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Indian Stock Market - 2015

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Indian Stock Market - 2015 Powered By Docstoc
					                              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/




                             http://sethiavikas.blogspot.com/                              3
                                                            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.
                             http://sethiavikas.blogspot.com/                                5
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    
                                 http://sethiavikas.blogspot.com/                                                                                                                                                                                       11
   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   
                                http://sethiavikas.blogspot.com/                                                                                                                                                                             12
Investor’s to watch
• Following is Economic Cycle. Investors to watch the situations so closely & invest wisely.




                                      http://sethiavikas.blogspot.com/                         13
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.




                                      http://sethiavikas.blogspot.com/                                  14
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.
                                http://sethiavikas.blogspot.com/                           15
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.




                                http://sethiavikas.blogspot.com/                                     16
    Vikas Sethia
   +91‐9321020823
vikas.sethia@in.com




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Description: This document is a trend analysis of Indian Stock Market by 2015.
Vikas Sethia Vikas Sethia
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