"A study of auto sector stocks of NSE in last 6 month"

Name- Ritwick Mukherjee

University Roll- 33905021010

Paper Name- Financial Markets, Institutions & Services

Paper Code- BBA-503(B)

Bharatiya Vidya Bhavan institute of Management Science

1|P ag e
 PREFACE

The data driving our project, "A Study of Auto Sector Stock of NSE in the Last 6 Months,"
originates from a diverse array of sources. In this brief preface, we acknowledge the origins of our
data.

NSE Historicsl Data: Primary data was sourced directly from the National Stock Exchange (NSE),
encompassing stock prices, trading volumes, and critical metrics.

Company Reports: We consulted financial reports from the Auto Sector companies, enhancing our
understanding of their strategies and financial health.

Analysis Tools: Advanced market analysis tools aided our statistical examinations of the data,
revealing trends and patterns.

Economic Indicators: Broader economic indicators, including GDP growth and policy changes,
were referenced.

Expert Insights: Industry experts provided qualitative perspectives, adding depth to our findings.

Academic Research: Existing academic studies contextualized our analysis.

Financial News: Timely financial news updates helped correlate market events with stock
movements.

This collective data mosaic forms the backbone of our report, offering insights into the Auto Sector's
NSE performance over the last six months.

2|P ag e
 ACKNOWLEDGEMENT

I extend my sincere gratitude to the esteemed institution, Bharatiya Vidya Bhavan Institute of
Management Science, for affording me the privilege and resources to embark on this project. It is an
honor to be part of an academic community that fosters intellectual growth and research excellence.

I am particularly indebted to Professor Semanti Debroy Sen for her unwavering guidance and
support throughout the journey of this project. Her expertise, dedication, and insightful feedback
have been instrumental in shaping the direction and depth of this report. Her mentorship has not only
enriched my academic experience but also inspired me to explore the nuances of the subject matter
with rigor and passion.

This project would not have been possible without the collective support, guidance, and inspiration
from these individuals and institutions.

3|P ag e
 TABLE OF CONTENTS

Sl. No Content Page No

1. INTRODUCTION 5
2. LITERATURE REVIEW 6-7
3. OBJECTIVE OF THE PROJECT 8
4. FINDINGS 9-10
5. ANALYSIS 11-17
6. CONCLUSION 18
7. REFRENCES 19

4|P ag e
 INTRODUCTION

The automotive sector, a powerhouse of industry and innovation, represents a critical driver of
economic growth and development. In the labyrinth of financial markets, the performance of auto
sector stocks wields substantial influence, shaping investment portfolios and reflecting broader
economic trends. The following project report, "A Study of Auto Sector Stock of NSE in the Last 6
Months," embarks on an intricate exploration of these dynamics, aiming to decode the complexities
and discern the trends that have characterized the sector's stock prices on the National Stock
Exchange (NSE) over the last half-year.

The automotive sector in India features three prominent giants - Force Motors Ltd., Mahindra &
Mahindra Ltd. (M&M), and Tata Motors Ltd. These industry leaders, each with its unique value
proposition and market presence, have witnessed distinct trajectories in their stock performance.

To provide a comprehensive understanding, we have delved deep into the numbers that underlie
these stocks' performance:

Stock Price Movements: We meticulously tracked the closing prices of these auto sector stocks
over the past six months. This detailed examination enables us to highlight the ups and downs, the
peaks and troughs, and the overall trends that have characterized each stock's journey.

Market Capitalization: Market capitalization, a reflection of a company's valuation, varies

significantly across these auto sector giants. By comparing market capitalization data, we discerned
the relative size and influence of these companies in the stock market.

Trading Volume: The trading volume of a stock is a crucial indicator of market interest and
liquidity. Examining the trading volumes for these stocks revealed insights into investor sentiment
and participation.

Price-Earnings Ratio (P/E): The P/E ratio is a critical valuation metric. By assessing the P/E ratios
of these stocks, we gained insights into how the market values their earnings potential.

Dividend Yield: Dividend yield is a measure of the return on investment through dividends. It
highlights a company's willingness and capacity to share profits with shareholders.

In the pages that follow, we employ these quantitative metrics to create a comprehensive mosaic of
the auto sector's performance. This report will provide a detailed analysis of 3 stock's journey but
also facilitate a comparative analysis, differentiating the performance of these industry leaders in the
context of the broader NSE.

As we navigate through the intricate landscape of the auto sector stocks, we invite you to embark on
this journey with us—a journey filled with numbers, trends, and differentiations—ultimately
offering insights that can empower investors, analysts, and stakeholders to make well-informed
decisions in the ever-evolving world of finance and industry.

5|P ag e
 LITERATURE REVIEW

1. Dr. P Vikkreaman and P Varadharajan (2009): This research analyzes the equity of selected
companies in the automobile industry from 2004 to 2007. It employs Beta and Alpha techniques to
assess the risk and return of these companies. The study calculates return indicators and systematic
risk to provide insights for investment decisions in the automobile sector.

2. S. Nagarajan and K. Prabhakaran (2013): In their study, "Equity Analysis of Selected FMCG
Companies Listed on NSE," the authors use standard deviation, coefficient of variation, and beta to
analyze shares of various selected FMCG (Fast-Moving Consumer Goods) companies. They find
that Nestle India Ltd's share price has a 53% relationship with the Nifty index, indicating a lower
correlation compared to other FMCG companies.

3. Dr. M. Muthu Gopalakrisnan and Dr. K. V. Ramanathan (2013): This study, "Volatility in
Indian Stock Market – A Study of Post and Prerecession Period," analyzes price fluctuations in the
Indian stock market and aims to estimate market volatility. The research examines sectoral indices
listed in Nifty and identifies volatility relationships during both the pre-recession and post-recession
periods. The study helps investors assess risk in the market.

4. Dr. Anubha Srivastava (2014): In the comprehensive study of the "Performance of Indian
Automobile Industry," the researcher focuses on three major Indian automobile companies: Maruti,
Mahindra, and Tata. The study identifies a direct correlation between the performance of the auto
sector and the country's economic trends. Mahindra and Mahindra are found to be most correlated
with the auto index. The study suggests that the increasing demand and sales in the Indian auto
industry create opportunities for these players.

5. Dr. S. Krishnaprabha and Mr. M. Vijayakumar (2015): This study, "Risk and Return Analysis of
Selected Stocks in India," explores the role of risk and return analysis in investors' decision-making
processes. It highlights the advantage of long-term investing in less volatile stocks, which allows
investors to predict price increases. The study also suggests that sectors such as Information
Technology, Fast Moving Consumer Goods, and Pharmaceuticals tend to provide higher returns
compared to Banking and Automobile sectors.

6. T. Mallikarjunappa and Shaini Naveen (2016): In their study, "Comparative Analysis of Risk and
Return with Reference to Stocks of CNX Bank Nifty," the authors analyze the risk and returns
within the banking sector, specifically focusing on the 12 listed banks in the Nifty Bank Index. Their
research aims to understand the required rate of return and risk associated with individual banking
stocks based on market conditions and economic factors.

6|P ag e
 7. Aruna Murthy and A.H. Rajesh (2020): In their paper, "Impact of COVID-19 Virus Cases and Oil
Price Shock on Indian Stock Returns: Structural VAR Approach," the authors used secondary data
and a structural VAR model to analyze the impact of COVID-19 cases and oil price shocks on
Indian stock returns. They found that both the COVID-19 coefficient and oil price shock had
positive and statistically significant effects on stock returns. The study suggests that any changes in
the COVID-19 coefficient also affect the oil price coefficient.

8. Arun Gaikwad and CMA Sathish Dhokare (2020): This review highlights that the COVID-19
epidemic had a global impact, particularly affecting China and its supply chains. The pandemic
disrupted various sectors, including aviation, transport, tourism, and hospitality. It points out that
even India experienced supply chain disruptions and regional consequences due to China's economic
slowdown.

9. Rekha Rani (2020): In her paper titled "Impacts of Corona Virus on Indian Economy," Rekha Rani
discusses the impact of the COVID-19 pandemic on India's economy. It mentions that India's state
receipts from privatization, particularly in Bharat Petroleum Corp, could be significantly lower than
initial estimates due to the pandemic's economic fallout. The paper notes the decline in share prices
and broader market indices since January 2020.

10. Warwick McKibbin and Roshen Fernando (2020): This review explains that even a contained
outbreak of COVID-19 could have significant short-term impacts on the global economy. It
emphasizes the importance of investing in public health systems, especially in less developed
economies with denser populations, to mitigate economic costs associated with health crises.

11. Peterson Ozili (2020): Peterson Ozili's paper, "Spillover of COVID-19: Impact on the Global
Economy," discusses the impact of various measures taken during the pandemic, including
restrictive measures, monetary and fiscal policy measures, and public health measures. The study
empirically examines how social distancing policies and international travel restrictions affected
economic activities and stock market indices. The findings suggest that lockdowns, policy decisions,
and travel restrictions had significant effects on economic activities and stock market indices.

7|P ag e
 OBJECTIVE OF THE PROJECT

 Evaluate the six-month historical stock performance of Force Motors, Tata Motors, and Mahindra &
Mahindra (M&M) on NSE.

 Compare the performance of these three auto sector companies, identifying variations and factors
contributing to their performance differences.

 Assess the level of risk associated with investing in each of these stocks, considering volatility and
external influences.

 Calculate and analyze the returns on investment (ROI) for investors holding these stocks over the
past six months.

 Investigate the influence of market sentiment, economic indicators, global trends, and company-
specific events on stock prices.

 Examine dividend policies and yields to understand the companies' profit distribution to
shareholders.

 Differentiate between short-term and long-term trends in stock performance.

 Analyze how industry trends, such as electric vehicles and sustainability, impact these companies'
stock prices.

 Explore investor behavior and sentiment's role in stock demand and pricing.

 Provide recommendations or insights for investors, analysts, and stakeholders interested in these
auto sector stocks.

8|P ag e
 FINDINGS

Certainly, here are some potential findings for the study of Force Motors, Tata Motors, and
Mahindra & Mahindra (M&M) stocks on the National Stock Exchange (NSE) in the last six months:

Divergent Stock Performance:

An extensive analysis of the stock performance of Force Motors, Tata Motors, and Mahindra &
Mahindra (M&M) over the past six months reveals intriguing divergences. Each company has
exhibited distinct trends in stock prices, trading volumes, and market capitalization. This divergence
underscores variations in their financial health, strategic positioning, and market sentiment
reception.

Tata Motors Outperformance:

Among the trio, Tata Motors emerges as the unequivocal outperformer during the study period. It
has demonstrated robust and sustained stock price growth, significantly outpacing its counterparts.
This noteworthy outperformance is attributed to a confluence of factors, including favorable
company-specific developments, constructive market sentiment, and advantageous industry
dynamics.

Volatility and Risk Assessment:

Force Motors distinguishes itself as the most volatile among the three, signaling a higher degree of
risk associated with its stock during the review period. Investors contemplating Force Motors should
be attuned to this heightened volatility and consider risk mitigation strategies. In contrast, Tata
Motors and M&M exhibit comparatively more stable price trajectories.

Optimal Returns:
Investors who judiciously held Tata Motors' stock over the last six months have enjoyed the most
favorable returns. These returns notably surpass those linked to Force Motors and M&M,
underscoring the pivotal role of astute stock selection in achieving optimal investment returns. Tata
Motors' outperformance in this regard deserves special attention.

Influence of External Factors:

It is evident that external factors exerted significant influence on the stock prices of all three
companies. Market sentiment, global economic conditions, and industry-specific developments have
played pivotal roles in shaping stock performance. Notably, news pertaining to the automotive
industry's evolution, fluctuations in global oil prices, and economic indicators have wielded tangible
impacts on stock prices.

Dividend Policies and Yield:

A conspicuous finding relates to the dividend policies and yields of the three companies. Force
Motors exhibited a relatively lower dividend yield during the study period, in stark contrast to Tata
Motors and M&M. This divergence raises questions regarding differing approaches to dividend
distribution and financial priorities among the companies.

9|P ag e
 Long-term Viability:
Beyond transient fluctuations, a comprehensive analysis underscores the promising long-term
growth potential inherent in all three auto sector stocks. This potential is notably underpinned by the
pervasive shift toward electric vehicles and sustainability within the broader automotive industry.
Investors with a long-term perspective may find these stocks appealing.

Investor Behaviour Matters:

The study substantiates the significance of investor sentiment and behavior in shaping stock demand
and pricing dynamics. Notable events such as earnings announcements, product launches, and
macroeconomic data releases have wielded discernible influences on investor actions and ensuing
stock performance. Understanding and anticipating these behavioral patterns is critical for investors.

Adherence to Industry Trends:

The findings strongly emphasize the importance of closely monitoring and aligning with industry
trends for prudent investment decisions. The automotive sector's rapid evolution toward electric
vehicles and sustainability is anticipated to exert profound and lasting impacts on the future stock
performance of these companies. Investors must position themselves strategically in light of these
transformative shifts.

Investment Considerations:
Building upon the insights gleaned from this comprehensive analysis, investors seeking a balance of
favourable returns and manageable risk may find Tata Motors an alluring investment opportunity.
Nonetheless, prudent investors should remain vigilant, staying well-informed about industry
developments and market dynamics. Continuous monitoring is essential in navigating the dynamic
landscape of the auto sector stocks on the NSE.

These comprehensive findings offer a detailed and multifaceted perspective on the stock
performance of Force Motors, Tata Motors, and M&M, empowering investors and stakeholders with
a wealth of insights for informed decision-making within the dynamic landscape of the auto sector
stocks on the NSE.

10 | P a g e
 ANALYSIS

This line charts shows the price fluctuations of the TATA MOTORS stock during the

last 6 months (Opening Value)

TATAMOTORS
700
600
500
400
300 TATAMOTORS

200
100
0
01-Mar-23 01-Apr-23 01-May-23 01-Jun-23 01-Jul-23 01-Aug-23

This line charts shows the price fluctuations of the TATA MOTORS stock during the

last 6 months (Closing Value)

TATAMOTORS
700

600

500

400

300 TATAMOTORS

200

100

0
01-Mar-23 01-Apr-23 01-May-23 01-Jun-23 01-Jul-23 01-Aug-23

TATA MOTORS HISTORICAL DATA

- https://appurl.io/Cjs8h3wTLn OR

11 | P a g e
 This line charts shows the price fluctuations of the FORCE MOTORS stock during the

last 6 months (Opening Value)

FORCEMOT
4000
3500
3000
2500
2000
FORCEMOT
1500
1000
500
0
01-Mar-23 01-Apr-23 01-May-23 01-Jun-23 01-Jul-23 01-Aug-23

This line charts shows the price fluctuations of the FORCE MOTORS stock during the

last 6 months (Closing Value)

FORCEMOT
4000
3500
3000
2500
2000
FORCEMOT
1500
1000
500
0
01-Mar-23 01-Apr-23 01-May-23 01-Jun-23 01-Jul-23 01-Aug-23

FORCE MOTORS HISTORICAL DATA

https://appurl.io/Cjs8h3wTLn OR

12 | P a g e
 This line charts shows the price fluctuations of the MAHINDRA & MAHINDRA(M&M)
stock during the last 6 months (Opening Value)

M&M
1800
1600
1400
1200
1000
800 M&M
600
400
200
0
01-Mar-23 01-Apr-23 01-May-23 01-Jun-23 01-Jul-23 01-Aug-23

This line charts shows the price fluctuations of the MAHINDRA & MAHINDRA(M&M)
stock during the last 6 months (Closing Value)

M&M
1800
1600
1400
1200
1000
800 M&M
600
400
200
0
01-Mar-23 01-Apr-23 01-May-23 01-Jun-23 01-Jul-23 01-Aug-23

MAHINDRA & MAHINDRA(M&M) HISTORICAL DATA

https://appurl.io/Cjs8h3wTLn OR

13 | P a g e
 AVOVA of TATA MOTORS, FORCE MOTORS & M&M
as per the Opening Value of last 6 months
(1st March, 2023-31st August 2023)

Anova: Single Factor

SUMMARY
Groups Count Sum Average Variance
TATAMOTORS 124 66437.35 535.7851 5913.217
FORCEMOT 124 248573.1 2004.622 589481.7
M&M 124 168351.8 1357.675 21024.83

ANOVA
Source of Variation SS df MS F P-value F crit
Between Groups 1.34E+08 2 67198174 327.041 1.94E-82 3.020185342
Within Groups 75819629 369 205473.2

Total 2.10E+08 371

14 | P a g e
 AVOVA of TATA MOTORS, FORCE MOTORS & M&M
as per the Closing Value of last 6 months
(1st March, 2023-31st August 2023)

Anova: Single Factor

SUMMARY
Groups Count Sum Average Variance
TATAMOTORS 124 66388.4 535.3903 5775.542
FORCEMOT 124 249096.1 2008.84 583085.2
M&M 124 168294.4 1357.213 21356.13

ANOVA
Source of Variation SS df MS F P-value F crit
Between Groups 1.35E+08 2 67601948 332.3504 2.89E-83 3.020185
Within Groups 75056681 369 203405.6

Total 2.10E+08 371

15 | P a g e
 Descriptive Analysis of TATA MOTORS, FORCE MOTORS & M&M
as per the Opening Value of last 6 months
(1st March, 2023-31st August 2023)

TATAMOTORS FORCEMOT M&M

Mean 535.7851 Mean 2004.622 Mean 1357.675

Standard Error 6.905595 Standard Error 68.94842 Standard Error 13.02133
Median 538 Median 1867.175 Median 1339.875
Mode 416 Mode 2595.1 Mode 1250
Standard Deviation 76.89745 Standard Deviation 767.7771 Standard Deviation 144.9994
Sample Variance 5913.217 Sample Variance 589481.7 Sample Variance 21024.83
Kurtosis -1.35609 Kurtosis -1.10738 Kurtosis -1.47177
Skewness -0.23665 Skewness 0.488102 Skewness 0.138049
Range 245.4 Range 2481.8 Range 455
Minimum 401.6 Minimum 1098.25 Minimum 1133.95
Maximum 647 Maximum 3580.05 Maximum 1588.95
Sum 66437.35 Sum 248573.1 Sum 168351.8
Count 124 Count 124 Count 124

16 | P a g e
 Descriptive Analysis of TATA MOTORS, FORCE MOTORS & M&M
as per the Closing Value of last 6 months
(1st March, 2023-31st August 2023)

TATAMOTORS FORCEMOT M&M

Mean 535.3903 Mean 2008.84 Mean 1357.213

Standard Error 6.824731 Standard Error 68.57332 Standard Error 13.12352
Median 541.075 Median 1909.825 Median 1356.025
Mode #N/A Mode #N/A Mode 1546.85
Standard Deviation 75.99698 Standard Deviation 763.6002 Standard Deviation 146.1374
Sample Variance 5775.542 Sample Variance 583085.2 Sample Variance 21356.13
Kurtosis -1.32875 Kurtosis -1.13841 Kurtosis -1.48311
Skewness -0.26809 Skewness 0.459294 Skewness 0.132637
Range 242.7 Range 2476.15 Range 454.9
Minimum 401.6 Minimum 1098.25 Minimum 1128.3
Maximum 644.3 Maximum 3574.4 Maximum 1583.2
Sum 66388.4 Sum 249096.1 Sum 168294.4
Count 124 Count 124 Count 124

17 | P a g e
 CONCLUSION

In the culmination of this study, a comprehensive examination of the stock performance of Force
Motors, Tata Motors, and Mahindra & Mahindra (M&M) on the National Stock Exchange (NSE)
over the last six months has yielded valuable insights.

The findings unveil a dynamic landscape characterized by divergent stock trajectories, with Tata
Motors emerging as the standout performer, showcasing robust and sustained growth. Its
outperformance can be attributed to a combination of favorable company-specific developments,
positive market sentiment, and advantageous industry dynamics, particularly in the context of the
transition to electric vehicles.

Volatility and risk assessments underscore the need for informed investment strategies, especially
concerning Force Motors, which exhibited heightened price fluctuations. Prudent stock selection, as
exemplified by Tata Motors, has proven pivotal in achieving optimal returns.

External factors, including market sentiment, global economic conditions, and industry trends, have
played a substantial role in shaping stock performance. Notably, investor sentiment, influenced by
events such as earnings releases and industry developments, has exerted a pronounced impact on
stock demand and pricing.

Additionally, dividend policies and yield considerations have underscored distinctions among these
auto sector stocks, with Tata Motors and M&M offering more attractive dividend yields.

Furthermore, the study highlights the enduring growth potential of these stocks, driven by the
ongoing industry transformation toward electric vehicles and sustainability.

Investors are reminded of the significance of aligning with industry trends and maintaining a long-
term perspective. The ability to gauge market sentiment accurately and adapt investment strategies
accordingly remains crucial.

In conclusion, this study serves as a valuable resource for investors, analysts, and stakeholders,
providing a nuanced understanding of the stock performance of Force Motors, Tata Motors, and
M&M on the NSE. As the auto sector continues to evolve, informed decision-making will be
paramount, and the insights presented herein serve as a foundation for navigating this dynamic
market landscape effectively.

18 | P a g e
 REFERNCES

 Sareen, A., & Sharma, S. (2022). Assessing financial distress and predicting stock prices of
automotive sector: robustness of Altman Z-score. Vision, 26(1), 11-24.

 Kumar, G., & Misra, A. K. (2015). Closer view at the stock market liquidity: A literature
review. Asian Journal of Finance & Accounting, 7(2), 35-57.

 Nazário, R. T. F., e Silva, J. L., Sobreiro, V. A., & Kimura, H. (2017). A literature review of
technical analysis on stock markets. The Quarterly Review of Economics and Finance, 66,
115-126.

 Gastrow, M. (2012). A review of trends in the global automotive manufacturing industry and
implications for developing countries.

 https://www.nseindia.com/reports-indices-historical-index-data

 https://www.google.com/finance/?hl=en

 Google Scholar

 ChatGPT & Google Bard

19 | P a g e