CICI Bank is India

Embed Size (px)

Citation preview

  • 8/3/2019 CICI Bank is India

    1/14

    1

    Assignment

    ON

    Technical Analysis (StockMarket) reference to

    ICICI BANK

    Submitted to: Esha Jain Submitted by: Vivekanand Vashisath

    Designation: Ass. Prof. Reg. No.: 10P35F0468

    Name of the Specialization: Finance

    (Academic Session 2010-12)

  • 8/3/2019 CICI Bank is India

    2/14

    2

    Introduction:

    CICI Bank is India's second-largest bank with total assets of Rs. 4,062.34 billion (US$ 91 billion)

    at March 31, 2011 and profit after tax Rs. 51.51 billion (US$ 1,155 million) for the year ended

    March 31, 2011. The Bank has a network of 2,540 branches and 7,037 ATMs in India, and has a

    presence in 19 countries, including India.

    ICICI Bank offers a wide range of banking products and financial services to corporate and retail

    customers through a variety of delivery channels and through its specialized subsidiaries in the

    areas of investment banking, life and non-life insurance, venture capital and asset management.

    The Bank currently has subsidiaries in the United Kingdom, Russia and Canada, branches in

    United States, Singapore, Bahrain, Hong Kong, Sri Lanka, Qatar and Dubai International Finance

    Centre and representative offices in United Arab Emirates, China, South Africa, Bangladesh,

    Thailand, Malaysia and Indonesia. Our UK subsidiary has established branches in Belgium and

    Germany.

    ICICI Bank's equity shares are listed in India on Bombay Stock Exchange and the National Stock

    Exchange of India Limited and its American Depositary Receipts (ADRs) are listed on the New

    York Stock Exchange (NYSE)

    Technical Analysis:

    Meaning: A method of evaluating securities by analyzing statistics generated by marketactivity, such as past prices and volume. It dont attempt to measure securitys intrinsic values,

    but instead use charts and others tools to indentify patterns that can suggest future activity.

    Technical analysts believe that the historical performance of stocks and markets are indications of

    future performance. In a shopping mall, a fundamental analyst would go to each store, study the

    product that was being sold, and then decide whether to buy it or not. By contrast, a technical

    analyst would sit on a bench in the mall and watch people go into the stores. Disregarding the

    intrinsic value of the products in the store, the technical analyst's decision would be based on thepatterns or activity of people going into each store.

    Objectives of Technical Analysis

    Market Monitoring: The main objectives of technical analysis are to be able to profit from

    trading by observing market patterns and statistics, to know when to enter and exit a market,

    especially when it starts to shift, and to not let emotions influence trading decisions. Technical

    analysis is based on the emotional trading of the uninformed masses, it is only effective in auction

    markets, where many buyers and sellers converge to 1 pointbe it the floor of an exchange or a

    websitewhere the public price is determined by the highest bid price and the lowest ask price.

  • 8/3/2019 CICI Bank is India

    3/14

    3

    SCOPE OF THE STUDY:The project entitled A study on the performance of ICICI Bank based and technical analysis will enable from

    investor point of view to refer the performance of the Banks, their relative growth and thereby decide on buy or sell the

    particular slab. This study will also help to identify the bank that is lagging behind in its performance.OBJECTIVES OF THE STUDY

    PRIMERY OBJECTIVE To analyze the various factors which influence the share price of ICICI bank Ltd. SECONDREY OBJECTIVE To analyze the market value of ICICI bank To offer suggestions and recommendations based on the findings. To study the performance of ICICI Bank.

    Start Date End Date High Low ClosePrice

    PriceRange

    Price Range%

    08/11/2011 11/11/2011 889.35 816.7 821.00 72.65 8.90

    31/10/2011 04/11/2011 953.65 859.2 884.30 94.45 10.99

    24/10/2011 28/10/2011 935.0 852.65 933.35 82.35 9.66

    17/10/2011 21/10/2011 907.9 866.05 870.55 41.85 4.83

    10/10/2011 14/10/2011 900.0 816.15 890.40 83.85 10.27

    03/10/2011 07/10/2011 860.0 761.4 824.45 98.60 12.95

    26/09/2011 30/09/2011 897.35 833.0 875.40 64.35 7.73

    19/09/2011 23/09/2011 904.8 838.35 843.75 66.45 7.93

    12/09/2011 16/09/2011 894.95 840.05 883.90 54.90 6.54

    05/09/2011 09/09/2011 928.0 855.3 896.80 72.70 8.50

    29/08/2011 02/09/2011 899.7 835.0 887.15 64.70 7.75

  • 8/3/2019 CICI Bank is India

    4/14

    4

    821

    884.3933.35

    870.55 890.4

    824.45875.4

    843.75883.9 896.8 887.15

    0

    200

    400

    600

    800

    1000

    1200

    Pr

    i

    c

    e

    High

    Low

    Close

    Price

    889.35

    953.65 935907.9 900

    860897.35 904.8 894.95

    928899.7

    821884.3

    933.35

    870.55 890.4824.45

    875.4843.75

    883.9 896.8 887.15

    0

    200

    400

    600

    800

    1000

    1200

    Price(Rs.) High

    Low

    Close Price

  • 8/3/2019 CICI Bank is India

    5/14

    5

    Start Date End Date High Low Close Price Price Range Price Range %

    03/10/2011 31/10/2011 953.65 761.4 931.15 192.25 25.25

    02/09/2011 30/09/2011 928.0 833.0 875.40 95.00 11.40

    04/08/2011 30/08/2011 1015.0 813.9 873.25 201.10 24.71

    01/08/2011 30/08/2011 1059.7 813.9 873.25 245.80 30.20

    04/07/2011 29/07/2011 1111.8 1003.6 1036.75 108.20 10.78

    01/07/2011 29/07/2011 1111.8 1003.6 1036.75 108.20 10.78

    02/06/2011 30/06/2011 1099.5 1003.4 1094.65 96.10 9.58

    01/06/2011 30/06/2011 1099.5 1003.4 1094.65 96.10 9.58

    02/05/2011 31/05/2011 1118.3 1003.0 1086.10 115.30 11.50

    04/04/2011 29/04/2011 1139.0 1072.0 1114.45 67.00 6.25

    01/04/2011 29/04/2011 1139.0 1072.0 1114.45 67.00 6.25

    953.65 928

    10151059.7

    1111.8 1111.8 1099.5 1099.5 1118.3 1139 1139

    761.4833 813.9 813.9

    1003.6 1003.6 1003.4 1003.4 10031072 1072

    0

    200

    400

    600

    800

    1000

    1200

    Price

    (Rs.)

    Month

  • 8/3/2019 CICI Bank is India

    6/14

    6

    Share Price History of ICICI Bank Ltd.

    Date High Low Open Close 15 DayMovingAverage

    50 DayMovingAverage

    RSI Stochastic

    14/11/2011 839.45 813.75 837.9 821.0 879.46 870.147 31.5591 13.952

    12/11/2011 857.0 816.7 856.25 821.0 883.16 870.404 39.036 18.153311/11/2011 889.35 857.3 886.75 862.15 888.35 870.828 42.1682 23.5887

    09/11/2011 887.0 870.65 884.5 881.3 890.233 870.628 47.9651 33.9035

    08/11/2011 892.0 879.25 889.6 884.3 890.137 870.022 50.9626 43.7893

    04/11/2011 891.6 869.05 880.0 878.05 888.497 868.979 53.7441 54.4342

    03/11/2011 903.95 859.2 885.7 885.0 885.46 868.694 59.8945 69.5032

    02/11/2011 923.5 892.5 917.95 895.0 882.637 869.19 59.8606 74.713

    31/10/2011 953.65 921.55 935.0 931.15 877.933 870.002 71.5556 81.1011

    28/10/2011 935.0 911.5 911.65 933.35 867.807 870.178 76.5232 83.390725/10/2011 891.9 852.65 879.0 878.4 858.98 870.362 65.0535 79.818

    24/10/2011 897.5 861.05 884.8 868.45 856.36 872.068 55.141 81.0087

    21/10/2011 883.3 866.55 880.0 870.55 856.823 873.502 49.2414 84.1641

    20/10/2011 886.95 870.15 885.35 878.05 858.167 875.109 48.0684 87.3161

    19/10/2011 907.9 888.0 888.0 904.15 857.547 876.878 55.4748 93.425

    18/10/2011 888.05 866.05 888.0 876.5 856.34 878.658 48.4742 85.9325

    17/10/2011 903.1 887.1 895.0 898.85 855.11 881.167 56.403 83.6138

    14/10/2011 900.0 872.1 877.0 890.4 851.437 883.624 57.1891 74.08713/10/2011 888.8 866.0 875.5 879.85 849.567 886.723 52.6316 65.571

    12/10/2011 863.35 833.75 840.0 859.7 850.99 889.861 44.0917 53.3558

    11/10/2011 861.0 829.1 852.0 832.5 852.5 893.016 42.7301 36.3176

    10/10/2011 847.8 816.15 824.9 842.65 854.3 896.864 47.6304 29.3982

    07/10/2011 831.6 815.0 817.1 824.45 857.05 900.802 41.783 26.4047

  • 8/3/2019 CICI Bank is India

    7/14

    7

    Mathematical Indicators:

    Moving Averages: Moving Averages are mathematical indicators of the underlying the trend of

    the price movement of shares. Two types of MA are commonly used by analysts:

    A. Simple Moving Average: An average is the sum of share prices of a specific number of daysdivided by the number of days. In a simple moving average, a set of moving average are

    calculated for a specific number of days, each average being calculated by including a new

    price and excluding an old price.

    0

    100

    200

    300

    400

    500

    600

    700

    800

    900

    1000

    15 Day Moving Average

    50 Day Moving Average

    RSI

  • 8/3/2019 CICI Bank is India

    8/14

    8

    B. Exponential Moving Average (EMA):This type of moving average reacts faster to recent price changes than a simple moving

    average. The 12- and 26-day EMAs are the most popular short-term averages, and they are

    used to create indicators like the moving average convergence divergence (MACD) and the

    percentage price oscillator (PPO). In general, the 50- and 200-day EMAs are used as signals

    for long term trends.

  • 8/3/2019 CICI Bank is India

    9/14

    9

    C. Money flow Index (MFI):

  • 8/3/2019 CICI Bank is India

    10/14

    10

    D. Moving Average Convergence and Divergence (MACD):

    E. Rate of change (ROC)

  • 8/3/2019 CICI Bank is India

    11/14

    11

    Date High Low Opening Closing Volume ROC RSI

    18-Oct-11 887 867 886 879 344685 2.28 55.79

    19-Oct-11 908 886 886 904 328752 2.51 50.00

    20-Oct-11 887 870 886 878 458694 -2.55 56.24

    21-Oct-11 884 867 878 870 393886 0.78 50.00

    24-Oct-11 897 863 889 869 317040 2.92 50.00

    25-Oct-11 892 853 877 877 848398 2.43 50.00

    26-Oct-11 887 864 887 872 158314 -1.76 51.13

    28-Oct-11 935 907 909 933 581926 7.37 50.00

    31-Oct-11 953 921 933 931 881076 4.59 60.82

    01-Nov-11 924 892 920 895 798469 2.26 50.00

    02-Nov-11 904 875 886 887 587336 5.67 50.00

    03-Nov-11 892 869 880 878 680056 9.68 50.00

    04-Nov-11 892 880 890 835 596364 13.64 50.00

    08-Nov-11 888 871 880 881 429801 6.85 50.76

    09-Nov-11 889 858 886 863 656289 2.05 50.0011-

    Nov-11 859 817 853 823 1195515 -1.25 50.00

    14-Nov-11 840 815 839 821 608092 -4.52 50.00

    15-Nov-11 823 784 820 791 648979 -10.04 50.00

    16-Nov-11 802 774 788 789 714968 -11.38 50.00

    17-Nov-11 799 773 790 777 586071 -11.6 50.00

    Relative Strength Index (RSI):- A technical momentum indicator that compares themagnitude 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 = 100100 / (1 + RS*)

    *Where RS = Average of x days' up closes / Average of x days' down closes.

  • 8/3/2019 CICI Bank is India

    12/14

    12

    0

    200

    400

    600

    800

    1000

    1200

    18-Oct-11

    20-Oct-11

    22-Oct-11

    24-Oct-11

    26-Oct-11

    28-Oct-11

    30-Oct-11

    1-Nov-11

    3-Nov-11

    5-Nov-11

    7-Nov-11

    9-Nov-11

    11-Nov-11

    13-Nov-11

    15-Nov-11

    17-Nov-11

    High

    Low

    Closing

    0

    200

    400

    600

    800

    1000

    1200

    0

    200000

    400000

    600000

    800000

    1000000

    1200000

    1400000

    18-O

    ct-11

    20-O

    ct-11

    22-O

    ct-11

    24-O

    ct-11

    26-O

    ct-11

    28-O

    ct-11

    30-O

    ct-11

    1-N

    ov-11

    3-N

    ov-11

    5-N

    ov-11

    7-N

    ov-11

    9-N

    ov-11

    11-N

    ov-11

    13-N

    ov-11

    15-N

    ov-11

    17-N

    ov-11

    Volume

    High

    Low

    Closing

  • 8/3/2019 CICI Bank is India

    13/14

    13

    Interpretation:

    A After analyzing three month (October- November) stock market using various indicators(Moving average, exponential moving average, Rate of change, relative strength index, MACD)

    the ICICI Bank stock price has seen constant declines since October-11.

    B Share price and volume fluctuates due to the supply and demand of stock. When the demandof the stock more than its supply price moves up, other hand if the supply more than demand the

    price slashed.

    C. Share price also have to decline/increase on account of earning of the company when the firmearn more profit, investors prefer to invest such firm and if the firm have not earn much profit or

    threat of loss, the stock holder move to another, consequently supply and demand of stock take

    place, fluctuation in share price and volume.

  • 8/3/2019 CICI Bank is India

    14/14

    14

    ASSUMPTION:

    Stock Price has to change due to the supply and demand if more people want to buy

    a stock (demand) than sell it (supply) the share price moves up.

    Conversely if more people wanted to sell a stock than buy it there would be greater

    supply then demand and the price would fall.

    The most important factor that affects the value of a company is its earnings.

    Earnings are the profit a company makes, and in the long run no company can

    survive without them. It makes sense when you think about it.

    If a company never makes money, it isn't going to stay in business. Public

    companies are required to report their earnings four times a year (once each

    quarter). Wall Street watches with rabid attention at these times, which are referred

    to as earnings seasons. The reason behind this is that analysts base their future value

    of a company on their earnings projection.

    If a company's results surprise (are better than expected), the price jumps up. If a

    company's results disappoint (are worse than expected), then the price will fall.

    BIBLIOGRAPHY

    Web link;

    www.freestockchart.com

    www.moneycontrol.com

    www.investopedia.com

    Book;

    Security Analysis & Portfolio ManagementPunithavathy Pandian

    http://www.investopedia.com/terms/e/earnings.asphttp://www.investopedia.com/terms/w/wallstreet.asphttp://www.investopedia.com/terms/e/earningsseason.asphttp://www.freestockchart.com/http://www.freestockchart.com/http://www.moneycontrol.com/http://www.moneycontrol.com/http://www.investopedia.com/http://www.investopedia.com/http://www.investopedia.com/http://www.moneycontrol.com/http://www.freestockchart.com/http://www.investopedia.com/terms/e/earningsseason.asphttp://www.investopedia.com/terms/w/wallstreet.asphttp://www.investopedia.com/terms/e/earnings.asp