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Infrastructure Stock Insights

This document discusses fundamental analysis and outlines a study on analyzing stocks in India's infrastructure sector. Fundamental analysis examines economic, financial, qualitative, and quantitative factors to evaluate a security's intrinsic value. The study aims to analyze financial statements and ratios to determine the right time to enter and exit specific infrastructure stocks. The scope is limited to India's economic environment and two infrastructure companies. Research methodology will use secondary data from annual reports and financial statements to conduct an analytical and descriptive study. Key research instruments include balance sheets, income statements, cash flow statements, management discussions, annual reports, and shareholding patterns.

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167 views3 pages

Infrastructure Stock Insights

This document discusses fundamental analysis and outlines a study on analyzing stocks in India's infrastructure sector. Fundamental analysis examines economic, financial, qualitative, and quantitative factors to evaluate a security's intrinsic value. The study aims to analyze financial statements and ratios to determine the right time to enter and exit specific infrastructure stocks. The scope is limited to India's economic environment and two infrastructure companies. Research methodology will use secondary data from annual reports and financial statements to conduct an analytical and descriptive study. Key research instruments include balance sheets, income statements, cash flow statements, management discussions, annual reports, and shareholding patterns.

Uploaded by

jinen07
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Chetan Shah Finance - B

MMS – II 2016133

INTRODUCTION

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.

Fundamental analysis uses real, public data in the evaluation a security's value. Although most
analysts use fundamental analysis to value stocks, this method of valuation can be used for just
about any type of security. For example, an investor can perform fundamental analysis on a
bond's value by looking at economic factors such as interest rates and the overall state of the
economy. He can also look at information about the bond issuer, such as potential changes
in credit ratings.

For stocks and equity instruments, this method uses revenues, earnings, future growth, return on
equity, profit margins and other data to determine a company's underlying value and potential for
future growth. In terms of stocks, fundamental analysis focuses on the financial statements of the
company being evaluated. One of the most famous and successful fundamental analysts is the so-
called "Oracle of Omaha", Warren Buffett, who is well known for successfully employing
fundamental analysis to pick securities. His abilities have turned him into a billionaire.
PROJECT TITLE

FUNDAMENTAL ANALYSIS OF INFRASTRUCTURE SECTOR IN INDIA

OBJECTIVES OF THE STUDY



To analyse the financial statements and draw conclusions from the qualitative aspects of
stocks.

To find out the right time to enter into the respective stocks.

To find out the right time to exit the respective stocks.

To analyse the stock based on various ratios.

SCOPE OF STUDY

The scope of the project is limited to only one country, one sector and 2 companies. For
Economic analysis only India has been taken into consideration. The reason is the growth aspects
of the country due to political changes. With new government and promises for good days ahead
something good is expected. The sector analysis is limited to the extent of Infrastructure sector
which is again selected on the basis of growth opportunities in it. Last few years have not been
the best for this sector but with government’s new initiatives and investment in infrastructure the
sector is expected to grow at pace.

This study aims to discuss and explain the nature, role and process of the equity research with
particular focus on Infrastructure sector. This study is aimed at being helpful to retail and
individual investors who do not have extensive financial statement expertise, to value the stocks
based on basic company information. The study serves to answer questions, such as:
If the company's revenue growing, Is it actually making a profit, Is it in a strong-enough position
to beat out its competitors in the future, is it able to repay its debts?
RESEARCH METHODOLOGY

Information required for understanding the financial data is collected from the company records
and data base itself. Fundamental study adopts analytical and descriptive research design, which
is based on the secondary data. So the metrics required are collected from the annual reports and
balance sheet, published on the companies’ websites.

RESEARCH INSTRUMENTS

 Balance Sheet
 Income Statement
 Cash Flow Statements
 Management Discussion and Analysis
 Annual Reports
 Shareholding Patterns

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