Fundamental & Technical Analysis of 5 Companies of Oil & Gas Sector

Executive Summary:
The report Fundamental & Technical analysis of the 5 major oil & gas companies is to
analyze the strength and weakness of the scrips of the 5 major companies in the oil & gas
industry. The 5 major companies include ONGC, BPCL, GAIL INDIA LTD, HPCL and Cairn
India.
The primary objective of the study is to suggest the investors, whether to buy the scripts or
not, based on the valuation of shares. Also to analyze the trend of the scripts in the market.
The secondary objective is to analyze how the companies perform, understand the capital
market and its functioning, and to compare theoretical knowledge with actual industrial
practice.
To analyze all the scripts, fundamental and technical analysis is used. In the fundamental
analysis, ratios of the companies are studied. For technical analysis, tools like Japanese
Candlestick Charts, Relative Strength Index (RSI), Simple moving average (SMA),
Exponential moving average (EMA) and volume are used. Also the movement of
corresponding graphs is studied to interpret whether to buy, sell or hold the share.
Chapter 1
1.1 Introduction to the Industry1:
Financial Markets:
India Financial market is one of the oldest in the world and is considered to be the fastest
growing and best among all the markets of the emerging economies. The history of capital
markets dates back 200 years toward the end of the 18th century when India was under the
rule of the East India Company. The development of the capital market in India concentrated
around Mumbai where no less than 200 to 250 securities brokers were active during the
second half of the 19th century. The financial market in India today is more developed than
many other sectors because it was organized long before with the securities exchanges of
Mumbai, Ahmedabad and Kolkata were established as early as the 19th century.
It is classified as follows:
1 https://books.google.co.in/books?isbn=8179752224
2
What is Money Market?2

The Money market in India is the money market for short-term and long-term
funds with maturity ranging from overnight to one year in India including financial
instruments that are deemed to be close substitutes of money. Similar
to developed economies the Indian money market is diversified and has evolved
through many stages, from the conventional platform of treasury bills and call
money to commercial
paper, certificates
of
deposit, repos, forward
rate
agreements and most recently interest rate swaps
The Indian money market consists of diverse sub-markets, each dealing in a particular type of
short-term credit. The money market fulfills the borrowing and investment requirements of
providers and users of short-term funds, and balances the demand for and supply of short-term
funds by providing an equilibrium mechanism. It also serves as a focal point for the central
bank's intervention in the market.
Structure of Money Market:

The Indian money market consists of the unorganised sector: moneylenders, indigenous
bankers, and unregulated Non-Bank Financial Intermediaries (e.g. Finance companies, Chit
funds, Nidhis) organized sector: Reserve Bank of India, private banks, public sector banks,
development banks and other non-banking financial companies (NBFCs) such as Life
Insurance Corporation of India(LIC), the International Finance Corporation, IDBI, and the cooperative sector.
Instruments in Money Market:3

1. Call Money:
The call money market deals in short term finance repayable on demand, with a maturity
period varying from one day to 14 days Commercial banks, both Indian and foreign, co2 https://en.wikipedia.org/wiki/Money_market_in_India
3 business.mapsofindia.com India-market
3
operative banks, Discount and Finance House of India Ltd.(DFHI), Securities trading
corporation of India (STCI) participate as both lenders and borrowers and Life Insurance
Corporation of India (LIC), Unit Trust of India(UTI), National Bank for Agriculture and Rural
Development (NABARD)can participate only as lenders. The interest rate paid on call money
loans, known as the call rate, is highly volatile. It is the most sensitive section of the money
market and the changes in the demand for and supply of call loans are promptly reflected in
call rates. There are now two call rates in India: the Inter bank call rate'and the lending rate of
DFHI. The ceilings on the call rate and inter-bank term money rate were dropped, with effect
from May 1, 1989. The Indian call money market has been transformed into a pure inter-bank
market
during
200607.[4] The
major
call
money
markets
are
in Mumbai, Kolkata, Delhi, Chennai, Ahmedabad.
2. Treasury bill market:

Treasury bills are instrument of short-term borrowing by the Government of India, issued as
promissory notes under discount. The interest received on them is the discount which is the
difference between the price at which they are issued and their redemption value. They have
assured yield and negligible risk of default. Under one classification, treasury bills are
categorised as ad hoc, tap and auction bills and under another classification it is classified on
the maturity period like 91-days TBs, 182-days TBs, 364-days TBs and two types of 10-days
TBs. In the recent times (200203, 200304), the Reserve Bank of India has been issuing only
91-day and 364-day treasury bills. the auction format of 91-day treasury bill has changed from
uniform price to multiple price to encourage more responsible bidding from the market
players. the bills are two kinds- Adhoc and regular. The treasury bills sold to the public and
banks are called regular treasury bills. They are freely marketable. commercial bank buy
entire quantity of such bills issued on tender. They are bought and sold on discount basis. Adhoc bills were abolished in April 1997.
3. Ready forward contract (Repos):

Repo is an abbreviation for Repurchase agreement, which involves a simultaneous "sale and
purchase" agreement. When banks have any shortage of funds, they can borrow it
from Reserve Bank of India or from other banks. The rate at which the RBI lends money to
commercial banks is called repo rate, a short term for repurchase agreement. A reduction in
the repo rate will help banks to get money at a cheaper rate. When the repo rate increases
borrowing from RBI becomes more expensive.
4
4. Money market mutual funds:

Money market mutual funds invest money in specifically, high-quality and very short
maturity-based money market instruments. The RBI has approved the establishment of very
few such funds in India. In 1997, only one MMMF was in operation, and that too with very
small amount of capital.
What is Capital Market?4

Capital markets are financial markets for the buying and selling of long-term debt or equitybacked securities. These markets channel the wealth of savers to those who can put it to longterm productive use, such as companies or governments making long-term investments.
Capital markets are defined as markets in which money is provided for periods longer than a
year.
Modern capital markets are almost invariably hosted on computer-based electronic
trading systems; most can be accessed only by entities within the financial sector or the
treasury departments of governments and corporations, but some can be accessed directly by
the public. There are many thousands of such systems, most serving only small parts of the
overall capital markets. Entities hosting the systems include stock exchanges, investment
banks, and government departments.
A key division within the capital markets is between the primary markets and secondary
markets. In primary markets, new stock or bond issues are sold to investors, often via a
mechanism known as underwriting. The main entities seeking to raise long-term funds on the
primary capital markets are governments (which may be municipal, local or national) and
business enterprises (companies). Governments tend to issue only bonds, whereas companies
often issue either equity or bonds. The main entities purchasing the bonds or stock include
pension funds, hedge funds, sovereign wealth funds, and less commonly wealthy individuals
and investment banks trading on their own behalf. In the secondary markets, existing
securities are sold and bought among investors or traders, usually on an exchange, over-thecounter, or elsewhere. The existence of secondary markets increases the willingness of
4 www.yourarticlelibrary.com/.../capital-market...of-capital-market/11128
5
investors in primary markets, as they know they are likely to be able to swiftly cash out their
investments if the need arises.
A second important division falls between the stock markets (for equity securities, also known
as shares, where investors acquire ownership of companies) and the bond markets (where
investors become creditors).
Classification:
Primary Markets:
The primary market is where securities are created. It's in this market that firms sell (float)
new stocks and bonds to the public for the first time. For our purposes, you can think of the
6
primary market as being synonymous with an initial public offering (IPO). Simply put, an
IPO occurs when a private company sells stocks to the public for the first time.
IPOs can be complicated because many different rules and regulations dictate the processes of
institutions, but they all follow a general pattern:
1. A company contacts an underwriting firm to determine the legal and financial details of
the
public
offering.
2. A preliminary registration statement, detailing the company's interests and prospects and
the specifics of the issue, is filed with the appropriate authorities. Known as a preliminary
prospectus, or red herring, this document is neither finalized nor is it a solicitation by the
company issuing the new shares. It is simply an information pamphlet and a letter describing
the
company's
intent.
3. The appropriate governing bodies must approve the finalized statement as well as a final
prospectus, which details the issue's price, restrictions and benefits, and is issued to those
who purchase the securities. This final prospectus is legally binding for the company.
The important thing to understand about the primary market is that securities are purchased
directly from an issuing company.
Secondary Market:
The secondary market is what people are talking about when they refer to the "stock market".
The defining characteristic of the secondary market is that investors trade among themselves.
That is, in the secondary market, investors trade previously issued securities without the
issuing companies' involvement. For example, if you go to buy Microsoft stock, you are
dealing only with another investor who owns shares in Microsoft. Microsoft (the company) is
in no way involved with the transaction. The secondary market, also called the aftermarket, is
the financial market in which previously issued financial instruments such as
stock, bonds, options, and futures are bought and sold.
The term "secondary market" is also used to refer to the market for any used goods or assets,
or an alternative use for an existing product or asset where the customer base is the second
market (for example, corn has been traditionally used primarily for food production and
feedstock, but a "second" or "third" market has developed for use in ethanol production).
With primary issuances of securities or financial instruments, or the primary market, investors
purchase these securities directly from issuers such as corporations issuing shares in
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an IPO or private placement, or directly from the federal government in the case of treasuries.
After the initial issuance, investors can purchase from other investors in the secondary market.
The secondary market for a variety of assets can vary from loans to stocks, from fragmented
to centralized, and from illiquid to very liquid. The major stock exchanges are the most visible
example of liquid secondary markets - in this case, for stocks of publicly traded companies.
Stock Markets in India:

People buy goods and services in a place called market. However, when the people need to
trade in stocks, shares, debentures etc. there is a specific place where one needs to go. One
cannot deal with these items in a normal market place. Thus a place or a platform where the
trading of these shares and stocks takes place is known as the STOCK MARKET. The price
of these shares and stocks is not considered by monopoly; rather it is the demand and supply
forces of the market that determines the prices of these shares and stocks.
In earlier times, the trading, that is, the buying and selling of shares and stocks takes place at a
particular place known as stock exchange. Thus, the person needs to go at that particular
platform if he or she needs to trade in the shares. However with the advancement of
technology, this process has almost become redundant. Now, the trading of shares and stock
can take place electronically. There is a tremendous reduction of paperwork as everything has
gone online.
Origin of the Indian Stock Market: 5

The Indian stock market is not a new concept. It has a history of about 299 years old. It was in
early 18th Century, the main institution that is dealing in the trading of shares and stocks is
the East India Company. Later by around 1830s the main dealing in the shares and stocks
(mainly in bank and cotton) was initiated in Bombay. However, the items in which the trading
took place increased tremendously by the end of 1839. There after the concept
of broker business was started which show momentum in the mid 18th century. This concept
has attracted nm\ember of people to indulge in the trading of items. By 1860, the number of
brokers who are dealing in the trading of items goes up to 60 in number. Further, the number
of brokers increased from 60 to 250 in around 1862-1863.
However, around 1980-61 there is no supply of cotton from America as there was civil war
that took place in America. Due to this, there is a concept of Share Mania that took place in
India.
This is the era of 1980 in which the Indian market had the initial flavor of the trading in items
and the concept of Stock market. Thereafter, it has shown significant changes both in the preindependence era and post-independence era.
Pre-Independence Era:
The concept of stock market place was not a very systematic system. People who needs to
trade generally gathered on the streets which was popularly known as the DALAL
STREET and the trading and the transaction used to take place from the Dalal street. It was in
year 1875 that the first stock exchange was formulated in the name of The Native Share and
Stock Brokers Association which is presently known as the Bombay stock exchange.
There after it was in year 1908, that the stock exchange in Calcutta was formulated known
as The Calcutta Stock Exchange Association. This wind of stock exchange has also shown
its pace in madras in 1920 resulting in the formation of the Madras Stock exchange which was
started with around 100 brokers who are trading in the madras Stock exchange. It was in 1934
when the Lahore Stock exchange was established. The Uttar Pradesh stock exchange and the
Nagpur stock Exchange was established in year 1940. In year 1944, the Hyderabad stock
exchange was established. It was not until 1947 that any stock exchange was established in
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Delhi. It was in year 1947 that the Delhi Stock and Share Broker Association Limited and
The Delhi stocks and Shares exchange Limited was established in Delhi.
Post-Independence Era:
There was shutdown of various stock exchanges in India due to the depression that took place
after Independence. It was under the Securities Contracts (Regulations) Act, 1956 that various
stock exchanges has got a recognition as a recognized stock exchange such as Bombay, Delhi,
Hyderabad, Indore etc. there are several other stock exchanges that were established postindependence.
Thus, the market of stock exchange in India is tremendous and is growing with leaps and
bounds.
Exchanges in India:
Stock Exchanges are an organized marketplace, either corporation or mutual organization,
where members of the organization gather to trade company stocks or other securities. The
members may act either as agents for their customers, or as principals for their own accounts.
Stock exchanges also facilitate for the issue and redemption of securities and other financial
instruments including the payment of income and dividends. The record keeping is central but
trade is linked to such physical place because modern markets are computerized. The trade on
an exchange is only by members and stock broker do have a seat on the exchange.
The major stock exchange maintained by the Securities and Exchange Board of India (SEBI)
are:
Bombay Stock Exchange (BSE)
10
National Stock Exchange of India (NSE)
Commodity Exchange
Multi Commodity Exchange of India Limited (MCX)
National Commodity & Derivatives Exchange Limited (NCDEX)
Indian National Multi-Commodity Exchange (NMCE)
Commodity Exchange Limited ICEX.
About BSE:6
6 www.bseindia.com
11
Established in 1875, BSE (formerly known as Bombay Stock Exchange Ltd.), is Asia's first &
fastest Stock Exchange with the speed of 200 micro seconds and one of India's leading
exchange groups. Over the past 140 years, BSE has facilitated the growth of the Indian
corporate sector by providing it an efficient capital-raising platform. Popularly known as
BSE, the bourse was established as "The Native Share & Stock Brokers' Association" in 1875.
BSE is a corporatized and demutualized entity, with a broad shareholder-base which includes
two leading global exchanges, Deutsche Bourse and Singapore Exchange as strategic partners.
BSE provides an efficient and transparent market for trading in equity, debt instruments,
derivatives, mutual funds. It also has a platform for trading in equities of small-and-medium
enterprises.
More than 5500 companies are listed on BSE making it world's No. 1 exchange in terms of
listed members. The companies listed on BSE command a total market capitalization of USD
1.68 Trillion as of March 2015. It is also one of the world's leading exchanges (5th largest in
March 2015) for Index options trading. BSE also provides a host of other services to capital
market participants including risk management, clearing, settlement, market data services and
education. BSE systems and processes are designed to safeguard market integrity, drive the
growth of the Indian capital market and stimulate innovation and competition across all
market segments. BSE is the first exchange in India and second in the world to obtain an ISO
9001:2000 certification. It is also the first Exchange in the country and second in the world to
receive Information Security Management System Standard BS 7799-2-2002 certification for
its On-Line trading System (BOLT). BSE's popular equity index - the S&P BSE SENSEX - is
India's most widely tracked stock market benchmark index. It is traded internationally on the
EUREX
as
well
as
leading
exchanges
of
the
BRICS.
BSE has won several awards and recognitions that acknowledge the work done and progress
made like India Innovation Award for the Big Data implementation , ICICI Lombard & ET
Now Risk Management BFSI Company 2013, SKOCH Order of Merit Certificate was
awarded to BSE for E -Boss for qualifying amongst India's Best 2013, The Golden Peacock
Global CSR Award for its initiatives in Corporate Social Responsibility, NASSCOM - CNBCTV18's IT User Awards, 2010 in Financial Services category, Skoch Virtual Corporation 2010
Award in the BSE StAR MF category and Responsibility Award (CSR) by the World Council
of Corporate Governance. Its recent milestones include the launching of BRICSMART
indices derivatives, BSE-SME Exchange platform, S&P BSE GREENEX to promote
investments in Green India.
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Bombay Stock Exchange has now adopted only its initials as the new name (BSE),
positioning itself better position as a national multi-asset financial infrastructure institution.
BSEs strategic shift in approach, attitude and business focus is reflected in its new tag line
-Experience the New. With renewed zeal and focus on new business opportunities, product
and service innovation, upgrades in technology, increased investor and member focus, BSE is
always pushing the envelope on all fronts. The ambition is to continually improve and adopt
new and better ways of conducting our business. As the first stock exchange in Asia and the
pioneer of securities transaction business, BSE prides itself on being at the forefront of
bringing innovations to the Indian capital markets while creating diverse investment
opportunities for the investor community in India throughout its long history.
BSE continues to undertake several initiatives to build on its strong brand, legacy and market
position to create value for its stakeholders and the financial system.
At par with international standards, BSE Ltd. has been a pioneer in several areas over the
decades and has many firsts and key achievements to its credit. BSE is the first exchange in
India to:
Launch a special platform for trading in SME securities
Introduce Equity Derivatives
Launch a Free Float Index - S&P BSE SENSEX
Launch Exchange Enabled Internet Trading Platform
Obtain ISO certification for a stock exchange
Exclusive facility for financial training BSE Institute Ltd.
Launch its website in Hindi and regional languages
Host the popular opening-bell ceremony in Indian capital markets
About NSE:7
7 www.nseindia.com
13
The National Stock Exchange (NSE) is India's leading stock exchange covering various cities
and towns across the country. NSE was set up by leading institutions to provide a modern,
fully automated screen-based trading system with national reach. The Exchange has brought
about unparalleled transparency, speed & efficiency, safety and market integrity. It has set up
facilities that serve as a model for the securities industry in terms of systems, practices and
procedures.
NSE has played a catalytic role in reforming the Indian securities market in terms of
microstructure, market practices and trading volumes. The market today uses state-of-art
information technology to provide an efficient and transparent trading, clearing and settlement
mechanism, and has witnessed several innovations in products & services viz.
demutualisation of stock exchange governance, screen based trading, compression of
settlement cycles, dematerialisation and electronic transfer of securities, securities lending and
borrowing, professionalisation of trading members, fine-tuned risk management systems,
emergence of clearing corporations to assume counterparty risks, market of debt and
derivative instruments and intensive use of information technology.
Purpose
Committed to improve the financial well-being of people.
Vision
To continue to be a leader, establish global presence, facilitate the financial well being of
people.
Values
NSE is committed to the following core values :
Integrity
Customer focused culture
Trust, respect and care for the individual
Passion for excellence
Teamwork
Ms. Chitra was selected as the woman of the year, in the business leadership awards by the
Forbes magazine recently and is also ranked 17th in the list of top global women business
leaders by Fortune Magazine USA. She is the second most powerful businesswoman in India
in this list. She has also been featured in the list of top 30 women achievers by the Business
Today group, for the last four successive years. She is the third woman CEO to head an
Exchange in the Asia-Pacific region.
For fourth consecutive year CRISIL has assigned its highest corporate credit rating of CCR
AAA to the National Securities Clearing Corporation Ltd (NSCCL). 'CCR AAA' rating
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indicates highest degree of strength with regard to honouring debt obligations. As per CRISIL
the rating reflects NSCCLs status as Clearing Corporation for NSE. The rating also factors in
NSCCLs rigorous risk management controls and adequate settlement guarantee cover.
CRISIL has further stated that NSCCLs risk management system is comprehensive, and is
regularly upgraded to pre-empt market failures. The company addresses risks in clearing and
settlement with its stringent norms for selection of members, robust margining system, and
risk-based position limits and surveillance mechanism.
The award recognizes best practice, quality service and innovation in derivatives and risk
management in the Asia-Pacific region. The winning institutions are those that, over the past
year, have responded best in the needs of their clients, both on the asset and liability side,
along with the end-users that have demonstrated outstanding trading and risk management
strategies.
'Asia Risk' is the only publication dedicated solely to the business of financial risk
management and the derivatives market in the Asia-Pacific region since 1995.
NSE has been awarded 'The Asian Banker Financial Derivative Exchange of the Year Award"
NSCCL has been awarded 'The Asian Banker Clearing House of the Year Award"
Security Measures and Operational Features of BSE and NSE:

The leading stock exchanges in India have developed itself to a large extent since its
emergence. These stock exchanges aim at offering the investors and traders better
transparency, genuine settlement cycle, honest transaction and to reduce and solve investor
grievances if any. Please Note: The researcher has not covered all the operational features of
both the stock exchanges, but has taken into consideration only the ones which are important
to understand the thesis. The aim to describe these operational features is for better
understanding of the working of stock exchanges. This is done for the purpose of easy
understanding from the readers point of view.
Its general operational features are as follows:
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Market Timings: Trading on the equities segment takes place on all days of
1)
the week (except Saturdays and Sundays and holidays declared by the Exchange in advance).
The market timings of the equities segment are:
Normal Market Open: 09:55 hours Normal
Market Close: 15:30 hours
The Post Closing Session is held between 15.50 to 16.00 hours.

2) Automated Trading System: Today our country has an advanced trading
system which is a fully automated screen based trading system. This system
adopts the principle of an order driven market as opposed to a quote driven
system.
i) NSE operates on the 'National Exchange for Automated Trading' (NEAT)
system.
ii) BSE operates on the BSEs Online Trading (BOLT) system.
3)
Market Segments
The Exchange operates the following sub-segments in the Equities segment:
Rolling Settlement
In a rolling settlement, each trading day is considered as a trading period and
trades executed during the day are settled based on the net obligations for the
day.
At NSE, trades in rolling settlement are settled on a T+2 basis i.e. on the 2nd
working day. For arriving at the settlement day all intervening holidays, which
include bank holidays, NSE holidays, Saturdays and Sundays are excluded.
Typically trades taking place on Monday are settled on Wednesday, Tuesday's
trades settled on Thursday and so on.
Limited Physical Market

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Pursuant to the directive of SEBI to provide an exit route for small investors
holding physical shares in securities mandated for compulsory dematerialised
settlement, the Exchange has provided a facility for such trading in physical
shares not exceeding 500 shares.
Settlement Cycle
Settlement for trades is done on a trade-for-trade basis and delivery obligations
arise out of each trade. The settlement cycle for this segment is same as for the
rolling settlement viz:
Activity
Day
Trading
Rolling Settlement Trading
Clearing
Custodial Confirmation
T+1 working days
Delivery Generation
T+1 working days

17
Settlement
Post
Settlement
Securities and Funds pay in
T+2 working days
Securities and Funds pay out
T+2 working days
Assigning of shortages for close out
T+3 working days
Reporting and pick-up of bad delivery
T+4 working days
Close out of shortages
T+5 working days
Replacement of bad delivery
T+6 working days
Reporting of re-bad and pick-up
T+8 working days
Close out of re-bad delivery
T+9 working days
4) Brokerage And Other Transaction Costs

Brokerage is negotiable. The Exchange has not prescribed any minimum
brokerage. The maximum brokerage is subject to a ceiling of 2.5 percent of the
contract value. However, the average brokerage charged by the members to the
clients is much lower.Typically there are different scales of brokerages for
delivery transaction, trading transaction, etc.
The Stamp Duty on transfer of securities in physical form is to be paid by the
seller but in practice it is paid by the buyer while registering the shares in his
name. In case of transfer of shares, the rate is 50 paise for every Rs.100/- or
part thereof on the basis of the amount of consideration and that for transfer of
debentures the rate of stamp duty varies from State to State, where the
registered office of a Company issuing the debentures is located
5) Transfer Of Ownership
Transfer of ownership of securities, if the same is not delivered in demat form
by the seller, is effected through a date stamped transfer-deed which is signed
by the buyer and seller. The duly executed transfer-deed along with the share
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certificate has to be lodged with the company for change in the ownership. A
nominal duty becomes payable in the form of stamps to be affixed on the
transfer-deeds.
Transfer-deed remains valid for twelve months or the next book closure
following the stamped date whichever occurs later for transfer of shares in the
name of buyer. However, for delivery of shares in the market, transfer deed is
valid till book closure date of the company.
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1.2 Introduction to the Company8:

Ventura Securities Ltd. (Ventura) commenced operations in 1994 as a stock broking house.
Over the past two decades, they have grown into a group of companies that provides a
complete array of financial products and services.
Through a large network of sub-brokers, they offer their clients the opportunity to invest and
trade in equity and equity derivatives, commodities, mutual funds, fixed income products and
currency futures. They also directly facilitate clients who wish to trade in equity online via
their in-house, customized and ready to use software Pointer which enables seamless
processes and flawless execution. They adhere to a well-defined risk management system and
settlement
mechanism
thereby
conducting
fully
compliant
operations.
Beyond investment avenues, the Ventura Group is constantly committed to providing
investors with access to timely and relevant research and data to ensure an informed and
fruitful investment experience. Change for the better is a way of life at Ventura. Innovations
have always been customer centric which has been amply reflected in the upgradation of
systems to facilitate their network partners.
Mission Statement: To build true relationships and strive towards customer delight, through
constant innovation on a strong foundation of dedicated and trained resources.
8 https://www.ventura1.com
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1.3 Introduction to the Project:

This project is on analyzing the equities to invest money for getting higher return on
investments made. This project report can be helpful for investors planning to invest in any of
these five companies from the oil & gas sector in India. I chose to do this project because I
wanted to analyze the equities from the investor point of view and also to understand the
movement and performance of stocks and also try to know the factors that affect the
movement of stock prices in the Indian stock markets.
In the recent past, the bank interest rates have been increased steadily. But the rate of Inflation
has also been increased. There is no big difference between the interest rate and Inflation rate.
Because of inflation, value of money has been decreased and cost of living has been
increased. This has created panic among lower, middle and upper middleclass families who
considered keeping their savings in banks as safe as well as remunerative. So, the investors
are searching for proper investment avenues. Here, an attempt is made to predict the future
movement of scrips. This study helps the investors to invest in shares. The stock exchange
comes in the secondary market. Stock exchange performs activities such as trading in share,
securities, bonds, mutual fund & commodities. Stock Broking industry is growing at an
enormous rate, as more and more people are attracted towards stock exchanges with the hope
of making profits.
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Chapter 2
2.1 Literature Review
Warren Buffet, Investment Guru:
Only buy something that youd be happy to hold if the market shuts down for 10 years
George Soros, Chairman, Soros Fund Management:

Prevailing wisdom is that markets are always right, I assume they are always wrong
Michal Parness, Founder & CEO:

Investors dont Make Money in the Stock Market. One reason the institutions make so much
money is that they are trading. They make money every time you buy or sell. They make
money whether you win or lose. That means that when youre investing, youre basically just
sitting there. Youre not going anywhere. Youre not making money as an investor.
Trading the Trend: The Only Way to Make Money in the Market:
If you dont know this already, Trend Trading means trading trends based on human
emotions. Not lagging indicators. Not complex statistical analysis and not Ph.D. level
mathematical equations. With trend trading, you look for market movement. That could mean
stocks that are going to move up or down during the course of a day (intraday). Youll play
the gaps up and down, often several days a week. The Trend trading means being aware and
taking advantage of trends like the run-ups that happen around earning sessions. These are
trends that have worked time and time again in the market. They consistently yield results.
Australian National University Stephen Sault Australian National University - Faculty of

Economics & Commerce March 28, 2006:
While the fundamental and technical analysis literatures invest considerable effort in
assessing their respective ability to explain share prices, they invariably do so without
reference to each other. In this context, we propose an equity valuation model integrating both
fundamental and technical analysis and, in doing so, recognize their potential as complements
rather than as substitutes. Testing confirms the complementary nature of fundamental and
22
technical analysis by showing that, while each performs well in isolation, models integrating
both have superior explanatory power. While our findings relate to the valuation of shares,
they also have implications for other valuation exercises.
Sandy Jadeja 9- Oct -2004 Should you use Technical or Fundamental analysis to make
your decisions?
Volumes have been written about the different ways to forecast or predict market movement.
Traditionally, there are two distinct schools of thought that an individual may choose from,
and that being Fundamental analysis or Technical analysis. By choosing fundamental analysis,
your decisions are based upon underlying economic factors, cash flows, and price earnings.
This information will aim to tell you why a stock will move. Technical analysis aims to show
you how and when a stock will move. This method discounts all news and information
regarding the value of the stock. In other words, you only pay attention to a chart. The saying
a picture is worth a thousand words truly summarizes this concept nicely. You can of course
choose to use a combination of both if you prefer. This would imply that when the stock you
are looking at becomes undervalued fundamentally, you would wait for a technical setup to
get you in to the market. Deciding on which method is appropriate and gives bigger returns is
truly a matter of opinion. Respectively, both methods have the same goal; to determine market
direction. I know of a number of individuals who only use one or the other and is equally
successful with phenomenal returns. It becomes interesting when one speaks to traders from
each school. The fundamental traders believe that charts are a waste of time and provide no
real sense as to why one would make trading decisions based on indicators and repetitive
patterns. This group are essentially bargain hunters. They want to buy stocks which they feel
are underpriced and will return to a normal value at a later stage. Fundamental traders often
hold stocks for longer periods of time compared to technical traders. On the other hand, the
technical traders believe that numbers do not lie and that information based on value, supply
and demand are already factored into the price. They also argue that people can be predictable
and that these behaviors occur in the form of price patterns. These patterns repeat with a
degree of predictability and therefore can be used to forecast future price movements.
Technical traders generally hold positions for shorter periods of time compared to
fundamental traders. Clearly both avenues are important, and one must make careful decisions
before jumping into trading without having an objective. I have always said that finding a
method, style or strategy depends on ones personality. If you are thinking of long term
investing then the fundamental approach may suit your needs whereas if you are looking for
short term market moves, then technical analysis can provide a myriad of systems to
accommodate your personal style.
23
2.2 Statement of Problem:

Technical analysis is the study of price movement and trend in the markets in order to forecast
future prices. Investors play a crucial role for trading in the stock market. Investment timing
plays a crucial role for trading in the market. So this analysis is directed towards the use of
different tools of technical analysis, which help the investor to identify and decide when to
buy and sell.
2.3 Objectives of the Project:

1.
2.
3.
4.
To gain practical knowledge of fundamental and technical analysis.

To know how technical tools are used to predict the future behavior of stocks.
To know how charting techniques are useful to take buy and sell decisions.
To know how an investor takes rational investment decisions by studying the market
trends and movements.
2.4 Methodology:
Secondary data source:
Data is collected from the websites, magazines, textbooks and newspapers.
2.5 Sample Design and Sample Size:

The samples are selected from the index of Nifty and belong to the Oil & Gas sector. The
companies selected are:
1.
2.
3.
4.
5.
Oil and Natural Gas Corporation Limited

GAIL (India) Limited
Bharat Petroleum Corporation Limited
Hindustan Petroleum Corporation Limited
Cairn India Limited
2.6 Scope and Limitations:

1. The study is related to fundamental and technical analysis to predict the future
behavior of stocks.
2. The analysis has been done only on selected 5 stocks of Nifty, from the Oil & Gas
sector industries.
3. The analysis involves use of limited technical tools and charts out of the various tools
present.
4. Technical analysis cannot be applied to newly listed company scrips.
5. The study depends on secondary data rather than primary data.
24
Chapter 3
3.1 An overview of Fundamental & Technical Analysis:
What is Fundamental Analysis?9
Fundamental analysis is the examination of the underlying forces that affect the wellbeing of
the economy, industry groups and companies. As with most analysis, the goal is to develop a
forecast of future price movement and profit from it. At the company level, fundamental
analysis may involve examination of financial data, management, business concept and
competition. At the industry level, there might be an examination of supply and demand
forces of the products. For the national economy, fundamental analysis might focus on
economic data to assess the present and future growth of the economy.
To forecast future stock prices, fundamental analysis combines economic, industry, and
company analysis to derive a stocks fair value called intrinsic value. If fair value is not equal
to the current stock price, fundamental analysts believe that the stock is either over or under
valued. As the current market price will ultimately gravitate towards fair value, the fair value
should be estimated to decide whether to buy the security or not. By believing that prices do
not accurately reflect all available information, fundamental analysts look to capitalize on
perceived price discrepancies.
Fundamental Analysis is a method of evaluating a security by attempting to measure its
intrinsic value by examining related economic, financial and other qualitative and quantitative
factors. Fundamental analysts attempt to study everything that can affect the securitys value,
including macroeconomic factors (like the overall economy and industry conditions) and
individual specific factors (like the financial condition and management of companies).
25
Objectives of Fundamental Analysis:

1. To predict the direction of national economy because economic activity affects the
corporate profit, investor attitudes and expectation and ultimately security prices.
2. To estimate the stock price changes by studying the forces operating in the overall
economy, as well as influences peculiar to industries and companies.
3. To select the right time and right securities for the investment.
Three phases of Fundamental Analysis:

1. Understanding of the macro-economic environment and developments (Economic
Analysis)
2. Analyzing the prospects of the industry to which the firm belongs (Industry Analysis)
3. Assessing the projected performance of the company (Company Analysis)
The three phase examination of fundamental analysis is also called as an EIC (EconomyIndustry-Company analysis) framework or a top-down approach.
Here the financial analyst first makes forecasts for the economy, then for industries and finally
for companies. The industry forecasts are based on the forecasts for the economy and in turn,
the company forecasts are based on the forecasts for both the industry and the economy. Also
in this approach, industry groups are compared against other industry groups and companies
against other companies. Usually, companies are compared with others in the same group. For
example, a telecom operator (Spice) would be compared to another telecom operator not to an
oil company.
26
Strengths of Fundamental Analysis:

1.
Long-term Trends Fundamental analysis is good for long term investments based on
long-term trends. The ability to identify and predict long-term economic,
demographic, technological or consumer trends can benefit investors and helps in
picking the right industry groups or companies.
2. Value Spotting Sound fundamental analysis will help identify companies that represent
a good value. Some of the most legendary investors think for long-term and value.
Fundamental analysis can help uncover the companies with valuable assets, a strong
balance sheet, stable earnings, and staying power.
3. Business Acumen One of the most obvious, but less tangible rewards of fundamental
analysis is the development of a thorough understanding of the business. After such
painstaking research and analysis, an investor will be familiar with the key revenue
and profit drivers behind a company. Earnings and earnings expectations can be potent
drivers of equity prices. A good understanding can help investors avoid companies that
are prone to shortfalls and identify those that continue to deliver.
4.
Value Drivers In addition to understanding the business, fundamental analysis allows

investors to develop an understanding of the key value drivers within the company. A
stocks price is heavily influenced by the industry group. By studying these groups,
investors can better position themselves to identify opportunities that are high-risk
(tech), low-risk (utilities), growth oriented, value driven, non-cyclical, cyclical etc.
27
Fundamental Analysis Tools:

These are the most popular tools of fundamental analysis. They focus on earnings, growth,
and value in the market.
1.
2.
3.
4.
5.
Financial Ratio Analysis

Balance Sheet of a Company
Profit & Loss Account
Cash Flow Statement
Annual Reports etc.
28
What is Technical Analysis?10

Fundamental analysis and Technical analysis are the two main approaches to security
analysis. Technical analysis is frequently used as a supplement to fundamental analysis rather
than as a substitute to it. According to technical analysis, the price of stock depends on
demand and supply in the market place. It has little correlation with the intrinsic value. All
financial data and market information of a given stock is already reflected in its market price.
Technical analysts have developed tools and techniques to study past patterns and predict
future price. Technical analysis is basically the study of the markets only. Technical analysts
study the technical characteristics which may be expected at market turning points and their
objective assessment. The previous turning points are studied with a view to develop some
characteristics that would help in identification of major market tops and bottoms.
Human reactions are, by and large consistent in similar though not identical reaction; with his
various tools, the technician attempts to correctly catch changes in trend and take advantage
of them. Technical analysis is directed towards predicting the price of a security. The price at
which a buyer and seller settle a deal is considered to be the one precise figure which
synthesis, weighs and finally expresses all factors, rational and irrational, quantifiable and
non-quantifiable and is the only figure that counts. Thus, the technical analysis provides a
simplified and comprehensive picture of what is happening to the price of a security. Like a
shadow or reflection it shows the broad outline of the whole situation and it actually works in
practice.
29
Assumptions of Technical Analysis:

1.
2.
3.
4.
5.
6.
7.
The market value of a security is solely determined by the interaction of demand and
supply factors operating in the market.
The demand and supply factors of a security are surrounded by numerous factors;
these factors are both rational as well as irrational.
The security prices move in trends or waves which can be both upward or downward
depending upon the sentiments, psychology and emotions of operators or traders.
The present trends are influenced by the past trends and the projection of future trends
is possible by an analysis of past price trends.
Except minor variations, stock prices tend to move in trends which continue to persist
for an appreciable length of time.
Changes in trends in stock prices are caused whenever there is a shift in the demand
and supply factors. Shifts in demand and supply, no matter when and why they occur,
can be detected through charts prepared specially to show market action.
Some chart trends tend to repeat themselves. Patterns which are projected by charts
record price movements and these patterns are used by technical analysis for making
forecasts about the future patterns.
30
Tools & Techniques of Technical Analysis:

There are numerous tools and techniques for doing technical analysis. Basically this analysis
is done from the following four important points of view:
1. Prices: Whenever there is change in prices of securities, it is reflected in the changes in
investor attitude and demand and supply of securities.
2. Time: The degree of movement in price is a function of time. The longer it takes for a
reversal in trend, greater will be the price change that follows.
3. Volume: The intensity of price changes is reflected in the volume of transactions that
accompany the change. If an increase in price is accompanied by a small change in
transactions, it implies that the change is not strong enough.
4. Width: The quality of price change is measured by determining whether a change in
trend spreads across most sectors and industries or is concentrated in few securities
only. Study of the width of the market indicates the extent to which price changes have
taken place in the market in accordance with a certain overall trends.
The theories used in technical analysis are:
1. Dow Theory: The Dow Theory, originally proposed by Charles Dow in 1900 is one of
the oldest technical methods still widely followed. The basic principles of technical
analysis originate from this theory. According to Charles Dow The market is always
considered as having three movements, all going at the same time. The first is the
narrow movement from day to day. The second is the short swing, running from two
weeks to a month or more and the third is the main movement, covering at least four
years in its duration. The Theory advocates that stock behavior is 90% psychological
and 10% logical. It is the mood of the Crowd which determines the way in which
prices move and the move can be gauged by analyzing the price and volume of
transactions. The Dow Theory only describes the direction of market trends and does
not attempt to forecast future movements or estimate either the duration or the size of
such market trends. The theory uses the behavior of the stock market as a barometer of
business conditions rather than as a basis for forecasting stock prices themselves.
2. Elliott Wave Theory: Ralph Nelson Elliott developed the Elliott Wave Theory in the
late 1920s by discovering that stock markets, thought to behave in a somewhat chaotic
manner, in fact traded in repetitive cycles. Elliott discovered that these market cycles
resulted from investors' reactions to outside influences, or predominant psychology of
the masses at the time. He found that the upward and downward swings of the mass
psychology always showed up in the same repetitive patterns, which were then divided
31
further into patterns he termed "waves". Elliott's theory is somewhat based on the Dow
theory in that stock prices move in waves.
The tools used in Technical Analysis are:
1. Trends: It is a graphical representation of Time Series of data. Technical analysis is
built on the assumption that prices trend. Trend Lines are an important tool in technical
analysis for both trend identification and confirmation. A trend line is a straight line that
connects two or more price points and then extends into the future to act as a line of
support or resistance.
Types of Trend lines:
i.
Uptrend
ii.
Downtrend
iii.
Horizontal trend
2. Charts: A chart pattern is a distinct formation on a stock chart that creates a trading
signal, or a sign of future price movements. Chartists use these patterns to identify
current trends and trend reversals and to trigger buy and sell signals.
Types of Charts:
i.
ii.
iii.
iv.
Line Chart
The most basic of the four charts is the line chart because it represents only the
closing prices over a set period of time. The line is formed by connecting the
closing prices over the time frame.
Bar Charts
The bar chart expands on the line chart by adding several more key pieces of
information to each data point. The chart is made up of a series of vertical lines
that represent each data point. This vertical line represents the high and low for
the trading period, along with the closing price.
Candlestick Charts
The candlestick chart is similar to a bar chart, but it differs in the way that it is
visually constructed. Similar to the bar chart, the candlestick also has a thin
vertical line showing the period's trading range.
Point and Figure Charts
The point and figure chart is not well known or used by the average investor
but it has had a long history of use dating back to the first technical traders.
This type of chart reflects price movements and is not as concerned about time
and volume in the formulation of the points.
3. Mathematical Indicators:
32
i.
Moving Averages: A Moving Average is an indicator that shows the average value
of a security's price over a period of time. When calculating a moving average, a
mathematical analysis of the security's average value over a predetermined time
period is made. As the security's price changes, its average price moves up or down.
There are five popular types of moving averages: simple (also referred to as
arithmetic), exponential, triangular, variable, and weighted. Moving averages can be
calculated on any data series including a security's open, high, low, close, volume, or
another indicator. A moving average of another moving average is also common.
ii.
Bollinger Band: It is a band plotted two standard deviations away from a simple
moving average, developed by famous technical trader John Bollinger. Because
standard deviation is a measure of volatility, Bollinger Bands adjust themselves to
the market conditions. When the markets become more volatile, the bands widen
(move further away from the average), and during less volatile periods, the bands
contract. The tightening of the bands is often used by technical traders as an early
indication that the volatility is about to increase sharply.
4. Oscillators: A technical analysis tool that is banded between two extreme values and
built with the results from a trend indicator for discovering short-term overbought or
oversold conditions. As the value of the oscillator approaches the upper extreme value
the asset is deemed to be overbought, and as it approaches the lower extreme it is
deemed to be oversold. Oscillators are most advantageous when a clear trend cannot be
easily seen in a company's stock such as when it trades horizontally or sideways. The
most common oscillators are: RSI & MACD.
i.
Relative Strength Index (RSI): A technical momentum indicator that compares the
magnitude of recent gains to recent losses in an attempt to determine overbought and
oversold conditions of an asset. It is calculated using the following formula:
RSI = 100 - 100/(1 + RS*)
*Where RS = Average of x days' up closes / Average of x days' down closes.
ii. Moving Average Convergence Divergence (MACD): A trend-following momentum
indicator that shows the relationship between two moving averages of prices. The
MACD is calculated by subtracting the 26-day EMA from the 12-day EMA. A nineday EMA of the MACD, called the "signal line", is then plotted on top of the MACD,
functioning as a trigger for buy and sell signals.
33
Analysis & Findings:

Fundamental Analysis:
It is carried out through the analysis of the following 3 phases
3.2.1 Economy Analysis11:
The Oil Industry started off more than five thousand years back. Oil sipping up from
the ground was used to make the boats waterproof in the Middle East and also used as
medicating as well as for painting different things.The demand for Oil was much
higher than what it actually produced and this brought forward the concept of making
oil production companies which is collectively known as the Oil Industry.
The Oil Industry is a very important industry in the world and a lot depends on the
price of the oil and it has been observed that whenever the oil prices increase the price
of various products also increases. The Oil Industry also through oil production
accounts for a large amount of the consumption of energy. According to the statistics
the amount of oil consumed by the world every year is as many as 30 billion
barrel The Oil Industry can be parted in two, Upstream and Downstream. The
importance of oil in the world evolved at a slow pace but once it was identified, it
became one of the most important things in the lives of human beings.
The Impact of Oil Price Crash on Different Industries and Overall Indian Economy is
very prominent. The price trend is crucial for the government in bringing out vital
economic and policy reforms in India. The steep fall in crude prices has caught the
global economy by surprise, not to miss the existing & emerging potential oil
exporting nations. On one hand the downward trend is highly detrimental to the
nations with major revenue chunk linked to oil exports and those who have invested
11 http://www.worldoil.com
34
heavily on the alternate energy sources such as renewable, shale, etc., on the other
hand the major net oil importers such as the Asian nations led by India are looking
overjoyed on account of anticipated national fiscal savings on buying of cheaper crude
oil
and
drop
in
fuel
prices
at
consumer
end.
On the surface, one may claim that falling crude oil prices are oil importing nation's
moment of delight and oil exporting nation's worst nightmare. But is it really all good
and great for a crude oil import dependent nation such as India? There is a need to go
beyond pre-conceived notions and understand that the reverse of the common phrase,
"Every cloud has a silver lining" is also true, especially for a country like India. For a
nation like India, there is a need to identify the cloud under the silver lining.
While it may be assumed that India will be able to reduce fiscal deficit, reduce
inflation, lower interest rates and recover from oil subsidy on account of lower oil
import bill. But the steep decline in crude oil price is expected to leave a bitter taste on
the government's tax revenues, translate into lower growth of both exports & imports
and impact the GDP growth of the country. It is worth to note that the government has
increased the excise duty on petrol and diesel twice in a move to aid the tax revenues.
35
3.2.2 Industry Analysis12:

After the Indian Independence, the Oil Industry in India was a very small one in size
and Oil was produced mainly from Assam and the total amount of Oil production was
not more than 250,000 tons per year. This small amount of production made the oil
experts from different countries predict the future of the oil industry as a dull one and
also doubted India's ability to search for new oil reserves. But the Government of
India declared the Oil industry in India as the core sector industry under the Industrial
Policy Resolution bill in the year 1954, which helped the Oil Industry in India vastly.
Oil exploration and production in India is done by companies like NOC or National
Oil Corporation, ONGC or Oil and Natural Gas Corporation and OIL who are actually
the oil companies in India that are owned by the government under the Industrial
Policy Rule. The National Oil Corporation during the 1970s used to produce and
supply more than 70 percent of the domestic need for the petroleum but by the end of
this amount dropped to near about 35 percent. This was because the demand on the
one hand was increasing at a good rate and the production was declining at a steady
rate.
Oil Industry in India during the year 2004-2005 fulfilled most of demand through
importing oil from multiple oil producing countries. The Oil Industry in India itself
produced nearly 35 million metric tons of Oil from the year 2001 to 2005. The Import
that is done by the Oil Industry in India comes mostly from the Middle East Asia.
The Oil that is produced by the Oil Industry in India provides more than 35 percent of
the energy that is primarily consumed by the people of India. This amount is expected
to grow further with both economic and overall growth in terms of production as well
as percentage. The demand for oil is predicted to go higher and higher with every
passing decade and is expected to reach an amount of nearly 250 million metric ton by
the year 2024.
12 www.makeinindia.com
36
Statistics:
i. The oil and gas industry ranks amongst Indias six core industries.
ii. India was the fourth largest consumer of crude oil and petroleum products in the world in
2013, after the United States, China and Japan.
iii. Oil imports constitute over 80% of Indias total domestic oil consumption as of May, 2014.
iv. Oil and gas contribute 39.2% to primary energy consumption.
v. During 2013-14, natural gas constituted about 7.8% of the energy mix.
vi. India had 47 Trillion cubic feet of proven natural gas reserves at the beginning of 2014.
Approximately 34% of total reserves are located onshore, while 66% are offshore.
vii. Investments worth USD 70 Billion are expected across the oil and gas value chain during
201217.
viii. At the end of 2013, India had 215.066 MMTPA of refining capacity, making it the second
largest refiner in Asia after China. Private joint venture companies own about 41% of total
capacity.
ix. India increasingly relies on imported LNG; the country was the fourth-largest LNG importer
in 2013 and accounted for 5.5% of global imports.
x. Indias crude oil pipeline network spans just under 9,460 miles and has a total capacity of
129.4 MMTPA.
37
Sector Policy:
i.
The Integrated Energy Policy, 2006 outlines goals for dealing with challenges
faced by Indias energy sector.
ii.
The Petroleum and Natural Gas Regulatory Board Act, 2006 regulates refining,
processing, storage, transportation, distribution, marketing and the sale of
petroleum, petroleum products and natural gas.
iii.
The Auto Fuel Policy, 2003 provides a roadmap to comply with various
vehicular emission norms and corresponding fuel quality upgrading
requirements over a period of time.
iv.
The National Biofuel Policy, 2009 promotes bio-fuel usage; the Government of
India has provided a 12.36% concession on excise duty on bio-ethanol and
exempted bio-diesel from excise duty.
v.
The National Exploration Licensing Policy, 1999 provides a contract

framework for the exploration and production of hydrocarbons. Licenses for
exploration are awarded through a competitive bidding system nine rounds of
bidding were completed as of 2011.
vi.
52 Blocks proposed to be offered under N.E.L.P.X. The offer is de-risked to the

extent of all necessary statutory clearances having been pre-obtained.
vii.
The Coal Bed Methane Policy, 1997 encourages exploration and production of
coal bed methane as a new eco-friendly source of energy.
viii.
The Petroleum Rules, 1976 contains provisions for regulations governing

pollution, society and other operating standards.
38
ix.
The Policy on Shale Gas & Oil, 2013 allows companies to apply for shale gas
and oil rights in their petroleum exploration licenses and petroleum mining
leases.
Recent happenings in India:
Diesel price to go up by Rs 2.80 a litre in Chandigarh

ONGC Videsh loses bid for two oil blocks in Mexico.
LNG import terminals to face major challenges.
GAIL India to swap US LNG, issue tender next month
GAIL plans to buy US shale gas asset for $1.5 billion to meet future Indian
demand.
India's June fuel demand rises 2.83% YoY
GAIL seeks bids to sell 0.37 million tonnes US LNG.
Post N-deal, RIL may look at exporting petrol, diesel to Iran
Indian Oil Corp bags 'leading oil & gas corporate' award.
Impact of Irans nuclear deal on India13:

Current bilateral trade between India and Iran is about $14bn (8.96bn) with
the balance of trade in heavily in Tehran's favor. Indian exports to Iran were
around $4.2bn last year. India primarily imports oil from Iran, but has been
hampered by restrictions placed by global powers.
13 http://articles.economictimes.indiatimes.com/2015-0715/news/64449967_1_iran-nuclear-deal-oil-prices-nuclear-weapon
http://articles.economictimes.indiatimes.com/2015-07-15/news/64449967_1_irannuclear-deal-oil-prices-nuclear-weapon
39
Due to the sanctions, India has been paying Iran in Indian rupees, with the
money kept in an Indian account. In fact, the country is yet to release an
estimated $6bn in pending oil payments to Iran.
Now Delhi, which is the fourth largest consumer of oil in the world, is free to
import Iranian oil but will have to pay in dollars. Importing goods or sending
shipments to Iran is currently expensive because of high shipping charges.
India hopes the removal of sanctions will make it easier for companies to get
shipments.
Markets are seeing some positive developments that could bring cheers to
equity investors globally. Earlier, it took 12 hours of rigorous political efforts
yesterday to seal the fate of Greece debt crisis with the European creditors.
And today nine-years of negotiations of the six major countries with Iran on
nuclear deal finally reached to conclusion.
How Iran deal affects the oil markets:

a. Will incremental supply of 0.5-0.8 million barrels per day to the world
market in the next six months.
b. Iran will emerge as an added supply source for an oversupplied market.
c. Iran incremental supplies would double the global surplus projected for the
rest of the year.
d. Expert believe that If agreement's details drive prices lower, Brent crude
may drop to mid-$40s/bbl before recovering to $50s.
e. Oil inventories in industrialized countries are at their widest surplus.
f. Increased imports from Iran likely to further help reduce crude import
costs
g. Lower shipping costs as travel time will reduce
h. Credit period offered by Iran is 90 days as compared with other Gulf
countries at 30 days
40
i. Additional 60 days of credit period can lift the GRM as much as $1/bbl
j. MRPL, Essar Oil and IOC imported 10-30% of total crude requirement from
Iran
k. Insurance costs of ship which procures crude from Iran will reduce
Market is expected to oversupplied, positive for oil consumer nations like
India.
l. India imported 10-16% of crude from Iran between 2002 and 2012.
m. Pre Sanctions India used to import a significant quantity of Crude from
Iran which can be restored to a large extent now.
n. Official selling price of Gulf producer to remain quite competitive in order
to maintain market share this will help Indian refiners to boost their
margins.
o. Lower crude oil prices will bring down import bill for government.
3.2.3 Company Analysis14:
An analysis is going to be performed of 5 companies from Oil & Gas sector from the
Nifty index. Ratio Analysis of the companies is done and interpretations have been
drawn from it as follows:
A. Oil and Natural Gas Corporation Limited:

i.
Company Profile:
ONGC (Oil and Natural Gas Corporation Limited) is India's leading oil &
gas exploration company. ONGC has produced more than 600 million
metric tonnes of crude oil and supplied more than 200 billion cubic metres
of gas since its inception. Today, ONGC is India's highest profit making
corporate. It has a share of 77 percent in India's crude oil production and
81 per cent in India's natural gas production.
14 www.stockcharts.com
41
Major Achievements of ONGC:
Judged as Asia's best Oil & Gas company, as per a recent survey
conducted by US-based magazine 'Global Finance'
Ranked as the 2nd biggest E&P company (and 1st in terms of profits),
as per the Platts Energy Business Technology (EBT) Survey 2004.
Latest News:
ii.
Exit ONGC, prefer midcap IT stocks: Sharmila Joshi

Hold ONGC for long term: Sudarshan Sukhani
Buy ONGC 310 Put, advises VK Sharma
Stay invested in ONGC, advises Sameet Chavan
Antique upgrades ONGC to buy, sees growth recovery
Sell ONGC, SBI; buy Bharti Airtel: Rahul Mohindar
Financial Ratios:
Ratios
March 2015
March 2014
Face Value (Rs.)

Dividend Per Share (Rs.)
Gross Profit Margin (%)
Return
On
Capital
Employed (%)
Current Ratio
Debtors Turnover Ratio
Investments Turnover Ratio
Asset Turnover Ratio
Earnings Per Share
Book Value
5.00
9.50
39.38
23.34
5.00
9.50
42.41
24.58
0.97
11.16
14.31
0.64
25.83
159.81
1.19
12.71
14.60
0.69
24.46
145.47
iii.
42
The balance sheet is the statement showing the increase or decrease in the
assets and liabilities. This indicates the change in capital structure as well
as increase or decrease in assets. As we can see, the face value of the share
is Rs.5. Also, we can see that the current ratio was 1.19 in 2014 and it has
gone down to 0.97 in 2015, which shows that the firm has lesser abilities
to pay off its liabilities than the previous year. Also the asset turnover ratio
in 2014 was 0.69, meaning the company generated more revenue per
rupee of asset investment than 2015, in which the ratio slightly falls down
to 0.64. The gross profit margin ratio in 2014 was 42.41, which declined
slightly to 39.38 in 2015. Now higher the GP ratio, higher is the firms
ability to produce goods and services at a low cost with high sales. Here,
even if there is a small drop down in the ratio in 2015, it is still high
enough and hence favourable. The book value has increased from 2014 to
2015 by a considerable amount, hence showing that the investors are
willing to pay more price for the stocks. The debtors turnover ratio has
fallen from 12.71 in 2014 to 11.16 in 2015, which shows that the debtors
collection period has increased and efficient credit collection policies are
recommended. Lastly, the EPS has increased from 24.46 to 25.83 in 2015,
which indicates that the company is profitable.
B. GAIL (India) Limited:

i.
Company Profile:
GAIL (India) Limited is the largest state-owned natural gas processing and
distribution company in India, It is headquartered in New Delhi. It has
following business segments: Natural Gas, Liquid Hydrocarbon, Liquefied
petroleum gas Transmission, Petrochemical, City Gas Distribution,
Exploration and Production, GAILTEL and Electricity Generation. GAIL
has been conferred with the Maharatna status on 1 Feb 2013, by the
Government of India.
Major Achievements of GAIL (India) Ltd:

43
Selected as the top Indian company in the Gas Processing,

Transmission and Marketing sector for the Dun & Bradstreet American Express Corporate Awards 2006.
GAIL's Dahej-Vijaipur Pipeline Project won the Silver Medal in Mega
Projects Category at the International Project Management Association
Awards, 2006.
Received the Platts Global Industry Leadership Award 2005.
Rated as one of the Best Employers in India by Hewitt Associates in
Latest News:
ii.
GAIL to swap US LNG, issue tender next month

GAIL sells 2 mn tonnes US LNG abroad
GAIL India's Q1 results on July 24, 2015
Oil Min reverts back to promoters selecting CEO of Petronet
Go long in GAIL India, target Rs 393: Siddarth Bhamre
Oil & Gas- RIL, ONGC, OIL, BPCL, GAIL top picks: KRChoksey
Buy GAIL India, target Rs 442: Rajat Bose
Financial Ratios:
Ratios
March 2015
March 2014
Face Value (Rs.)

Return
On
Capital
Employed (%)
Current Ratio
Earnings Per Share
Book Value
10.00
10.40
9.60
10.00
9.60
11.54
17.55
19.18
1.10
21.44
25.51
1.66
34.49
213.42
1.00
21.33
30.95
1.61
31.71
191.00
44
is Rs.10. Also, we can see that the current ratio was 1.00 in 2014 and it
has increased to 1.10 in 2015, which shows that the firms abilities to pay
off its liabilities has increased than the previous year. Also the asset
turnover ratio in 2014 was 0.61, meaning the company generated less
revenue per rupee of asset investment than 2015, in which the ratio
slightly increased to 1.66. The gross profit margin ratio in 2014 was 11.54,
which declined slightly to 9.60 in 2015. Now higher the GP ratio, higher is
the firms ability to produce goods and services at a low cost with high
sales. Here, there is a small drop down in the ratio in 2015, it is hence not
high enough and therefore unfavorable. The book value has increased
from 2014 to 2015 by a considerable amount, hence showing that the
investors are willing to pay more price for the stocks. The debtors
turnover ratio has increased from 21.33 in 2014 to 21.44 in 2015, which
shows that the debtors collection period has declined and efficient credit
collection policies are being used. Lastly, the EPS has increased from
31.71 to 34.49 in 2015, which indicates that the company is profitable.
C. Bharat Petroleum Corporation Limited:

i.
Company Profile:
Bharat Petroleum Corporation Limited (BPCL) is an Indian statecontrolled oil and gas company headquartered in Mumbai, Maharashtra. The
Corporation operates two large refineries of the country located
at Mumbai and Kochi. BPCL has been ranked 242th in the Fortune Global
500 rankings of the world's biggest corporations for the year 2014.
45
Major Achievements of GAIL (India) Ltd:
Twelve locations certified ISO-14001

Seventy one locations certified ISO-9002
Achievement of million man hour safety record
Cultivation of Jatrobha to facilitate Bio Diesel production
Contribution to Alternate energy resources (wind mills and Solar energy)
Latest News:
ii.
BPCL's Q1 results on August 14, 2015

Shell reopens 77th petrol pump in India
Positive on BPCL: Mayuresh Joshi
HPCL may test Rs 898, BPCL 1050: Rajat Bose
India to outperform, Fed rate hike likely in Sept: Deutsche
BPCL to invest $4 bn to double Bina oil refinery capacity
BPCL to expand Bina oil refinery by 30%: S. Varadarajan
Financial Ratios:
Ratios
March 2015
March 2014
Face Value (Rs.)

Return
On
Capital
Employed (%)
Current Ratio
10.00
17.00
2.24
10.00
11.00
1.74
18.52
14.57
0.87
0.78
46

Earnings Per Share
Book Value
64.17
13.64
6.53
56.16
269.11
46.16
14.39
6.29
36.55
230.04
slightly increased to 6.53. The gross profit margin ratio in 2014 was 1.74,
which increased slightly to 2.24 in 2015. Now higher the GP ratio, higher
is the firms ability to produce goods and services at a low cost with high
sales. Here, there is a increase in the ratio in 2015, it is hence high enough
and therefore favorable. The book value has increased from 2014 to 2015
by a considerable amount, hence showing that the investors are willing to
pay more price for the stocks. The debtors turnover ratio has increased
from 46.16 in 2014 to 64.17 times in 2015, which shows that the debtors
collection period has declined and efficient credit collection policies are
being used. Lastly, the EPS has increased from 36.55 to 56.16 in 2015,
which indicates that the company is profitable.
D. Hindustan Petroleum Corporation Limited (HPCL):

i.
Company Profile
Hindustan Petroleum Corporation Limited (HPCL) is an Indian stateowned oil and natural gas company with its headquarters at Mumbai,
Maharashtra and with Navratna status. HPCL has been ranked 260th in the
47
Fortune Global 500 rankings of the world's biggest corporations (2013)

and 4th among India's Companies for the year 2012. HPCL has about 25%
marketing share in India among PSUs and a strong marketing
infrastructure.
Major Achievements of HPCL:
HPCL ranks 1054 in Forbes 2000 list

HPCL ranks 336 in Fortune Global 500 list
Scope CSR Award for the Year 2009-10
Golden Peacock Award for CSR 2011
Readers Digest Trusted Brand Gold Award 2011
Brand Leadership award
Latest News:
ii.
Go long in HPCL, target Rs 940: Ashish Kyal

Buy HPCL, says Sudarshan Sukhani
Buy IT on dips; banks still to gain momentum: IIFL
Look at HPCL, says VK Sharma
HPCL may test Rs 898, BPCL 1050: Rajat Bose
Bulls got grip, see 8650 level if 8580 is held: Rajat Bose
HPCL looks positive: Ajay Jain
Expect upside in oil marketing companies: Devang Mehta
Financial Ratios:
Ratios
March 2015
March 2014
Face Value (Rs.)

10.00
15.50
1.35
10.00
8.50
1.10
48
Return
On
Capital
Employed (%)
Current Ratio
Earnings Per Share
Book Value
8.54
7.31
0.73
42.93
11.89
4.79
51.20
443.32
0.68
48.64
12.58
4.76
26.72
405.35
slightly increased to 4.79. The gross profit margin ratio in 2014 was 1.10
in 2014, which increased to 1.35 in 2015. Now higher the GP ratio, higher
is the firms ability to produce goods and services at a low cost with high
sales. Here, there is an increase in the ratio in 2015, it is hence high
enough and therefore favorable. The book value has increased from 2014
to 2015 by a considerable amount, hence showing that the investors are
willing to pay more price for the stocks. The debtors turnover ratio has
decreased from 48.64 in 2014 to 42.93 in 2015, which shows that the
debtors collection period has increased and efficient credit collection
policies are not being used. Lastly, the EPS has increased from 26.72 to
51.20 in 2015, which indicates that the company is profitable.
E. Cairn India:
i.
Company Profile
49
Cairn India is one of the largest independent oil and gas exploration and
production companies in India with a market capitalization of ~ US$ 7
billion. Cairn India was rated as the fastest-growing energy company in
the world, as per 2012 & 2013 Platts Top 250 Global Energy Company
Rankings. Cairn India operates ~27% of India's domestic crude oil
production. Through its affiliates, Cairn India has been operating for close
to 20 years playing an active role in developing India's oil and gas
resources.
Major Achievements of HPCL:
Winner of 2012 Platts Top 250 Global Energy Company award for the
Fastest growing company in Asia and the World
Winner of 2012 PetroFed award for O&G Pipeline Transportation
Company of the Year
Winner of Blue Dart Global CSR Award, 2012
Winner of 2011 Spotlight Awards by League of American
Communications Professionals
Cairn India awarded 'Superbrand' status, 2011
Latest News:
ii.
Cairn-Vedanta merger blues: After LIC, UIIC unhappy

Cairn India Q1 net falls 24% as oil prices hit a soft patch
Cairn India Q1 net seen at Rs 1000 cr, revenue may rise 7%
Cairn India for stable & predictable investment regime
Asset quality remains a concern for PSU banks: Dipan Mehta
'LIC monitoring wing votes against Cairn-Vedanta merger'
Exit Cairn India: Devang Mehta
Financial Ratios:
Ratios
March 2015
March 2014
Face Value (Rs.)
10.00
10.00
50

Return
On
Capital
Employed (%)
Current Ratio
Earnings Per Share
Book Value
9.00
35.99
12.50
59.23
10.41
20.06
1.43
7.37
42.10
0.21
7.04
197.62
1.26
7.44
60.81
0.27
39.08
203.28
slightly decreased to 0.21. The gross profit margin ratio in 2014 was
59.23, which declined slightly to 35.99 in 2015. Now higher the GP ratio,
higher is the firms ability to produce goods and services at a low cost
with high sales. Here, there is a drop down in the ratio in 2015, it is hence
not high enough and therefore unfavorable. The book value has decreased
from 2014 to 2015 by a considerable amount, hence showing that the
investors are not willing to pay more price for the stocks. The debtors
turnover ratio has decreased from 7.44 in 2014 to 7.37 in 2015, which
shows that the debtors collection period has increased and efficient credit
collection policies are not being used. Lastly, the EPS has decreased
largely from 39.08 in 2014 to 7.04 in 2015, which indicates that the
company is not at all profitable.
3.3 Analysis and Findings

51
Technical Analysis:
Technical analysis of the following 5 companies from Nifty is done on the following
parameters as given below:
1. Relative Strength Index (RSI)
2. Moving Average Convergence Divergence (MACD)
3. Japanese Candlestick Chart
A. Oil and Natural Gas Corporation Limited:
52
i.
Relative Strength Index (RSI):
RSI indicator is a momentum indicator, which measures over bought and over sold
conditions in the market. The indicator oscillates between 0 and 100, with the values
below 30 traditionally showing oversold conditions in the market, which in this case
doesnt go below 30. Since it is not going below the 30 level, it is not suitable to buy.
And values above 70 show over bought conditions in the market, here, indicating to sell
of approximately in the month of July, 2014. It also shows the current direction of the
trend, with the values above 50 indicating an uptrend and the values below 50 indicating
downtrend. As we can see here, the values show more of an uptrend than the downtrend
in the market condition.
ii.
Moving Average Convergence Divergence (MACD):
53
MACD is a momentum indicator that shows relationship between differences of two

moving averages. It is used then to find new trends and new entries for your trade. It
consists of 4 components, a slow moving average shown here by the red line, a fast
moving average, shown here by the black line, a difference between the two shown by
the histogram and a 0 line, shown here at 1.811. Although there is more than one
strategy to use MACD in trading, the safest one can be interpreted as follows: Trading
the moving average crossover. For long positions, looking at the crossover between the
faster moving average and slower moving average above the 0 line, here, shown in the
month of May 2013 & July 2014, indicates buying and the crossover below the 0 line,
shown here at November 2013 and April 2015, indicate selling action to be taken,
opposite in case of short positions.
iii.
Japanese Candlestick Chart:
54
Candlestick provides us with great strength in market condition insights and even
signals us about trend changes and price reversals. We can see that there is a bearish
trend in the market mostly in the years shown above due to the presence of more
number of red candles than the white ones. We can also see that the sellers are largely
in control around the August and September of 2013 and we can see that the market
falls largely below the 60M moving average starting from the end of December 2014
to July 2015. Buying action shouldve been recommended at the beginning of the year
2014.
55
B. GAIL (India) Limited:
i. Relative Strength Index (RSI):
doesnt go below 30 at all. Since it is not going below the 30 level, means the buying
indictor is not showing, hence it is not suitable to buy. And values above 70 show over
bought conditions in the market, here, indicating there are no extreme conditions
involved in the stock, hence the stock prices being stable. It also shows the current
direction of the trend, with the values above 50 indicating an uptrend and the values
below 50 indicating downtrend. As we can see here, the values show more of an down
than the uptrend in the market condition, hence indicating a bullish market in the late
2013 and a bearish market in 2015.
56
ii. Moving Average Convergence Divergence (MACD):

the moving average crossover. For long positions, looking at the crossover between
the faster moving average and slower moving average above the 0 line, here, shown in
the month of April 2014 & also October 2014, indicates buying and the crossover
below the 0 line, shown here from April-September 2013 and May 2015, indicate
selling action to be taken, opposite in case of short positions.
57
iii.
Japanese Candlestick Chart, Volume and Moving Average (50 & 200 days MA):
trend in the market mostly in the year 2013 from March-October shown above. We
can also see that the sellers are largely in control around the Nov and Dec of 2014 and
we can see that the market falls largely below the 60M moving average starting from
the end of December 2014 to July 2015. Buying action shouldve been recommended
at the beginning of the year 2014.
58
C. Bharat Petroleum Corporation Limited (BPCL):

indictor is off, hence it is not a suitable time to buy. And values above 70 show over
bought conditions in the market, here, indicating that at the mid of the year 2013 there
was an over bought condition in the market, hence the perfect time to sell. It also
shows the current direction of the trend, with the values above 50 indicating an
uptrend and the values below 50 indicating downtrend. As we can see here, the values
show more of an down than the uptrend in the market condition, hence indicating a
bullish market in the late 2013 and a stable market henceforth.
59
ii.

the faster moving average and slower moving average above the 0 line, here, shown
in the month of Feb to April and June 2015, indicates buying and the crossover
below the 0 line, shown here in May 2015, indicate selling action to be taken,
opposite in case of short positions.
60
iii.
Japanese Candlestick Chart, Volume and Moving Average (50 & 200 days MA):
trend in the market mostly in the Jan 2015 as shown above. We can also see that the
sellers are largely in control around the mid May of 2015 and we can see that the
market falls largely below the 4M moving average in the beginning of Jan 2015.
Buying action shouldve been recommended at the end of Jan 2015.
61
D. Hindustan Petroleum Corporation Limited (HPCL):

i.
Relative Strength Index:
indictor is off, hence it is not a suitable time to buy. And values above 70 show over
bought conditions in the market, here, indicating that at the mid of the year 2015 there
was an over bought condition in the market, hence the perfect time to sell. It also
shows the current direction of the trend, with the values above 50 indicating an
uptrend and the values below 50 indicating downtrend. As we can see here, the values
show more of an down than the uptrend in the market condition, hence indicating a
stable market in the 2013 & 2014 and a bearish market henceforth.
62
ii.

the month of Jan to April 2015, indicates buying and the crossover below the 0 line,
shown here from May 2015, indicate selling action to be taken, opposite in case of
short positions.
63
iii.
Japanese Candlestick Chart:
signals us about trend changes and price reversals. Here if we observe there is a rise
and fall every now and then, hence there is an unstable market overall. There is a sharp
rise in the market at the beginning of Feb 2015 and after a certain point the buyers pull
down the price and hence we can see a spinning top, indicating the trend reversal. This
chart is full of spinning tops and as we can see, the trend is changing every now and
then, hence concluding to a very indecisive market condition.
64
E. Cairn India:
went below 30 in the mid of June, 2015, sensing over sold conditions in the market,
hence the right time to buy. And values above 70 show over bought conditions in the
market, here, indicating that the market is well stable and there is no over bought
condition. It also shows the current direction of the trend, with the values above 50
indicating an uptrend and the values below 50 indicating downtrend. As we can see
here, it shows a potential uptrend till April 2015 and a downtrend thereafter.
65
ii.

the month of February 2015, indicates buying and the crossover below the 0 line,
shown here from April to June 2015, indicate selling action to be taken, opposite in
case of short positions.
66
iii. Japanese Candlestick Chart, Volume and Moving Average (50 & 200 days MA):
signals us about trend changes and price reversals. Here, if we observe, the market is
too bullish in Jan 2015 and hence spinning tops are observed in the entire month of
Feb and March 2015, after which the sellers take control of the market and heavy
selling action takes place in the month of March 2015, after which in April, again there
is more of a bullish trend, after which by the mid of April 2015, the sellers gain control
again. Towards the end of July 2015, there are a lot of spinning tops indicating a trend
reversal, thus the months ahead of July, to be brighter as compared to the previous 2
months i.e. May (a lot of dojis) & June (all time low in June beginning due to the
crash of Chinese markets).
67
Chapter 4
Conclusion:
The Oil & Gas sector has been analyzed and studied. Five scrips of a combination of Large
Cap and Mid Cap were selected, of which Fundamental analysis as well as Technical analysis
of the scrips was performed and interpretations were drawn about the companies. The
suggestions to the investors to invest in these companies of the Oil & Gas Industry in India
are as follows:
Buoyed by Iran's historic nuclear accord with world powers to end sanctions, India will
ask Tehran for rights to develop ONGC-discovered Farzad-B gas field in the Persian
Gulf.
Oil and gas companies' stocks have not been doing too well. But experts suggest that
patience will pay in the long run.
A United Nation pegged India's economic growth at 8.1 per cent for 2015-16, quite higher
than what other global agencies such as the International Monetary Fund and the World
Bank have projected.
India invites Canadian firms to invest in energy infra.
While approving a new gas pricing formula based on international hub rates in October
last year, the government had decided that new gas discoveries in deep-water, ultra-deep
sea or high-temperature and high-pressure fields will be given a premium over and above
the approved price.
Hence, these are some of the reasons one should invest in this sector.
68
ANNEXURES:
Bibliography:
Books referred:
1. Getting started in fundamental analysis - Michael C. Thomsett
2. Fundamental Market Analysis - Michael N. Kahn
3. Technical Analysis of the Financial Markets - John J. Murphy
4. Security Analysis and Portfolio Management Ranganatham
Websites:
1. http://economictimes.indiatimes.com/configspace/ads/defaultinterstitial.html
2. http://www.worldoil.com/magazine/2015/july-2015
3. www.wikipedia.com
4. www.investopedia.com/university
5. www.diffen.com Finance
6. www.makeinindia.com/sectors/
7. www.moneycontrol.com MARKETS
8. http://www.ft.com/companies/oil-gas
9. www.stockcharts.com
Newspaper & Magazines:
1. Petroleum Bazaar July 2015 edition
2. Offshore World
3. The Ecologist (blog)
4. Offshore Oil and Gas Magazine
5. Forbes India
6. History and Evolution of stock exchanges in India pdf
69

Fundamental &amp; Technical Analysis of 5 Companies of Oil &amp; Gas Sector

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Fundamental &amp; Technical Analysis of 5 Companies of Oil &amp; Gas Sector

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Executive Summary:

What is Money Market?2

Structure of Money Market:

Instruments in Money Market:3

2. Treasury bill market:

3. Ready forward contract (Repos):

4. Money market mutual funds:

What is Capital Market?4

Stock Markets in India:

Origin of the Indian Stock Market: 5

Bombay Stock Exchange (BSE)

National Stock Exchange of India (NSE)

Multi Commodity Exchange of India Limited (MCX)

National Commodity & Derivatives Exchange Limited (NCDEX)

Indian National Multi-Commodity Exchange (NMCE)

Commodity Exchange Limited ICEX.

Launch a special platform for trading in SME securities

Introduce Equity Derivatives

Launch a Free Float Index - S&P BSE SENSEX

Launch Exchange Enabled Internet Trading Platform

Obtain ISO certification for a stock exchange

Exclusive facility for financial training BSE Institute Ltd.

Launch its website in Hindi and regional languages

Host the popular opening-bell ceremony in Indian capital markets

Security Measures and Operational Features of BSE and NSE:

Its general operational features are as follows:

The Post Closing Session is held between 15.50 to 16.00 hours.

Limited Physical Market

Rolling Settlement Trading

T+1 working days

T+1 working days

Securities and Funds pay in

T+2 working days

Securities and Funds pay out

T+2 working days

Assigning of shortages for close out

T+3 working days

Reporting and pick-up of bad delivery

T+4 working days

Close out of shortages

T+5 working days

Replacement of bad delivery

T+6 working days

Reporting of re-bad and pick-up

T+8 working days

Close out of re-bad delivery

T+9 working days

4) Brokerage And Other Transaction Costs

1.2 Introduction to the Company8:

1.3 Introduction to the Project:

George Soros, Chairman, Soros Fund Management:

Michal Parness, Founder & CEO:

Australian National University Stephen Sault Australian National University - Faculty of

2.2 Statement of Problem:

2.3 Objectives of the Project:

To gain practical knowledge of fundamental and technical analysis.

2.5 Sample Design and Sample Size:

Oil and Natural Gas Corporation Limited

2.6 Scope and Limitations:

Objectives of Fundamental Analysis:

Three phases of Fundamental Analysis:

Strengths of Fundamental Analysis:

Value Drivers In addition to understanding the business, fundamental analysis allows

Fundamental & Technical Analysis of 5 Companies of Oil & Gas Sector

Fundamental & Technical Analysis of 5 Companies of Oil & Gas Sector