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IILM-CMS2011 “Stock Return & Portfolio

Management ”

IAPM ProjectSubmitted to: DR. P. K. AGARWAL

ASIN GANGULY; (PGDM10-12/021, Sec – ‘A’

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TOTAL STOCKS ANALYZED :

➢ YES BANK LTD

➢ TATA MOTORS LTD

➢ BRITANNIA INDUSTRIES LTD

➢ ICICI BANK LTD

➢ HINDUSTAN PETROLEUM CORPORATION LTD. (HPCL)

➢ RASHTRIYA CHEMICALS & FERTILIZERS LTD. (RCF)

STOCK 1

YES BANK LTD

YES Bank Limited is an Indian Bank, engaged in providing arange of banking and financial services. The Bank’s businesssegments include Treasury, Corporate/Wholesale Banking, and

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Retail Banking, Corporate Finance, Transaction Banking and ahost of other Banking services. It was founded by RanaKapoor and his partner (Late) Ashok Kapur, with the duo holding acollective financial stake of 27.16%.

In 2010, the bank announced the roll-out of a strategic blueprint,named Version 2.0 of the bank, to further accelerate its businessgrowth in the retail banking space, with the objective to achieveby 2015, a balance sheet size of Rs.1,50,000 crore, a pan Indianetwork of 750 branches and a human capital base 12,000 by2015

Boards of Directors

• Dr. Rana Kapoor: Founder/Managing Director & CEO YES BANK LTD.

• Mr. Wouter Kolff

• Mr. Bharat Patel

• Mr. S.L Kapur

• Mr. Arun K Mago

• Ms Radha Singh

• Mr. Ajay Vohra

STOCK STANDING from 10th August TO 2ndSeptember 2011

PRICE EARNING RATIO: 13.48

EARNING PER SHARE (EPS): 20.95

DIVIDEND PAYOUT RATIO: 13.91

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STOCK 2

TATA MOTORS LTD

Tata Motors is a part of the Tata Group manages its share-holdingthrough Tata Sons. The company was established in 1950 as alocomotive manufacturing unit and later expanded its operationsto commercial vehicle sector in 1954 after forming a joint venturewith Daimler-Benz AG of Germany. Despite the success of itscommercial vehicles, Tata realized his company had to diversifyand he began to look at other products. Based on consumerdemand, he decided that building a small car would be the most

practical new venture. So in 1998 it launched Tata Indica, India'sfirst fully indigenous passenger car. Designed to be inexpensiveand simple to build and maintain, the Indica became a hit in theIndian market. It was also exported to Europe, especially the UK and Italy.

Board of Directors

Mr. Ratan N. Tata (Chairman)

Mr. Ravi Kant

Mr. Nusli N. Wadia

Mr. S M Palia

Dr. R. A. Mashelkar

Mr. Nasser Munjee

Mr. Subodh Bhargava

Mr. V K Jairath

Mr. Ranendra (Ronen) SenDr. Ralf Speth

Mr. Carl-Peter Forster

Mr. Prakash M. Telang

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STOCK 3

BRITANNIA INDUSTRIES LTD

Britannia Industries Limited is an Indian company based

in Kolkata that is famous for its Britannia and Tiger brands of

biscuit, which are popular throughout the country. Britannia has

an estimated 38% market share.[1]

The Company's principal activity is the manufacture and sale of

biscuits, bread, rusk, cakes and dairy products.

Board of Directors

Mr. Nusli Neville Wadia Chairman

Ms. Vinita Bali Managing

Mr. A.K.Hirjee

Dr. Ajai Puri

Mr. Avijit Deb

Mr. Jeh N Wadia

Mr. Keki Dadiseth

Mr. Nasser Munjee

Mr. Ness Nusli Wadia

Mr. Nimesh N Kampan

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Mr. Pratap Khanna

Mr. S. S. Kelkar

Dr. Vijay L. Kelkar





STOCK 4

ICICI BANK LTD

ICICI Bank was established in 1994 by the Industrial Credit and

Investment Corporation of India, an Indian financial

institution, as a wholly owned subsidiary. The parent company

was formed in 1955 as a joint-venture of the World Bank, India's

public-sector banks and public-sector insurance companies to

provide project financing to Indian industry. The bank was initially

known as the Industrial Credit and Investment Corporation of

India Bank , before it changed its name to the abbreviated ICICIBank . The parent company was later merged into ICICI Bank.

BOARD OF DIRECTORS

Mr. K. V. Kamath, Chairman

Ms. Chanda Kochhar, Managing Director & CEO

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Mr. N. S. Kannan, Executive Director & CFO

Mr. K. Ramkumar, Executive Director

Mr. Rajiv Sabharwal, Executive Director

Mr. Sridar Iyengar

Mr. Homi R. Khusrokhan

Mr. Arvind Kumar

Mr. M.S. Ramachandran

Dr. Tushaar Shah

Mr. V. Sridar

STOCK STANDING from 10th August TO 2nd

September 2011




STOCK 5

HINDUSTAN PETROLEUM CORPORATION LTD.(HPCL)

Hindustan Petroleum Corporation Limited (HPCL) is anIndian state-owned oil company headquartered at Mumbai,India and is a Fortune 500 company of India listed at number 336.HPCL operates 2 major refineries producing a wide variety of petroleum fuels & specialties, one in Mumbai (West Coast) of 6.5

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Million Metric Tonnes Per Annum (MMTPA) capacity and the otherin Vishakhapatnam, (East Coast) with a capacity of 8.3 MMTPA.

BOARD OF DIRECTORSMr. S. Roy Choudhury, Chairman & Managing Director

Dr.V. Vizia Saradhi, Director- Human Resources

Mr.B.Mukherjee, Director- Finance

Mr.K. Murali, Director- Refineries

Ms. Nishi Vasudeva, Director- Marketing

Mr.P.K.Sinha, Director

Mr.L.N.Gupta, Director

Dr. Gitesh K Shah, Director

Shri S K Roongta, Director

Shri. Anil Razdan, Director





STOCK 6

RASHTRIYA CHEMICALS & FERTILIZERS LTD.(RCF)

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RCF was incorporated under the Companies Act 1956. Thecompany was formed after the reorganization of the Fertilizer

Corporation of India (FCI) into 5 companies. Till 1992, thecompany was a wholly owned PSU. During 1992 and 1993, someof the equity has been disinvested to financial institutions, publicetc.

BOARD OF DIRECTORS

Shri R.G. Rajan, Chairman & Managing Director

Shri.Gautam Sen, Director(Finance)

Shri.Manoj Priya, Director(Technical),

Dr V.Rajagopalan, IAS, Director

Shri Sham Lal Goyal, IAS, Director

STOCK STANDING from 10th August TO 2nd September2011




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PORTFOLIOSTOCKS UNDERTAKEN IN PORTFOLIO:

• TATA MOTORS LTD• ICICI BANK LTD• HINDUSTAN PETROLEUM CORPORATION LTD.

The reason behind choosing these three stocks only is that out of the chosen six stocks only these three are showing less differencebetween average returns & their respective risks when thehorizon is set to 3 yrs

Data Analysis of PortfolioStocks

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x y z

Month Tata Motors Icici Hpcl

Jul-09 181.690611 82.3324526 22.13473 xy yz xz

Jan-10 64.7135571 9.39990778 -4.34097 Covarian 1917.902 197.7881 310.3542

Jul-10 21.8621733 8.91738921 29.69897 xy yz xz

Jan-11 35.7028896 12.7757201 -16.9746 r(Coeffici 0.950026 0.389253 0.269884

Jul-11 -17.4918354 1.74019608 6.467316

Risk 67.5930149 29.8668111 17.01292

BETA 2.50921706 1.17724971 0.337553

Rsm 0.93433238 0.9920755 0.499376

STOCKS Avg. ReturnTotal Risk r(Coeff.) Weightage

Tata Mot 57.2954792 67.5930149 0.950026 0.33 RISK = σxyz 34.12568

Icici 23.0331331 29.8668111 0.389253 0.33 RETURN = Rxyz 29.2419

Hpcl 7.39708908 17.0129217 0.269884 0.33

STOCK NO 2, 4 &5

PORTFOLIO

RETURN

PORTFOLIO

Analysis of portfolioBy analyzing the portfolio stocks it can be derived that theportfolio is giving more returns when compared with theindividual stocks except Tata Motors but its risk is also less whencompared to all.

The data are stated above.

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Henceforth it can be stated that it’s beneficial to invest in aportfolio containing these stocks, as returns are high compared toindividual with low risk.

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Complete Findings & DataAnalysis

STOCKS Rsm R RSI ᵦ RISK AvgReturn 52WeekH/L

YESBANK 0.855558224 0.840897 45.67866 1.633327 3.046444 -0.532171945 388.00 - 233.55

TATA MOTO 0.77069452 0.516603 34.06317 1.470617 3.02378 -0.74497429 1,381.40 - 695.00

BRITANIA IN 0.297326871 1.844113 64.83965 0.247754 1.329708 0.182527905 534.70 - 324.00

ICICI BANK 0.567558664 0.95268 48.78834 1.09067 3.066565 -0.558530227 1,277.00 - 813.55

HPCL 0.148214404 0.452793 31.16705 0.127862 1.376643 -0.265222378 555.45 - 307.00

RCF 0.015675058 0.673629 1.673629 0.039632 4.034654 -0.091229538 132.25 - 70.90

STOCKS Rsm ᵦ RISK AvgReturn CURRENTMKTPRICE

YESBANK 0.935333410 2.231979 60.06046 48.52145 290.75

TATA MOTO 0.934332381 2.509217 67.59301 57.29548 769.05

BRITANIA IN 0.431470818 0.741427 43.24956 -1.84442 478.65

ICICI BANK 0.992075502 1.17725 29.86681 23.03313 896.80

HPCL 0.499376245 0.337553 17.01292 7.397089 391.85

RCF 0.846480918 1.600855 47.59922 25.81423 80.65

STOCKS Rsm ᵦ RISK AvgReturn

X TATA MOTORS 0.934332 2.509217 67.59301 57.29548

Y ICICI BANK 0.992076 1.17725 29.86681 23.03313

Z HPCL 0.499376 0.337553 17.01292 7.397089

RISK

XY YZ XZ XY YZ XZ

1917.901504 197.7881 310.3542 0.950026 0.389253 0.269883874 34.12568395

SUMMARY

15 DAYSHORIZON

3 YEARSHORIZON

PORTFOLIOSTOCKS

P

O

R

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F

O

L

I

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COVARIANCE COEFFICIENTOFCORELATION

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Interpretation &Recommendations:If we analyze all the six stocks on the last 15 days time & 3yrstime the interpretation that can be given on the stocks is that:-

YES BANK :- The risk arrives to 3.04% with a avg. return of -0.532%. The beta value is 1.63 with correlation between security& market is 0.85. Its RSI stands on 45.67 denoting that to HOLDthe security if purchased or wait for a while as prices shall fall. Butif we increase the watch view to 3 yrs it can be seen that the

stock has performed well with its avg return of 48.52% withattached risk of 60.06%

TATA MOTORS: - The risk arrives to 3.02% with a avg. return of -0.74%. The beta value is 1.47 with correlation between security& market is 0.51. Its RSI stands on 34.06 denoting that to BUYsecurity. But if we increase the watch view to 3 yrs it can be seenthat the stock has performed well with its avg return of 57.29%with attached risk of 67.59%

BRITANNIA:-The risk arrives to 1.32% with a avg. return of

0.18%. The beta value is 0.24 with correlation between security &market is 0.29. Its RSI stands on 64.83 denoting that to SELLsecurity asap. But if we increase the watch view to 3 yrs it can beseen that the stock has underperformed with its avg return of -1.84% with attached risk of 43.24%

ICICI BANK : - The risk arrives to 3.06% with a avg. return of -0.55%. The beta value is 1.59 with correlation between security& market is 0.95. Its RSI stands on 48.78 denoting that to BUY indue course of time, right now HOLD. But if we increase the watch

view to 3 yrs it can be seen that the stock has underperformedwith its avg return of 23.03% with attached risk of 29.86%

HPCL: - The risk arrives to 1.37% with a avg. return of -0.26%. The beta value is 0.12 with correlation between security & marketis 0.14. Its RSI stands on 31.16 denoting that to BUY asap. But if we increase the watch view to 3 yrs it can be seen that the stock

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has underperformed with its avg return of 7.39% with attachedrisk of 17.01%

RCF: - The risk arrives to 4.03% with a avg. return of -0.09%. The

beta value is 0.03 with correlation between security & market is0.015. Its RSI stands on 1.67 denoting that to BUY but the pricesshall fall. But if we increase the watch view to 3 yrs it can be seenthat the stock has underperformed with its avg return of 25.81%with attached risk of 47.59%

It can be seen that the avg returns of all the stocks are down inshort term because of the CREDIT RATING fall of US, possibility of

THE GREAT DEPRESSION & RBI increasing the INTEREST rates.

Disclaimer:

Investment involves risk. The price of securities may move up or down and may become valueless. Theinformation is strictly for information purposes only and should not be considered as an offer, or solicitation, to deal in any if the investments mentioned herein. All samples are only hypothetical. Do not rely on the material to make investment decision

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