Vivek Project Final Copy.docx

CHAPTER 1 INTRODUCTION Doing project in an integral part of MBA curriculum in VTU. It is an initiative to bridge the gap between the knowledge and its application and it helps to apply the things in practical like what we have studied or discussed in the classroom & implement the same concept in the project report. This project has been conducted during the 4th semester of MBA program and it has been carried for a period of 10 weeks on the topic called “THE ANALYSIS OF INVESTORS RISK AND RETURN ON EQUITY SHARES” at Geojit, Bangalore. It was pleasure to do internship project report in this company. During this finance project, I have learnt some basic concepts about stock market and also some information about derivative market and its product. The resolution of the study is to empower the students to realize the practical world. INDUSTRY PROFILE The capital market reforms were initiated in 1991, as part of the structural reforms comprising industrial deregulation, privatization, and financial reforms through liberalization of domestic economic policies and foreign exchange policies. Capital is a vital factor of production, necessary for economic development. A marketplace for raising funds, for capital formation and investment, is stated as capital market, is so terribly important for economic development of any country. Investment comes from savings and also the mobilization of savings may be a major operate of the capital market. Capital market may be a wide term use to comprise all operations within the new problems and securities market. New problems created by the businesses represent the first market, whereas commercialism within the existing securities relates to the secondary market. whereas we are able to solely stock the first market, we are able to obtain and sell securities within the secondary market. Capital market so provides funds from public who are measure savers to investors. The surpluses of the house sector and foreign sector square measure accustomed meet the deficits of the government. and business, who invest more than they save, or pay more than their financial gain. Besides the allocation of the funds and flow of funds from less profitable to additional profitable avenues and intercession between savers and investors square measure the functions of the capital market. CAPITAL MARKET

Capital market is wide term use to comprise all operation in the new issue and securities market. New issue created by the businesses constitutes the first market, whereas commerce in the existing securities relates to the secondary market. The term capital market encompasses all operations of F.I.s, banks, etc. At the long finish of spectrum of maturities. The demand and supply for long run funds square measure mirrored in the capital market, that may be a marketplace for borrowing and landing for more than one year. Indian capital market’s land marks and development: 

  

 

Amendment to banking regulation act in 1983 permitting banks to undertake non-banking functions like merchant banks and mutual funds who started operations in the capital market through their subsidiaries. Entry of public sector banks through mutual funds in a big way since 1987 for channeling small saving into the capital market. Setting up of the SEBI by the govt. in 1988 to oversee capital market. Establishment of SHCIL (Stock Holding Corporation India Ltd) by all India Financial Institutes (AIFIs) & books introducing a new concept depository functions & book keeping for stock market dealings of the sponsoring institutions. Setting the credit rating agencies, namely, CRISIL, ICRA, CARE, etc. from 19988 onwards popularizing the credit rating functions by companies issuing debt instruments. Introducing a new tier to the capital market structure OTCEI was set up in1989 operations in 1982.

STOCK MARKET INTRODUCTION; Stock exchange are the foremost good style of the marketplace for securities positively govt. and semi-govt. groups or alternative public bodies also for shares and debentures issued by the jointstock firms. In the securities market, purchase and sales of shares are created in conditions of free competitions. Govt. securities are traded outside the mercantilism ring in the form of over the counter sales and purchases. ORIGINS OF THE INDIAN STOCK EXCHANGES; The origin of the securities market goes back to the time when securities represented the property and promise to pay wherever initial issue had been transferable from one person another. The earliest recorded securities market dealings in India were transactions in loan Stock Exchanges of the East India company, towards the end of the eighteenth century. Wide ranges of the banks and cotton mills securities were being traded in Bombay and Calcutta by 1830. The company’s act 1850 introduced a new concept of limited liability with sole motive with simulating activities in securities market.

During the boom 186-1900 brokers and bank managers were a privileged and a decent category and police had solely “Salam” for them. once the war, brokers were thought of as a social nuisance and were driven from post to pillar. They were shifted from place to position. Finally, they found in a street referred to as ‘Dalal Street’ wherever they transacted their business. STOCK EXCHANGE “Stock exchanges suggests that anybody or individuals whether incorporated or not, accepted for the business of buying, merchandising or dealing in securities”. it's an organization of member dealers for the aim of self-regulation and reserves the interests of its peoples. It will be operated only if it's recognizing by the govt. below the securities contracts (regulations) act, 1956. The identify is granted below sec three of the act by the central government. FUNCTIONS OF THE STOCK EXCHANGE          

Provides space for the buyers and sellers Regulation of the market Efficient allocation of capital market Market surveillance to monitor the prices of securities Education role Secondary market function Handling compliances and grievances Heathy distributions of new securities Expert investment advice Balance in fluctuations of prices

BOMBAY STOCK EXCHANGE (BSE) Bombay stock exchange restricted is that the oldest securities market in Asia with an expensive heritage. Generally referred to as “BSE”, it had been set up as “the native shares and stock brokers association” in 1875. It's the first securities market within the country to get perpetual identify 1956 from govt. of India below the securities contracts(regulation) act,1956. The exchange’s important and pre-eminent role within the development of Indian capital market is widely identified and its index, Sensex is tracked worldwide. Earlier and association of persons (AOP), the exchange is currently approach. Interns of organization framework, the committee formulate bigger policy problems & exercise over-all control. The groups accepted by committee or board based mostly the director and a management team of skilled manage the day to day operations of the exchange. The exchange contains a nationwide reach with occurring with 417 town and cities of India. The system & processes of trading’s are style to trading market safeness & increase clearness in operations. During the year 2004-05, the trading volumes on exchange showed strong growth.

The exchange contributes an effective & clear marketplace for trading in equity shares, debt instruments and derivatives. The BSE’s on-line trading system (BOLT) is ownership system of the exchange and is BS7799-2-2002 certified. The close observation & clearing & settlement functions of the exchange are ISO9001:2000 certified. NATIONAL STOCK EXCHANGE (NSE) The high power study group on formation of latest securities market popularly referred to as Pherwani Committee had in 1991 suggested the promotion of a brand new securities market at new Mumbai as a model security market & to act as the National stock exchange. In order to supply nationwide securities market facilities to investors, upgrading the facilities & to carry the Indian capital market in line with the universal markets in 1992, the NSE was established. The securities market has two separate segments viz, capital market segment and money market section. Capital market segment would cover commercialism inequities, convertible debentures, nonconvertible debentures etc. NSE provides access to investors from all across the country on an equal footing and works as an integral part of the National securities market system. The growth of business on NSE since the time when exchange started its operations, i.e., on Nov three, 1994.Over the amount, the avg commercialism volume has redoubled manifold. The value of the traded scrip’s during the year 1999-2000 on NSE was eight, 39,052 large integers (40% of the entire turnover of all the stocks exchange combined in India) compared to Rs.369052/- (30.49 the entire turnover of all the securities markets combined in India) on the country’s premium stock market the Bombay stock exchange. TRADING IN NSE: NSE was introduced for the first time in India, totally electrical screen based dealings. It uses a existing, totally processed buying and selling system deliberate to supply investors across the length and breadth of the country is harmless and guileless thanks to invest. The NSE dealing scheme known as “National Exchange for machine-controlled trading” (NEAT) is totally machine self-controlled screen based dealing system, that adopts the principle of an order operated market. •Wholesale debit market segment(WDM) •Capital market segment(CM) The wholesale debit market segment or market because it is usually observed is a facility of institutions, banks, company & high network people high enter into great worth dealings in tools like, govt. securities, treasury bills, public sector unit’s bonds, business papers, certificate of

deposits, etc. Capital market segments covers commerce in equities (presently) convertible debentures and different innovative monetary instruments. BENEFITS OF NSE TO TRADING MEMBERS:  Efficient services to clients  Savings in man power and establishment costs  Back office load is reduced as the system generates reports of orders and traders  High growth in trading volumes as a result of automated trading system  Establishments of a computer network to receive orders from various locations  Transparency in the system increase investors’ confidence  Trading as well as settlement is monitored and regulated by the exchange ensuring fairness among the members  Foreign investing community favors an automated and regulated exchange

BENEFITS OF NSE TO INVESTORS:     

Assured of best prices in the market Price brokerage is separately shown a contract act Time conditions, allow the investors to keep his order open till it is executed Quantity conditions ensures that the buyers want the securities in proper marketable lots as per his requirements Date and time of the trade is indicated on the orders and trace confirmation slip, which provides a power audit trail

COMPANY PROFILE Geojit financial Services Ltd was founded by C.J.George in 1987 as a proprietorship for doing Broking business in cochin securities market.The partnership between promoters Mr. C. J.George and Mr.Ranjit Kanjilal became a sole ownership on Kanjilal’s retirement in 1983.Geojit securities became a company broking house in 1995. In 1994, the business was confiscated by Geojit securities Ltd, a joint venture between mister. C. J. George and also the Kerala State Industrial Development Corporation Ltd(KSIDC). In the following year, the corporate came up with AN Initial Public Offer(IPO) and also the shares were listed in varied securities market in India in 1995. Geojit securities Ltd, is growing as a “Financial Supermarket”. This gives all modern financial capital market services under 1 roof. Geojit securities ltd, is the 1st “on line share broking firm” in India. The company stands as the first member of National Stock Exchange(NSE),in Kerala.The 1st company to give depository services in South India.Geojit securities ltd is India’s 1st internet

brokerage firm.It has been active in the field of capital markets for fifteen years.It is a leading retail broker listed on major stock exchanges and has 100 offices across the country. Geojit serves a client base of around one lakh investors. The company has been growing at over three hundredth annually and incorporates a internet price of over Rs.13 crores. The company endeavors to provide the best services at the lowest possible cost to investors, well qualified human resources and constant up gradation of technology support this aim. The company possesses the largest pool of certified professionals in the Indian stock broking industry. A Geojit security limited is a well-established corporate sector in the Indian capital market. Its rate of return is growing per year. Its role in the market and in the worldis expanding. The company also has an institute named as “Geojit Institute of capital market” also to train Geojit’s staff to equip them with modern technology for trading and related services. The staff is also trained for qualifying in the NCFM exam conducted by NSE. The electronic share trading, including internet based trading and derivative trading are the most modern operational technique in the capital market. Geojit is the member to start trading in index Futures & Options being a new concept, investors are hesitating to enter this business. To spread awareness about the derivatives among investors. Mutual fund is an important tool or product in the capital market. It has its own mutual fund department. Now all branches are being registered as per the statutory compliance of the ESI Act, which states that Geojit is a commercial establishment.

COMPANY PROMOTERS 1. BNP Paribas 2. Kerala State Industrial Development 3. Eldho Abraham 4. C.J. George 5. BNP Paribas India Holding Private 6. Binoy Abraham 7. Shiny George 8. Lazar M A 9. Susan Raju 10. Emily Rajan 11. Jones George C

12. Sara Macheril George 13.Jyothis Abraham George 14. Sally Sampath VISION AND MISSION VISION: 

The vision of Geojit is to be leading financial and commodities markets intermediary for individual and institutional clients from India and overseas. They continually strive to raise their products and services standards by intelligent application of technology and processes.



MISSION:   

To understand and respect customers’ needs to consistently deliver total quality solution through constants skills up-gradation. To believe that the company culture helps to attract and retain best talent. To freely share their investments experience across all ages and strata of society to encourage wise investments for a better future.

Quality policy Talented, efficient and element team of youngsters rolling out high position application for the world profession, keeping in mind true quality, total customers satisfaction, delivering on time, every time. They are forever effort for continuing development and improvement of our own set values in succeeding total quality management. The quality of the merchandise and services provided by Geojit to clients is that the concern of each workers within the organization. All are therefore creative thinking concerned in on condition that top quality merchandise and services through; Responsiveness to client wants Provision of labor satisfaction and promising careers Constant measuring and observation of all operation Continuous improvement of procedures, merchandise and services Performance of operation in an exceedingly accountable manner

PRODUCTS / SERVICES PROFILE Following are the various product and services of Geojit 1. Equity a) NSE b) BSE c) Net Trading 2. Derivatives a) Index futures b) Index options c) Stock futures d) Stock options 3. Margin trading and funding scheme 4. Loan against share 5. Loan for commodity trading 6. Depository services a) Internet services b) DEMAT c) All DP services are available at all the branches d) Delivery of shares with the help of internet e) Off market transaction 7. Portfolio management services 8. Fixed deposits 9. Non-convertible debentures 10. Distribution a) Initial public offering (IPO) b) Mutual funds c) Corporate bonds and government securitiesd) Life & general insurance product

AREA OF OPERATION Globally    

Dubai Abu Dubai Bahrain Kuwait

   

Ras Al-Khaimah Sharja Muscat European country

Nationally          

Delhi Karnataka Goa Tamilnadu Pondicherry Maharashtra Gujarat Uttar Pradesh Kerala Madhya Pradesh

Regional         

Bangalore Belgaum Dawangere Mysore Mandya Hassan Dharwad Mangalore Bagalk

        

Andhra Pradesh Uttarakhand West Bengal Bihar Haryana Jammu & Kashmir Orissa Punjab Rajasthan

OWNERSHIP PATTERN Sl.No 1 a) i. ii. b) i. 2 a) b) i. ii. iii. iv.

Contribution Shareholding of promoter and promoter group Indian Individuals Corporate bodies Foreign Corporate bodies Public share holding Foreign institutional investors Non institutions Body Corporate Directors and their relatives NRI Clearing members TOTAL

Percentage

20.64% 8.93% 34.22% 2.34% 16.61% 13.15% 2.92% 1.19% 100%

INFRASTRUCTURAL FACILITIES  Geojit provides online trading services to the clients  The co provides the various services such as,  Sending mails everyday about transaction details to the client’s ID  Company staff will provide information through telephone  The company also provides security to the clients  Company gives more importance to the cleanliness  Geojit also provides allowances facilities such as:  Travel allowance  Medical allowance  House rental allowance  The company also facilitate mobile applications like SELFI,  Company also provides refreshments for clients  Tax saving schemes  Equity linked savings scheme  Some of the bonds to reduce the risk of tax i. Govt. bonds ii. Rural electrical company

iii. iv.

National high way authority of India Indian railway financial corporations

COMPETITORS DETAILS Category ‘1’ (these are the firm which provides DMAT, trading and along with the banking facilities)  ICICI Direct  Kotak securities  HDFC securities Category ‘2’ (these are the firm which provides DMAT, trading facilities)          

Sherkhan stock broking limited AnandRathi stock broking limited India info line Broking Limited Indian Bulls Edelweiss Limited Angle Broking limited Zerodha Ventura RK Global Karvy

SWOT ANALISIS STRENGTH         

Geojit has an International expertise It facilitates multichannel services in order to support the clients through internet, mobile and local office etc. It has above 550 offices, about 300 cities across India It works for around 776000 trades It has constantly been an initiator there by, has taken an advantage of 1st mover in financial services The company has qualified, experienced, well trained and industry certified employees It offers wide range of products or services It also creates a large employment opportunity It has developed mobile application like selfie

WEAKNESS

It has less perforation (in some region of the country) Lack of awareness among investors because of low promotion. Lack of proper training. OPPORTUNITY   

It provides customized and cheaper services through growing rural market Geojit has an opportunity to increase an investor by providing an education regarding stock market trading. Geojit can attract the customers through its various products and services offered.

THREATS     

The major threats are banks entry of large number of competitors The company services mainly based on the investors and markets trends or conditions. There are some strict procedures of SEBI It involves inflexible economic measure by government and RBI increases entrance of Foreign Finance companies in Indian market.

FUTURE GROWTH AND PROSPECTUS i. ii. iii. iv. v. vi. vii. viii.

The company’s main target is to become a number 1 stock broking company in India. They are planning to increase the market share in India. They are focusing on insurance advisory services and currency trading. They are focusing more on retail and institutional investors by facilitating more products or services. Company focusing on developing a research team in technical and fundamental analysis. Geojit has opportunities to increase in insurance and mutual funds. They are also planning to increase the more number of branches. They are planning to invest for improving the technology.

FINANCIAL STATEMENTS: Profit and Loss Account as on 31st March 2017 to 2013 Particulars 31-Mar-17 31-Mar-16 31-Mar-15 31-03-14 31-Mar-13 1. Revenue from 2,443,463,004 2,172,981,063 2,720,222,326 1,730,271,174 1,978,380,998 Operations 2. Other Income 224,035,452 190,680,131 172,445,277 229,172,565 349,554,221

3. Total Revenues (1+2) 4. Expenses: (a) Operating Expenses (b) Employee Benefit Expenses (c) Finance Costs (d) Depreciation and Amortization Expenses (e) Other Expenses Total Expenses 5. Profit Before Exceptional Item and Tax (3 – 4)

2,667,498,456 2,363,661,194 2,892,667,603 1,959,443,739 2,327,935,219

6. Exceptional Item

-100,000,000

7. Profit / (Loss) Before Tax (5+6) 8. Tax Expenses: (a) Current Tax Expenses (b) Deferred Tax Expenses / (Credit) Net Tax Expenses 9. Profit / (Loss) for the Year (7 – 8) 10. Earnings per Equity Share (Face value of Rs. 1/- each) (a) Basic (b) Diluted

562,012,097

487,783,461

609,759,823

394,398,887

725,196,680

803,258,539

765,242,451

748,787,734

579,077,359

494,457,378

5,310,734

7,266,142

10,373,893

7,525,328

7,882,110

123,850,231

113,192,479

84,798,218

95,347,596

112,904,352

432,650,135 444,868,096 428,474,129 381,586,724 430,822,383 1,927,081,736 1,818,352,629 1,882,193,797 1,457,935,894 1,771,262,903 740,416,720

545,308,565

1,010,473,806 501,507,845

556,672,316

1,119,339,780

640,416,720

172,580,000

323,840,000

-617,831,935

556,672,316

256,970,000

16,766,000

11,160,000

156,919,000

160,300,000

1,000,000

189,346,000

335,000,000

16,000

-23,272,000

-707,000

355,962,565

675,473,806

156,935,000

137,028,000

-774,766,935

419,644,316

-3 -3

2 2

383,153,720

1.63 2

1.53 1.52

2.94 2.92

Balancesheet as on 31st march 2013-to 2017

RATIOS 1. Current Ratio = Current Assets/Current liabilities Particulars

Current Assets

Current Liabilities

current ratio

2017

645.96

244.4

2.64

2016

480.64

164.12

2.92

2015

496.45

208.74

2.37

2014

496.78

248.6

1.99

2013

597.47

211.43

2.82

Current Ratio 2.92

3

2.82

2.64 2.37

2.5

1.99

2 1.5 1 0.5 0 2017

2016

2015

2014

2013

Interpretation: From the above chart, the current ratio is varies from one year by year. However, it reached its ideal ratio of 2.92 during 2016, which shows that the company is in good solvent position. Proprietary Ratio = Shareholders fund/Total assets Particulars Shareholders fund Total Assets

proprietary ratio

2017

512.41

818.26

0.62

2016

490.37

704.84

0.69

2015

468.52

721.7

0.64

2014

434.42

722.82

0.6

2013

469.28

174.21

0.64

proprietory ratio 0.69

0.7 0.68

0.64

0.66 0.64

0.64

0.62 0.6

0.62 0.6 0.58 0.56 0.54

2017

2016

2015

2014

2013

Interpretation: From the above chart, the company proprietary ratio in the year of 2013 is 0.64 in the year 2014 the ratio has diminishing to 0.6, in the year 2015 ratio has improved to 0.64, in the year 2016 ratio has again improved to 0.69, in the year 2017 the ratio has come down to 0.62 percent. Finally, the company capital structure ratio fluctuating by every year this ratio shows that the company shareholders fund increasing year by year it indicates that company performance well. 3.Current assets of fixed assets ratio = Current Assets/Total Assets Particulars 2017 2016 2015 2014 2013

Current Assets 645.96 480.64 496.45 496.78 597.47

Total Assets 818.26 704.84 721.7 722.82 174.21

current assets of fixed assets ratio 0.78 0.67 0.68 0.68 0.81

current assets of fixed assets ratio 0.9

0.81

0.78

0.8

0.67

0.68

0.68

0.7 0.6 0.5 0.4 0.3 0.2 0.1 0 2017

2016

2015

2014

2013

Interpretation: From the above chart, the company current fixed assets ratio is in the year of 2013 is 0.81and the year 2014 & 2015 the ratio has maintain the 0.68, 78in the year 2016 ratio has go down to 0.67, in the year 2017 ratio has again increased to 0.78. Finally, the company capital structure ratio fluctuating by every year this ratio shows that the company shareholders fund increasing year by year it indicates that company performance well.

CHAPTER 2 CONCEPTUAL BACKGROUND AND LITERATURE REVIEW BACKGROUND OF STUDY Every monetary decision contains a part of risk and a part of return. the connection between risk and return exists within the kind of a risk-return trade-off, by that it's meant that it's only attainable to earn higher returns by agree to receive higher risk. If an capitalist desires to earn higher returns, then the capitalist should appreciate that this can only be achieved by agree to receive a corresponding increase in risk. Risk and return are absolutely correlated; a rise in one is among a rise within the different. In financial management nowadays the treatment of risk is that the main part in monetary call making. Key current questions involve however risk ought to be measured, and the way the desired return related to a given risk level is decided. However, risk didn't continuously have such a outstanding place. before 1952 the risk part was typically either assumed away or treated qualitatively within the monetary literature. A monetary conclusion usually involves risk. let's say, a corporation that borrows funds faces the danger that interest rates could modification, & a corporation that builds a replacement factory faces the danger that product sales is also less than expected. These and lots of different selections involve future funds flows that are risky. Investors usually dislike risk, however they're conjointly unable to avoid it. The valuation for shares and debt securities shows that the value of a risky product depends on its expected future money flows, the duration of cash, and risk. to create effective monetary selections, managers got to perceive what causes risk, however it ought to be measured & also the impact of risk on the speed of return needed by investors (Peirson, Brown, Easton, Howard, and Pinder, 2011).

Risk and return analysis Risk: Risk suggests that you've got the likelihood of losing some, or maybe all, of your original investment. Low level of uncertainty is related to low potential returns; High level of uncertainty are related to high potential return. Finally, risk suggests that uncertainty of investment method.    

Risk returns to dispersion of a variable. It is measuring the Standard deviation. Variance is the sum of deviation of actual return from average return. Standard deviation=(variance²)½

Types of Risk

1. Systematic risk 2. Systematized risk Systematic risk: Additionally, referred to as "market risk" or "un-diversifiable risk", systematic risk is that the uncertainty intrinsic to the complete marketplace or entire marketplace section. Additionally, mentioned as volatility, systematic risk is that the everyday fluctuations during a stock's value. Volatility could be a live of risk as a result of it refers to the performance, or "temperament," of your investment instead of cause for this behavior. As a result of market movement is that the reason why individuals will create cash from shares, fluctuation is decisive for returns, & therefore the additional unstable the investment the additional probability there's that it'll expertise a affected modification in either direction.

international events

int rate risk

industrial risk

market risk

political risk

Un systemized Risk: Additionally, referred to as "specific risk," "diversifiable risk" this kind of uncertainty comes with the corporate or business you invest in & may be reduced through diversification. as an example, news that's specific to little variety of stocks, similar to an unexpected strike by the workers of an organization you've got shares in, is taken into account to be un systemized risk.

Business risk

Industrial disputes

Non systemati c risk

Financial risk

Uncertainity

Return: A return is that the gain or loss of a security in a very specific duration. The return consists of the financial gain & therefore the capital gains relative on in investment. The overall rules are that a lot of risk you are taking, the bigger the potential for higher return.

Relationship between Risk and Return Risk/Return Tradeoff

Less risk Less return

Return

More risk More return

Risk The Risk and Return is one of the main concepts in finance subject. Every financial decision involves in Risk and return analysis. Every time high return expecting high risk. In case every investors demand higher return the risk level is also high. The risk and return both have a direct relationship. The investors measure this relationship and use that measurement to build an appropriate risk and return. CAPM: CAPM is measuring the relationship b/w the probable return for assets and systemized risk. Calculation of CAPM(SML) Model Ri = Rf + Beta ( Rm-Rf )

REVIEW OF LITERATURE 

Bedanta Bora and Anindita Adhikary: 2011: (Dept. of management studies, Sikkim Manipal University) The risk and return is characterized by stock market investment. The return is yield to capital appreciation. Risk is uncertainty of the future outcomes. The two types of risk are one is systematic risk and another one is unsystematic risk. Risk analysis and return both have an uncertainty and it

is not measured easily, totally the study s-ays, high risks create a high return low risk create a low return. 

Dr Narayanasamy, Ms. R.Thirugnanasoundari March to April 2016 - it'll be ready to verify the market value and trading volume for the stock, high and low value for the stock over totally different periods and therefore the earnings for the corporate. the current study during this context has relevancy in explaining the parity between risk and return within the Indian equity market he analysis of testing the link between risk and return within the Indian securities market reveals that of all the various risk variables thought of within the study.

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Narayan Gaonkar31 Dr. Kushalapp March’ 2015 -The study is undertaken with the most objective of crucial the risk return profile of thirty stocks listed on NSE. Only thirty prime firms shares listed on NSE are thought-about during this paper. To check the variation within the stock returns for the study period of 1 years. To rank the businesses on the idea of return and risk to seek out the risk and return of portfolio consisting of thirty stocks and compare it with risk and return of individual stock. to supply meaningful suggestions to the investors regards the findings of the study.



Franco painter and Gerald A Pogue (1983): Risk is that the main part in monetary higher cognitive process. everybody should be expecting high return. He says that portfolio theory deals with the measuring of the link between risk and return. It's involved with the suggestive for security costs of the portfolio finding created by investors.

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Dr S krishnaprabha Mr M vijayakumar 2013- to create comparative study of risk and return of chosen company stocks. To seek out the quality deviation and variance of the stocks. future investors were able to make the most of the market because it less volatile. based on this idea in banking and automobile sector high risk provides low returns and in info technology. Alpha stock is positive and therefore the firms are freelance to promote return and have a profitable return.



Ananda mukarji: American state A&M International University

The risk and return relationship has an uncertainty. three kinds of risk and return relationship are there, positive relationship, negative relationships and curving relationship. He says that risk and return relationship that means a negative risk and return relationship below and higher than the failure and success reference points and a positive relationship in between the 2 points professional person also as analysis implications are mentioned.

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Kolani pamane& Anani Ekoue Vikpossi: 2008

Risk and return is one among the foremost necessary ideas within the investment method. it's pillar of the many investment model. Risk is calculated by beta. Returns embrace residual variance of stock. Risk and return effectively in order that the investors who would like to participate in an exceedingly structured and acceptable market will do the particular return are totally different than expected return. The return is loss in a while, someday adequate to original investment. 

Salman (2003) Provides tried and true information to support the positive and linear relationship between risk and return. whereas learning the big city exchange, he finds that the CAPM’s conception is valid and he believes that each risk and come are integrated within the data provided to the market. Similarly, a positive and important association between risk and return within the Jordanian stock exchange.



Sangeetha and Dheeraj (2008) studied the risk return relation utilizing market & accounting primarily based info and located that risk computed on the premise of accounting info wasn't considerably captured by the market however monetary risk had important influence.



Hasan Ali and Habibolah (2011) The research has been conducted to analyze the relationship of risk and return of 70 firms listed on Iran stock exchange from the period 2002 to 2004. The study analyses the characteristics of the return in terms of lopsidedness & Kurtosis to find out the distribution of series as the study considers that Kurtosis does not show any relation with the return in the entire analysis and whereas lopsidedness showed the vital effects on returns.





Dr. Pramod Kumar Patjoshi 2015- The study on risk and return tries to identify the correlation between the BSE and 30 companies of banking sector based on the 15 years of data from 2001, Jan to 2015, Dec and tested the presence or absence of the risk return tradeoff between the Indian equity markets and hypothesis testing of that information has been done to calculate the beta of four banking stocks with the BSE sensex with the relevance sensex. Madhu and Tamimi (2011) in their study disclose that CAPM command smart in Indian stock exchange in explaining the systematic risk and establishing the trade-off b/w risk and return. So as to determine the positive risk-return relationship between equity returns & totally different sharing and monetary risk variables. From the study it was understood that the systematic risk was high in small corporations when compared to the big corporations due to difference in beta and also because of inconsistency in the market.



Shijin and others (2008) in this study the author has done an analysis on risk & return of traditional stocks of 72 firms listed on BSE from the period 1995 to 2005 March, using Vector Autoregressive Model, which has resulted that market risk alternative had a deliberate impact on returns in Indian market.



Koo and Olson (2008) The research on risk & return of 299 companies listed on New York Stock Exchange was conducted using CAPM model. The study was based on S&P 500 index 500 index as a representative of market portfolio and resulted that this market model of beta was not significant in calculating the market risk and thereby the expected return derived by method of incorporate with the market model of beta was no longer related to New York stock market.



Ahmed (2008) In his investigation to recognize the connection between the financial variables and made an undertaking in his investigation to chase out the r connection between stock cost and differed monetary factors on the idea of supposition of the financial factors are regularly the clarification behind determinative cost of the security with association Indian economy. data were gathered covering twelve years on the idea of quarterly information. The investigation utilized Indian Industrial Production, trades, remote direct venture, trade out hand and as an intermediary for financial factors and Sensex was taken for the intermediary of market return.



Vanitha (2008) inspected the connection between certain organization fundamental factors and additionally the market estimation of the security. The examination known size, use, esteem income proportion and book to advance value proportion and furthermore the known factors were then relapsed with the arrival of the scrips gathered from 455 firms recorded in BSE with the traverse of 10-year term result demonstrated that the scale and esteem profit greatness connection had positive effect while obligation value size connection and book to advance value extent connection had negative effect on scrip's arrival in Indian setting.



Rajagopala Nair and Elsamma Joseph(2001) found the fluctuated dangers educated by financial specialists in organization securities and additionally the measures embraced for declining dangers. They opined that computed hazard may delaine the power of loss of fund in organization securities. According to their examination, a few financial specialists are holding offers of these organizations that are non-existent these days. They opined that speculators may make due with dangers intrinsic in value, anyway they won't compromise to the danger of extortion. Promoters shouldn't be permitted to plunder the specific financial specialists by their untrustworthy demonstrations.





Suresh G Lalwani (1999) directed the need for chance administration inside money markets with particular weight on the esteem chance. He remarked that the stock exchange could be an unsafe and there's finished a decent likelihood that reserved from up, genuine may slip. Robert Gay (2009) examined the connection between the monetary science variable and along these lines the securities advertise return. The examination broke down with reference to four rising firms like Brazil, Russia, China and India by approach of particular the interceding factors. The investigation utilized ARIMA model to look out the impact of interceding factors on securities advertise return and extra the examination ended that there was no imperative connection between the mediating factors and along these lines the securities showcase return.

CHAPTER 3 RESEARCH DESIGN

STATEMENT OF THE PROBLEM In the current economic situation interest rates are reducing and fluctuation within the share market has put investors in confusion. One finds it tough to require call on investment. This can be primarily, as a result of investments are risky in nature and investors have to be compelled to contemplate varied factors before investment in investment avenues. Therefore, the study aims equity within the kind their risk, return and making awareness regarding equity among the investors. NEED FOR THE STUDY The project conducted for the Geojit Financial Services Limited, is basically carried out to study the analysis of investors risk and return of equity shares. The need of the study is to guide the investors and also to understand the volatility of the market before investment. OBJECTIVES OF THE STUDY objective of the study is to yield data to single investors relating to their risk, the simplest investment options to match there was an perspective to risk. 1.To know the risk and return in list 0f five IT sector firms. 2.To analyze the performance of equity shares relying upon the market. 3.To find the variation of shares by utilizing beta. 4.To deliver data regarding pros and cons of investment in equity.

SCOPE OF THE STUDY One of the most important functions of the market index is to show, in which direction the set of scripts are heading toward. The market index as a benchmark against which, the investors evaluate the risk and return of their institutional portfolio. Market indicator is one of the economic indicators, if the index is heading upwards, it shows the economy is in a boom, investors purchasing power is high, and market is bullish if the index is heading toward, it signifies slack period in the economy comma in this period investors are bearish full stop. If the historical projected it shows future Trends, by the help of this investors can forecast and tell decisions accordingly to buy or sell or to hold their securities this research seeks to if ticket and constructively contribute to help.

 

The investors understand the risk and return of selected securities in comparison with market index It also helps the investor to understand the working half market index and their related concepts

RESEARCH METHODOLOGY In order to satisfy the target of the study, the information collected from each the first and secondary sources. • Primary information • Secondary information Primary Data: The information collected initial hand by the investigator involved with the analysis drawback refers to the first data. Personal discussion was created with unit manager and interaction with alternative personnel within the organization for this purpose. This can be no formal style of form employed in this study. Methods of primary information includes;   

Questionnaires Interviews Observation

Secondary Data: The information offered at varied sources created for a few alternative purpose but facilitating the study undertaken is termed as Secondary information. The various sources that were used for the gathering of secondary knowledge are • Various text books were accustomed perceive the concepts of risk and return. • Websites of the corporate. • Newspapers similar to Economic times, merchandise. • Magazines similar to Business world, capital market.

We adopted descriptive research methodology. We explain the risk, return and beta. The following measures are used to analyzing data analysis 

Calculation of expected return



Analysis of expected risk



Calculation of beta



Calculation of alpha



CAPM Model

HYPOTHESES H0: There is no negative relationship between Return and Risk. H1: There is a negative relationship between Return and Risk.

LIMITATIONS • The period of time of the project was restricted to only 2.5 month • The data provided is restricted to the extent and net and journals. • The analysis is strictly supported share value data. • Other company performance indicators aren't thought-about. • It focuses in each month ending closing costs of throughout the amount from first Apr 2007 to thirty first march2018. • The calculation is simply for IT sectors

CHAPTER SCHEEM CHAPTER 1: Introduction The report on the study has been presented in a format consist different chapters. The chapter one gives information about introduction to the internship and about the title of the project. And continue with industry profile and company profile, promoters details, vision, mission, quality policy and product and services offered by the organization and area which they are operating and infrastructure details. It also gives information regarding competitors, what are their Strengths, weakness, opportunities and threats. It describes what are its future growth and financial disclosure. CHAPTER 2: Conceptual Background and Literature Review

In the chapter second provide the information about the theoretical background of the study of the organization and literature review of authors regarding the topic is Analysis of investors risk and return on equity shares. CHAPTER 3: Research Design The chapter three explains the topic Analysis of investors risk and return on equity shares is the statement of the problem, need of the study, objectives, scope, research methodology, research design, hypotheses, and limitations. The hypotheses tool used for calculation is correlation. CHAPTER-4 Data Analysis and Interpretation The fourth chapter contains details regarding Data Analysis and required interpretation. In this chapter Rate of return, Risk, Alpha, Beta, CAPM and correlation CHAPTER-5 Findings, Suggestions and Conclusion The fifth chapter contains the findings, suggestions and conclusion about the about the subject, its objectives, values estimated and graph.

CHAPTER 4: ANALYSIS AND INTERPRETATION The following formulas are used to calculate the risk and return: Return Return = (P1-P0)/P0*100 Where, P1 =Current month price P0 = Previous month price R1=∑R/n n = Number of months. Risk Risk = √∑(R-R1)2/n Beta Beta = [∑(Ra-Ra1)(Rm-Rm1)]/∑(Rm-Rm1)2 Where, Ra = Return on company Ra1=Average return on company Rm=Return on market Rm1=Average return on market

Alpha

=(Ra1-Rm1) *B

CALCULATION OF RETURN AND RISK OF SELECTED COMPANIES 1. Table Showing Calculation of Return and Risk of Bench Mark (BSE SENSEX) Month Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15

Sensex R% (R-R1) 5709.64 6065.34 6.230 4.953 6255.1 3.129 1.852 7458.19 19.234 17.957 8027.55 7.634 6.357 7839.26 -2.346 -3.623 8477.73 8.145 6.868 8414.25 -0.749 -2.026 9081.78 7.933 6.656 9476.62 4.348 3.071 9792.25 3.331 2.054 8789.38 -10.241 -11.518 8751.78 -0.428 -1.705 8455.36 -3.387 -4.664 9346.1 10.535 9.258 9742.34 4.240 2.963 10085.87 3.526 2.249 10687.59 5.966 4.689 10701.99 0.135 -1.142 11207.45 4.723 3.446 10583.98 -5.563 -6.840 11178.71 5.619 4.342 11969.48 7.074 5.797 11404.12 -4.723 -6.000 10410.98 -8.709 -9.986

(R-R1)2 24.53037 3.428409 322.4447 40.41175 13.12285 47.16281 4.103806 44.30669 9.42862 4.217346 132.6751 2.906306 21.7526 85.70352 8.777173 5.058698 21.98644 1.304768 11.87524 46.78555 18.85429 33.60397 36.00416 99.71235

May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18

10910.45 10449.45 11072.67 11161.34 11577.86 11263.78 10950.02 11061.31 11165.05 10229.49 11387.95 11330.17 11576.14 11199.95 10813.2 10439.35 10229.09 10032.72 9851.55 10176.05 9586.34 10376.1 10365.51 9618.99 10229.52 9833.46 10437.79 10063.83 9946.6 10362.22 10730.87 11277.81 12556.98 12505.73 12100.55

Calculation of Return:

4.798 -4.225 5.964 0.801 3.732 -2.713 -2.786 1.016 0.938 -8.379 11.325 -0.507 2.171 -3.250 -3.453 -3.457 -2.014 -1.920 -1.806 3.294 -5.795 8.238 -0.102 -7.202 6.347 -3.872 6.146 -3.583 -1.165 4.179 3.558 5.097 11.342 -0.408 -3.240 75.363

3.521 -5.502 4.687 -0.476 2.455 -3.990 -4.063 -0.261 -0.339 -9.656 10.048 -1.784 0.894 -4.527 -4.730 -4.734 -3.291 -3.197 -3.083 2.017 -7.072 6.961 -1.379 -8.479 5.070 -5.149 4.869 -4.860 -2.442 2.902 2.281 3.820 10.065 -1.685 -4.517

12.39414 30.27538 21.9693 0.226766 6.026092 15.91822 16.50444 0.067941 0.115013 93.24533 100.9565 3.184006 0.79911 20.49103 22.37423 22.41406 10.83141 10.21903 9.503603 4.067877 50.01428 48.46094 1.901811 71.89278 25.70624 26.50948 23.70375 23.61718 5.962703 8.418779 5.201298 14.59151 101.3115 2.839695 20.40288 1844.317

Return = (P1-P0)/P0*100 Where, P1 =Current month price P0 = Previous month price R1=∑R/n n = Number of months. R1=75.363/59 =1.277 Calculation of Risk: Risk = √∑(R-R1)2/n =√∑1844.317/59 =5.59

Sensex 14000 12000 10000 8000 6000 4000 2000

Jan-18

Oct-17

Jul-17

Apr-17

Jan-17

Oct-16

Jul-16

Apr-16

Jan-16

Oct-15

Jul-15

Jan-15

Apr-15

Oct-14

Jul-14

Apr-14

Jan-14

Oct-13

Jul-13

Apr-13

0

Interpretation: In the opening month of April 2013 the Sensex rate was 5,709.64 and that have been increased to 8,789.38 in the month of March 2014 which refers there is an increase in the Sensex rate by 3,079.74. In the opening month of April 2014 the Sensex rate was 8,751.78 and that have been increased to 11404.12 in the month of March 2015 which refers there is an increase in the Sensex rate by 2652.34. In the opening month of April 2015 the Sensex rate was 10,410.98 and that have been increased to 11,387.95 in the month of March 2016 which refers there is an increase in the Sensex rate by 976.97.

In the opening month of April 2016 the Sensex rate was 11,330.17 and that have been decreased to 10,365.51 in the month of March 2017 which refers there is a drastic change in the Sensex rate that is been decreased by 976.97. In the opening month of April 2017 the Sensex rate was 9618.99 and that have been increased to 12100 in the month of March 2018 which refers there is an increase in the Sensex rate by 2,481.56. Here there is an average profit 1.277% every month. The Risk of BSE Sensex is 5.59. 2.a) TABLE SHOWING CALCULATION OF RETURN AND RISK OF WIPRO Date Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15

Price R% R-R1 173.95 163.28 -6.13395 -7.17005 174.9 7.11661 6.08051 218.65 25.01429 23.97819 241.95 10.656 9.620 237.03 -2.033 -3.070 238.47 0.608 -0.429 235.47 -1.258 -2.294 279.52 18.707 17.671 287.48 2.848 1.812 298.38 3.792 2.755 271.3 -9.076 -10.112 261 -3.797 -4.833 252.5 -3.257 -4.293 272.48 7.913 6.877 271.82 -0.242 -1.278 282.7 4.003 2.967 298.18 5.476 4.440 281.73 -5.517 -6.553 292.75 3.912 2.875 276.9 -5.414 -6.450 303.15 9.480 8.444 329.62 8.732 7.696 313.9 -4.769 -5.805 269.27 -14.218 -15.254 280.8 4.282 3.246 272.07 -3.109 -4.145

(R-R1)2 51.40957 36.9726 574.9538 92.54825 9.422309 0.183683 5.262986 312.2701 3.282036 7.592605 102.248 23.35436 18.42817 47.28998 1.634101 8.800412 19.71066 42.94052 8.268193 41.60606 71.29872 59.22151 33.70067 232.6846 10.53553 17.18164

Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18

284.57 285.73 298.57 286.65 286.35 279.9 280.6 259.95 281.68 276.85 273.1 279.18 272.65 245.25 238.82 232.5 232.55 237 228.55 244.25 257.68 247.05 268.57 258.75 289 299.05 280.95 294 291.8 313.4 304.65 292.8 281.45

4.594 0.408 4.494 -3.992 -0.105 -2.252 0.250 -7.359 8.359 -1.715 -1.355 2.226 -2.339 -10.050 -2.622 -2.646 0.022 1.914 -3.565 6.869 5.498 -4.125 8.711 -3.656 11.691 3.478 -6.052 4.645 -0.748 7.402 -2.792 -3.890 -3.876 61.134

3.558 -0.628 3.458 -5.028 -1.141 -3.289 -0.786 -8.395 7.323 -2.751 -2.391 1.190 -3.375 -11.086 -3.658 -3.682 -1.015 0.877 -4.602 5.833 4.462 -5.161 7.675 -4.693 10.655 2.441 -7.089 3.609 -1.784 6.366 -3.828 -4.926 -4.912

Calculation of Return = (P1-P0)/P0*100 Where,

12.66154 0.394971 11.95536 25.28545 1.301327 10.81481 0.617813 70.48157 53.62926 7.566965 5.715084 1.416554 11.39125 122.8908 13.38034 13.5604 1.029402 0.769948 21.17381 34.02732 19.9127 26.63976 58.90082 22.01958 113.5231 5.960476 50.24824 13.02383 3.184081 40.52889 14.65404 24.2636 24.13232 2669.857

P1 =Current month price P0 = Previous month price R1=∑R/n n = Number of months. R1=61.134/59 =1.036 Calculation of Risk SD = √∑(R-R1)2/n SD =√∑2669.857/59 =6.727

WIPRO 350 300 250 200 150 100 50

Jan-18

Oct-17

Jul-17

Apr-17

Jan-17

Oct-16

Jul-16

Apr-16

Jan-16

Oct-15

Jul-15

Apr-15

Jan-15

Oct-14

Jul-14

Apr-14

Jan-14

Oct-13

Jul-13

Apr-13

0

Analysis and Interpretation: In the above table and graph we can understand the one percent change in market return causes 1.036 changes in the stock return with beta of 0.939 is less impulsive in the market. There is a positive correlation 0.787 between the BSE Sensex and stock. The stock price moves in the same direction with the BSE index rate. 2.b) TABLE SHOWING CALCULATION OF WIPRO BETA Date Ra Rm Ra-Ra1 Apr-13 May-13 -6.13395 6.23 -7.17005 Jun-13 7.11661 3.129 6.08051

RmRm1 4.953 1.852

(RmRm1)2 24.532 3.430

(Ra-Ra1)(RmRm1) -35.513 11.261

Jul-13 25.01429 19.234 23.97819 17.957 Aug-13 10.656 7.634 9.6199 6.357 Sep-13 -2.033 -2.346 -3.0691 -3.623 Oct-13 0.608 8.145 -0.4281 6.868 Nov-13 -1.258 -0.749 -2.2941 -2.026 Dec-13 18.707 7.933 17.6709 6.656 Jan-14 2.848 4.348 1.8119 3.071 Feb-14 3.792 3.331 2.7559 2.054 Mar-14 -9.076 -10.241 -10.1121 -11.518 Apr-14 -3.797 -0.428 -4.8331 -1.705 May-14 -3.257 -3.387 -4.2931 -4.664 Jun-14 7.913 10.535 6.8769 9.258 Jul-14 -0.242 4.24 -1.2781 2.963 Aug-14 4.003 3.526 2.9669 2.249 Sep-14 5.476 5.966 4.4399 4.689 Oct-14 -5.517 0.135 -6.5531 -1.142 Nov-14 3.912 4.723 2.8759 3.446 Dec-14 -5.414 -5.563 -6.4501 -6.84 Jan-15 9.48 5.619 8.4439 4.342 Feb-15 8.732 7.074 7.6959 5.797 Mar-15 -4.769 -4.723 -5.8051 -6 Apr-15 -14.218 -8.709 -15.2541 -9.986 May-15 4.282 4.798 3.2459 3.521 Jun-15 -3.109 -4.225 -4.1451 -5.502 Jul-15 4.594 5.964 3.5579 4.687 Aug-15 0.408 0.801 -0.6281 -0.476 Sep-15 4.494 3.732 3.4579 2.455 Oct-15 -3.992 -2.713 -5.0281 -3.99 Nov-15 -0.105 -2.786 -1.1411 -4.063 Dec-15 -2.252 1.016 -3.2881 -0.261 Jan-16 0.25 0.938 -0.7861 -0.339 Feb-16 -7.359 -8.379 -8.3951 -9.656 Mar-16 8.359 11.325 7.3229 10.048 Apr-16 -1.715 -0.507 -2.7511 -1.784 May-16 -1.355 2.171 -2.3911 0.894 Jun-16 2.226 -3.25 1.1899 -4.527 Jul-16 -2.339 -3.453 -3.3751 -4.73 Aug-16 -10.05 -3.457 -11.0861 -4.734 Sep-16 -2.622 -2.014 -3.6581 -3.291

322.454 40.411 13.126 47.169 4.105 44.302 9.431 4.219 132.664 2.907 21.753 85.711 8.779 5.058 21.987 1.304 11.875 46.786 18.853 33.605 36.000 99.720 12.397 30.272 21.968 0.227 6.027 15.920 16.508 0.068 0.115 93.238 100.962 3.183 0.799 20.494 22.373 22.411 10.831

430.576 61.154 11.119 -2.940 4.648 117.618 5.564 5.661 116.471 8.240 20.023 63.666 -3.787 6.673 20.819 7.484 9.910 44.119 36.663 44.613 34.831 152.327 11.429 22.806 16.676 0.299 8.489 20.062 4.636 0.858 0.266 81.063 73.580 4.908 -2.138 -5.387 15.964 52.482 12.039

Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18

-2.646 0.022 1.914 -3.565 6.869 5.498 -4.125 8.711 -3.656 11.691 3.478 -6.052 4.645 -0.748 7.402 -2.792 -3.89 -3.876

-1.92 -1.806 3.294 -5.795 8.238 -0.102 -7.202 6.347 -3.872 6.146 -3.583 -1.165 4.179 3.558 5.097 11.342 -0.408 -3.24

-3.6821 -1.0141 0.8779 -4.6011 5.8329 4.4619 -5.1611 7.6749 -4.6921 10.6549 2.4419 -7.0881 3.6089 -1.7841 6.3659 -3.8281 -4.9261 -4.9121

-3.197 -3.083 2.017 -7.072 6.961 -1.379 -8.479 5.07 -5.149 4.869 -4.86 -2.442 2.902 2.281 3.82 10.065 -1.685 -4.517

10.221 9.505 4.068 50.013 48.456 1.902 71.893 25.705 26.512 23.707 23.620 5.963 8.422 5.203 14.592 101.304 2.839 20.403 1872.303

11.772 3.126 1.771 32.539 40.603 -6.153 43.761 38.912 24.160 51.879 -11.868 17.309 10.473 -4.070 24.318 -38.530 8.300 22.188 1759.724

Beta = [∑(Ra-Ra1) (Rm-Rm1)]/∑(Rm-Rm1)2 Where, Ra = Return on company Ra1=Average return on company Rm=Return on market Rm1=Average return on market

Beta=1759.724/1872.303 =0.939 Alpha

=(Ra1-Rm1) *B = (1.036-1.277) *0.939 =-0.226

3.a) TABLE SHOWING CALCULATION OF RETURN AND RISK OFINFOSYS

Date Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16

Price R% 558.61 601.9 7.750 623.31 3.557 741.79 19.008 775.08 4.488 753.86 -2.738 827.16 9.723 838.38 1.356 871.38 3.936 924.86 6.137 955.05 3.264 819.71 -14.171 794.3 -3.100 735.38 -7.418 811.61 10.366 841.42 3.673 898.5 6.784 936.91 4.275 1,012.86 8.106 1,089.81 7.597 985.6 -9.562 1,071.38 8.703 1,147.42 7.097 1,108.30 -3.409 971.2 -12.370 1,011.20 4.119 985.35 -2.556 1,078.05 9.408 1,095.20 1.591 1,160.45 5.958 1,136.05 -2.103 1,088.45 -4.190 1,104.55 1.479 1,164.85 5.459 1,083.75 -6.962 1,217.95 12.383 1,210.85 -0.583 1,249.85 3.221

R-R1 6.314 2.121 17.572 3.052 -4.174 8.287 -0.080 2.500 4.701 1.828 -15.607 -4.536 -8.854 8.930 2.237 5.348 2.839 6.670 6.161 -10.998 7.267 5.661 -4.845 -13.806 2.683 -3.992 7.972 0.155 4.522 -3.539 -5.626 0.043 4.023 -8.398 10.947 -2.019 1.785

(R-R1)2 39.861 4.499 308.782 9.313 17.420 68.679 0.006 6.251 22.103 3.343 243.578 20.574 78.391 79.746 5.004 28.599 8.059 44.495 37.962 120.961 52.814 32.051 23.478 190.614 7.196 15.939 63.550 0.024 20.447 12.522 31.651 0.002 16.186 70.531 119.835 4.076 3.186

Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18

1,170.75 1,073.95 1,036.80 1,038.10 1,002.50 975.45 1,010.70 929.3 1,012.30 1,020.80 919.4 976.95 935.65 1,011.30 915.3 898.75 921.65 974.95 1,039.30 1,150.65 1,174.25 1,134.40

-6.329 -7.765 60.291 -8.268 -9.704 94.172 -3.459 -4.895 23.963 0.125 -1.311 1.718 -3.429 -4.865 23.672 -2.698 -4.134 17.092 3.614 2.178 4.742 -8.054 -9.490 90.057 8.931 7.495 56.182 0.840 -0.596 0.356 -9.933 -11.369 129.263 6.260 4.824 23.266 -4.227 -5.663 32.075 8.085 6.649 44.213 -9.493 -10.929 119.437 -1.808 -3.244 10.525 2.548 1.112 1.237 5.783 4.347 18.897 6.600 5.164 26.670 10.714 9.278 86.080 2.051 0.615 0.378 -3.394 -4.830 23.326 84.736 2699.340

Calculation of Return: Return= (P1-P0)/P0*100 Where, P1 =Current month price P0 = Previous month price R1=∑R/n n = Number of months. R1=84.736 /59 =1.436

Calculation of Risk SD = √∑(R-R1)2/n

SD =√∑2699.340/59 =6.764

INFOSYS 1400 1200 1000 800 600 400 200

Jan-18

Oct-17

Jul-17

Apr-17

Jan-17

Oct-16

Jul-16

Apr-16

Jan-16

Oct-15

Jul-15

Apr-15

Jan-15

Oct-14

Jul-14

Jan-14

Apr-14

Jul-13

Oct-13

6

Apr-13

0

Analysis and Interpretation: In the above table and graph we can understand the one percent change in market return causes 1.436 changes in the stock return with beta of 1.124 is less impulsive in the market. There is a positive correlation 0.936 between the BSE Sensex and stock. The stock price move in the same direction with the BSE index rate. 3.b)TABLE SHOWING CALCULATION OF INFOSYS BETA Date Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14

R% 7.75 3.557 19.008 4.488 -2.738 9.723 1.356 3.936 6.137 3.264

Rm

Ra-Ra1

Rm-Rm1

(Rm-Rm1)2

(Ra-Ra1)(RmRm1)

6.23 3.129 19.234 7.634 -2.346 8.145 -0.749 7.933 4.348 3.331

6.314 2.121 17.572 3.052 -4.174 8.287 -0.08 2.5 4.701 1.828

4.953 1.852 17.957 6.357 -3.623 6.868 -2.026 6.656 3.071 2.054

24.532 3.43 322.454 40.411 13.126 47.169 4.105 44.302 9.431 4.219

31.273 3.928 315.540 19.402 15.122 56.915 0.162 16.640 14.437 3.755

Mar-14 -14.171 -10.241 Apr-14 -3.1 -0.428 May-14 -7.418 -3.387

-15.607

-11.518

132.664

-4.536 -8.854

-1.705 -4.664

2.907 21.753

179.761 7.734 41.295

Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17

10.366 3.673 6.784 4.275 8.106 7.597 -9.562 8.703 7.097 -3.409 -12.37 4.119 -2.556 9.408 1.591 5.958 -2.103 -4.19 1.479 5.459 -6.962 12.383 -0.583 3.221 -6.329 -8.268 -3.459 0.125 -3.429 -2.698 3.614 -8.054 8.931 0.84 -9.933 6.26 -4.227 8.085 -9.493

10.535 4.24 3.526 5.966 0.135 4.723 -5.563 5.619 7.074 -4.723 -8.709 4.798 -4.225 5.964 0.801 3.732 -2.713 -2.786 1.016 0.938 -8.379 11.325 -0.507 2.171 -3.25 -3.453 -3.457 -2.014 -1.92 -1.806 3.294 -5.795 8.238 -0.102 -7.202 6.347 -3.872 6.146 -3.583

8.93 2.237 5.348 2.839 6.67 6.161 -10.998 7.267 5.661 -4.845 -13.806 2.683 -3.992 7.972 0.155 4.522 -3.539 -5.626 0.043 4.023 -8.398 10.947 -2.019 1.785 -7.765 -9.704 -4.895 -1.311 -4.865 -4.134 2.178 -9.49 7.495 -0.596 -11.369 4.824 -5.663 6.649 -10.929

9.258 2.963 2.249 4.689 -1.142 3.446 -6.84 4.342 5.797 -6 -9.986 3.521 -5.502 4.687 -0.476 2.455 -3.99 -4.063 -0.261 -0.339 -9.656 10.048 -1.784 0.894 -4.527 -4.73 -4.734 -3.291 -3.197 -3.083 2.017 -7.072 6.961 -1.379 -8.479 5.07 -5.149 4.869 -4.86

85.711 8.779 5.058 21.987 1.304 11.875 46.786 18.853 33.605 36 99.72 12.397 30.272 21.968 0.227 6.027 15.92 16.508 0.068 0.115 93.238 100.962 3.183 0.799 20.494 22.373 22.411 10.831 10.221 9.505 4.068 50.013 48.456 1.902 71.893 25.705 26.512 23.707 23.62

82.674 6.628 12.028 13.312 -7.617 21.231 75.226 31.553 32.817 29.070 137.867 9.447 21.964 37.365 -0.074 11.102 14.121 22.858 -0.011 -1.364 81.091 109.995 3.602 1.596 35.152 45.900 23.173 4.315 15.553 12.745 4.393 67.113 52.173 0.822 96.398 24.458 29.159 32.374 53.115

Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18

-1.808 2.548 5.783 6.6 10.714 2.051 -3.394 84.736

-1.165 4.179 3.558 5.097 11.342 -0.408 -3.24 75.363

-3.244 1.112 4.347 5.164 9.278 0.615 -4.83

-2.442 2.902 2.281 3.82 10.065 -1.685 -4.517

5.963 8.422 5.203 14.592 101.304 2.839 20.403 1872.302

7.922 3.227 9.916 19.726 93.383 -1.036 21.817 2104.242

Beta = [∑(Ra-Ra1) (Rm-Rm1)]/∑(Rm-Rm1)2 Where, Ra = Return on company Ra1=Average return on company Rm=Return on market Rm1=Average return on market Beta=2104.242/1872.302 =1.124 Alpha

=(Ra1-Rm1) *B = (1.436-1.277) *1.124

=-0.179 4.a) TABLE SHOWING CALCULATION OF RETURN AND RISK OFTCS Date Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14

Price R% R-R1 (R-R1)2 1,355.12 1,476.57 8.962 7.497 56.210 1,495.08 1.254 -0.211 0.045 1,787.23 19.541 18.076 326.733 1,992.08 11.462 9.997 99.937 1,897.12 -4.767 -6.232 38.836 2,075.88 9.423 7.958 63.325 1,973.82 -4.916 -6.381 40.723 2,137.62 8.299 6.834 46.698 2,201.86 3.005 1.540 2.372 2,237.90 1.637 0.172 0.030

Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17

2,095.57 2,155.78 2,111.28 2,382.30 2,577.30 2,524.60 2,738.20 2,604.55 2,643.10 2,554.70 2,481.00 2,675.30 2,547.05 2,466.65 2,610.60 2,552.20 2,510.00 2,565.25 2,587.70 2,497.30 2,365.25 2,439.20 2,391.20 2,181.90 2,516.05 2,530.05 2,575.10 2,550.80 2,618.55 2,512.55 2,427.20 2,394.60 2,276.75 2,361.95 2,229.90 2,466.50 2,431.10 2,272.10 2,544.35

-6.360 2.873 -2.064 12.837 8.185 -2.045 8.461 -4.881 1.480 -3.345 -2.885 7.832 -4.794 -3.157 5.836 -2.237 -1.653 2.201 0.875 -3.493 -5.288 3.127 -1.968 -8.753 15.315 0.556 1.781 -0.944 2.656 -4.048 -3.397 -1.343 -4.921 3.742 -5.591 10.610 -1.435 -6.540 11.982

-7.825 1.408 -3.529 11.372 6.720 -3.510 6.996 -6.346 0.015 -4.810 -4.350 6.367 -6.259 -4.622 4.371 -3.702 -3.118 0.736 -0.590 -4.958 -6.753 1.662 -3.433 -10.218 13.850 -0.909 0.316 -2.409 1.191 -5.513 -4.862 -2.808 -6.386 2.277 -7.056 9.145 -2.900 -8.005 10.517

61.230 1.983 12.455 129.317 45.163 12.319 48.940 40.271 0.000 23.132 18.921 40.533 39.173 21.359 19.104 13.705 9.725 0.542 0.348 24.586 45.599 2.761 11.785 104.406 191.812 0.826 0.100 5.802 1.419 30.394 23.639 7.885 40.787 5.186 49.783 83.637 8.411 64.084 110.614

Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18

2,364.35 2,494.05 2,496.75 2,437.00 2,616.30 2,634.25 2,700.40 3,111.75 3,038.25 2,849.30

-7.074 5.486 0.108 -2.393 7.357 0.686 2.511 15.233 -2.362 -6.219 86.439

-8.539 4.021 -1.357 -3.858 5.892 -0.779 1.046 13.768 -3.827 -7.684

Calculation of Return: Return= (P1-P0)/P0*100 Where, P1 =Current month price P0 = Previous month price R1=∑R/n n = Number of months. R1=86.439 /59 =1.46 Calculation of Risk SD = √∑(R-R1)2/n SD =√∑2432.128/59 =6.42

72.923 16.166 1.841 14.885 34.720 0.607 1.094 189.556 14.646 59.044 2432.128

TCS 3,500.00 3,000.00 2,500.00 2,000.00 1,500.00 1,000.00 500.00

Jan-18

Oct-17

Jul-17

Apr-17

Jan-17

Jul-16

Oct-16

Apr-16

Jan-16

Jul-15

Oct-15

Apr-15

Jan-15

Oct-14

Jul-14

Apr-14

Jan-14

Oct-13

Jul-13

Apr-13

0.00

Analysis and Interpretation: In the above table and graph we can understand the one percent change in market return causes 1.46 changes in the stock return with beta of 0.99 is less impulsive in the market. There is a positive correlation 0.875 between the BSE Sensex and stock. The stock price move in the same direction with the BSE index rate. 4.b)TABLE SHOWING CALCULATION OF TCS BETA Date Ra Rm Apr-13 May-13 8.962 6.23 Jun-13 1.254 3.129 Jul-13 19.541 19.234 Aug-13 11.462 7.634 Sep-13 -4.767 -2.346 Oct-13 9.423 8.145 Nov-13 -4.916 -0.749 Dec-13 8.299 7.933 Jan-14 3.005 4.348 Feb-14 1.637 3.331 Mar-14 -6.36 -10.241 Apr-14 2.873 -0.428 May-14 -2.064 -3.387 Jun-14 12.837 10.535 Jul-14 8.185 4.24

RmRa-Ra1 Rm1 7.497 4.953 -0.211 1.852 18.076 17.957 9.997 6.357 -6.232 -3.623 7.958 6.868 -6.381 -2.026 6.834 6.656 1.54 3.071 0.172 2.054 -7.825 -11.518 1.408 -1.705 -3.529 -4.664 11.372 9.258 6.72 2.963

(RmRm1)2 24.532 3.43 322.454 40.411 13.126 47.169 4.105 44.302 9.431 4.219 132.664 2.907 21.753 85.711 8.779

(Ra-Ra1)(RmRm1) 37.133 -0.391 324.591 63.551 22.579 54.656 12.928 45.487 4.729 0.353 90.128 -2.401 16.459 105.282 19.911

Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17

-2.045 8.461 -4.881 1.48 -3.345 -2.885 7.832 -4.794 -3.157 5.836 -2.237 -1.653 2.201 0.875 -3.493 -5.288 3.127 -1.968 -8.753 15.315 0.556 1.781 -0.944 2.656 -4.048 -3.397 -1.343 -4.921 3.742 -5.591 10.61 -1.435 -6.54 11.982 -7.074 5.486 0.108 -2.393 7.357

3.526 -3.51 5.966 6.996 0.135 -6.346 4.723 0.015 -5.563 -4.81 5.619 -4.35 7.074 6.367 -4.723 -6.259 -8.709 -4.622 4.798 4.371 -4.225 -3.702 5.964 -3.118 0.801 0.736 3.732 -0.59 -2.713 -4.958 -2.786 -6.753 1.016 1.662 0.938 -3.433 -8.379 -10.218 11.325 13.85 -0.507 -0.909 2.171 0.316 -3.25 -2.409 -3.453 1.191 -3.457 -5.513 -2.014 -4.862 -1.92 -2.808 -1.806 -6.386 3.294 2.277 -5.795 -7.056 8.238 9.145 -0.102 -2.9 -7.202 -8.005 6.347 10.517 -3.872 -8.539 6.146 4.021 -3.583 -1.357 -1.165 -3.858 4.179 5.892

2.249 4.689 -1.142 3.446 -6.84 4.342 5.797 -6 -9.986 3.521 -5.502 4.687 -0.476 2.455 -3.99 -4.063 -0.261 -0.339 -9.656 10.048 -1.784 0.894 -4.527 -4.73 -4.734 -3.291 -3.197 -3.083 2.017 -7.072 6.961 -1.379 -8.479 5.07 -5.149 4.869 -4.86 -2.442 2.902

5.058 21.987 1.304 11.875 46.786 18.853 33.605 36 99.72 12.397 30.272 21.968 0.227 6.027 15.92 16.508 0.068 0.115 93.238 100.962 3.183 0.799 20.494 22.373 22.411 10.831 10.221 9.505 4.068 50.013 48.456 1.902 71.893 25.705 26.512 23.707 23.62 5.963 8.422

-7.894 32.804 7.247 0.052 32.900 -18.888 36.909 37.554 46.155 15.390 20.368 -14.614 -0.350 -1.448 19.782 27.437 -0.434 1.164 98.665 139.165 1.622 0.283 10.906 -5.633 26.099 16.001 8.977 19.688 4.593 49.900 63.658 3.999 67.874 53.321 43.967 19.578 6.595 9.421 17.099

Nov-17 Dec-17 Jan-18 Feb-18 Mar-18

0.686 2.511 15.233 -2.362 -6.219 86.439

3.558 5.097 11.342 -0.408 -3.24 75.363

-0.779 1.046 13.768 -3.827 -7.684

2.281 3.82 10.065 -1.685 -4.517

5.203 14.592 101.304 2.839 20.403 1872.302

-1.777 3.996 138.575 6.448 34.709 1866.860

Beta = [∑(Ra-Ra1) (Rm-Rm1)]/∑(Rm-Rm1)2 Where, Ra = Return on company Ra1=Average return on company Rm=Return on market Rm1=Average return on market Beta=1866.860/1872.302 =0.99 Alpha

=(Ra1-Rm1) *B = (1.46-1.277) *0.99 =-0.181

5.a) TABLE SHOWING CALCULATION OF RETURN AND RISK OF MINDTREE COMPANY Date Price R% (R-R1) (R-R1)2 Apr-13 199.07 May-13 203.59 2.271 -0.514 0.264 Jun-13 207.8 2.068 -0.717 0.514 Jul-13 237.48 14.283 11.498 132.212 Aug-13 256.5 8.009 5.224 27.295 Sep-13 303.37 18.273 15.488 239.888 Oct-13 342.48 12.892 10.107 102.156 Nov-13 345.33 0.832 -1.952 3.812 Dec-13 379.96 10.028 7.243 52.468 Jan-14 353.66 -6.922 -9.706 94.214 Feb-14 406.92 15.060 12.275 150.677 Mar-14 327.34 -19.557 -22.341 499.132

Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17

352.22 372.35 439.58 522.32 560.35 584.83 543.45 596.95 638.1 656.87 719.31 649.43 607.65 722.57 631.8 635.66 694.96 753.84 780.85 715.77 715.13 733.92 707.88 649.3 675.09 659.11 661.95 574.72 561.43 479.42 438.99 475.14 519.55 448.7 471.36 450.49 484.1 542.56 526.32

7.601 5.715 18.056 18.823 7.281 4.369 -7.076 9.845 6.893 2.942 9.506 -9.715 -6.433 18.912 -12.562 0.611 9.329 8.472 3.583 -8.335 -0.089 2.627 -3.548 -8.275 3.972 -2.367 0.431 -13.178 -2.312 -14.607 -8.433 8.235 9.347 -13.637 5.050 -4.428 7.461 12.076 -2.993

4.816 2.931 15.271 16.038 4.496 1.584 -9.860 7.060 4.109 0.157 6.721 -12.499 -9.218 16.128 -15.347 -2.174 6.544 5.688 0.798 -11.119 -2.874 -0.157 -6.333 -11.060 1.187 -5.152 -2.354 -15.962 -5.097 -17.392 -11.218 5.450 6.562 -16.421 2.266 -7.212 4.676 9.291 -5.778

23.194 8.588 233.203 257.215 20.217 2.509 97.223 49.842 16.882 0.025 45.173 156.237 84.970 260.100 235.521 4.725 42.828 32.351 0.637 123.635 8.260 0.025 40.103 122.324 1.410 26.540 5.540 254.796 25.980 302.480 125.837 29.705 43.061 269.662 5.133 52.016 21.867 86.330 33.383

Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18

474.99 460.7 461.6 478.23 538.85 610.1 768.45 814.45 774

-9.753 -3.008 0.195 3.603 12.676 13.223 25.955 5.986 -4.967 164.2929 Calculation of Return:

-12.537 -5.793 -2.589 0.818 9.891 10.438 23.170 3.201 -7.751

Return= (P1-P0)/P0*100 Where, P1 =Current month price P0 = Previous month price R1=∑R/n n = Number of months. R1=164.2929 /59 =2.785 Calculation of Risk SD = √∑(R-R1)2/n SD =√∑5463.473/59 ==9.623

157.182 33.560 6.704 0.669 97.838 108.952 536.856 10.249 60.080 5463.473

MINDTREE 900 800 700 600 500 400 300 200 100

Jan-18

Oct-17

Jul-17

Apr-17

Jan-17

Oct-16

Jul-16

Apr-16

Jan-16

Oct-15

Jul-15

Apr-15

Jan-15

Oct-14

Jul-14

Apr-14

Jan-14

Oct-13

Jul-13

Apr-13

0

Analysis and Interpretation: In the above table and graph we can understand the one percent change in market return causes 2.785 changes in the stock return with beta of 0.981 is less impulsive in the market. There is a positive correlation 0.551 between the BSE Sensex and stock. The stock price moves in the same direction with the BSE index rate. 5.b) TABLE SHOWING CALCULATION OF MINDTREE BETA RmRa-Ra1 Rm1

Date Ra Rm Apr-13 May-13 2.271 6.23 -0.514 4.953 Jun-13 2.068 3.129 -0.717 1.852 Jul-13 14.283 19.234 16.449 17.957 Aug-13 8.009 7.634 4.849 6.357 Sep-13 18.273 -2.346 -5.131 -3.623 Oct-13 12.892 8.145 5.360 6.868 Nov-13 0.832 -0.749 -3.534 -2.026 Dec-13 10.028 7.933 5.148 6.656 Jan-14 -6.922 4.348 1.563 3.071 Feb-14 15.06 3.331 0.546 2.054 Mar-14 -19.557 -10.241 -13.026 -11.518 Apr-14 7.601 -0.428 -3.213 -1.705 May-14 5.715 -3.387 -6.172 -4.664 Jun-14 18.056 10.535 7.750 9.258

(RmRm1)2 24.532 3.430 322.454 40.411 13.126 47.169 4.105 44.302 9.431 4.219 132.664 2.907 21.753 85.711

(Ra-Ra1)(RmRm1) -2.544 -1.327 295.382 30.828 18.588 36.815 7.159 34.268 4.801 1.122 150.029 5.477 28.784 71.753

Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17

18.823 7.281 4.369 -7.076 9.845 6.893 2.942 9.506 -9.715 -6.433 18.912 -12.562 0.611 9.329 8.472 3.583 -8.335 -0.089 2.627 -3.548 -8.275 3.972 -2.367 0.431 -13.178 -2.312 -14.607 -8.433 8.235 9.347 -13.637 5.05 -4.428 7.461 12.076 -2.993 -9.753 -3.008 0.195

4.24 1.455 3.526 0.741 5.966 3.181 0.135 -2.650 4.723 1.938 -5.563 -8.348 5.619 2.834 7.074 4.289 -4.723 -7.508 -8.709 -11.494 4.798 2.013 -4.225 -7.010 5.964 3.179 0.801 -1.984 3.732 0.947 -2.713 -5.498 -2.786 -5.571 1.016 -1.769 0.938 -1.847 -8.379 -11.164 11.325 8.540 -0.507 -3.292 2.171 -0.614 -3.25 -6.035 -3.453 -6.238 -3.457 -6.242 -2.014 -4.799 -1.92 -4.705 -1.806 -4.591 3.294 0.509 -5.795 -8.580 8.238 5.453 -0.102 -2.887 -7.202 -9.987 6.347 3.562 -3.872 -6.657 6.146 3.361 -3.583 -6.368 -1.165 -3.950

2.963 2.249 4.689 -1.142 3.446 -6.84 4.342 5.797 -6 -9.986 3.521 -5.502 4.687 -0.476 2.455 -3.99 -4.063 -0.261 -0.339 -9.656 10.048 -1.784 0.894 -4.527 -4.73 -4.734 -3.291 -3.197 -3.083 2.017 -7.072 6.961 -1.379 -8.479 5.07 -5.149 4.869 -4.86 -2.442

8.779 5.058 21.987 1.304 11.875 46.786 18.853 33.605 36.000 99.720 12.397 30.272 21.968 0.227 6.027 15.920 16.508 0.068 0.115 93.238 100.962 3.183 0.799 20.494 22.373 22.411 10.831 10.221 9.505 4.068 50.013 48.456 1.902 71.893 25.705 26.512 23.707 23.620 5.963

4.312 1.667 14.918 3.026 6.680 57.098 12.307 24.866 45.046 114.775 7.089 38.567 14.902 0.944 2.326 21.935 22.633 0.462 0.626 107.796 85.814 5.872 -0.549 27.319 29.504 29.548 15.792 15.041 14.153 1.027 60.675 37.961 3.981 84.676 18.061 34.275 16.367 30.947 9.645

Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18

3.603 12.676 13.223 25.955 5.986 -4.967 164.2929

4.179 3.558 5.097 11.342 -0.408 -3.24 75.363

1.394 0.773 2.312 8.557 -3.193 -6.025

2.902 2.281 3.82 10.065 -1.685 -4.517

8.422 5.203 14.592 101.304 2.839 20.403 1872.303

4.047 1.764 8.833 86.130 5.380 27.213 1836.585

Beta = [∑(Ra-Ra1) (Rm-Rm1)]/∑(Rm-Rm1)2 Where, Ra = Return on company Ra1=Average return on company Rm=Return on market Rm1=Average return on market Beta=1836.585/1872.302 =0.981 Alpha

=(Ra1-Rm1) *B = (2.785-1.277) *0.981 =1.479

6.a) TABLE SHOWING CALCULATION OF RETURN AND RISK OFHEXAWARE Date Price R% R-R1 (R-R1)2 Apr-13 81.95 May-13 80.5 -1.769 -4.835 23.373 Jun-13 86.7 7.702 4.637 21.499 Jul-13 116.1 33.910 30.845 951.404 Aug-13 128.15 10.379 7.314 53.491 Sep-13 128.45 0.234 -2.831 8.015 Oct-13 133 3.542 0.477 0.228 Nov-13 122.3 -8.045 -11.110 123.439 Dec-13 131.75 7.727 4.662 21.731 Jan-14 134.8 2.315 -0.750 0.563 Feb-14 160.05 18.731 15.666 245.432 Mar-14 150.55 -5.936 -9.001 81.015

Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17

151.3 143.35 158.1 142.3 159.9 201.15 197.65 218.5 199.95 225.6 270.1 312.6 281.05 281.15 255.4 286.8 244.75 246.55 239.75 249.9 243.25 229.65 233.95 267.55 241.45 216.9 228.65 220.8 202.7 188.7 204.35 205.85 207.15 194.5 223.65 214.7 230.15 234.75 242.35

0.498 -5.254 10.290 -9.994 12.368 25.797 -1.740 10.549 -8.490 12.828 19.725 15.735 -10.093 0.036 -9.159 12.294 -14.662 0.735 -2.758 4.234 -2.661 -5.591 1.872 14.362 -9.755 -10.168 5.417 -3.433 -8.197 -6.907 8.294 0.734 0.632 -6.107 14.987 -4.002 7.196 1.999 3.237

-2.567 -8.320 7.224 -13.059 9.303 22.732 -4.805 7.484 -11.555 9.763 16.660 12.670 -13.158 -3.030 -12.224 9.229 -17.727 -2.330 -5.823 1.168 -5.726 -8.656 -1.193 11.297 -12.820 -13.233 2.352 -6.498 -11.263 -9.972 5.228 -2.331 -2.434 -9.172 11.922 -7.067 4.131 -1.067 0.172

6.590 69.217 52.191 170.534 86.546 516.752 23.090 56.007 133.516 95.316 277.555 160.522 173.132 9.179 149.426 85.179 314.246 5.428 33.910 1.365 32.790 74.929 1.423 127.619 164.362 175.111 5.532 42.229 126.848 99.440 27.336 5.434 5.923 84.123 142.133 49.942 17.064 1.137 0.030

Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18

262.05 272.9 269.55 285.45 336.25 340.25 381.05 345.9 375.35

8.129 5.064 25.639 4.140 1.075 1.156 -1.228 -4.293 18.428 5.899 2.834 8.029 17.796 14.731 217.010 1.190 -1.876 3.518 11.991 8.926 79.673 -9.225 -12.290 151.037 8.514 5.449 29.690 180.847 5667.475 Calculation of Return: Return= (P1-P0)/P0*100 Where, P1 =Current month price P0 = Previous month price R1=∑R/n n = Number of months. R1=180.847 /59 =3.065 Calculation of Risk SD = √∑(R-R1)2/n SD =√∑5667.475/59 =9.801

HEXAWARE 450 400 350 300 250 200 150 100 50

Jan-18

Oct-17

Jul-17

Apr-17

Jan-17

Oct-16

Jul-16

Apr-16

Jan-16

Oct-15

Jul-15

Apr-15

Jan-15

Oct-14

Jul-14

Apr-14

Jan-14

Oct-13

Jul-13

Apr-13

0

Analysis and Interpretation: In the above table and graph we can understand the one percent change in market return causes 3.065 changes in the stock return with beta of 1.019 is less impulsive in the market. There is a positive correlation 0.586 between the BSE Sensex and stock. The stock price move in the same direction with the BSE index rate. 6.b) TABLE SHOWING CALCULATION OF HEXAWARE BETA Date

Ra

Rm

Ra-Ra1

Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14

-1.769 7.702 33.91 10.379 0.234 3.542 -8.045 7.727 2.315 18.731

6.23 3.129 19.234 7.634 -2.346 8.145 -0.749 7.933 4.348 3.331

-4.8342 4.6368 30.8448 7.3138 -2.8312 0.4768 -11.1102 4.6618 -0.7502 15.6658

Mar-14

-5.936

-10.241

-9.0012

Apr-14 May-14 Jun-14

0.498 -5.254 10.29

-0.428 -3.387 10.535

-2.5672 -8.3192 7.2248

RmRm1

(RmRm1)2

(Ra-Ra1)(RmRm1)

4.953 1.852 17.957 6.357 -3.623 6.868 -2.026 6.656 3.071 2.054 11.518 -1.705 -4.664 9.258

24.5322 3.4299 322.4538 40.4114 13.1261 47.1694 4.1047 44.3023 9.4310 4.2189

-23.944 8.587 553.880 46.494 10.257 3.275 22.509 31.029 -2.304 32.178

132.6643

103.676

2.9070 21.7529 85.7106

4.377 38.801 66.887

Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17

-9.994 12.368 25.797 -1.74 10.549 -8.49 12.828 19.725 15.735 -10.093 0.036 -9.159 12.294 -14.662 0.735 -2.758 4.234 -2.661 -5.591 1.872 14.362 -9.755 -10.168 5.417 -3.433 -8.197 -6.907 8.294 0.734 0.632 -6.107 14.987 -4.002 7.196 1.999 3.237 8.129 4.14 -1.228

4.24 3.526 5.966 0.135 4.723 -5.563 5.619 7.074 -4.723 -8.709 4.798 -4.225 5.964 0.801 3.732 -2.713 -2.786 1.016 0.938 -8.379 11.325 -0.507 2.171 -3.25 -3.453 -3.457 -2.014 -1.92 -1.806 3.294 -5.795 8.238 -0.102 -7.202 6.347 -3.872 6.146 -3.583 -1.165

-13.0592 9.3028 22.7318 -4.8052 7.4838 -11.5552 9.7628 16.6598 12.6698 -13.1582 -3.0292 -12.2242 9.2288 -17.7272 -2.3302 -5.8232 1.1688 -5.7262 -8.6562 -1.1932 11.2968 -12.8202 -13.2332 2.3518 -6.4982 -11.2622 -9.9722 5.2288 -2.3312 -2.4332 -9.1722 11.9218 -7.0672 4.1308 -1.0662 0.1718 5.0638 1.0748 -4.2932

2.963 2.249 4.689 -1.142 3.446 -6.84 4.342 5.797 -6 -9.986 3.521 -5.502 4.687 -0.476 2.455 -3.99 -4.063 -0.261 -0.339 -9.656 10.048 -1.784 0.894 -4.527 -4.73 -4.734 -3.291 -3.197 -3.083 2.017 -7.072 6.961 -1.379 -8.479 5.07 -5.149 4.869 -4.86 -2.442

8.7794 5.0580 21.9867 1.3042 11.8749 46.7856 18.8530 33.6052 36.0000 99.7202 12.3974 30.2720 21.9680 0.2266 6.0270 15.9201 16.5080 0.0681 0.1149 93.2383 100.9623 3.1827 0.7992 20.4937 22.3729 22.4108 10.8307 10.2208 9.5049 4.0683 50.0132 48.4555 1.9016 71.8934 25.7049 26.5122 23.7072 23.6196 5.9634

-38.694 20.922 106.589 5.488 25.789 79.038 42.390 96.577 -76.019 131.398 -10.666 67.258 43.255 8.438 -5.721 23.235 -4.749 1.495 2.934 11.522 113.510 22.871 -11.830 -10.647 30.736 53.315 32.819 -16.716 7.187 -4.908 64.866 82.988 9.746 -35.025 -5.406 -0.885 24.656 -5.224 10.484

Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18

5.899 17.796 1.19 11.991 -9.225 8.514

4.179 2.8338 2.902 8.4216 3.558 14.7308 2.281 5.2030 5.097 -1.8752 3.82 14.5924 11.342 8.9258 10.065 101.3042 -0.408 -12.2902 -1.685 2.8392 -3.24 5.4488 -4.517 20.4033 1872.3033 75.363 2 Beta = [∑(Ra-Ra1) (Rm-Rm1)]/∑(Rm-Rm1)

8.224 33.601 -7.163 89.838 20.709 -24.612 1909.314

Where, Ra = Return on company Ra1=Average return on company Rm=Return on market Rm1=Average return on market Beta=1909.314/1872.302 =1.019 Alpha

=(Ra1-Rm1) *B

= (3.065-1.277) *1.019 =1.822 7. Calculation of CAPM Model Particulars

Returns

Beta

WIPRO

1.036

0.939

INFOSYS

1.436

1.124

1.46

0.99

MINDTREE

2.785

0.981

HEXAWARE

3.065

1.019

TRREASURY-BILL

0.521

MARKET INDEX

1.277

TCS

RI=Rf + Beta (Rm-Rf) WIPRO

= 0.521 + 0.939 (1.277-0.521)

= 0.521 + 0.709 =1.231 INFOSYS

= 0.521 + 1.124 (1.277-0.521) = 0.521 + 0.8491 = 1.371

TCS

=0.521 + 0.99(1.277-0.521) =0.521 + 0.748 =1.269

MINDTREE

=0.521 + 0.981(1.277-0.521) =0.521 +0.7420 =1.263

HEXAWARE =0.521 + 1.019(1.277-0.521) =0.521 +0.770 = 1.291 (Xi)(Ri)

= 0.20*1.036 + 0.20*1.436 + 0.20*1.46 + 0.20*2.785 + 0.20*3.065 = (0.2072) + (0.2872) +(0.292) + (0.557) + (0.613) = 1.9564

8. Calculation of Correlation Sensex Rm 6.23 3.129 19.234 7.634 -2.346 8.145 -0.749 7.933 4.348

Wipro Infosys TCS Mindtree Hexaware R% R% R% R% R% -6.13395 7.75 8.962 2.271 -1.769 7.11661 3.557 1.254 2.068 7.702 25.01429 19.008 19.541 14.283 33.91 10.656 4.488 11.462 8.009 10.379 -2.033 -2.738 -4.767 18.273 0.234 0.608 9.723 9.423 12.892 3.542 -1.258 1.356 -4.916 0.832 -8.045 18.707 3.936 8.299 10.028 7.727 2.848 6.137 3.005 -6.922 2.315

3.331 -10.241 -0.428 -3.387 10.535 4.24 3.526 5.966 0.135 4.723 -5.563 5.619 7.074 -4.723 -8.709 4.798 -4.225 5.964 0.801 3.732 -2.713 -2.786 1.016 0.938 -8.379 11.325 -0.507 2.171 -3.25 -3.453 -3.457 -2.014 -1.92 -1.806 3.294 -5.795 8.238 -0.102 -7.202

3.792 -9.076 -3.797 -3.257 7.913 -0.242 4.003 5.476 -5.517 3.912 -5.414 9.48 8.732 -4.769 -14.218 4.282 -3.109 4.594 0.408 4.494 -3.992 -0.105 -2.252 0.25 -7.359 8.359 -1.715 -1.355 2.226 -2.339 -10.05 -2.622 -2.646 0.022 1.914 -3.565 6.869 5.498 -4.125

3.264 -14.171 -3.1 -7.418 10.366 3.673 6.784 4.275 8.106 7.597 -9.562 8.703 7.097 -3.409 -12.37 4.119 -2.556 9.408 1.591 5.958 -2.103 -4.19 1.479 5.459 -6.962 12.383 -0.583 3.221 -6.329 -8.268 -3.459 0.125 -3.429 -2.698 3.614 -8.054 8.931 0.84 -9.933

1.637 -6.36 2.873 -2.064 12.837 8.185 -2.045 8.461 -4.881 1.48 -3.345 -2.885 7.832 -4.794 -3.157 5.836 -2.237 -1.653 2.201 0.875 -3.493 -5.288 3.127 -1.968 -8.753 15.315 0.556 1.781 -0.944 2.656 -4.048 -3.397 -1.343 -4.921 3.742 -5.591 10.61 -1.435 -6.54

15.06 -19.557 7.601 5.715 18.056 18.823 7.281 4.369 -7.076 9.845 6.893 2.942 9.506 -9.715 -6.433 18.912 -12.562 0.611 9.329 8.472 3.583 -8.335 -0.089 2.627 -3.548 -8.275 3.972 -2.367 0.431 -13.178 -2.312 -14.607 -8.433 8.235 9.347 -13.637 5.05 -4.428 7.461

18.731 -5.936 0.498 -5.254 10.29 -9.994 12.368 25.797 -1.74 10.549 -8.49 12.828 19.725 15.735 -10.093 0.036 -9.159 12.294 -14.662 0.735 -2.758 4.234 -2.661 -5.591 1.872 14.362 -9.755 -10.168 5.417 -3.433 -8.197 -6.907 8.294 0.734 0.632 -6.107 14.987 -4.002 7.196

6.347 8.711 6.26 11.982 12.076 -3.872 -3.656 -4.227 -7.074 -2.993 6.146 11.691 8.085 5.486 -9.753 -3.583 3.478 -9.493 0.108 -3.008 -1.165 -6.052 -1.808 -2.393 0.195 4.179 4.645 2.548 7.357 3.603 3.558 -0.748 5.783 0.686 12.676 5.097 7.402 6.6 2.511 13.223 11.342 -2.792 10.714 15.233 25.955 -0.408 -3.89 2.051 -2.362 5.986 -3.24 -3.876 -3.394 -6.219 -4.967 Correlation 0.787383 0.936388 0.875189 0.550679

1.999 3.237 8.129 4.14 -1.228 5.899 17.796 1.19 11.991 -9.225 8.514 0.586365

Interpretation Finally the above table showing the correlation of 5 selected major IT companies. Market and Return are correlated each other. Whenever market return is growing in the same way the company also growing. Both market returns and company returns are showing positive correlation is 0.936388.

HYPOTHESIS ANALYSIS;

The mean t-test for the equality of means at 95% of confidence level for the abnormal returns and risk of company return and risk. Here the test the Spearman’s rank method applied. Hypothesis; Null Hypothesis (H0): There is no negative relationship between Return and Risk. H1: There is a relationship between Return and Risk.

Years 2013-14 2014-15 2015-16 2016-17 2017-18

Rank Risk Rank Returns 1.036 5 6.727 4 1.436 4 6.764 3 1.46 3 6.42 5 2.785 2 9.623 2 3.065 1 9.801 1

D(Rank diff) 1 1 2 0 0 Total

P = 1-6∑62/5(52-1) = 1-6*6/5*24 = 1-36/120 = 1-0.3 = 0.7 t - Test Analysis t=r√n-2/√1-r2 =0.7√5-2√1-0.72 =0.7√3√1-0.49 =0.7*1.732*1-0.49

D2 1 1 4 0 0 6

=0.7224

Interpretation: Above the table value of the t-test at 5% significance level of (n-2), (5-2) 3.182 and our calculated value is 0.7224. That is less than the table value, it means null hypothesis is accepted. So the t-test shows that there is a positive relationship between Return and Risk.

CHAPTER -5 FINDINGS, SUGGESTIONS AND CONCLUSIONS FINDINGS  The risk of 2013 to 2018 with reference to WIPRO stock displays that 6.727%, and gives the return on a monthly average 1.036%.  The risk of 2013 to 2018 with reference to INFOSYS stock displays that 6.764%, and gives the return on a monthly average 1.436%.  The risk of 2013 to 2018 with reference to TCS stock displays that 6.42%, and gives the return on a monthly average 1.46%.  The risk of 2013 to 2018 with reference to MINDTREE stock displays that 9.623%, and gives the return on a monthly average 2.785%.  The risk of 2013 to 2018 with reference to HEXAWARE stock displays that 9.801%, and gives the return on a monthly average 3.065%.  The study shows that, more investment in commodity market, rather than equity market.  Brokers play a very important role in investment decision of the investor.  Market is volatile; we can often find decrease and increase in share prices of the companies.

Suggestions:  Investors should go for long term investment.  Speculators and traders can take advantage of market volatility.  Before investing shareholders should use the variables like fundamental analysis, technical analysis, to determine the stock price effectively.  Shareholders should analyze the price earnings ratio net turnover, Sensex and nifty and capitalization rate from the previous years, which indicates further, increase or decrease in shares.  It is recommended that investors should opt equity shares as the best investment avenues because of capital appreciation.

Conclusion: Saving money is not enough. Each of also need to invest one’s savings intelligently in order to have enough money available for funding the higher education of one’s children, buying a house, or for one’s own golden years. The study will guide the new investors who wants to invest in equity by providing knowledge about how to measure the risk and return of particular scrip. The study recommends new investors to go for commodity market, because of high risk and market instability. For this study 5 IT sector company have been selected to know the risk and return of the selected companies. High risk is creating a high return in the above 5 companies return to the investors the company MINDTREE is have to get the high return and high risk in the market. The sensitiveness of the company’s stock returns to the changes in the market returns is observed as revealed in the data analysis. The percentage in which some securities should have been invested to gain finest return is also calculated and characterized. When the BSE SENSEX changes, companies stock prices also have a tendency to change. This directs that some original factors affect the market index as well as the company’s stock price. Every investor has to calculate the risk and return analysis before investors investing the particular organization. It is crucial to know the routine of the securities in the market for the better investment decision. The investor has to participate in such securities which have sensible risk and high return and if the investor is a risk taker then he can invest in high risk securities with high return on securities. CHAPTER – 6 BIBILOGRAPHY &ANNEXURE BIBILOGRAPHY Reference Books

SL.NO 1 2

BOOKS Securities Analysis & Portfolio Management Investment Management

AUTHOR & PUBLICATION Punithavathi pandian Vikas publishing Preethi Singh Himalaya publishing house

Journals;  Dr Narayanasamy, Ms. R.Thirugnanasoundari. R. SSRG International Journal of economic science and Management Studies (SSRG-IJEMS) – volume3 issue2 March to April 2016  Narayan Gaonkar31 Dr. Kushalapp Volume four, Number 1, Jan – March’ 2015 ISSN (Print):2279-0896 PEZZOTTAITE JOURNALS Others;  Company broachers  Business line newspapers, business today, capital market Website;  www.geojit.com  www.bseindia.com  www.moneycontrol.com