A Study on “the relationship between the Financial Performance

of a company and its Share Price”

Master Thesis Report submitted in partial fulfilment

Of the requirements for the degree of

MASTER OF BUSINESS ADMINISTRATION

By

Shagun Upadhyay

(1627358)

Under the guidance of

Dr.Sreelakshmi P

Institute of Management

Christ (Deemed to be university)

Bengaluru

March 2018

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 Declaration

I, Shagun Upadhyay, do hereby declare that the Master Thesis Report entitled “A study on
the relationship between the Financial Performance of a company and its Share Price” has
been undertaken by me for the award of degree of Master of Business Administration. I have
completed this study under the guidance of Dr.Sreelakshmi P Assistant professor, Deartment
of Finance, Christ( Deemed to be University), Bangalore

I also declare that this Master Thesis Report has not been submitted for the award of any
degree, diploma, associate ship, fellowship or any other title, in this University or in any
other University.

Place: Bengaluru Signature of the candidate

Date: ( )

ii
 Certificate
This is to certify that the Master thesis Report submitted by Shagun Upadhyay
on the title “A study on the relationship between the Financial Performance of a company and
its Share Price” is a record of master thesis work done by him/ her during the academic year
2016-2018 under my guidance and supervision in partial fulfilment of Master of Business
Administration.

Place: Bengaluru Signature of the Guide

Date: Dr.Sreelakshmi P

Associate Professor

Institute of Management

Christ (Deemed to be University)

Bengaluru

iii
 Acknowledgement
I am indebted to many people who have helped me in accomplishing this report successfully.

Firstly, I thank god for everything.

I thank Dean Prof.Srikant Rao and HOD of finance Prof Krishna MC for giving me the
opportunity to do my master thesis project.

I thank Dr.Sreelakshmi P for her support and guidance during the course of master thesis
report. I remember her with much gratitude for her patience and motivation, but for which I
could not have submitted this report.

I thank my parents for their blessings and constant support without which this report would
not have seen the light of the day.

Shagun Upadhyay

Register No. - 1627358

iv
 Page
TABLE OF CONTENTS No.

CHAPTER 1 (a) Introduction 2

(b) Need & Rationale 3

(c) Objectives of the Study 3

(d) Purpose of the Study 4

(e) Significance of the Study 4

CHAPTER 2 Literature Review 5-8

CHAPTER 3 (a) Variables of the Study 9

(b) Operational Definitions of the Variables 9-10

CHAPTER 4 (a) Statement of Problem 11

(b) Hypotheses 11

(c) Population and Sample 11

(d) Sampling Technique 12

(e) Data Collection Plan 12

(f) Tools to be used for the Study 12

CHAPTER 5 (a) Research Study 13

(b) Database of Companies 14 – 19

CHAPTER 6 (a) Research Output 20 – 35

(b) Findings & Interpretations 36 – 43

CHAPTER 7 (a) Limitations of the Study and Conclusion 44 – 45

(b) Bibliography 46-47

Table No. LIST OF TABLES Page No.

5.1 Sectors chosen for the Study 14

Database of EPS, ROE, BVPS and Share Price for the

5.2 Companies 14 - 19

Effect of overall financial performance of the company on its

6.1 share prices at the market level 20

Effect of overall financial performance of the company on its

6.2 share prices in the automobile sector 20

Effect of overall financial performance of the company on its

6.3 share prices in the cement sector 21

Effect of overall financial performance of the company on its

6.4 share prices in the banking sector 21

Effect of overall financial performance of the company on its

6.5 share prices in the pharmaceutical sector 22

Effect of overall financial performance of the company on its

6.6 share prices in the IT sector 22

Effect of overall financial performance of Maruti on its share

6.7 prices 23

Effect of overall financial performance of TATA Motors on its

6.8 share prices 23

Effect of overall financial performance of Eicher Motors on its

6.9 share prices 24

Effect of overall financial performance of M&M on its share

6.10 prices 24

Effect of overall financial performance of Ashok Leyland on

6.11 its share prices 25

6.12 25
Effect of overall financial performance of Ultratech Cement on
 its share prices

Effect of overall financial performance of ACC Cement on its

6.13 share prices 26

Effect of overall financial performance of Ambuja Cements on

6.14 its share prices 26

Effect of overall financial performance of Shree Cements on

6.15 its share prices 27

Effect of overall financial performance of JKL Cements on its

6.16 share prices 27

Effect of overall financial performance of SBI on its share

6.17 prices 28

Effect of overall financial performance of ICICI Bank on its

6.18 share prices 28

Effect of overall financial performance of Bank of Baroda on

6.19 its share prices 29

Effect of overall financial performance of HDFC Bank on its

6.20 share prices 29

Effect of overall financial performance of PNB on its share

6.21 prices 30

Effect of overall financial performance of Cipla on its share

6.22 prices 30

Effect of overall financial performance of Lupin on its share

6.23 prices 31

Effect of overall financial performance of Dr Reddy’ on its

6.24 share prices 31

Effect of overall financial performance of Aurobindo Pharma

6.25 on its share prices 32
 Effect of overall financial performance of Sun Pharma on its
6.26 share prices 32

Effect of overall financial performance of TCS on its share

6.27 prices 33

Effect of overall financial performance of Wipro on its share

6.28 prices 33

Effect of overall financial performance of HCL on its share

6.29 prices 34

Effect of overall financial performance of Oracle on its share

6.30 prices 34

Effect of overall financial performance of Infosys on its share

6.31 prices 35