1

CERTIFICATE

This is certify that the project titled “EQUITY RESEARCH ANALIST” carried out by Mr. PIYUSH

SAINI has been accomplished under my guidance & supervision as a duly registered MBA student of

S.S. Jain Subodh Management Institute. This project is being submitted by me in the partial fulfillment

of the requirements for the award of the Master of Business Administration from Rajasthan

Technical University.

His dissertation represents his original work and is worthy of consideration for the award of the degree of

Master of Business Administration.

Mr. Piyush Saini

2
 DECLARATION

I “PIYUSH SAINI”, hereby declare that the work presented herein is genuine work done originally by

me and has not been published or submitted elsewhere. Any literature, data or work done by others and

cited in the report has been given due acknowledgement and listed in the reference section.

Piyush Saini

3
 ACKNOWLEDGEMENT

I am using opportunity to express my gratitude to everyone who supported me throughout the course of

this MBA project. I am thankful for their aspiring guidance, invaluably constructive criticism and friendly

advice during the project work. I am sincerely grateful to them for sharing their truthful and illuminating

view on a number of issues related to the project.

I express my warm thanks to Mr. for his support and guidance and all other who

provided me with the facilities being required and conductive condition for my MBA project.

THANK YOU

HARDEEP SINGH

4
 PREFACE

This research contains project report on Equity research and mutual fund with fundamental analysis

of equity markets. This research contains compact information of the firm. I have tried my level best

to collect the information. All the required relevant information has been obtained from the firm.

This report is made on the basis of the discussion with the owner of the firm. This exercise helped

me to sharpen many skills. In this time of a summer project I have learned many things like how to

behave, how to deal with the colleagues, how to get work done. I have made my sincere efforts to

maintain the knowledge. I have gained during my training period and while project work preparation.

5
 TABLE OF CONTENT

SR. NO. PARTICULARS PAGE

NO.
1. INTRODUCTION OF THE FIRM
2. HISTORY OF INDIAN MARKET
3. TERMINOLOGIES OF THE MARKET
4. FUNDAMENTAL ANALYSIS
 PROFIT & LOSS A/C
 BALANCE SHEET AND RATIOS
 CASH FLOW STATEMENT
5. TECHNICAL ANALYSIS
6. INITIAL PUBLIC OFFER (IPO)
 WHY PUBLISHED IPO
 ANALYSIS OF TATA TECHNOLOGIES IPO
7. EARNING CONCALL OF COMPANIES
 KPI’S OF KOTAK MAHINDRA BANK
8. HOLDING COMPANY
 KAMA HOLDING Ltd.
9. MUTUAL FUND IN INDIA
 SCHEMES IN FUNDS
 RETURNS GENERATED BY TOP MUTUAL FUND
10. EQUITY RESEARCH REPORT
 BLUE STAR Ltd. EQUITY RESEARCH REPORT
11. KEY LEARNING FROM THE EXPERIENCE
 LEARNING REGARDING PLANING &
DECISION MAKING
 MARKET RESEARCH

12. CONCLUSION
13. RECOMMENDATIONS
14. REFERENCES AND BIBLIOGRAPHY

6
 INTRODUCTION

Modani financial services

With 6 years of experience in fund management and financial solution, we at “

” bring forward our expertise by consistently delivering value to our investors. We provide financial

solution to investors with efficiently. With our in-depth analysis and expertise, we fulfil and achieve

goals and requirements. Also we provide capital market solution, wealth management, project

financing, insurance and taxation. Working on the analysis of stock on various parameters and

studies on the past, future and comparative performance of the equity market.

7
8
 REGULATORY BODY
SEBI

The Securities and Exchange Board of India (SEBI) is the regulatory body overseeing the securities

and capital markets in India. Here is a comprehensive overview of SEBI's history:

1. Background and Establishment:

Prior to SEBI's establishment, the regulation of the Indian securities market was fragmented and

lacked a centralized regulatory authority. The need for a comprehensive regulatory body became

evident due to increasing market complexities, malpractices, and a lack of investor protection.

SEBI was officially established on April 12, 1992, as a statutory regulatory body under the SEBI

Act, 1992, enacted by the Indian Parliament. It replaced the Controller of Capital Issues, which was

the earlier regulatory authority for the capital market.

2. Objectives of SEBI:

 SEBI was founded with specific objectives:

 Protecting the interests of investors in securities.

 Promoting the development and regulation of the securities market.

 Regulating intermediaries and entities associated with the securities market.

 Ensuring fair and transparent dealings in the market.

 Creating an environment conducive to the growth of the securities market in India.

9
3. Evolution and Key Milestones:

Expanded Regulatory Scope: Initially, SEBI focused on regulating stock exchanges and protecting

investor interests. Over time, its scope broadened to include regulating various entities such as

brokers, merchant banks, mutual funds, and other market intermediaries.

Market Reforms: SEBI introduced significant reforms to modernize and streamline the securities

market. Key initiatives included introducing electronic trading, dematerialization of securities, and

establishing guidelines for transparency and investor protection.

Corporate Governance and Disclosure Norms: SEBI introduced stringent corporate governance

norms for listed companies. It emphasized transparency, accountability, and the protection of

shareholders' rights. Stringent disclosure requirements were also put in place to ensure timely and

accurate information dissemination.

Investor Education and Awareness: SEBI has been actively involved in investor education and

awareness programs. It aimed to equip investors with knowledge about their rights, risk factors, and

best practices while investing in the securities market.

Regulatory Enforcement: SEBI has the authority to investigate and take enforcement actions against

market malpractices, insider trading, fraudulent activities, and non-compliance with regulations. This

is done to maintain market integrity and protect investor interests.

4. Current Role and Functions:

 SEBI's primary functions include:

 Regulating stock exchanges, clearinghouses, and various market intermediaries.

 Framing rules, regulations, and guidelines for the securities market.

10
5. Impact and Significance:

SEBI's establishment and proactive measures significantly transformed India's securities market. It

improved investor confidence, ensured fair market practices, and facilitated the growth and

development of the capital market.

The introduction of regulations and reforms by SEBI played a crucial role in making the Indian

securities market more transparent, efficient, and investor-friendly.

SEBI's enforcement actions against market malpractices and its focus on investor education have

contributed to enhancing investor protection and confidence in the Indian capital markets.

11
12
 POPULAR STOCK EXCHANGES

BOMBAY STOCK EXCHANGE

The Bombay Stock Exchange (BSE) is one of the oldest and most prominent stock exchanges in Asia.

Here's a comprehensive overview of the history of BSE:

1. Establishment and Early Years:

The BSE was established in 1875 as "The Native Share & Stock Brokers' Association" and operated

under a banyan tree in Mumbai, now known as Dalal Street.

Initially, the BSE functioned as an informal group of stockbrokers who conducted trading activities in

stocks and shares of companies.

2. Formal Recognition and Evolution:

In 1957, the BSE was recognized as a stock exchange under the Securities Contracts (Regulation) Act,

1956. It obtained a permanent recognition from the Indian government in 1980.

Over the years, the BSE expanded its operations, introduced new products, and established itself as a

premier stock exchange in India.

3. Technological Advancements:

BSE underwent significant technological advancements. In 1995, it became the first stock exchange

in India to adopt an electronic trading system called the BSE Online Trading (BOLT) system,

replacing the traditional open outcry system with an electronic trading platform.

Subsequently, BSE introduced various technology-driven initiatives, enhancing trading efficiency,

transparency, and accessibility for market participants.

13
4. Major Milestones and Developments:

Sensex: In 1986, BSE introduced the BSE Sensex, a benchmark index that reflects the performance of

the top 30 companies listed on the exchange. The Sensex is widely followed and serves as a barometer

of the Indian stock market.

Derivatives Market: BSE launched its derivatives segment in 2000 with the introduction of index

futures and options contracts based on the BSE Sensex.

Listing of Companies: BSE provides a platform for companies to list their securities and raise

capital from the public through Initial Public Offerings (IPOs). Numerous prominent Indian

companies are listed on the exchange.

5. Regulatory Compliance and Governance:

BSE operates under the regulatory framework set by the Securities and Exchange Board of India

(SEBI) and adheres to the rules and regulations for stock exchanges in India.

The exchange has stringent listing requirements and ensures compliance with corporate governance

norms to maintain transparency and protect investor interests.

6. Global Collaborations and Initiatives:

BSE has established collaborations with various international exchanges and financial institutions,
fostering international relationships and exploring new opportunities for growth and development.

7. Impact and Significance:

BSE holds historical significance as one of the oldest stock exchanges in Asia and remains a crucial
player in India's financial markets.

14
 NATIAONAL STOCK EXCHANGE

The National Stock Exchange of India Limited (NSE) is one of the leading stock exchanges in India.

Here's a comprehensive overview of the history of NSE:

1. Establishment and Background:

NSE was incorporated in 1992 and officially commenced operations in 1994. It was established as

a result of a government initiative to create a modern and sophisticated stock exchange in India.

It was founded by leading financial institutions, including IDBI, ICICI, LIC, and others, with

the support of the Government of India.

2. Objectives of NSE:

The primary objectives of NSE were to establish a transparent, efficient, and nationwide trading

platform for various financial instruments, particularly equities and derivatives.

NSE aimed to provide an alternative to the Bombay Stock Exchange (BSE) and introduce modern

trading practices and technology.

3. Technological Advancements and Innovations:

NSE introduced cutting-edge technology from its inception. It adopted an electronic trading system

called the National Exchange for Automated Trading (NEAT) system, which enabled screen-based

trading in a fully automated, order-driven environment.

NEAT was among the earliest electronic trading systems in India and significantly contributed to

improving trading efficiency and transparency.

15
4. Major Milestones and Developments:

Index Products: NSE launched various benchmark indices, including the Nifty 50, which consists of

the top 50 companies listed on the exchange. The Nifty 50 index is widely followed and serves as a

barometer of the Indian equity market.

Derivatives Segment: NSE played a significant role in introducing and popularizing derivatives

trading in India. It launched index futures in June 2000, followed by index options, stock futures, and

stock options.

5. Regulatory Compliance and Governance:

NSE operates under the regulatory framework set by the Securities and Exchange Board of India

(SEBI) and complies with regulations governing stock exchanges in India.

The exchange adheres to stringent listing requirements and maintains corporate governance standards

to ensure market transparency and protect investor interests.

6. Technological Innovations and Expansion:

NSE continued to invest in technological innovations, enhancing its trading infrastructure and

introducing new products and services to cater to the evolving needs of market participants.

It expanded its reach by establishing regional offices across India and offering various trading and

investment-related educational programs.

16
7. Impact and Significance:

NSE revolutionized the Indian capital markets by introducing advanced technology, improving
liquidity, enhancing transparency, and providing a platform for efficient trading and investment.

It significantly contributed to the growth of the Indian economy by facilitating capital formation,
providing access to a wide range of financial instruments, and attracting both domestic and
international investors.

17
 INTRODUCTION OF INDIAN STOCK MARKET

The structure of the Indian stock market is multifaceted, involving various entities, regulators, and

market participants. Here's a detailed explanation of the key components of the Indian stock market

structure:

1. Primary Market:

 Initial Public Offering (IPO):

 Companies looking to raise capital for expansion or other purposes issue new

securities to the public for the first time.

 Investors subscribe to these issues, and upon allotment, they become shareholders in

the company.

 Follow-on Public Offering (FPO):

 Existing publicly listed companies issue additional shares to the public to raise further

capital.

 This can be for expansion, debt repayment, or other corporate objectives.

2. Secondary Market:

 Stock Exchanges:

 The primary platforms for buying and selling existing securities.

 The two major stock exchanges in India are the Bombay Stock Exchange (BSE) and

the National Stock Exchange (NSE).

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  Stock Indices:

 Key market benchmarks, such as the Sensex (BSE) and Nifty (NSE), represent the

performance of the overall market or specific sectors.

3. Participants in the Stock Market:

 Investors:

 Retail Investors: Individuals who invest relatively smaller amounts.

 Institutional Investors: Mutual funds, insurance companies, banks, and other large

entities.

 Regulatory Bodies:

 Securities and Exchange Board of India (SEBI):

 The primary regulatory authority overseeing the functioning of the securities

market.

 Intermediaries:

 Stock Brokers:

 Facilitate the buying and selling of securities on behalf of investors.

 Execute trades on stock exchanges.

 Depository Participants (DPs):

 Provide dematerialization and maintenance of electronic records of securities.

 Facilitate electronic transfer of securities.

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  Listed Companies:

 Companies that have gone through the IPO process and have their shares listed on

stock exchanges.

 Required to comply with various regulatory norms to ensure transparency and protect

investor interests.

4. Instruments Traded:

 Equity Shares:

 Represent ownership in a company and provide voting rights.

 Traded on stock exchanges.

 Debentures/Bonds:

 Fixed-income securities representing loans given to a company.

 Traded in the debt market.

 Derivatives:

 Include futures and options, allowing investors to hedge or speculate on price

movements.

 Traded on derivative segments of stock exchanges.

20
5. Market Regulations:

 SEBI Guidelines:

 SEBI issues guidelines and regulations to govern the conduct of various market

participants.

 Ensures fair practices, market integrity, and investor protection.

 Listing Agreement:

 Companies must comply with listing requirements to remain listed on stock exchanges.

 These requirements include timely financial disclosures, corporate governance

norms, and adherence to SEBI regulations.

6. Trading Mechanism:

 Open Outcry System:

 Traditional method where traders physically gather on the trading floor to buy and

sell securities.

 Electronic Trading:

 Most trading now occurs electronically through computerized systems.

21
  This provides greater efficiency, transparency, and accessibility to a broader range of

investors.

7. Market Indices:

 Sensex (BSE):

 Represents the 30 largest and most actively traded stocks on the BSE.

 Nifty (NSE):

 Represents the 50 largest and most liquid stocks on the NSE.

8. Challenges and Opportunities:

 Volatility:

 Stock prices can be subject to rapid and unpredictable changes.

 Globalization:

 Increasing integration with global markets poses both challenges and opportunities.

 Technology:

 Advancements in technology have transformed the trading landscape, offering new

prospects but also introducing risks.

22
 PARTICIPANTS OF THE STOCK MARKET

The Indian stock market involves various participants who play distinctive roles in the buying, selling,

and trading of securities. Here's an in-depth explanation of the key participants:

1. Investors:

 Retail Investors:

 Individuals: These are small-scale investors who buy and sell securities for personal

investment purposes. They typically invest smaller amounts compared to institutional

investors.

 High Net Worth Individuals (HNIs): Individuals with significant financial assets who

engage in substantial investment activities.

 Institutional Investors:

 Mutual Funds: Pool funds from multiple investors to invest in a diversified portfolio

of stocks, bonds, or other securities.

 Insurance Companies: Invest policyholder premiums in various financial instruments.

 Pension Funds: Manage and invest funds to meet long-term pension liabilities.

 Banks and Financial Institutions: Invest in securities as part of their treasury

operations.

2. Regulatory Bodies:

 Securities and Exchange Board of India (SEBI):

 The primary regulatory authority overseeing the securities market in India

23
3. Intermediaries:

 Stock Brokers:

 Facilitate the buying and selling of securities on behalf of investors.

 Execute trades on stock exchanges.

 Provide investment advice and research.

 Depository Participants (DPs):

 Facilitate the holding of securities in electronic form.

 Provide services related to the dematerialization and rematerialization of securities.

 Merchant Bankers:

 Play a crucial role in the IPO process by underwriting, managing, and marketing new

issues.

 Advise companies on the IPO and listing process.

 Registrars and Transfer Agents (RTAs):

 Maintain records of investors and their holdings for listed companies.

 Facilitate the transfer of shares and update investor records.

4. Listed Companies:

 Issuers of Securities:

 Companies that have gone through the IPO process and have their shares listed on

stock exchanges..

24
Board of Directors and Management:

 Responsible for making strategic decisions to enhance shareholder value.

 Engage with investors and analysts to provide information about the company's

performance.

5. Credit Rating Agencies:

 Credit Rating Agencies (CRAs):

 Evaluate the creditworthiness of companies and their debt instruments.

 Provide credit ratings that help investors assess the risk associated with investing in a

particular security.

25
 INTRUMENTS TRADED IN STOCK MARKET

The Indian stock market offers a range of financial instruments that investors can buy and sell. These

instruments represent various ways to invest in companies, debt, and derivatives. Here's a detailed

explanation of the key instruments traded in the Indian stock market:

1. Equity Shares : Ownership shares in a company that represent a claim on part of the company’s

assets and earnings.

 Features:

 Shareholders have voting rights in corporate decisions.

 Returns come from capital appreciation (increase in share price) and dividends.

 Trading:

 Bought and sold on stock exchanges such as the Bombay Stock Exchange (BSE) and

the National Stock Exchange (NSE).

2. Preference Shares : Shares with preferential rights in terms of dividends and repayment of

capital in the event of liquidation.

3. Debentures/Bonds : Debt instruments representing loans given to a company.

4. Derivatives : Contracts to buy or sell an asset at a future date at a predetermined price.

26
 Features:

 Used for hedging or speculation.

 Standardized contracts with fixed expiration dates.

 Traded on derivative segments of stock exchanges.

Options : Contracts that give the holder the right (but not the obligation) to buy or sell an asset at a

predetermined price.

Features :

 Provide flexibility for risk management and trading strategies.

 Traded on derivative segments of stock exchanges.

5. Exchange-Traded Funds (ETFs) : Investment funds that hold a basket of securities and

trade on stock exchanges like individual stocks.

 Features:

 Provide diversification across a specific index or sector.

 Traded throughout the day like stocks.

6. Mutual Funds : Investment vehicles that pool money from multiple investors to invest in a

diversified portfolio of stocks, bonds, or other securities.

27
  Features:

 Managed by professional fund managers.

 Offer diversification and professional management.

 Trading : Investors buy and redeem units through the mutual fund.

7. Rights Issues and Bonus Issues:

 Rights Issues : Companies offer existing shareholders the right to buy additional shares at

a discounted price.

 Bonus Issues : Companies issue additional shares to existing shareholders without any cash

payment.

8. Commercial Papers and Treasury Bills:

Commercial Papers : Short-term debt instruments issued by corporations to raise funds

for a specific period.

Treasury Bills (T-Bills) : Short-term government securities with maturities ranging from

a few days to one year.

 Issued at a discount and redeemed at face value.

28
 Functioning of SEBI

Market regulations in the stock market are essential to maintain fair, transparent, and orderly

functioning. In India, the Securities and Exchange Board of India (SEBI) is the primary regulatory

authority responsible for overseeing the securities market. Here's a detailed explanation of market

regulations in the Indian stock market:

1. Role of SEBI (Securities and Exchange Board of India):

 Establishment:

 SEBI was established in 1988 as an autonomous regulatory body to protect the

interests of investors and regulate the securities market.

 Objectives:

 Protect the interests of investors.

 Ensure fair and transparent securities markets.

 Promote the development of, and regulate, the securities market.

2. Regulatory Functions of SEBI:

 Registration and Regulation:

 Registers and regulates various market intermediaries, such as stockbrokers, sub-

brokers, merchant bankers, and depository participants.

29
  Monitoring and Surveillance:

 Monitors and supervises stock exchanges, intermediaries, and listed companies

to detect and prevent market manipulation and fraud.

Enforcement:

 Has the power to enforce securities laws through actions such as investigations,

inspections, and imposing penalties for violations.

 Investor Protection:

 Takes measures to enhance investor awareness and education.

 Implements initiatives to protect the rights and interests of investors.

Regulation of Market Intermediaries:

 Formulates regulations governing the conduct of various market intermediaries

to ensure fair practices and market integrity.

 Issuer Regulation:

 Regulates the issuance and listing of securities by companies through measures such

as disclosure requirements and the vetting of offer documents.

3. Listing Requirements:

 Listing Agreement

 Companies seeking to list their securities on stock exchanges must comply with the listing

agreement, which includes disclosure norms and corporate governance standards.

30
  Continuous Disclosure Requirements:

 Listed companies must regularly disclose information about their

financial performance, operations, and any material events that may affect their

securities.

4. Insider Trading Regulations:

 Prevention of Insider Trading:

 SEBI has regulations in place to prevent insider trading, ensuring that individuals with

access to unpublished price-sensitive information do not take advantage of such

information for trading.

5. Takeover Regulations:

 SEBI (Substantial Acquisition of Shares and Takeovers) Regulations:

 Governs the acquisition of shares and takeovers of listed companies to ensure

transparency and protect the interests of minority shareholders.

6. Delisting Regulations:

 SEBI (Delisting of Equity Shares) Regulations:

 Regulates the process of delisting of securities from stock exchanges, ensuring

fairness and protecting the interests of shareholders.

31
7. Code of Conduct:

 Code of Conduct for Intermediaries:

 SEBI prescribes a code of conduct for various market participants, including

brokers and mutual funds, to ensure ethical behavior and adherence to market

integrity.

8. Risk Management:

 Risk Management Framework:

 Stock exchanges and clearing corporations implement risk management frameworks

to ensure the stability and integrity of the financial system.

9. Market Surveillance:

 Surveillance Systems:

 SEBI employs advanced surveillance systems to monitor trading activities, detect

market anomalies, and take preventive actions.

10. Global Best Practices:

 International Cooperation:

 SEBI collaborates with international regulatory bodies to adopt global best practices

and stay updated on developments in international financial markets.

32
 Trading Mechanism of stock market

The trading mechanism in the stock market refers to the processes and systems through which

securities are bought and sold. It involves various participants, technologies, and rules that ensure a

fair and efficient marketplace. In India, the trading mechanism is predominantly electronic, with

transactions facilitated through stock exchanges such as the Bombay Stock Exchange (BSE) and the

National Stock Exchange (NSE). Here's a detailed explanation of the trading mechanism:

1. Order Placement:

 Investors and Traders:

 Individual and institutional participants place buy or sell orders through stockbrokers.

 Online trading platforms allow investors to place orders electronically.

 Types of Orders:

 Market Orders: Executed at the prevailing market price.

 Limit Orders: Executed at a specific price or better.

 Stop-Loss Orders: Triggered when the stock reaches a predetermined price.

2. Stock Exchanges:

 Electronic Trading:

 Most trading occurs electronically through computerized systems.

 The BSE and NSE are the primary stock exchanges in India.

33
  Continuous Trading:

 Stocks are traded continuously during market hours, allowing for real-time price

discovery.

Trading Segments:

 Equity cash segment: Spot trading of stocks.

 Futures and options segment: Trading in derivative instruments.

3. Trading Hours:

 Normal Trading Hours:

 Equity cash segment: 9:15 AM to 3:30 PM (Monday to Friday).

 Derivatives segment: 9:15 AM to 3:30 PM (Monday to Friday).

 After-Market Hours:

 Some exchanges offer extended trading hours for retail investors.

4. Matching of Orders:

 Order Matching System:

 The exchange's computerized system matches buy and sell orders.

 Orders are matched based on price and time priority.

34
  Central Order Book:

 All buy and sell orders are recorded in a central order book.

5. Clearing and Settlement:

 Clearing Corporation:

 Acts as an intermediary to ensure the settlement of trades.

 Manages counterparty risk by guaranteeing trade settlement.

 Settlement Cycle:

 T+2 settlement cycle, where trades are settled two business days after the trade date.

 Dematerialization:

 Securities are held in electronic form through a depository.

6. Market Indices:

 Calculation:

 Indices like the Sensex and Nifty represent the market's overall performance.

 Calculated based on the weighted average of constituent stocks.

35
  Benchmark for Performance:

 Used as benchmarks for portfolio performance and market trends.

7. Trading Halts:

 Circuit Breakers:

 Mechanism to prevent excessive volatility..

8. Surveillance and Regulation:

 Market Surveillance:

 Continuous monitoring of trading activities.

 Detection of irregularities or potential market manipulation.

 Regulatory Oversight:

 SEBI oversees and regulates exchanges to ensure fair and transparent trading practices.

9. Technology and Algorithmic Trading:

 High-Frequency Trading (HFT):

 Use of algorithms for high-speed trading.

 Requires advanced technology infrastructure.

 Exchanges implement risk controls to manage the impact of algorithmic trading.

36
10. Post-Trade Reporting:

 Trade Confirmation:

 Brokers provide trade confirmations to clients.

 Confirmations include details of executed trades.

37
 Terminologies

1. Stock/Share:

A stock, also known as a share, represents ownership in a company. When individuals or institutions

purchase stocks, they become shareholders, owning a portion of the company proportional to the

number of shares they hold. Shareholders have the right to vote on certain company decisions and

may receive dividends, which are a share of the company's profits.

2. Ticker Symbol:

Each publicly traded company has a unique ticker symbol, which is a series of letters used to identify

its shares on a stock exchange. For example, Apple Inc. has the ticker symbol "AAPL" on the

NASDAQ stock exchange. Ticker symbols are used for trading purposes, allowing investors to easily

identify and trade stocks.

3. Dividend:

Dividends are a distribution of a portion of a company's profits to its shareholders. They are usually

paid out regularly, often quarterly, although the decision to pay dividends rests with the company's

board of directors. Not all companies pay dividends; some prefer to reinvest profits into the business

for growth. Dividend amounts can vary and are typically declared on a per-share basis.

38
4. Market Capitalization:

 Market capitalization, often referred to as market cap, is the total value of a company's

outstanding shares. It is calculated by multiplying the current stock price by the total number

of outstanding shares. Market cap categorizes companies into different size classes:

 Large-cap: Typically companies with a market cap above $10 billion.

 Mid-cap: Companies with market caps between $2 billion and $10 billion.

 Small-cap: Companies with market caps below $2 billion.

5. Bull Market:

A bull market refers to a period in the financial markets when stock prices are rising, investor

confidence is high, and there is an overall positive sentiment. During a bull market, economic

conditions are often favorable, leading to increased buying activity and rising stock prices. Bull

markets are characterized by optimism, increasing demand for stocks, and sustained upward trends

over a prolonged period.

Understanding these terms is fundamental for anyone interested in investing or trading in the stock

market, as they form the basis of stock market knowledge and investment decision-making.

6. Bear Market:

A bear market is the opposite of a bull market. It's a period in the financial markets

characterized by declining stock prices, investor pessimism, and a general downward trend. Bear

markets often coincide with economic downturns, high unemployment, and overall negative

sentiment. During a bear market, there's a sustained drop in stock prices (usually by 20% or more

from recent highs), causing investors to anticipate further losses.

39
7. Blue Chip Stocks:

Blue chip stocks are shares of large, well-established, financially sound companies with a history of

stable earnings and dividend payments. These companies are typically leaders in their industries,

have a strong market presence, and a track record of weathering economic downturns relatively well.

Examples of blue chip stocks include companies like Coca-Cola, IBM, and Johnson & Johnson.

8. Volatility:

Volatility refers to the degree of variation or fluctuation in the price of a stock, security, or the

overall market. High volatility implies that the price of the security can change dramatically over a

short period, leading to increased risk. Volatility is often measured by statistical tools such as

standard deviation and is a crucial factor in assessing risk and potential returns in investment

decisions.

9. Index:

An index is a statistical measure used to track the performance of a specific segment of the stock

market. It's created by combining the prices of multiple stocks into a single value, giving an

overview of how that segment of the market is performing. Commonly followed indexes include the

S&P 500, which tracks 500 large-cap U.S. stocks, and the Dow Jones Industrial Average (DJIA),

which follows 30 major U.S. companies.

10. IPO (Initial Public Offering):

An IPO occurs when a privately held company offers its shares to the public for the first time,

allowing investors to purchase ownership stakes in the company. This process involves the sale of

newly issued shares to raise capital for the company's expansion, debt repayment, or other corporate

purposes. IPOs are often seen as a way for companies to gain access to public capital markets and

increase their visibility.

40
Understanding these terms helps investors and traders navigate the stock market, evaluate investment

opportunities, and make informed decisions based on market conditions, company fundamentals, and

risk assessment.

11. Market Order:

A market order is an instruction given by an investor to a broker to buy or sell a security at the best

available price in the current market. When placing a market order, the trade is executed immediately

at the prevailing market price. Market orders prioritize execution speed over price, meaning the

investor accepts the current market price at the time of execution, which may not necessarily be the

last quoted price.

12. Limit Order:

A limit order is an order placed by an investor to buy or sell a security at a specified price or better.

Unlike market orders, limit orders allow investors to control the price at which they want their trades

to be executed. A buy limit order specifies the maximum price an investor is willing to pay, while a

sell limit order sets the minimum price at which an investor is willing to sell. The trade will only be

executed if the market reaches the specified limit price or better.

13. Bid Price:

The bid price represents the highest price that a buyer is willing to pay for a security at a given time

in the market. It's the price at which an investor can sell their shares when executing a market order.

The bid price is displayed in the order book and represents the demand side of the market.

41
14. Ask Price:

The ask price is the lowest price at which a seller is willing to sell a security at a given time in the

market. It's the price at which an investor can buy shares when executing a market order. The ask

price is also displayed in the order book and represents the supply side of the market.

15. Volume:

Volume refers to the total number of shares or contracts traded for a specific security or in the entire

market during a given period, typically over a day or a trading session. It indicates the level of

activity and liquidity in the market. Higher trading volume often suggests increased interest in a

particular stock or market, while lower volume may indicate decreased interest or less active trading.

These terms are crucial for investors and traders to understand as they directly impact the execution

of trades, pricing, and overall market dynamics. Knowledge of market orders, limit orders, bid and

ask prices, and trading volume helps individuals make more informed decisions while participating

in the stock market.

16. Broker:

A broker is a licensed individual or firm that facilitates the buying and selling of securities (such as

stocks, bonds, mutual funds, etc.) on behalf of investors. Brokers execute trades in financial markets,

providing access to exchanges and offering services that include research, investment advice, trade

execution, and account management. They may work for brokerage firms or operate as independent

agents.

42
17. Portfolio:

A portfolio refers to a collection of investments held by an individual, institution, or fund. It can

include a variety of assets such as stocks, bonds, mutual funds, exchange-traded funds (ETFs), real

estate, and more. Portfolios are managed to achieve specific investment goals, such as capital

appreciation..

18. Diversification:

Diversification is an investment strategy aimed at reducing risk by spreading investments across

various asset classes, industries, sectors, or geographic regions. The principle behind diversification

is that a diversified portfolio may be less vulnerable to the negative impact of a single investment's

poor performance. By investing in different types of assets, investors seek to minimize the impact of

market volatility on their overall portfolio.

19. P/E Ratio (Price-to-Earnings Ratio):

The price-to-earnings (P/E) ratio is a valuation metric used to evaluate a company's current stock

price relative to its earnings per share (EPS). It is calculated by dividing the market price per share

by the earnings per share. The P/E ratio indicates how much investors are willing to pay for each

dollar of a company's earnings. A higher P/E ratio might suggest that investors expect higher future

earnings growth, while a lower P/E ratio might indicate undervaluation or lower growth

expectations.

20. Dividend Yield:

Dividend yield is a financial ratio that represents the annual dividend income earned by an investor

relative to the current price of the stock. It is calculated by dividing the annual dividend per share by

the current price per share and expressing the result as a percentage. Dividend yield is used by

investors to assess the income potential of a stock investment and compare it to alternative

investments or to track changes in dividend payments over time.

43
 FUNDAMENTAL ANALYSIS

Fundamental analysis is a method of evaluating a security, such as stocks or bonds, by analysing

and interpreting various economic, financial, and other qualitative and quantitative factors. The goal

of fundamental analysis is to determine the intrinsic value of an asset and assess whether it is

overvalued or undervalued in the market. This approach is often used by investors to make informed

decisions about buying or selling securities for long-term investment.

Here are key aspects of fundamental analysis:

1. Financial Statements:

 Balance Sheet:

 Provides a snapshot of a company's financial position at a specific point in time.

 Includes assets, liabilities, and shareholders' equity.

 Income Statement:

 Shows the company's revenues, expenses, and profits over a specific period.

 Net income is a key metric.

 Cash Flow Statement:

 Details the flow of cash in and out of the company.

 Reflects operating, investing, and financing activities.

2. Earnings and Dividends:

 Earnings per Share (EPS):

 Indicates a company's profitability on a per-share basis.

44
  Calculated as net income divided by the number of outstanding shares.

 Dividend Yield:

 The dividend paid per share relative to the stock price.

 Important for income-seeking investors.

3. Valuation Ratios:

 Price-to-Earnings (P/E) Ratio:

 Compares a company's stock price to its earnings per share.

 Helps assess whether a stock is overvalued or undervalued.

 Price-to-Book (P/B) Ratio:

 Compares a company's market value to its book value (net asset value).

 Indicates whether a stock is trading below or above its book value.

4. Profitability Ratios:

 Return on Equity (ROE):

 Measures a company's ability to generate profit from shareholders' equity.

 Indicates how efficiently a company is using equity capital.

 Net Profit Margin:

 Calculates the percentage of revenue that remains as net profit after expenses.

 Reflects a company's profit efficiency.

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 PROFIT AND LOSS A/C

A Profit and Loss (P&L) statement is indicative of a company's strong financial performance and

operational efficiency. Investors and analysts assess various parameters within the P&L statement

to gauge the overall health of a business. Here are key parameters to consider when evaluating the

health of a P&L statement:

1. Revenue Growth:

 Positive Trend:

 Healthy companies exhibit consistent and sustainable revenue growth over time.

 Indicates market demand and the company's ability to increase sales.

2. Gross Profit Margin:

 High Gross Profit Margin:

 Indicates that the company is efficiently managing its production costs.

 Higher margins suggest better pricing power and profitability.

3. Operating Profit Margin:

 Consistent Operating Profit:

 A stable or increasing operating profit margin signifies effective cost management.

46
4. Net Profit Margin:

 Healthy Net Profit Margin:

 Indicates how well the company controls its costs relative to its revenue.

 A higher net profit margin suggests strong overall profitability.

5. Earnings Per Share (EPS):

 Increasing EPS:

 Growing EPS indicates that the company is generating more profit on a per-

share basis.

 It is a key metric for shareholders' return on investment.

6. Effective Tax Rate:

 Reasonable Tax Expense:

 A reasonable and consistent effective tax rate is a positive sign.

 High or fluctuating tax rates can impact overall profitability.

47
 BALANCE SHEET AND RATIOS

A balance sheet is crucial for assessing a company's financial stability, solvency, and overall well-

being. It provides a snapshot of a company's assets, liabilities, and equity at a specific point in

time. Here are key parameters to consider when evaluating the health of a balance sheet:

1. Current Ratio:

 Calculation:

 Current Ratio = Current Assets / Current Liabilities.

 Significance:

 A ratio above 1 indicates that the company has more current assets than

current liabilities, suggesting liquidity and the ability to cover short-term

obligations.

2. Quick Ratio (Acid-Test Ratio):

 Calculation:

 Quick Ratio = (Current Assets - Inventory) / Current Liabilities.

 Significance:

 Similar to the current ratio but excludes inventory, providing a more

conservative measure of a company's ability to meet short-term obligations.

48
3. Debt-to-Equity Ratio:

 Calculation:

 Debt-to-Equity Ratio = Total Debt / Shareholders' Equity.

Significance:

 Indicates the proportion of a company's financing that comes from debt compared

to equity. A lower ratio is generally favourable.

4. Interest Coverage Ratio:

 Calculation:

 Interest Coverage Ratio = Operating Income / Interest Expense.

 Significance:

 Measures a company's ability to cover interest expenses with operating income.

A higher ratio indicates better financial health.

5. Return on Equity (ROE):

 Calculation:

 ROE = Net Income / Shareholders' Equity.

 Significance:

 Indicates the profitability generated for shareholders' equity. Higher ROE

suggests effective use of equity capital.

49
6. Asset Turnover:

 Calculation:

 Asset Turnover = Revenue / Average Total Assets.

 Significance:

 Measures how efficiently a company utilizes its assets to generate revenue. A

higher ratio indicates better efficiency.

7. Working Capital:

 Calculation:

 Working Capital = Current Assets - Current Liabilities.

 Significance:

 Positive working capital ensures the company can meet its short-term obligations.

Negative working capital may indicate potential liquidity issues.

8. Inventory Turnover:

 Calculation:

 Inventory Turnover = Cost of Goods Sold / Average Inventory.

 Significance:

 Measures how efficiently a company manages its inventory. Higher turnover

is generally preferable.

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9. Cash Conversion Cycle:

 Calculation:

 Cash Conversion Cycle = Days Inventory Outstanding + Days Sales Outstanding

- Days Payable Outstanding.

 Significance:

 Reflects how long it takes for a company to convert its investments in inventory

and receivables into cash. A shorter cycle is generally better.

10. Cash and Cash Equivalents:

 Adequate Cash Reserves:

 Healthy companies maintain sufficient cash and cash equivalents to cover short-

term obligations and take advantage of opportunities.

11. Goodwill and Intangible Assets:

 Reasonable Levels:

 Excessive goodwill or intangible assets relative to total assets may signal

potential impairments and risks.

12. Retained Earnings:

 Accumulation of Retained Earnings:

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  Positive retained earnings over time indicate profitability and sound

financial management.

13. Capital Expenditures:

 Reasonable CapEx Levels:

 Companies should invest in capital expenditures to support growth, but

excessive spending may raise concerns about capital allocation.

14. Accounts Receivable Ageing:

 Timely Collection:

 Monitoring the ageing of accounts receivable helps assess the effectiveness of

credit and collection policies.

15. Shareholders' Equity Composition:

 Balanced Equity Structure:

 A balance between common equity and preferred equity, with a reasonable debt-

to- equity ratio, contributes to a healthy capital structure.

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 CASH FLOW STATEMENT

A cash flow statement is crucial for assessing a company's ability to generate and manage cash.

The cash flow statement provides insights into how cash moves in and out of a business over a

specific period, offering a comprehensive view of its liquidity and financial health. Here are key

parameters to consider when evaluating the health of a cash flow statement:

1. Operating Cash Flow (OCF):

 Positive Operating Cash Flow:

 Positive OCF indicates that the company is generating cash from its core

business operations.

 It ensures the company can cover its day-to-day operational expenses.

2. Free Cash Flow (FCF):

 Calculation:

 FCF = Operating Cash Flow - Capital Expenditures.

 Significance:

 Positive FCF reflects the cash available for debt reduction, dividends, or

further investments.

 A reliable indicator of a company's financial flexibility.

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3. Cash Flow from Investing Activities:

 Strategic Investments:

 Positive cash flow from investing activities indicates the company is making

strategic investments.

 Consistent negative cash flow may signal excessive capital spending.

4. Cash Flow from Financing Activities:

 Sustainable Financing:

 Positive cash flow from financing activities may include proceeds from issuing

stocks or bonds.

 Sustainable financing ensures the company's ability to meet long-term obligations.

5. Net Change in Cash and Cash Equivalents:

 A consistent increase in cash and cash equivalents is a positive sign.

 It indicates that the company is building liquidity.

6. Operating Cash Flow to Net Income Ratio:

 Calculation:

 Operating Cash Flow to Net Income Ratio = Operating Cash Flow / Net Income.

54
  Significance:

 A ratio above 1 suggests that the company is converting a significant portion of its

net income into cash, indicating quality earnings.

7. Working Capital Management:

 Efficient Working Capital:

 Effective management of accounts receivable, accounts payable, and

inventory ensures optimal working capital.

 Reducing the cash conversion cycle is generally positive.

8. Debt Serviceability:

 Sufficient Cash for Debt Service:

 Companies should have enough cash to cover interest payments and debt obligations.

 Ensures financial stability and avoids default risks.

9. Dividend Payments:

 Sustainable Dividend Payments:

 Companies paying dividends should have sustainable cash flows to cover

dividend obligations.

55
  Reliable dividend payments may attract income-seeking investors.

10. Share Buybacks:

 Prudent Share Repurchases:

 If a company engages in share buybacks, it should have sufficient cash

without compromising its financial health.

 Repurchases should be viewed positively when the stock is undervalued.

11. Cash Flow Volatility:

 Stable Cash Flows:

 Consistent and stable cash flows are generally preferable.

 Excessive volatility may indicate operational challenges or financial stress.

12. Cash Reserves:

 Adequate Cash Reserves:

 Maintaining adequate cash reserves ensures the company can weather

economic downturns or unforeseen circumstances.

13. Capital Expenditure Plans:

 Transparent CapEx Allocation:

 Clear communication and transparency regarding capital expenditure plans

are essential for investor confidence.

56
 Technical Analysis

Indicators available in the market

Technical indicators are tools used by traders and analysts in the stock market to analyze past market

data, identify trends, and make informed decisions about buying, selling, or holding securities. These

indicators are derived from mathematical calculations applied to price, volume, or open interest data.

They help traders to understand market trends, momentum, volatility, and potential reversal points.

Here are some commonly used technical indicators in the stock market:

Moving Averages (MA):

Simple Moving Average (SMA) and Exponential Moving Average (EMA) are popular indicators

that smooth out price data by averaging closing prices over a specific period. They help identify

trends and potential support or resistance levels.

Relative Strength Index (RSI):

RSI measures the magnitude of recent price changes to evaluate overbought or oversold conditions in

a stock. It oscillates between 0 and 100, where values above 70 are considered overbought and

values below 30 are considered oversold.

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Moving Average Convergence Divergence (MACD):

MACD is a trend-following momentum indicator that shows the relationship between two moving

averages. It consists of the MACD line (the difference between two EMAs) and a signal line (a

moving average of the MACD line). Traders use MACD crossovers and divergences to identify trend

changes.

Bollinger Bands:

Bollinger Bands consist of a middle line (usually a 20-period SMA) and two outer bands that

represent volatility around the price. The width of the bands widens or narrows based on market

volatility. They are used to identify potential price breakouts or reversals.

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Stochastic Oscillator:

The Stochastic Oscillator compares a security's closing price to its price range over a certain period.

It indicates overbought or oversold conditions and potential trend reversals. The values range from 0

to 100, with readings above 80 signaling overbought conditions and readings below 20 signaling

oversold conditions.

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Volume-Weighted Average Price (VWAP):

VWAP calculates the average price of a security based on both volume and price. It is used by

traders to assess the average price at which a security has traded throughout the day, considering

volume as a factor.

Average Directional Index (ADX):

ADX measures the strength of a trend without specifying its direction. It is part of the Directional

Movement System and helps traders determine the strength of a trend. A rising ADX indicates a

strong trend, while a falling ADX suggests a weakening trend.

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Fibonacci Retracement:

Based on the Fibonacci sequence, this tool identifies potential support and resistance levels. Traders

use retracement levels (38.2%, 50%, 61.8%, etc.) to determine potential areas where the price might

reverse or continue its trend.

These indicators are used in combination or individually by traders to supplement their trading

strategies and decision-making processes. It's essential to understand that no single indicator

guarantees success, and traders often use multiple indicators along with other analysis techniques for

comprehensive market evaluation.

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Chart Patterns

Chart patterns in the stock market are visual representations of historical price movements and

formations observed on stock charts. Traders and technical analysts use these patterns to identify

potential trend reversals, continuation patterns, and predict future price movements. Here are some

common chart patterns observed in stock markets:

1. Head and Shoulders:

This pattern typically signifies a reversal of an uptrend. It consists of three peaks: a higher peak

(head) between two lower peaks (shoulders). The neckline is a line drawn connecting the lows of the

troughs between the peaks.

2. Double Top/Bottom:

A double top forms when the price reaches a resistance level twice, failing to break through,

indicating a potential reversal. Conversely, a double bottom occurs when the price hits a support

level twice, signaling a potential upward trend reversal.

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3. Triangle Patterns:

Symmetrical Triangle: It forms when the price creates higher lows and lower highs, converging

toward a breakout point. Traders anticipate a potential price breakout when the triangle narrows.

Ascending Triangle: This pattern features a horizontal resistance line and a rising trendline. A

breakout above the resistance indicates a potential bullish move.

Descending Triangle: It has a horizontal support line and a descending trendline. A breakdown below

the support indicates a potential bearish move.

63
4. Pennants and Flags:

Pennants and flags are short-term continuation patterns. Pennants resemble small symmetrical

triangles, forming after strong price movements. Flags are rectangular and form after a strong trend.

Both patterns usually precede a continuation of the prior trend.

5. Cup and Handle:

The cup and handle pattern forms a rounded bottom (cup) followed by a smaller consolidation and

breakout (handle). Traders often see this as a bullish continuation pattern.

64
6. Wedge Patterns:

Rising Wedge: It forms when both trend lines converge upwards, signaling a potential reversal.

Falling Wedge: It slopes downward and narrows against the prevailing downtrend, suggesting a

potential bullish reversal.

65
7. Gaps:

A gap occurs when there's a significant difference between a stock's closing price and its opening

price the following day. Common gap types include breakaway gaps, runaway (measuring) gaps, and

exhaustion gaps, each indicating different market sentiments.

These chart patterns are not foolproof predictors of future price movements. Traders often combine

chart patterns with other technical indicators and fundamental analysis to make more informed

decisions. Moreover, patterns may not always play out as expected, and risk management strategies

are crucial when trading based on chart patterns.

66
Price Action

Price action refers to the movement of a security's price on a chart over a specific period. It involves

analyzing and interpreting the historical price movements of a stock or any financial instrument

without relying on indicators, oscillators, or other technical analysis tools. Traders who use price

action focus solely on the price movement itself, along with support, resistance levels, and chart

patterns, to make trading decisions.

Here are key components of price action analysis in the stock market:

Candlestick Patterns:

Traders using price action often study candlestick patterns to understand price movement dynamics.

These patterns, formed by candlesticks on a price chart, provide insights into market sentiment and

potential future price movements. Examples include doji, engulfing patterns, hammers, and shooting

stars.

Support and Resistance Levels:

Price action traders identify support and resistance levels based on historical price data. Support

levels are where the price tends to find buying interest, preventing it from falling further. Resistance

levels are where selling interest typically appears, limiting further price increases.

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Trend Analysis:

Price action traders analyze the direction and strength of trends by observing the highs and lows of

price movements. Trends can be upward (bullish), downward (bearish), or sideways (consolidation).

Understanding the prevailing trend helps traders determine potential entry and exit points.

Chart Patterns:

Similar to other technical analysis methods, price action traders recognize chart patterns such as head

and shoulders, double tops, triangles, flags, and pennants. These patterns help anticipate potential

future price movements and provide trading opportunities.

68
Volume Analysis:

Though primarily focused on price movements, price action traders often incorporate volume

analysis. Changes in volume levels during price movements can indicate the strength or weakness of

a price move, supporting the validity of a pattern or trend.

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Decision-Making Based on Price Movements:

Traders using price action make decisions based on the observed price movements and patterns. This

can involve identifying potential entry or exit points, setting stop-loss orders, or evaluating risk-to-

reward ratios without relying heavily on indicators or external factors.

Price action trading requires understanding market psychology and interpreting price movements

within a broader context. Traders employing this approach aim to make decisions based on the most

relevant and recent price information available on charts, emphasizing simplicity and the direct

analysis of price behavior.

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 INITIAL PUBLIC OFFER

What is IPO

IPO stands for Initial Public Offering. It is the process through which a private company offers its

shares to the public for the first time, allowing it to raise capital by listing on a stock exchange. In an

IPO, a private company transitions into a publicly traded company.

Here's an overview of the IPO process and its significance:

Process of an IPO:

Preparation: The company interested in going public works with investment banks, underwriters, and

financial advisors to prepare for the IPO. They evaluate the company's financials, determine the offer

price, draft a prospectus (offering document), and comply with regulatory requirements.

Filing with Regulators: The company files its prospectus with the Securities and Exchange

Commission (SEC) in the United States or the relevant regulatory authority in other countries. This

document provides detailed information about the company's business, financials, risks, and the

proposed offering.

Marketing and Roadshows: Once the prospectus is approved, the company, along with its

underwriters, promotes the IPO to potential investors through marketing efforts and roadshows. This

aims to generate interest and attract investors.

71
Pricing: Based on investor demand and market conditions, the underwriters and company set the IPO

price. The price determines the valuation at which the company's shares will be offered to the public.

Allocation and Listing: On the IPO date, shares are allocated to institutional and retail investors. The

company's shares are listed and start trading on a stock exchange, allowing the public to buy and sell

the shares.

Significance of an IPO:

Capital Raising: An IPO allows companies to raise significant capital by selling shares to the public,

providing funds for business expansion, debt repayment, research and development, or other corporate

purposes.

Liquidity for Investors and Employees: Going public offers liquidity to existing shareholders,

including founders, employees, and early investors, who can sell their shares in the open market.

Enhanced Visibility and Branding: Public companies often gain increased visibility, credibility, and

brand recognition, which can attract customers, partners, and potential future investors.

Mergers and Acquisitions (M&A) and Access to Capital Markets: Being publicly traded provides

greater access to future capital, potential mergers, acquisitions, and strategic partnerships.

Investing in IPOs involves risks, and investors should conduct thorough research, review the

prospectus, consider market conditions, and consult financial advisors before making investment

decisions. The success of an IPO depends on various factors, including market conditions, investor

appetite, and the company's financial performance and prospects.

72
 Why IPO is published

IPOs (Initial Public Offerings) are published or made public for several important reasons:

Capital Raising: The primary reason for conducting an IPO is to raise capital. By going public and

offering shares to the general public for the first time, a company can raise substantial funds that can

be used for various purposes, such as expansion, debt repayment, research and development,

working capital, acquisitions, and other corporate activities.

Liquidity for Existing Shareholders: An IPO provides an opportunity for existing shareholders,

including founders, early investors, and employees, to realize their investments. Previously held

private shares become tradable on a public exchange, allowing shareholders to sell their shares and

potentially make profits.

Brand Visibility and Credibility: Going public increases a company's visibility and credibility in the

market. Being listed on a recognized stock exchange can enhance a company's reputation, attracting

customers, suppliers, partners, and potential employees.

Access to Public Capital Markets: Publicly traded companies have increased access to capital

markets. This facilitates future capital-raising efforts through secondary offerings or debt issuances,

providing flexibility for future growth initiatives or strategic decisions.

73
Mergers, Acquisitions, and Currency for Future Deals: Publicly traded shares can be used as a

currency for acquisitions and mergers. Companies can use their shares to acquire other businesses or

as an incentive for potential acquisitions or partnerships.

Regulatory Compliance and Transparency: IPOs involve disclosing extensive information about

the company's financials, operations, and future prospects. This increased transparency and adherence

to regulatory requirements help build trust among investors and stakeholders.

Employee Incentives: Publicly traded companies often use stock-based compensation plans, such as

employee stock options, to attract and retain talent. This incentivizes employees by granting them an

opportunity to share in the company's success through ownership stakes.

Overall, the decision to go public through an IPO is a strategic move for a company to access the

public capital markets, raise funds, and gain several advantages that come with being a publicly

traded entity. The IPO process involves regulatory compliance, extensive disclosures, and marketing

efforts to attract investor interest, culminating in the offering of shares to the general public.

Basic terms and conditions for listing IPO

The process of listing an IPO involves several terms and conditions that companies must adhere to in

order to offer their shares to the public and get listed on a stock exchange. While specific

requirements may vary depending on the stock exchange and regulatory jurisdiction, here are some

basic terms and conditions for listing an IPO:

Compliance with Regulatory Authorities: Companies must comply with the regulations and

guidelines set forth by the relevant securities regulator in their jurisdiction. In the United States, for

74
instance, the Securities and Exchange Commission (SEC) regulates the process, while in India, it's

regulated by the Securities and Exchange Board of India (SEBI).

Fulfilling Disclosure Requirements: Companies planning an IPO must provide extensive disclosures

about their business, financials, operations, risks, and future prospects. This information is usually

presented in a prospectus or offering document, which must be submitted to the regulatory authority

for approval before the IPO.

Meeting Financial Eligibility Criteria: Companies need to meet specific financial eligibility criteria

set by the stock exchange or regulatory authority. This might include minimum revenue,

profitability, or net worth requirements. These criteria help ensure that companies seeking to go

public are financially stable and meet certain standards.

Appointment of Underwriters and Advisors: Companies typically engage investment banks or

underwriters to manage the IPO process. These entities assist in pricing the offering, marketing the

shares to potential investors, and facilitating the distribution of shares during the IPO.

Determining Offer Price: The company and its underwriters work together to determine the offering

price of the shares. The price is often based on factors such as the company's financial performance,

market conditions, demand from investors, and valuation models.

Minimum Public Float: Stock exchanges generally require companies to have a minimum percentage

of shares available for public trading, known as the public float. This ensures liquidity and fair trading

in the secondary market.

75
Corporate Governance and Compliance: Companies must demonstrate good corporate governance

practices and comply with accounting standards, reporting requirements, and ethical business

practices. This includes having a board of directors with diverse expertise and independence.

Lock-Up Periods: Insiders, such as company executives, employees, and early investors, may be

subject to lock-up agreements, restricting them from selling their shares for a certain period after the

IPO to prevent excessive selling pressure.

Listing Fees and Continued Obligations: Companies are required to pay listing fees to the stock

exchange for the privilege of being listed. Additionally, listed companies must comply with ongoing

reporting and disclosure obligations, including quarterly and annual financial reporting.

These are some general terms and conditions that companies need to consider and comply with when

planning to list an IPO. The specific requirements can vary based on the jurisdiction, st ock exchange,

and regulatory framework governing the IPO process.

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Open : ₹1,202.00

Listing Gains : 140%

IPO details

IPO Date November 22, 2023 to November 24, 2023

Listing Date November 30, 2023
Face Value ₹2 per share
Price Band ₹475 to ₹500 per share
Lot Size 30 Shares
60,850,278 shares
Total Issue Size
(aggregating up to ₹3,042.51 Cr)
60,850,278 shares of
Offer for Sale ₹2
(aggregating up to ₹3,042.51 Cr)
Issue Type Book Built Issue IPO
Listing At BSE, NSE
Share holding pre issue 405,668,530
Share holding post issue 405,668,530

77
Tata Technologies IPO Reservation

Investor Category Shares Offered Maximum Allottees

15,821,071
Anchor Investor Shares Offered NA
(26.00%)
10,547,382
QIB Shares Offered NA
(17.33%)
7,910,537
NII (HNI) Shares Offered
(13.00%)
5,273,691
bNII > ₹10L 12,556
(8.67%)
2,636,846
sNII < ₹10L 6,278
(4.33%)
18,457,919
Retail Shares Offered 615,263
(30.33%)
2,028,342
Employee Shares Offered NA
(3.33%)
6,085,027
Other Shares Offered NA
(10.00%)
60,850,278
Total Shares Offered
(100%)

Tata Technologies last day subscription

Subscription Shares Total Amount (Rs

Investor Category Shares Bid for
(times) Offered Cr.)*
Qualified Institutions 203.41 10,547,382 2,14,53,93,930 1,07,269.70
Non-Institutional
62.11 7,910,537 49,13,23,830 24,566.19
Buyers
bNII (bids above
70.67 5,273,691 37,27,14,120 18,635.71
₹10L)
sNII (bids below
44.98 2,636,846 11,86,09,710 5,930.49
₹10L)
Retail Investors 16.50 18,457,919 30,46,16,550 15,230.83
Employees 3.70 2,028,342 75,02,010 375.10
Others 29.20 6,085,027 17,76,55,920 8,882.80
Total 69.43 45,029,207 3,12,64,92,240 1,56,324.61

78
 KEY LEARNING FROM THE EXPERIENCE

MARKET RESEARCH

 Performing market analysis and in- depth research on the equity and debt market.

 Analysis of stocks on various parameters.

 Managing the client’s portfolio.

 Research about the equity markets.

 To study about the mutual fund industry.

 To study the behavior of the investors for preferring mutual fund.

 To help an investor to make right choice of investment, While considering the inherent

risk factors.

 To understand the risk and return of the mutual fund.

 To understand of the fundamental analysis of the companies.

 To understand the financials of the company.

79
 CONCLUSION

There is no shortcut for the prolonged success in this profile. Humbleness will help you to make

relations. One should be up to date with the markets and their movements. So that they can easily

solved the problem faced by industry. One should have patience to do such kind of job. Preparation

should be there before executing the work. Check list should be maintained after work is done.

Pending list should be maintained to avoid skipping of work. I will be very obliged that I get a chance

to work in such a prestigious firm which help me career growth and increase my knowledge on the

same time.

80
 BIBLIOGRAPHY

 https://www.linkedin.com/in/aditya-modani-

6557a38b/?original_referer=https%3A%2F%2Fwww%2Egoogle%2Ecom

%2F&originalSubdomain=in

 https://www.linkedin.com/company/modani-financial-services/about/

81
 Annexure A

Student’s Name:
Programme:

SUMMER TRAINING APPRAISAL

You are requested to provide your opinion on the following parameters.

4: Excellent 3: Good 2: Satisfactory 1: Unsatisfactory

1. Technical knowledge gathered about the industry and the job he/she was involved.

2. Communication Skills: Oral / Written / Listening skills 
3. Ability to work in a team 
4. Ability to take initiative 
5. Ability to develop a healthy long term relationship with client 
6. Ability to relate theoretical learning to the Summer Training Project 
7. Creativity and ability to innovate with respect to work methods & procedures 
8. Ability to grasp new ideas and knowledge 
9. Presentations skills 
10. Documentation skills 
11. Sense of Responsibility 
12. Acceptability (patience, pleasing manners, the ability to instill trust, etc.) 
13. His/her ability and willingness to put in hard work 
14. In what ways do you consider the student to be valuable to the organization? 
Consider the student’s value in term of:
(a) Qualification 
(b) Skills and abilities 
(c) ) Activities/ Roles performed 
15. Punctuality 
Any other comments

Assessor’s Overall rating 

Assessor’s
Name:
Designation:

Organization name and

address: Email id:

Contact No:

82
 SUMMER TRAINING PROJECT EVALUATION
FORM

Name of Student Institute Roll No.

Session

Name of Organization

Address

Place Pin Phone Fax No.

Duration of Training Period from to No. of Working Days

1) How to you rate the overall training programme as an educational

experience? Excellent ( ) Very good ( ) Good ( )
Fair ( ) Poor ( )
2) To what extent will it help you in future?
To large extent ( ) To some extent ( ) Negligible extent ( )
3) Indicate subject/ area to which training was found relevant.

4) Indicate the level of interest taken by the training organization

High ( ) Moderate ( ) Low ( )
5) Any other comments/ suggestions

Dated :

Signature of the Students

Note: A free and frank assessment of the Training experience would be helpful in
improving the Training Programme.

83
 FEED BACK FORM

1. Name of the Industry :

2. Concerned Group :
3. Turn Over (in terms of Capital) : (in terms of Product)
4. Work Force :
5. Description of Product Range:
6. Description of Process:
7. Area of Training:
8. Contact details of the Person responsible for Summer Training Project:
a. Name of contact person:
b. Designation:
c. Communication address:
d. Phone No. with STD code:
e. Mobile No. :
f. Email Address:

Name of the student :

Institute Roll No:

Class:

Phone : Mobile No. :

Email:

Dated :

Signature of the Student

84
85