

Japanese candle use historical prices of a stock in the prescribed manner i.e. Open, High, Low,
Close. The size of the candle is known by its magnitude of open and close, and the size of the shadow is
known by high and close.

In the above Candle Stick Chart it is clear that Stock Price of Maruti Suzuki Ltd. has been decreased.
Simply Share Prices of Maruti Suzuki Ltd is falling down. It indicates that the investors are becoming more
bearish than bullish. Here, as far as Maruti Suzuki is concerned, bearish market trend is taking place. It is a
right time to buy the Scrip.
Company: Tata Motors

Candle Stick for TATA Motors Scrip

900

800

700

600
Stock Prices

500 Opening Price

High Price
400 Low Price
300 Closing Price

200

100

0
4/2/2007

5/2/2007

6/2/2007

7/2/2007

8/2/2007

9/2/2007

1/2/2008

2/2/2008

3/2/2008
10/2/2007

11/2/2007

12/2/2007

Dates

Interpretation:
From the above Candle Stick Chart it is clear that Stock Price of Tata Motors is falling down. Here,
we can observe lot of volatility in stock price. Both the Bullish and Bearish trends are taking place. The
Bullish trend is following by Bearish Trend. It indicates that the investors are becoming more bearish than
bullish. At present Situation Bearish Trend is going on. It is a right time to buy the Scrip.
IV. BACKGROUND OF THE PROJECT:
In the recent past, the bank interest rates have been increased steadily. But the rate of Inflation has
also been increased. There is no big difference between the interest rate and Inflation rate. Because of
inflation, value of money has been decreased and cost of living has been increased. This has created panic
among lower, middle and upper middle class families who considered keeping their savings in banks as safe
as well as remunerative. So, the invertors are searching for proper investment avenues. Here, an attempt is
made to predict the future movement of scrips. This study helps the investors to invest in shares.
The stock exchange comes in the secondary market. Stock exchange performs activities such as
trading in share, securities, bonds, mutual fund & commodities. Stock Broking industry is growing at an
enormous rate, as more and more people are attracted towards stock exchanges with the hope of making
profits.
To quote couple of examples, the Automobile industry in India has consistently registered strong
performance. The automobile industry had a growth of 15.4 % during April-January 2007, with the average
annual growth of 10-15% over the last decade or so. With the incremental investment of $35-40 billion, the
growth is expected to double in the next 10 years. Consistent growth and dedication have made the Indian
automobile industry the second- largest tractor and two-wheeler manufacturer in the world. It is also the
fifth-largest commercial vehicle manufacturer in the world. The Indian automobile market is among the
largest in Asia.
The Indian automobile industry is going through a phase of rapid change and high growth. With new
projects coming up on a regular basis, the industry is undergoing technological change. The major players
are expanding their plants and focusing on mass customization, mass production, etc. Nearly every
automobile company is investing at a higher rate than ever before to achieve a high growth trajectory. The
overall investment in the sector has been increasing quite rapidly. It is expected that by the end of 2010
Indian automobile sector will be investing a huge amount as Rs. 30,000 crores. At present the industry is
enjoying a growth rate of 14-17% per annum, with domestic sales growth at 12.8%. The growth rate is
predicted to double by 2015.

V. OBJECTIVES OF THE STUDY:

1) To analyze individual company scrips by considering the factors relating to the economy, industry
and the respective company.

2) To predict investor positions (Buy, sell & hold).

3) To know the future trend of Stock Prices of Tata Motors and Maruti Udyog Ltd. in capital market.

4) To know which securities to be bought and which securities not to be bought.

5) To know which securities to be sold and which securities not to be sold.

VI. METHODOLOGY:

Primary data is collected through direct interactions with the Branch Manager, Employees and
clients of Geojit Financial Services, Ltd.

The Secondary data is collected from the annual reports of the company, relevant text books on the
subject matter and company’s official website.

TOOLS:

1. Moving Average Method.

2. Relative Strength Index (RSI).
3. Candlestick Charting.

LIMITATIONS OF THE STUDY:

1. The study is limited only to automobile sector and 2 companies

2. I have used only 3 Technical tools to predict the movement of Scrip’s.
3. Fundamental Analysis is used to analyze only financial performance of the companies.
4. Only Technical Analysis is used to predict the stock prices of the companies.

FINDINGS OF THE STUDY:

 In case of RSI of Maruti Suzuki Scrip, the best time to sell the stock was between 12th July 07 to 31st
July 07 and 9th October 07 to 18th October 07 since the RSI was above 70 & it had reached its peak level.
The best time to buy the stock was between 2nd Jan 08 to 24th Jan 08 since the RSI was below 30 for
these many days.
 In case of RSI of Tata Motors, the best time to sell the stock was between 27th Sep 07 to 4th October 07
and 10th December 07 to 12th December 07 since the RSI was above 70 & it had reached its peak level.
The best time to buy the stock was between 8th August 07 to 23rd August 07 and 23rd Jan 08 to 24th Jan
08 as well as between 7th March to 18th March 08 since the RSI was below 30 for these many days.
 The 10 days moving average of Maruti Suzuki scrip, provides a message to the investor that it is a right
time to buy the Stock and, the trend of the Moving Average line has been decreased, so it is also a right
time to buy the stock.
 In case of 10 days Moving Average of Tata Motors Ssrip, the actual Stock price is just below its moving
average line. It indicates that investors are becoming increasingly bullish on the Stock Price of Tata
Motors.
 In Japanese Candle Stick Chart of Maruti Suzuki Ltd. we can see that the stock price has been decreased.
Simply Share Prices of Maruti Suzuki Ltd is falling down. It indicates that the investors are becoming
more bearish than bullish.
 In case of Japanese Candle Stick Chart of Tata Motors, we can observe lot of volatility in stock price.
Both the Bullish and Bearish trends are taking place. The Bullish trend is following by Bearish Trend
 Fundamentally, financial performance of these companies in respect of sales and profit is good.
 If an investor opts for long term investment then he will earn huge amount of return. Long term
Investment is known to be less risky.
 This study may not provide any guidelines to Speculators. It is useful to Long Term Investors.
 Technical analysts evaluate securities by analyzing statistics generated by market activity, past prices
and volume.
 One of the most basic and easy to use technical analysis indicators is the moving average, which shows
the average value of a security's price over a period of time. The most commonly used moving averages
are 10 days, 20 days, 30 days, 50 days, 100 days and 200-days moving average..
 One of the most important areas for any investor to look when researching a company is the financial
statement. Financial reports are required by law and are published both quarterly and annually.
 Indian Economy is consistently achieving a tremendous growth in these Sectors.
 If we consider RSI then almost all the scrips of these companies are lying between 30 and 70. It means
an investor should hold the scrips until it reaches 70 to sell and 30 to buy.
 The stock prices always take a correction after a major climb.
 Moving average is one of the best methods of predicting future movement of Stock Price. If we use 200
Day Moving Average for Analysis then volatility of stock will be less. It gives clear picture of
movement of Stock.

CONCLUSION OF THE STUDY:

As we all know India is one of the fastest growing economies in the world. India is consistently
achieving growth in automobile sector. The automotive industry is witnessing tremendous and
unprecedented changes these days. On a global scale, the assets of the top ten automotive corporations
accounts for 28% of the assets of the world’s top 50 companies, 29% of their employment and 30% of their
total sales.
The Indian automobile industry is going through a technological change where each firm is engaged
in changing its processes and technologies to sustain the competitive advantage and provide customers with
the optimized products and services.
The automobile industry had a growth of 15.4 % during April-January 2007, with the average annual
growth of 10-15% over the last decade or so. With the incremental investment of $35-40 billion, the growth
is expected to double in the next 10 years.
Consistent growth and dedication have made the Indian automobile industry the second- largest
tractor and two-wheeler manufacturer in the world. It is also the fifth-largest commercial vehicle
manufacturer in the world. The Indian automobile market is among the largest in Asia.
The Ministry of Heavy Industries has released the Automotive Plan 2006-2016, with the motive of
making India the most popular manufacturing hub for automobiles and its components in Asia. The plan
focuses on the removal of all the bottlenecks that are inhibiting its growth in the domestic as well as
international arena.
With comparatively higher rate of economic growth rate index against that of great global powers,
India has become a hub of domestic and exports business. The automobile sector has been contributing its
share to the shining economic performance of India in the recent years.
The Indian automobile industry is going through a phase of rapid change and high growth. With new
projects coming up on a regular basis, the industry is undergoing technological change. The major players
are expanding their plants and focusing on mass customization, mass production, etc
Apart from domestic production, the industry is consistently focusing on the automobile exports. The
auto component segment is contributing a lot in the export arena. The liberalized policies of the government
are now making the companies go for more and more exports.
Because of these reasons, the shares of automobile industry are performing well and therefore the
share market is attracting people to invest their hard earned money and find fortune. But lack of knowledge
about shares and stock market is making them cautious of investing in this market. They need to be educated
as well as guided to minimize the risk and to assess the return on their investment.
SUGGESTIONS:

1. Before going to invest, an investor should have clear and adequate knowledge of capital market.
2. It is better to go for Long term Investment rather than the Short term Investment. Because it is less
risky and also provides sufficient return.
3. The investors should know the value of money.
4. Practically, stock market activities are very risky. So, investors should be careful while investing.
5. In case of half knowledge about stock market is very dangerous. So, whenever a person wants to
invest in stock market he should take necessary tips from the experts or Technical Analysts.
6. Investors should also look into global pressure and market movement in order to look for avenues of
investing in different stocks and to take position; some of the sources for understanding global
pressure are CNBC TV18, News Paper, Economy watch .

Findings of the study:

 In case of RSI of Maruti Suzuki Scrip, the best time to sell the stock was between 12th July 07 to 31st
July 07 and 9th October 07 to 18th October 07 since the RSI was above 70 & it had reached its peak level.
The best time to buy the stock was between 2nd Jan 08 to 24th Jan 08 since the RSI was below 30 for
these many days.
 In case of RSI of Tata Motors, the best time to sell the stock was between 27th Sep 07 to 4th October 07
and 10th December 07 to 12th December 07 since the RSI was above 70 & it had reached its peak level.
The best time to buy the stock was between 8th August 07 to 23rd August 07 and 23rd Jan 08 to 24th Jan
08 as well as between 7th March to 18th March 08 since the RSI was below 30 for these many days.
 The 10 days moving average of Maruti Suzuki scrip, provides a message to the investor that it is a right
time to buy the Stock and, the trend of the Moving Average line has been decreased, so it is also a right
time to buy the stock.
 In case of 10 days Moving Average of Tata Motors Ssrip, the actual Stock price is just below its moving
average line. It indicates that investors are becoming increasingly bullish on the Stock Price of Tata
Motors.
 In Japanese Candle Stick Chart of Maruti Suzuki Ltd. we can see that the stock price has been decreased.
Simply Share Prices of Maruti Suzuki Ltd is falling down. It indicates that the investors are becoming
more bearish than bullish.
 In case of Japanese Candle Stick Chart of Tata Motors, we can observe lot of volatility in stock price.
Both the Bullish and Bearish trends are taking place. The Bullish trend is following by Bearish Trend
 Fundamentally, financial performance of these companies in respect of sales and profit is good.
 If an investor opts for long term investment then he will earn huge amount of return. Long term
Investment is known to be less risky.
 This study may not provide any guidelines to Speculators. It is useful to Long Term Investors.
 Technical analysts evaluate securities by analyzing statistics generated by market activity, past prices
and volume.
 One of the most basic and easy to use technical analysis indicators is the moving average, which shows
the average value of a security's price over a period of time. The most commonly used moving averages
are 10 days, 20 days, 30 days, 50 days, 100 days and 200-days moving average..
 One of the most important areas for any investor to look when researching a company is the financial
statement. Financial reports are required by law and are published both quarterly and annually.
 Indian Economy is consistently achieving a tremendous growth in these Sectors.
 If we consider RSI then almost all the scrips of these companies are lying between 30 and 70. It means
an investor should hold the scrips until it reaches 70 to sell and 30 to buy.
 The stock prices always take a correction after a major climb.
 Moving average is one of the best methods of predicting future movement of Stock Price. If we use 200
Day Moving Average for Analysis then volatility of stock will be less. It gives clear picture of
movement of Stock.

Conclusion of the study:

As we all know India is one of the fastest growing economies in the world. India is consistently
achieving growth in automobile sector. The automotive industry is witnessing tremendous and
unprecedented changes these days. On a global scale, the assets of the top ten automotive corporations
accounts for 28% of the assets of the world’s top 50 companies, 29% of their employment and 30% of their
total sales.
The Indian automobile industry is going through a technological change where each firm is engaged
in changing its processes and technologies to sustain the competitive advantage and provide customers with
the optimized products and services.
The automobile industry had a growth of 15.4 % during April-January 2007, with the average annual
growth of 10-15% over the last decade or so. With the incremental investment of $35-40 billion, the growth
is expected to double in the next 10 years.
Consistent growth and dedication have made the Indian automobile industry the second- largest
tractor and two-wheeler manufacturer in the world. It is also the fifth-largest commercial vehicle
manufacturer in the world. The Indian automobile market is among the largest in Asia.
The Ministry of Heavy Industries has released the Automotive Plan 2006-2016, with the motive of
making India the most popular manufacturing hub for automobiles and its components in Asia. The plan
focuses on the removal of all the bottlenecks that are inhibiting its growth in the domestic as well as
international arena.
 With comparatively higher rate of economic growth rate index against that of great global powers,
India has become a hub of domestic and exports business. The automobile sector has been contributing its
share to the shining economic performance of India in the recent years.
The Indian automobile industry is going through a phase of rapid change and high growth. With new
projects coming up on a regular basis, the industry is undergoing technological change. The major players
are expanding their plants and focusing on mass customization, mass production, etc
Apart from domestic production, the industry is consistently focusing on the automobile exports. The
auto component segment is contributing a lot in the export arena. The liberalized policies of the government
are now making the companies go for more and more exports.
Because of these reasons, the shares of automobile industry are performing well and therefore the
share market is attracting people to invest their hard earned money and find fortune. But lack of knowledge
about shares and stock market is making them cautious of investing in this market. They need to be educated
as well as guided to minimize the risk and to assess the return on their investment.

MORE TO COME

BIBLIOGRAPHY

BOOKS REFERRED:

1. Security Analysis & Portfolio Management, By, Punithavathy Pandian.

2. Investment Analysis & Portfolio Management, By Prasanna Chandra
3. Financial Markets & Institutions, By, Dr. S. Guruswamy
4. Security Analysis And Portfolio Management, By, Donald E.Fisher And Ronald J. Jordan,

WEB SITES:

1. www.bseindia.com
2. www.nseindia.com
3. www.stockchart.com
4. www.icicidirect.com
5. www.marutisuzuki.com
6. www.tatamotors.com
 7. www.investopedia.com
8. www.moneycontrol.com
9. www.equitymaster.com

MAGZINES AND JOURNALS:

1. Annual Reports of Companies.
2. Factsheet of Geojit Securities.