A PROJECT SYNOPSIS ON

FUNDAMENATAL ANALYSIS OF INSURANCE SECTOR

AT

SHIRAM INSIGHT
MASTER OF BUSINESS ADMINISTRATION

SUBMITED BY,
STUDENT NAME: B NARASIMHA REDDY
ROLL NO: 18WJ1E0004

UNDER THE GUIDANCE OF,

FACUILTY NAME: Dr.M.SANDRA KIRTHY
DESIGNATION:

GURU NANAK INSTITUTIONS TECHNICAL CAMPUS

(Autonomous)
School of Management studies
Ibrahimpatnam, R. R. Dist, TELANGANA, INDIA.

Academic Year 2018-2020

 TABLE OF CONTENTS

CONTENT PAGE
NUMBERS
1-2
UNIT-1 INTRODUCTION
3
1.1 OBJECTIVES OF THE STUDY
4
1.2 NEED FOR THE STUDY
5-6
1.3 SCOPE OF THE STUDY
7-8
1.4 RESEARCH METHODOLOGY
9
1.5 LIMITATIONS OF THE STUDY
INTRODUCTION TO FUNDAMENTAL ANALYSIS
India is a developing country. Nowadays many people are interested to invest in
financial markets especially on equities to get high returns, and to save tax in honest way.
Equities are playing a major role in contribution of capital to the business from the beginning.
Since the introduction of shares concept, large numbers of investors are showing interest to
invest in stock market.

Fundamental analysis is the cornerstone of investing. In fact, some would say that you
aren't really investing if you aren't performing fundamental analysis. Because the subject is so
broad, however, it's tough to know where to start. There are an endless number of investment
strategies that are very different from each other, yet almost all use the fundamentals. The
biggest part of fundamental analysis involves delving into the financial statements. Also known
as quantitative analysis, this involves looking at revenue, expenses, assets, liabilities and all the
other financial aspects of a company. Fundamental analysts look at this information to gain
insight on a company's future performance.
An industry is plagued with skepticism and a stock market increasingly difficult to predict
and contend with, if one looks hard enough there may still be a genuine aid for the Day Trader
and Short Term Investor.
The price of a security represents a consensus. It is the price at which one person agrees to
buy and another agrees to sell. The price at which an investor is willing to buy or sell depends
primarily on his expectations. If he expects the security's price to rise, he will buy it; if the
investor expects the price to fall, he will sell it.
These simple statements are the cause of a major challenge in forecasting security prices,
because they refer to human expectations. As we all know firsthand, humans expectations are
neither easily quantifiable nor predictable. If prices are based on investor expectations, then
knowing what a security should sell for (i.e., fundamental analysis) becomes less important than
knowing what other investors expect it to sell for. That's not to say that knowing what a security
should sell for isn't important--it is. But there is usually a fairly strong consensus of a stock's
future earnings that the average investor cannot disprove
 Fundamental analysis and technical analysis can co-exist in peace and complement
each other. Since all the investors in the stock market want to make the maximum profits
possible, they just cannot afford to ignore either fundamental or technical analysis.

Definition:-
What is 'Fundamental Analysis'
Fundamental analysis is a method of evaluating a security in an attempt to measure its
intrinsic value, by examining related economic, financial and other qualitative and
quantitative factors. Fundamental analysts study anything that can affect the security's value,
including macroeconomic factors such as the overall economy and industry conditions, and
microeconomic factors such as financial conditions and company management. The end goal
of fundamental analysis is to produce a quantitative value that an investor can compare with
a security's current price, thus indicating whether the security is undervalued or overvalued.

Need of the study

 To analyze current growth trend of scripts of in equity market.

 To evaluate Securities using fundamental analysis ratios

 To study the factors affecting Equity share price behavior

 To study about performance of stock using fundamental factors

 Equity Analysis or investment helps investors in effective and efficient management of

their investment to achieve this goal.
OBJECTIVES OF THE STUDY

The objective of this project is to deeply analyze three companies for investment
purpose by monitoring the growth rate and performance on the basis of historical data.

The main objectives of the Project study are:

 To do detailed analysis of selected companies which are gearing towards performance of

equity
 To Analyze the Fundamental Ratio s of the insurance companiesSBI Life, HDFC and
India Bulls in 2015-2017.
 To do Comparative analysis between three companies insurance companiesSBI Life,
HDFC and India Bulls using fundamental analysis.
 To study about economy and industrial analysis of selected companies.
 To suggest the best stock to invest among the three selected stocks with the present
market conditions.
SCOPE OF THE STUDY

The scope of the study is identified after and during the study is conducted. The project
is based on tools like fundamental analysis and ratio analysis. Further, the study is based on
information of last five years.

 The analysis is made by taking into consideration three companies i.e. insurance
companiesSBI Life, HDFC and India Bulls.

 The scope of the study is limited for a period of three years.

 The scope is limited to only the fundamental analysis of the chosen stocks.

To start any business capital plays major role. Capital can be acquired in two ways by issuing
shares or by taking debt from financial institutions or borrowing money from financial
institutions. The owners of the company have to pay regular interest and principal amount at the
end.

Stock is ownership in a company, with each share of stock representing a tiny

piece of ownership. The more shares you own, the more of the company you

own. The more shares you own, the more dividends you earn when the company makes a profit.
In the financial world, ownership is called “Equity”.

Advantages of selling stock:

 A company can raise more capital than it could borrow.
 A company does not have to make periodic interest payments to creditors.
 A company does not have to make principal payments
RESEARCH METHODOLOGY

Research design or research methodology is the procedure of collecting, analyzing and

interpreting the data to diagnose the problem and react to the opportunity in such a way where
the costs can be minimized and the desired level of accuracy can be achieved to arrive at a
particular conclusion.

The methodology used in the study for the completion of the project and the fulfillment
of the project objectives. The sample of the stocks for the purpose of collecting secondary data
has been selected on the basis of Random Sampling.

The stocks are chosen in an unbiased manner and each stock is chosen independent
of the other stocks chosen. The stocks are chosen from three different sectors. The sample size
for the number of stocks is taken as 3 for fundamental analysis of stocks as fundamental analysis
is very exhaustive and requires detailed study.

Introduction:

RESEARCH DESIGN:
Research design indicates the methods and procedure of conducting research study.
Research design can be done in following three types:-
Data Collection and Sampling:
A) Sources of Data Collection:-
Basically there are two types of data i.e. secondary and primary:
I) Primary Data Collection:-
Through currency derivative traders, and also who are dealing with currency derivatives and
brokers .It contains Personal Interview, Telephone Interview and Mail Interview.
 II) Secondary Data Collection: -
It can be collected from internal as well as external sources
Various internal sources like employee, books, sales activity, stock availability, product
cost, etc .Libraries, trade publications, literatures, etc are some important sources of external
data. The Researcher has used primary data for the core purpose of the project and this primary
data has been gathered by survey method. The researcher has also used secondary data
B) Data collection Tools:
NSE website open price ,closing price ,high price and low price.
Sample Size: Sample size purpose I taken three companies insurance companies SBI Life,
HDFC and India Bulls
 LIMITATIONS

 This study has been conducted purely to understand fundamental analysis for investors.

 The study is restricted to three companies based on Fundamental analysis.

 The study is limited to the companies having equities.

 Detailed study of the topic was not possible due to limited size of the project.

 There was a constraint with regard to time allocation for the research study i.e. for a
period of 45 days.

 Suggestions and conclusions are based on the limited data of three years.