Indian Stock Market - 2015
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Description
This document is a trend analysis of Indian Stock Market by 2015.
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Document Sample
D t 6th M h
Date: 16 March 2010
http://sethiavikas.blogspot.com/ 1
Flow of Presentation
Indices – BSE Sensex, NSE S&P CNX Nifty
Factors effecting Market Movements
India’s GDP
GDP v/s Sensex & Nifty
Sensex & Nifty @ 2015
Conclusion
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Key Assumptions & Data Sources
Key Assumptions
Data for stock indices has been taken till 12th Mar’ 10 for FY: 2009‐10.
g g y
Annual Averages of stock indices has been used and the averages are based on daily
closing index.
Data Sources:
Reserve Bank of India (RBI) – http://rbi.org.in/
World Bank ‐ http://datafinder.worldbank.org/
National Stock Exchange of India (NSE) ‐ http://www.nseindia.com/
y g p
Bombay Stock Exchange (BSE) ‐ http://www.bseindia.com/
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Slide No.
Slid N
• Indices – BSE Sensex, NSE S&P CNX Nifty 5 ‐ 6
ff i k
• Factors effecting Market Movements 7
• India’s GDP 8
• GDP v/s Sensex & Nifty 9 ‐ 10
• Sensex @ 2015 11
• Nifty @ 2015 12
• Investor ‘s to watch 13 ‐ 14
• Conclusion 15
• Disclaimer 16
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Indices : BSE Sensex, NSE S&P CNX Nifty
There are two flagship indices of Indian Stock Market:
BSE Sensex
NSE S&P CNX Nifty
The BSE Index, SENSEX, is India's first and most popular stock market benchmark index.
sectors.
It constitutes 30 stocks representing 12 major sectors
BSE has entered into an index cooperation agreement with Deutsche Börse and
Singapore Stock Exchange, as its strategic partners.
S&P CNX Nifty is a well diversified 50 stock index accounting for 22 sectors of the
economy.
S&P CNX Nifty is owned and managed by India Index Services and Products Ltd.
( ) j
(IISL), which is a joint venture between NSE and CRISIL. IISL has a Marketing and g
licensing agreement with Standard & Poor's (S&P), who are world leaders in index
services.
Both Sensex & Nifty is constructed on a 'free‐float' methodology, and is sensitive to
k d k li i
market movements and market realities. Thi methodology i quite reliable & used b
This h d l is i li bl d by
most of the top indices of the world.
This ‘free‐float’ methodology helps to define Index’s correct & fair real time value. It uses
weighted average market capitalization of all its stocks along with considering free‐float
value of no. of shares available in market for trading of that particular share.
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Indices Cont…
NSE S&P CNX
Year BSE Sensex
Nifty
1990-91 1049.53 366.18
1991-92 1879.51 556.48
1992-93 2895.67 840.99 • Table shows the data for sensex & nifty from
1993 94
1993-94 2898.69
2898 69 884 60
884.60 2009/1o.
1990/91 to 2009/1o
1994-95 3974.91 1202.87 • Graph here shows the trend of both sensex
1995-96 3288.68 965.26 & nifty for last 20 years .
1996-97 3469.24 1005.75
nifty s similar.
• Both sensex & nifty’s trend is almost similar
1997-98 3812.86 1087.34
1998-99 3294.78 956.62
1999-00 4658.63 1369.01 Sensex & Nifty
2000-01 4269.69 1336.49 6000.00 18000.00
16000.00
2001-02 3331.95 1077.13 5000.00
14000.00
4000.00 12000.00
2002-03 3206.29 1036.10 10000.00
3000.00
8000.00
2003-04
2003 04 4492 19
4492.19 1428.13
1428 13 2000 00
2000.00 6000 00
6000.00
4000.00
2004-05 5740.99 1805.26 1000.00
2000.00
0.00 0.00
2005-06 8278.55 2513.40
1990‐91
1991‐92
1992‐93
1993‐94
1994‐95
1995‐96
1996‐97
1997‐98
1998‐99
1999‐00
2000‐01
2001‐02
2002‐03
2003‐04
2004‐05
2005‐06
2006‐07
2007‐08
2008‐09
2009‐10
2006-07 12277.33 3572.44
2007-08 16568.89 4896.60
2008-09 12365.55 3731.03
BSE Sensex NSE S&P CNX Nifty
2009-10 15517.41 4627.76 http://sethiavikas.blogspot.com/ 6
Factors affecting Market Movement
Government Budget Deficits or Surpluses
Balance of Trade levels & Trends
Economic Growth & Health
Inflation & Interest Rate Fluctuations
Foreign Investment Inflows
l l d
Political Conditions
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India’s GDP Year
GDP (in
Year
GDP (in
• Shown here GDP data & graph for last 50 years. Bn US$) Bn US$)
est.
• Following table calculates est value of GDP based on 1960 36.6 1985 229.9
SAGR, CAGR, GDP growth @ 9%, and trend analysis as shown 1961 38.8 1986 246.4
1962 41.7 1987 276.0
in below graph. 1963 47.9 1988 293.1
Value in Bn USD
S. No. Particulars Value GDP @ 2015 1964 55.9 1989 292.9
1 SAGR 0.672 1389.71 1965 58.8 1990 317.5
2 CAGR 0.076 2029.67 1966 45.3 1991 267.5
3 GDP Growth @ 9% 0.090 2225.64 1967 49.5 1992 245.6
4 Trend Analysis (Poly.) R^2 = 0.945 1725.00 1968 52.4 1993 276.0
Average
A 1842.51
1842 51 1969 57.7 1994 323.5
1970 61.2 1995 356.3
GDP Value in Bn USD 1971 66.3 1996 388.3
2000
1972 71.1 1997 410.1
1800 R² = 0.945 1973 85.2 1998 416.3
1600 1974 98.8 1999 450.5
1400 1975 97.0 2000 460.2
1200 1976 101.1 2001 477.8
1000
1977 119.8
119 8 2002 507 2
507.2
GDP Value in Bn USD
800
1978 135.4 2003 599.5
GDP Trend (Poly.)
1979 150.9 2004 700.9
600
1980 183.8 2005 810.2
400
1981 190 5
190.5 2006 914.9
914 9
200
1982 197.7 2007 1176.9
0 1983 215.2 2008 1217.5
1960
1962
1964
1966
1968
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
http://sethiavikas.blogspot.com/ 1984 209.7 2009 -8
GDP v/s Sensex & Nifty
18000.00 1400.0
• Data & Graph for GDP v/s Sensex & Nifty
16000.00 1200.0
1200 0
India's 14000.00
BSE NSE S&P 1000.0
Year GDP (in 12000.00
Sensex CNX Nifty 10000.00 800.0
Bn USD)
1990-91
1990 91 317.5 1049.53 366.18 8000.00 600.0 BSE Sensex
BSE Sensex
6000.00
1991-92 267.5 1879.51 556.48 400.0 India's GDP (in Bn USD)
4000.00
1992-93 245.6 2895.67 840.99 200.0
2000.00
1993-94 276.0 2898.69 884.60
0.00 0.0
1994-95
1994 95 323 5
323.5 3974 91
3974.91 1202.87
1202 87
1995-96 356.3 3288.68 965.26
1996-97 388.3 3469.24 1005.75
1997-98 410.1 3812.86 1087.34
6000.00 400.0
1400.0
1998-99 416.3 3294.78 956.62
5000.00 1200.0
1999-00 450.5 4658.63 1369.01
2000-01 460.2 4269.69 1336.49 1000.0
4000.00
2001-02 477.8 3331.95 1077.13 800.0
3000 00
3000.00
2002-03 507.2 3206.29 1036.10 600.0 NSE S&P CNX Nifty
2003-04 599.5 4492.19 1428.13 2000.00
400.0 India's GDP (in Bn USD)
2004-05 700.9 5740.99 1805.26 1000.00 200.0
2005 06
2005-06 810 2
810.2 8278.55
8278 55 2513.40
2513 40
0.00 0.0
2006-07 914.9 12277.33 3572.44
2007-08 1176.9 16568.89 4896.60
2008-09 1217.5 12365.55 3731.03 http://sethiavikas.blogspot.com/ 9
GDP v/s Sensex & Nifty Cont.
25000.00
20000.00
R² = 0.951
R² 0 951 GDP V/S Sensex
GDP V/S S
• GDP CAGR for 1990/91 to 2008/09: 7.8%
nsex Index
• Estimated Value of GDP @ 7.8% for next 15000.00
y
5 years: 10000 00
10000.00 GDP V/S Sensex
GDP V/S Sensex
Sen
Est. Value of GDP
Trend (Poly.)
Year (In Bn USD)
5000.00
2009-10 1311.89
2010-11 1105.30
0.00
2011-12 1014.81
1014 81
2012-13 1140.42 0.0 500.0 1000.0 1500.0 2000.0
2013-14 1336.68 GDP Value in Bn USD
2014-15 1472.21
• O b i of d h
On basis f data shown i slide#9 &
in lid GDP / Nift
GDP v/s Nifty
above table, plotted a scatter chart of GDP 7000.00
6000.00 R² = 0.957
v/s Sensex & GDP v/s Nifty.
5000.00
Added trend line hi h h
• Add d a t d li which shows th est. the t Nifty Index
x
4000.00
value of sensex & nifty, if India’s GDP will 3000.00 GDP v/s Nifty
be around 1.47 trillion dollar. 2000.00 Trend (Poly.)
1000.00
0.00
0.0 500.0 1000.0 1500.0 2000.0
http://sethiavikas.blogspot.com/ GDP Value in Bn USD 10
Sensex @ 2015
S. No. Particulars Value Sensex @ 2015
• As per trend line drawn in shown 1 SAGR 0.73 19324.75
chart, sensex will be around 24000 2 CAGR 0.15 31525.92
3 p
Trend as per Est. GDP R^2 = 0.951 21200.00
2015.
in 2015 4 Trend Analysis (Poly.) R^2 = 0.903 24000.00
• Table shows est. value of sensex in Average 24012.67
2015 based on SAGR, CAGR and
est.
trend analysis as per est GDP as
described in slide#10.
• If we take an average of all, sensex BSE Sensex
2015.
will at least be on 24000 by 2015 25000.00
²
R² = 0.903
20000.00
15000.00
10000.00
10000 00
BSE Sensex
5000.00
Trend (Sensex)
0.00
1990‐91
1992‐93
1994‐95
1996‐97
1998‐99
2000‐01
2002‐03
2004‐05
2006‐07
2008‐09
2010‐11
2012‐13
2014‐15
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Nifty @ 2015
S. No
S No. Particulars Value Nifty @ 2015
1 SAGR 0.61 5749.23
• As per trend line drawn in shown 2 CAGR 0.14 9021.64
chart, nifty will be around 6800 in 3 Trend as per Est. GDP R^2 = 0.957 6000.00
2015
2015. 4 Trend Analysis (Poly )
(Poly.) 0.917
R^2 = 0 917 6800 00
6800.00
Average 6892.72
• Table shows est. value of nifty in
2015 based on SAGR, CAGR and
est.
trend analysis as per est GDP as
described in slide#10. NSE S&P CNX Nifty
• If we take an average of all, nifty 8000.00
7000.00 R² = 0.917
2015.
will at least be on 6900 by 2015 6000.00
5000.00
4000.00
3000.00 NSE S&P CNX Nifty
2000.00
2000 00
Trend (Nifty)
1000.00
0.00
1990‐91
1992‐93
1994‐95
1996‐97
1998‐99
2000‐01
2002‐03
2004‐05
2006‐07
2008‐09
2010‐11
2012‐13
2014‐15
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Investor’s to watch
• Following is Economic Cycle. Investors to watch the situations so closely & invest wisely.
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Investor’s to watch Cont..
o o g s cyc e o a e o o s. es o o a c e s ua o s so c ose y & es se y.
• Following is cycle of Market Emotions. Investor to watch the situations so closely & invest wisely.
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Conclusion
India is developing into an open‐market economy, yet traces of its past autarkic policies
remain. E
i Economic lib li i including reduced controls on f i
i liberalization, i l di d d l foreign trade and
d d
investment, began in the early 1990s and has served to accelerate the country's
growth, which has averaged more than 7% since 1997.
2008, crisis,
An industrial slowdown early in 2008 followed by the global financial crisis led annual
GDP growth to slow to 6.1% in 2009, still second highest growth in the world among major
economies.
g p y
India’s GDP growth is expected to remain 8~10% for next decade. Country is on world’s #44
in terms of GDP (Purchasing Power Parity), which are indicators of an attractive economy
for investments.
Due to Growing Domestic demand,
Domestic Companies are going to grow resulting increased market capitalization.
Foreign Investment Inflows are expected to increase continuously.
Similarly Foreign Institutional Investors (FIIs) has seen Indian Stock Markets as relatively
Market.
large Return on Investment (ROI) Market
Good Economic Policies of the country has supported market to recover fast after
economic crisis and Economy is expected to be more healthier in upcoming years.
Indian Stock Market is expected to growth with minimum 12~15% average ROI per annum
for next 5 years.
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Disclaimer
Above all analysis is based on the data from various sources. However Market conditions
l l differ from the said predictions.
may completely diff f h id di i
One advise for Investors is:
Be a smart investor. There is lot of information available on internet. Government of
India, India,
India Reserve Bank of India BSE and NSE are providing all the required data to ensure the safe
investment. Just do a little home work and check out all the details about stock market and
particular stock/company, in which you are investing. Just analyze it yourself before you invest
your hard earned money.
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Vikas Sethia
+91‐9321020823
vikas.sethia@in.com
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