A STUDY ON “ARBITRAGE TRADE ANALYSIS OF STOCK TRADI

Description
APT. An alternative asset pricing model to the Capital Asset Pricing Model. Unlike the Capital Asset Pricing Model, which specifies returns as a linear function of only systematic risk, Arbitrage Pricing Theory may specify returns as a linear function of more than a single factor

A STUDY ON
“ARBITRAGE TRADE ANALYSIS
OF STOCK TRADING IN NSE AND BSE”
Project submtte! " #$rt$% &u%&%%me"t o& t'e re(ureme"t &or t'e $)$r! o& t'e !e*ree o&
“+ASTER OF BUSINESS AD+INISTRATION”
DECLARATION

I, 'ere b- !ec%$re t'$t t'e #roject )or. tt%e! “ARBITRAGE TRADE ANALYSIS
OF STOCK TRADING IN NSE AND BSE” submtte! b- me " #$rt$% &u%&%%me"t
o& t'e $)$r! o& t'e !e*ree o& “+ASTER OF BUSINESS AD+INISTRATION” "
F"$"ce s m- or*"$% )or. $"! t )$s "ot submtte! to $"- u"/erst- or "sttuto"
Or #ub%s'e! $"- tme be&ore0
P%$ce1
D$te1
2333334
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2

ACKNOELEDGE+ENT
It is indeed a pleasant task to thank all the people who have contributed towards
the successful completion of this project.
I express my sincere gratitude to 33333, for his able supervision during the
course of the project.
I thank to 3333, faculty and internal guide, Department of usiness
!anagement, 33333 for his kind cooperation and who as my guide helped me in
completing my project work.
PLACE1
DATE1
233334

"
TABLES OF CONTENT
50 INTRODUCTION
505 OB6ECTI7E OF T8E STUDY
90 CO+PANY PROFILE
95 BSE
909 NSE
:0 +ET8ODOLOGY
;0 DATA ANALYSIS
;05 RETURN, 7ARIANCE, STANDARD DE7IATION
OF BSE SENSE3
;09 RETURN, 7ARIANCE, STANDARD DE7IATION
OF NSE
;0: CORRELATION OF RETURNS BET<EEN BSE
= NSE
>0 CONCLUSION
?0 BIBLIOGRAP8Y
#
INTRODUCTION
Arbtr$*e Prc"* T'eor-
De&"to"
$%&. $n alternative asset pricing model to the 'apital $sset %ricing !odel. (nlike the
'apital $sset %ricing !odel, which specifies returns as a linear function of only
systematic risk, $rbitrage %ricing &heory may specify returns as a linear function of more
than a single factor.
Fu"!$me"t$% A"$%-ss
&his investment strategy involves evaluating a stock by examining the company,
especially its operations and its financial condition. )ere we look at several valuation
methods, factoring in price*earnings ratio, %+,, dividend yields, book value, price*sales
ratio, and return on e-uity.
Stoc. Str$te*es
.earn about various strategies for investing in stocks, including the /buy and hold
approach,0 analy1ing market timing, and estimating a company2s potential for growth.
Stoc.s $"! Your Port&o%o
I like this company, but should I add it to my portfolio3 &his article talks about
diversification and balancing risk with your stock selections.
&he $rbitrage %ricing &heory 4$%&5 was developed primarily by 6oss 41789a, 1789b5.
It is a oneeriod model in which every investor believes that the stochastic properties of
returns of capital assets are consistent with a factor structure. 6oss argues that if
e-uilibrium prices offer no arbitrage opportunities over static portfolios of the assets, then
the expected returns on the assets are approximately linearly related to the factor
loadings. 4&he factor loadings, or betas, are proportional to the returns2 co variances with
the factors.5 &he result is stated in ;ection 1. 6oss2 41789a5 heuristic argument for the
theory is based on the preclusion of arbitrage. &his intuition is sketched out in ;ection 2.
<
6oss2 formal proof shows that the .inear pricing relation is a necessary condition for
e-uilibrium in a market where agents maximi1e certain types of utility. &he subse-uent
work, which is surveyed below, derives either from the assumption of the preclusion of
arbitrage or the e-uilibrium futility:maximi1ation. $ linear relation between the expected
returns and the betas is tantamount to an identification of the stochastic discount factor
4;D=5. ;ections " and #, respectively, review this literature.
&he $%& is a substitute for the 'apital $sset %ricing !odel 4'$%!5 in that both
assert a linear relation between assets2 expected returns and their covariance with other
random variables. 4In the '$%!, the covariance is with the market portfolio2s return.5
&he covariance is interpreted as a measure of risk that investors cannot avoid by
diversification. &he slope coefficient in the linear relation between the expected returns
and the covariance is interpreted as a risk premium. ;uch a relation is closely tied to
mean:variance efficiency, which is reviewed in ;ection <. ;ection < also points out that
an empirical test of the $%& entails a procedure to identify at least some features of the
underlying factor structure. !erely stating that some collection of portfolios 4or even a
single portfolio5 is mean:variance efficient relative to the mean:variance frontier spanned
by the existing assets does not constitute a test of the $%&, because one can always find a
mean:variance efficient portfolio.
'onse-uently, as a test of the $%& it is not sufficient to merely show that a setoff factor
portfolio satisfies the linear relation between the expected return and its covariance with
the factors portfolios.
$ sketch of the empirical approaches to the $%& is offered in ;ection 9, while ;ection 8
describes various procedures to identify the underlying factors. &he large number of
factors proposed in the literature and the variety of statistical or ad hoc procedures to find
them indicates that a definitive insight on the topic is still missing.
=inally, ;ection > surveys the applications of the $%&, the most prominent being the
evaluation of the performance of money managers who actively change their portfolios. 1
(nfortunately, the $%& does not necessarily preclude arbitrage opportunities over
dynamic portfolios of the existing assets. &herefore, the applications of the $%& in the
evaluation of managed portfolios contradict at least the spirit of the $%&, which obtains
price restrictions by assuming the absence of arbitrage.
9
$rbitrage is an often:used term in share markets. &he arbitrager is an
important intermediary that helps in price discovery mechanism in all markets be it
e-uity, moneyforex or derivatives. &here are three important participants that are
important in a cash market, the speculator, arbitrager and an investor. In futures market
the investor is replaced by a hedger. $rbitrager and ;peculator are often confused and
both are termed as ;peculators. In this article I wish to explain the difference between the
two and show how arbitrage works in the market and its influence on market volatility.
$rbitraging in India has been going on for several years. Initially arbitrage activity
was between ;tock +xchange !umbai and all other regional exchanges. !r. abulal
agri the founder of . ;ecurities and !r. !anubhai!aneklal were legendary
arbitragers of that era. &hey traded between !umbai, Delhi and 'alcutta markets.
$rbitraging in those days was done manually and not on any online system. &he way the
fingers of these brokers flew on telex machines giving trade instructions was an
experience by itself. &hen it shifted to cashing on price difference between ?;+ and ;+
limited. &oday large amount of arbitrage happens between cash and derivative markets.
$rbitrage is also possible between the current month and near or far month contracts. In
case of 'ommodity exchanges also there is an arbitrage opportunity between the local
cash markets or mandis and the future markets which are popularly known as ?ational
'ommodity +xchanges.
;peculator is one who gives li-uidity to the markets. &he buyers and sellers may
not often decide at the same time to buy or sell a security. &here is a time gap as well as a
difference in price and -uantity at which the buyer and seller intend to do a transaction.
&he speculator fills this time gap and gives -uotes to buyers as well as sellers on a
continuous basis. &his imparts li-uidity to the market since each order has a counter offer
from a speculator even if there is no counter party to match the order.
&he arbitrager is one who plays the role of balancing the price differences across the
markets. &he markets may be two exchanges trading in the same product or two segments
such as cash and derivatives or across international markets and local markets. &he
arbitrager continuously tracks prices across the chosen segment. are momentary price
differences in two markets due to difference in level of information as well as demand
supply situation in the market. &hese price differences are an
8
@pportunity for the arbitrager.
&he arbitrager has money power at his disposal. )e takes deliveries in a
particular market segment and is able to give deliveries in another market segment. &here
is a time gap between giving and taking deliveries. )e holds the stock for this time and
earns an interest on the funds invested which comes by way of price differential between
buy and sell rates. &he arbitrager has a particular interest return as his target. )e does not
have any open positions and all his purchases or sells in a particular market segment have
a counter position in another market segment. $t the net level his position is always 1ero.
&his is how the arbitrager earns a risk free return.
&he arbitrager does not always wait for the expiry of the contract or the settlement of the
transaction. &hey may reverse the position before the actual settlement date even if they
have to compromise on some percentage of the price difference earned by them. .esser
return is acceptable if it is earned with smaller or no investment. $ll decisions are taken
with reference to a benchmark:targeted return.
&o give example of an arbitrage transaction, assume that the arbitrager has 6s.1A
lacs available for doing arbitrage activity. )is targeted return is say 1>B p.a. which works
to about 1.<B p.m. Ce will take a simplistic transaction where he does just one trade to
earn the return. If some share is -uoting at 6s.1AAA in one cash market he will look for
opportunity to buy at 6s.1AAA*: and sell at 6s.1A1<*: or more in another cash market
simultaneously. &hese markets must have different settlement dates otherwise in current
rolling settlement scenario it is not possible to give and receive delivery since both
happen on the same day.
?ow the same example can be extended to cash and derivative segment. ;hares
are purchased in cash marketD and sold in futures market. Delivery of the shares is
received in the rolling settlement. ;ince deliveries are not permitted in futures market a
reversal opportunity is looked for before the expiry of contract, otherwise the arbitrager
will be left with the delivery of shares. )ence if he gained say 6s.2< per share on the first
leg he will reverse the trades up to a loss of 6s.1A in order to achieve his benchmark
return of 6s.1<.&he returns are not often as fantastic but opportunities are many. Ce also
have to deduct from this the cost of brokerage, ;ecurities transaction tax, stock exchange
>
charges and stamp duty. )ence it becomes unviable for an investor unless the transaction
costs are very low. &he price difference is only for a few minutes or seconds hence it
must be captured instantly through a speedy trading system. It should not so happen that
one transaction is done and the other one does not go through i.e. if the arbitrager buys
and is unable to sell and the market falls then instead of making a profit he will end up
with a loss. $utomated trading programs are used in order to release both orders so that
both the prices are captured simultaneously.
$rbitrage activity thus adds to li-uidity in the markets and also helps in balancing
the prices of same shares across various markets. %rices continuously balance out once
the differences are cash upon. $rbitrage )elps in reducing volatility in markets since
continuous flow of orders reduces impact cost and more depth means less volatility.
$ small investor may not always be able to capture small differences in prices. &hey are
not constantly in front of the trading screen nor do they have sophisticated trading
systems to execute the orders. &hey are often linked to Internet or a network connection
that is not direct feed into the stock exchange system i.e. @.& or ?+$&. ;treaming
-uotes on online trading is closest that is available for such trading. est strategy is to
look for difference in shares prices of stocks that you already have, hence delivery is not
a problem. @therwise it is a volume game, small returns over thousands of transactions is
the name of the game. It is advisable to study the opportunities. Eou may not act on all of
them, but it prepares you to invest your money wisely when you are a illionaireF.
+utu$% Fu"! Fe$ture
&here have been many successful arbitrage schemes launched in the Indian !utual =und
Industry, but G! =inancial !utual =und is the pioneer in this segment. It launched its first
arbitrage scheme : G! +-uity H Derivative =und : and introduced the concept across the
country in 2AA<. $fter an overwhelming response to this scheme, where the 'ompany
collected around 6s >2" crores, it has now come up with a new fund offering called
Arbtr$*e A!/$"t$*e Fu"!0
&he objective of this ;cheme is to generate income through arbitrage
opportunities emerging out of misricing between the cash and the derivatives markets
and through deployment of surplus cash in fixed:income instruments. $rbitrage
$dvantage =und is an extended version of the G! +-uity H Derivatives =und, which
7
$ccording to the new guidelines by ;+I can hedge the entire position of its e-uity
stock, opposed to earlier when a mutual fund scheme could buy*sell futures for only up to
<AB of the corpus. &herefore in this new scheme, there is a mandate to deploy up to >AB
of the corpus into e-uity shares and hedge e-uivalent futures by allocating the balance
2AB towards margins. &his will enhance the returns of an arbitrage scheme
phenomenally, just as the 'ompany delivered 8B per annum returns in the pastD and with
the new ;cheme, the returns to investors would be higher, at >.<:7B a year.
;cheme =eature Asset A%%oc$to"
Instruments 6isk %rofile !in:!ax
+-uity H +-uity:linked instruments !ediumigh 9<:>AB
Derivatives, including stock futures and stock optionsI !ediumigh 9<:>AB
Debt ;ecurities, !oney !arket Instruments !ediumigh 2A:"<B
G! $rbitrage $dvantage =und
1#th Gune 2AA9 $ market:neutral strategy
Arbtr$*e Str$te*es
$rbitrage is a strategy involving a simultaneous purchase and sale of identical
or e-uivalent instruments across two or more markets in order to benefit from a
discrepancy in their price relationship. It is a risk:free transaction, as the long and short
legs of the transaction offset each other exactly. &hus, arbitrage engages in a strategy in
order to reduce risk of loss caused by price fluctuations of securities held in the portfolio.
It involves buying and selling of e-ual -uantities of a security in two different markets,
with the expectations that a future change in price will offset by an opposite change in the
other.
Daily turnover in the derivatives segment is around ".< times the cash market
volumes and is to the tune of 6s "A,AAA crores. $rbitrage activity is largely concentrated
in single stock futures, while index arbitrage is not very popular, although it contributes
about 2<:"AB of the total stock futures volumes. In India, stock borrowing in the cash
market is cumbersome, making the /;ell ;tock buy =utures0 strategy difficultD hence,
almost the entire arbitrage activity is concentrated in /uy ;tock:;ell =utures0.#
A!/$"t$*es o& Arbtr$*e Str$te*-
1A
• J 'apitalises opportunities of misricing 4cost of carry5 between cash and
derivatives.
• J It is safe, as it does not carry e-uity market risk, as all e-uity positions are
completely hedged.
• J %otential returns are higher than comparable investment avenues with similar
risks.
• enefits of investing in an $rbitrage =und
• J ;ince the arbitrage fund is categori1ed as e-uity fund, there will be no tax on
.ong:&erm capital gainsD
• Dividends are also tax:free.
• J %otential returns are higher than those in comparable investment avenues with
similar risks like bank
• =ixed:deposits or li-uid schemes.
• J It does not carry risk e-uivalent to the e-uity market risk, as all e-uity positions
are hedged.
Co"c%uso"
&he $rbitrage =und, in such uncertain times, can prove to be one of the good choices by
investors, other than putting the money in fixed deposits. &he =und )ouse is claiming a
return of around 7:7.7B, which is much better than that of many other savings
instruments. )owever, finding an arbitrage opportunity in a bear phase is very
T'e Fu"!$me"t$% T'eorem o& Arbtr$*e Prc"*
1. Introduction
11
&he lack:;chools theory, which is the main subject of this course and its se-uel, is
based on the +fficient !arket )ypothesis that arbitrages 4the term will be defined
shortly5 do not exist in efficient markets. $lthough this is never completely true in
practice, it is a useful basis for pricing theory, and we shall limit our attention 4at least for
now5 to efficient 4that is, arbitrage:free5 markets. Ce shall see that absence of arbitrage
sometimes leads to uni-ue determination of prices of various derivative securities, and
gives clues about how these derivative securities may be hedged. In particular, we shall
see that, in the absence of arbitrage, the market imposes a probability distribution, called
a risk:neutral or e-uilibrium measure, on the set of possible market scenarios, and that
this probability measure determines market prices via discounted expectation. &his is the
=undamental &heorem of arbitrage pricing. efore we state the =undamental &heorem
formally, or consider its ramifications, we shall consider several simple examples of
derivative pricing in which the +fficient !arket )ypothesis allows one to directly
determine the market price.
E@$m#%e1 For)$r! Co"tr$cts
In the simplest forward contract, there is a single underlying asset ;tock, whose
share price 4in units of 'ash5 at time t K A is known but at time t K 1 is subject to
uncertainty.
It is also assumed that there is a riskless asset !oney!arket, that is, an asset whose
;hare price at t K 1 is not subject to uncertaintyD the share price of !oney!arket at t K A
is 1 and at t K 1 is regardless of the market scenario. &he constant r is called the risk less
rate of return. &he forward contract calls for one of the agents to pay the other an amount
= 4the forward price5 in 'ash at time t K 1 in exchange for one share of ;tock. &he
forward price = is written into the contract at time t K A. ?o money or assets change
hands at time t K A.
%roposition 1. In an arbitrage:free market, the forward price is = K ;Aer.Informally, an
arbitrage is a way to make a guaranteed profit from nothing, by short:selling certain
assets at time t K A, using the proceeds to buy other assets, and then settling accounts at
time t K 1. Chen an investor sells an asset short, he*she must borrow shares of the asset to
sell in return for a promise to return the shares at a pre:specified future time 4and, usually,
an interest charge5. In real markets there are constraints on short:selling imposed by
12
brokers and market regulators to assure that the shares borrowed for short sales can be
repaid. In the ideali1ed markets of the lack:;choles universe, such constraints do not
exist, nor are there interest payments on borrowed shares, nor are there transaction costs
4brokerage fees5. =urthermore, it is assumed that investors may buy or sell shares 4as
many as they like5 in any asset at the prevailing market price without affecting the share
price.
Fu"!$me"t$%s1 Au$"tt$t/e $"! Au$%t$t/e
Eou could define fundamental analysis as /researching the fundamentals0, but that
doesn2t tell you a whole lot unless you know what fundamentals are. $s we mentioned in
the introduction, the big problem with defining fundamentals is that it can include
anything related to the economic well:being of a company. @bvious items include things
like revenue and profit, but fundamentals also include everything from a company2s
market share to the -uality of its management.
&he various fundamental factors can be grouped into two categoriesL -uantitative
and -ualitative. &he financial meaning of these terms isn2t all that different from their
regular definitions. )ere is how the !;? +ncarta dictionary defines the termsL
Muantitative N capable of being measured or expressed in numerical terms.
Mualitative N related to or based on the -uality or character of something, often as
opposed to its si1e or -uantity.
In our context, -uantitative fundamentals are numeric, measurable characteristics
about a business. It2s easy to see how the biggest source of -uantitative data is the
financial statements. Eou can measure revenue, profit, assets and more with great
precision. &urning to -ualitative fundamentals, these are the less tangible factors
surrounding a business : things such as the -uality of a company2s board members and
key executives, its brand:name recognition, patents or proprietary technology.
Au$"tt$t/e +eets Au$%t$t/e
?either -ualitative nor -uantitative analysis is inherently better than the other.
Instead, many analysts consider -ualitative factors in conjunction with the hard,
1"
-uantitative factors. &ake the 'oca:'ola 'ompany, for example. Chen examining its
stock, an analyst might look at the stock2s annual dividend payout, earnings per share,
%*+ ratio and many other -uantitative factors. )owever, no analysis of 'oca:'ola would
be complete without taking into account its brand recognition. $nybody can start a
company that sells sugar and water, but few companies on earth are recogni1ed by
billions of people. It2s tough to put your finger on exactly what the 'oke brand is worth,
but you can be sure that it2s an essential ingredient contributing to the company2s ongoing
success.
T'e Co"ce#t o& I"tr"sc 7$%ue
efore we get any further, we have to address the subject of intrinsic value. @ne of
the primary assumptions of fundamental analysis is that the price on the stock market
does not fully reflect a stock2s /real0 value. $fter all, why would you be doing price
analysis if the stock market were always correct3 In financial jargon, this true value is
known as the intrinsic value.
=or example, let2s say that a company2s stock was trading at O2A. $fter doing
extensive homework on the company, you determine that it really is worth O2<. In other
words, you determine the intrinsic value of the firm to be O2<. &his is clearly relevant
because an investor wants to buy stocks that are trading at prices significantly below their
estimated intrinsic value.
&his leads us to one of the second major assumptions of fundamental analysisL in
the long run, the stock market will reflect the fundamentals. &here is no point in buying a
stock based on intrinsic value if the price never reflected that value. ?obody knows how
long /the long run0 really is. It could be days or years.
&his is what fundamental analysis is all about. y focusing on a particular business,
an investor can estimate the intrinsic value of a firm and thus find opportunities where he
or she can buy at a discount. If all goes well, the investment will pay off over time as the
market catches up to the fundamentals.
&he big unknowns areL
• Eou don2t know if your estimate of intrinsic value is correctD and
• Eou don2t know how long it will take for the intrinsic value to be reflected in the
marketplace.
1#
Crtcsms o& Fu"!$me"t$% A"$%-ss
&he biggest criticisms of fundamental analysis come primarily from two groupsL
proponents of technical analysis and believers of the /efficient market hypothesis0.
&echnical analysis is the other major form of security analysis. Ce2re not going to get
into too much detail on the subject. 4!ore information is available in our Introduction to
&echnical $nalysis tutorial.5
%ut simply, technical analysts base their investments 4or, more precisely,
their trades5 solely on the price and volume movements of securities. (sing charts and a
number of other tools, they trade on momentum, not caring about the fundamentals.
Chile it is possible to use both techni-ues in combination, one of the basic tenets of
technical analysis is that the market discounts everything. $ccordingly, all news about a
company already is priced into a stock, and therefore a stock2s price movements give
more insight than the underlying fundamental factors of the business itself.
=ollowers of the efficient market hypothesis, however, are usually in
disagreement with both fundamental and technical analysts. &he efficient market
hypothesis contends that it is essentially impossible to produce market:beating returns in
the long run, through either fundamental or technical analysis. &he rationale for this
argument is that, since the market efficiently prices all stocks on an ongoing basis, any
opportunities for excess returns derived from fundamental 4or technical5 analysis would
be almost immediately whittled away by the market2s many participants, making it
impossible for anyone to meaningfully outperform the market over the long term.

FUNDA+ENTAL ANALYSISL
Au$%t$t/e F$ctors B T'e Com#$"-
efore diving into a companyPs financial statements, wePre going to take a look at some of
the -ualitative aspects of a company.
=undamental analysis seeks to determine the intrinsic value of a companyPs stock.
ut since -ualitative factors, by definition, represent aspects of a companyPs business that
are difficult or impossible to -uantify, incorporating that kind of information into a
1<
pricing evaluation can be -uite difficult. @n the flip side, as wePve demonstrated, you
canPt ignore the less tangible characteristics of a company.
In this section we are going to highlight some of the company:specific
-ualitative factors that you should be aware of.
Bus"ess +o!e%
+ven before an investor looks at a companyPs financial statements or does any
research, one of the most important -uestions that should be asked isL Chat exactly does
the company do3 &his is referred to as a companyPs business model N itPs how a company
makes money. Eou can get a good overview of a companyPs business model by checking
out its website or reading the first part of its 1A:Q filing 4?oteL CePll get into more detail
about the 1A:Q in the financial statements chapter. =or now, just bear with us5.
;ometimes business models are easy to understand. &ake !cDonalds, for instance,
which sells hamburgers, fries, soft drinks, salads and whatever other new special they are
promoting at the time. ItPs a simple model, easy enough for anybody to understand.
@ther times, youPd be surprised how complicated it can get. oston 'hicken Inc. is
a prime example of this. ack in the early P7As its stock was the darling of Call ;treet. $t
one point the companyPs '+@ bragged that they were the Rfirst new fast:food restaurant
to reach O1 billion in sales since 1797R. &he problem is, they didnPt make money by
selling chicken. 6ather, they made their money from royalty fees and high:interest loans
to franchisees. oston 'hicken was really nothing more than a big franchisor. @n top of
this, management was aggressive with how it recogni1ed its revenue. $s soon as it was
revealed that all the franchisees were losing money, the house of cards collapsed and the
company went bankrupt.
$t the very least, you should understand the business model of any company
you invest in. &he R@racle of @mahaR, Carren uffett, rarely invests in tech stocks
because most of the time he doesnPt understand them. &his is not to say the technology
sector is bad, but itPs not uffettPs area of expertiseD he doesnPt feel comfortable investing
in this area. ;imilarly, unless you understand a companyPs business model, you donPt
know what the drivers are for future growth, and you leave yourself vulnerable to being
blindsided like shareholders of oston 'hicken were.
Com#ett/e A!/$"t$*e
19
$nother business consideration for investors is competitive advantage. $ companyPs long:
term success is driven largely by its ability to maintain a competitive advantage : and
keep it. %owerful competitive advantages, such as 'oca 'olaPs brand name and
!icrosoftPs domination of the personal computer operating system, create a moat around
a business allowing it to keep competitors at bay and enjoy growth and profits. Chen a
company can achieve competitive advantage, its shareholders can be well rewarded for
decades.
)arvard usiness ;chool professor !ichael %orter, distinguishes between
strategic positioning and operational effectiveness. @perational effectiveness means a
company is better than rivals at similar activities while competitive advantage means a
company is performing better than rivals by doing different activities or performing
similar activities in different ways. Investors should know that few companies are able to
compete successfully for long if they are doing the same things as their competitors.
%rofessor %orter argues that, in general, sustainable competitive advantage gained byL
$ uni-ue competitive position 'lear tradeoffs and choices vis:S:vis competitor
$ctivities tailored to the companyPs strategy $ high degree of fit across activities 4it is the
activity system, not the parts that ensure sustainability5 $ high degree of operational
effectiveness
+$"$*eme"t
Gust as an army needs a general to lead it to victory, a company relies
upon management to steer it towards financial success. ;ome believe that management is
the most important aspect for investing in a company. It makes sense : even the best
business model is doomed if the leaders of the company fail to properly execute the plan.
;o how does an average investor go about evaluating the management of a company3
&his is one of the areas in which individuals are truly at a disadvantage compared to
professional investors. Eou canPt set up a meeting with management if you want to invest
a few thousand dollars. @n the other hand, if you are a fund manager interested in
investing millions of dollars, there is a good chance you can schedule a face:to:face
meeting with the upper brass of the firm.
+very public company has a corporate information section on its website. (sually
there will be a -uick biography on each executive with their employment history,
18
educational background and any applicable achievements. DonPt expect to find anything
useful here. .etPs be honestL CePre looking for dirt, and no company is going to put
negative information on its corporate website.
Instead, here are a few ways for you to get a feel for managementL
50 Co"&ere"ce C$%%s
&he 'hief +xecutive @fficer 4'+@5 and 'hief =inancial @fficer 4'=@5 host -uarterly
conference calls. 4;ometimes youPll get other executives as well.5 &he first portion of the
call is management basically reading off the financial results. Chat is really interesting is
the -uestion:and:answer portion of the call. &his is when the line is open for analysts to
call in and ask management direct -uestions. $nswers here can be revealing about the
company, but more importantly, listen for candor. Do they avoid -uestions, like
politicians, or do they provide forthright answers3
90 +$"$*eme"t Dscusso" $"! A"$%-ss 2+D=A4
&he !anagement Discussion and $nalysis is found at the beginning of the annual report
4discussed in more detail later in this tutorial5. In theory, the !DH$ is supposed to be
frank commentary on the managementPs outlook. ;ometimes the content is worthwhile,
other times its boilerplate. @ne tip is to compare what management said in past years with
what they are saying now. Is it the same material rehashed3 )ave strategies actually been
implemented3 If possible, sit down and read the last five years of !DH$sD it can be
illuminating.
:0 O)"ers'# $"! I"s!er S$%es
Gust about any large company will compensate executives with a combination of cash,
restricted stock and options. Chile there are problems with stock options 4;ee %utting
!anagement under the !icroscope5, it is a positive sign that members of management
are also shareholders. &he ideal situation is when the founder of the company is still in
charge. +xamples include ill ,ates 4in the P>As and P7As5, !ichael Dell and Carren
uffett. Chen you know that a majority of managementPs wealth is in the stock, you can
have confidence that they will do the right thing. $s well, itPs worth checking out if
management has been selling its stock. &his has to be filed with the ;ecurities and
+xchange 'ommission 4;+'5, so itPs publicly available information. &alk is cheap : think
1>
twice if you see management unloading all of its shares while saying something else in
the media.
;0 P$st Per&orm$"ce
$nother good way to get a feel for management capability is to check and see how
executives have done at other companies in the past. Eou can normally find biographies
of top executives on company web sites. Identify the companies they worked at in the
past and do a search on those companies and their performance.
Eear after year, key players in the =orex market make a killing by picking the right
currencies N now it2s your turn. $ccess industry gurus oris and Qathy2s exclusive =6++
report, &he =ive &hings &hat !ove the 'urrency !arket N $nd )ow to %rofit =rom
&hem, right nowT
Cor#or$te Go/er"$"ce
'orporate governance describes the policies in place within an organi1ation denoting the
relationships and responsibilities between management, directors and stakeholders. &hese
policies are defined and determined in the company charter and its bylaws, along with
corporate laws and regulations. &he purpose of corporate governance policies is to ensure
that proper checks and balances are in place, making it more difficult for anyone to
conduct unethical and illegal activities.
,ood corporate governance is a situation in which a company complies with all of its
governance policies and applicable government regulations 4such as the ;arbanesxley
$ct of 2AA25 in order to look out for the interests of the companyPs investors and other
stakeholders. $lthough, there are companies and organi1ations 4such as ;tandard H
%oorPs5 that attempt to -uantitatively assess companies on how well their corporate
governance policies serve stakeholders, most of these reports are -uite expensive for the
average investor to purchase.
=ortunately, corporate governance policies typically cover a few general areasL
structure of the board of directors, stakeholder rights and financial and information
transparency. Cith a little research and the right -uestions in mind, investors can get a
good idea about a companyPs corporate governance
Tec'"c$% A"$%-ss
17
De&"to"
$ method of evaluating securities by relying on the assumption that market data, such as
charts of price, volume, and open interest, can help predict future 4usually short:term5
market trends. (nlike fundamental analysis, the intrinsic value of the security is not
considered. &echnical analysts believe that they can accurately predict the future price of
a stock by looking at its historical prices and other trading variables. &echnical analysis
assumes that market psychology influences trading in a way that enables predicting when
a stock will rise or fall. =or that reason, many technical analysts are also market timers,
who believe that technical analysis can be applied just as easily to the market as a whole
as to an individual stock.
Re%$te! Terms
advance*decline line, head and shoulders, moving average, point:and:figure
chart, resistance, analysis, ascending bottoms, ascending tops, descending bottoms,
descending tops, breadthf:market theory, breakout, chartist, cup and handle, saucer,
flag, pennant, double bottom, double top, +lliott Cave &heory, high:low index,
momentum indicator, !$'D, on:balance volume, overbought, oversold,
overbought*oversold indicator, random walk theory, reading the tape, relative strength,
support, signal, technical analyst, technical indicator, test, trendline, vertical line charting,
$rms Index, double top breakout, triple bottom, ollinger bands
Tec'"c$% A"$%-ss
&echnical analysis is the study of a stock, or the market as a whole, strictly by using the
price and volume history of a stock. &echnical analysis uses little or no information
about the actual business behind the stock. &he common belief is that a stock price
represents all known information about a stock. &echnical analysis is an alternative to
fundamental analysis.
@ur service provides a very speciali1ed type of technical analysis, performing real:time
statistical analysis on all relevant market data. .ike many people we believe that changes
in the fundamentals will be visible through technical analysis.
A%ert T-#es
&he methods used to analy1e securities and make investment decisions fall into
two very broad categoriesL fundamental analysis and technical analysis. =undamental
2A
analysis involves analy1ing the characteristics of a company in order to estimate its value.
&echnical analysis takes a completely different approachD it doesnPt care one bit about the
RvalueR of a company or a commodity. &echnicians 4sometimes called chartists5 are only
interested in the price movements in the market.
Despite all the fancy and exotic tools it employs, technical analysis really just
studies supply and demand in a market in an attempt to determine what direction, or
trend, will continue in the future. In other words, technical analysis attempts to
understand the emotions in the market by studying the market itself, as opposed to its
components. If you understand the benefits and limitations of technical analysis, it can
give you a new set of tools or skills that will enable you to be a better trader or investor.
<'$t Is Tec'"c$% A"$%-ssC
&echnical analysis is a method of evaluating securities by analy1ing the statistics
generated by market activity, such as past prices and volume. &echnical analysts do not
attempt to measure a securityPs intrinsic value, but instead use charts and other tools to
identify patterns that can suggest future activity.
Gust as there are many investment styles on the fundamental side, there are also
many different types of technical traders. ;ome rely on chart patterns, others use
technical indicators and oscillators, and most use some combination of the two. In any
case, technical analystsP exclusive use of historical price and volume data is what
separates them from their fundamental counterparts. (nlike fundamental analysts,
technical analysts donPt care whether a stock is undervalued : the only thing that matters
is a securityPs past trading data and what information this data can provide about where
the security might move in the future.



21

OB6ECTI7ES OF T8E STUDY

? &he objective of the study is to analy1e the possibility of taking advantage of
arbitrage mechanism of the blue chip scrip2s of core sectors of Indian economy,
traded in ;+ and ?;+.
? &en blue chip scrip of five core sectors are studied for evaluation.
? &he share prices of these scrip2s are being taken for analysis for the period of two
months, @ctober 2AA8 and ?ovember 2AA8.
? 'losing prices of each share in the two exchanges are taken for analysis.
? &he difference in the prices is analy1ed for any scope of arbitration.
22


ORGANISATION PROFILE
2"


Bomb$- Stoc. E@c'$"*e 2BSE4
ombay ;tock +xchange .imited is the oldest stock exchange in $sia with a
rich heritage. %opularly known as R;+R, it was established as R&he ?ative
;hare ;tock rokers $ssociationR in 1>8<. It is the first stock exchange in the
country to obtain permanent recognition in 17<9 from the ,overnment of
India under the ;ecurities 'ontracts 46egulation5 $ct, 17<9.&he +xchangePs
pivotal and pre:eminent role in the development of the Indian capital market is
widely recogni1ed and its index, ;+?;+U, is tracked worldwide. +arlier an
$ssociation of %ersons 4$@%5, the +xchange is now a demutualised and
corporative entity incorporated under the provisions of the 'ompanies $ct,
17<9,

;+ 4'orporati1ation and Demutuali1ation5 ;cheme, 2AA< notified by the
;ecurities and +xchange oard of India 4;+I5.Cith demutuali1ation, the
trading rights and ownership rights have been de:linked effectively addressing
concerns regarding perceived and real conflicts of interest. &he +xchange is
professionally managed under the overall direction of the oard of Directors.
&he oard comprises eminent professionals, representatives of &rading
!embers and the !anaging Director of the +xchange. &he oard is inclusive
and is designed to benefit from the participation of market intermediaries.
In terms of organi1ation structure, the oard formulates larger policy
issues and exercises over:all control. &he committees constituted by the oard
are broad:based. &he day:to:day operations of the +xchange are managed by
the !anaging Director and a management team of professionals.
2#

8stor- o& t'e Bomb$- Stoc. E@c'$"*e1
&he ombay ;tock +xchange is known as the oldest
exchange in $sia. It traces its history to the 1><As, when stockbrokers
would gather under banyan trees in front of !umbaiPs &own )all. &he
location of these meetings changed many times, as the number of brokers
constantly increased. &he group eventually moved to Dalal ;treet in 1>8#
and in 1>8< became an official organi1ation known as P&he ?ative ;hare
H ;tock rokers $ssociationP. In 17<9, the ;+ became the first stock
exchange to be recogni1ed by the Indian ,overnment under the
;ecurities 'ontracts 6egulation $ct.
&he ombay ;tock +xchange developed the ;+ ;ensex in 17>9, giving
the ;+ a means to measure overall performance of the exchange. In
2AAA the ;+ used this index to open its derivatives market, trading
;ensex futures contracts. &he development of ;ensex options along with
e-uity derivatives followed in 2AA1 and 2AA2, expanding the ;+Ps
trading platform. )istorically an open:cry floor trading exchange, the
ombay ;tock +xchange switched to an electronic trading system in
177<. It took the exchange only fifty days to make this transition.

2<

NATIONAL STOCK E3C8ANGE OF INDIA LI+ITED
INTRODUCTION1
T'e Or*$"D$to"
&he ?ational ;tock +xchange of India .imited has genesis in the report of the )igh
%owered ;tudy ,roup on +stablishment of ?ew ;tock +xchanges, which recommended
promotion of a ?ational ;tock +xchange by financial institutions 4=Is5 to provide access
to investors from all across the country on an e-ual footing. ased on the
recommendations, ?;+ was promoted by leading =inancial Institutions at the behest of
the ,overnment of India and was incorporated in ?ovember 1772 as a taxaying
company unlike other stock exchanges in the country.
@n its recognition as a stock exchange under the ;ecurities 'ontracts 46egulation5 $ct,
17<9 in $pril 177", ?;+ commenced operations in the Cholesale Debt !arket 4CD!5
segment in Gune 177#. &he 'apital !arket 4+-uities5 segment commenced operations in
?ovember 177# and operations in Derivatives segment commenced in Gune 2AAA.
&he ?ational ;tock +xchange of India .td. is the largest stock exchange of the
country. ?;+ is setting the agenda for change in the securities markets in India. &he last <
years have seen us play a major role in bringing investors from "9" cities and towns
online, ensuring complete transparency, introducing financial guarantee of settlements,
ensuring scientifically designed and professionally managed indices and by nurturing
the demateriali1ation effort across the country.

29
Our Tec'"o%o*-
$cross the globe, developments in information, communication and network
technologies have created paradigm shifts in the securities market operations. &echnology
has enabled organi1ations to build new sources of competitive advantage, bring about
innovations in products and services, and to provide for new business opportunities.
;tock exchanges all over the world have reali1ed the potential of I& and have moved over
to electronic trading systems, which are cheaper, have wider reach and provide a better
mechanism for trade and post trade execution.
?;+ believes that technology will continue to provide the necessary impetus for
the organi1ation to retain its competitive edge and ensure timeliness and satisfaction in
customer service. In recognition of the fact that technology will continue to redefine the
shape of the securities industry, ?;+ stresses on innovation and sustained investment in
technology to remain ahead of competition. ?;+Ps I& set:up is the largest by any
company in India. It uses satellite communication technology to energies participation
from around "2A cities spread all over the country. In the recent past, capacity
enhancement measures were taken up in regard to the trading systems so as to effectively
meet the re-uirements of increased users and associated trading loads. Cith up gradation
of trading hardware, ?;+ can handle up to 9 million trades per day in 'apital !arket
segment. In order to capitali1e on in:house expertise in technology, ?;+ set up a separate
company, ?;+.I&, in @ctober 1777. &his is expected to provide a platform for taking up
new I& assignments both within and outside India
?;+.I& is a statef:the:art client server based application. $t the server end, all
trading information is stored in an in:memory database to achieve minimum response
time and maximum system availability for users. &he trading server software runs on a
fault tolerant ;&6$&(; main frame computer while the client software.
&he telecommunications network uses U.2< protocol and is the backbone of the
automated trading system. +ach trading member trades on the ?;+ with other members
through a %' located in the trading memberPs office, anywhere in India. &he trading
members on the various market segments such as '! * =H@ , CD! are linked to the
central computer at the ?;+ through dedicated 9#Qbps leased lines and V;$& terminals.
28
&he +xchange uses powerful 6I;' :based (?IU servers, procured from Digital and )%
for the back office processing. &he latest software platforms like @6$'.+ 8 6D!;,
,(%&$ : ;M.*@6$'.+ =@6!; #.< =ront : +nds, etc. have been used for the +xchange
applications. &he +xchange currently manages its data centre operations, system and
database administration, design and development of in:house systems and design and
implementation of telecommunicatiosolutions.
?;+ is one of the largest interactive V;$& based stock exchanges in the world.
&oday it supports more than "AAA V;$&s. &he ?;+: network is the largest private wide
area network in the country and the first extended ': and V;$& network in the world.
'urrently more than 7AAA users are trading on the real timenline ?;+ application.
&here are over 1< large computer systems which include non:stop fault:tolerant
computers and high end (?IU servers, operational under one roof to support the ?;+
applications. &his coupled with the nation wide V;$& network makes ?;+ the countryPs
largest Information &echnology user.
In an ongoing effort to improve ?;+Ps infrastructure, a corporate network has been
implemented, connecting all the offices at !umbai, Delhi, 'alcutta and 'hennai. &his
corporate network enables speedy interffice communications
C$reers )t' Us
&he ?ational ;tock +xchange of India .td. is the largest stock exchange of the
country. ?;+ is setting the agenda for change in the securities markets in India. &he last <
years have seen us play a major role in bringing investors from "9" cities and towns
online, ensuring complete transparency, introducing financial guarantee of settlements,
ensuring scientifically designed and professionally managed indices and by nurturing the
demateriali1ation effort across the country.
?;+ is a complete capital market prime mover. Its whollywned subsidiaries,
?ational ;ecurities 'learing 'orporation .td. 4?;''.5 provides clearing and settlement
of securities, India Index ;ervices and %roducts .td. 4II;.5 provides indices and index
services with a consulting and licensing agreement with ;tandard H %oorPs 4;H%5, and
2>
?;+.I& .td. forms the technology strength .
&oday, we are one of the largest exchanges in the world and still forging ahead. $t
?;+, we are constantly working towards creating a more transparent, vibrant H
innovative capital market. &his invariably implies that our need for competent people is
continuous. $s the leading stock exchange and fiscal entity in the country, we believe in
recruiting the finest of talent in the industry.
Ce are looking for talent to be developed into future leaders of our organi1ation by cross:
departmental exposure, continuous self:development opportunities and ongoing
reinforcement to develop H enhance customer orientation H leadership potential.
$waiting you is an excellent compensation package including medical benefits, super:
annotation benefits and a reward system designed to promote merit and professionalism.
Tr$!"*
?;+ introduced for the first time in India, fully automated screen based trading. It uses
a modern, fully computeri1ed trading system designed to offer investors across the length
and breadth of the country a safe and easy way to invest.
&he ?;+ trading system called P?ational +xchange for $utomated &radingP
4?+$&5 is a fully automated screen based trading system, which adopts the principle of
an order driven market.
Rs. +$"$*eme"t
$ sound risk management system is integral to an efficient clearing and settlement
system. ?;+ introduced for the first time in India, risk containment measures that were
common internationally but were absent from the Indian securities markets.
?;''. has put in place a comprehensive risk management system, which is constantly
upgraded to pre:empt market failures. &he 'learing 'orporation ensures that trading
member obligations are commensurate with their net worth.
6isk containment measures include capital ade-uacy re-uirements of members,
monitoring of member performance and track record, stringent margin re-uirements,
position limits based on capital, online monitoring of member positions and automatic
disablement from trading when limits are breached, etc.
27
+$r.et U#!$tes
II;. provides to speciali1ed clients facts and figures, reports and e-uity market updates
on regular intervals. &his is a paid service.
Lst"*
?;+ plays an important role in helping an Indian companies access e-uity capital, by
providing a li-uid and well:regulated market. ?;+ has about 1A19 companies listed
representing the length, breadth and diversity of the Indian economy which includes from
hi:tech to heavy industry, software, refinery, public sector units, infrastructure, and
financial services. .isting on ?;+ raises a company2s profile among investors in India
and abroad. &rade data is distributed worldwide through various news:vending agencies.
!ore importantly, each and every ?;+ listed company is re-uired to satisfy stringent
financial, public distribution and management re-uirements. )igh listing standards foster
investor confidence and also bring credibility into the markets.
"A
COMPANY PROFILE
ICICI
O/er/e)
I'I'I ank is IndiaPs second:largest bank with total assets of 6s. ",##9.<> billion 4(;O
87 billion5 at !arch "1, 2AA8 and profit after tax of 6s. "1.1A billion for fiscal 2AA8.
I'I'I ank is the most valuable bank in India in terms of market capitali1ation and is
ranked third amongst all the companies listed on the Indian stock exchanges in terms of
free float market capitali1ationW. &he ank has a network of about 7<A branches and
","AA $&!s in India and presence in 18 countries. I'I'I ank offers a wide range of
banking products and financial services to corporate and retail customers through a
variety of delivery channels and through its speciali1ed subsidiaries and affiliates in the
areas of investment banking, life and non:life insurance, venture capital and asset
management. &he ank currently has subsidiaries in the (nited Qingdom, 6ussia and
'anada, branches in ;ingapore, ahrain, )ong Qong, ;ri .anka and Dubai International
=inance 'entre and representative offices in the (nited ;tates, (nited $rab +mirates,
'hina, ;outh $frica, angladesh, &hailand, !alaysia and Indonesia. @ur (Q subsidiary
has established a branch in elgium.
I'I'I ankPs e-uity shares are listed in India on ombay ;tock +xchange and the
?ational ;tock +xchange of India .imited and its $merican Depositary 6eceipts 4$D6s5
are listed on the ?ew Eork ;tock +xchange 4?E;+5.
BOARD +E+BERS
• !r. ?. Vaghul, 'hairman
• !r. ;ridhar Iyengar
• !r. .akshmi ?. !ittal
"1
• !r. ?arendra !urkumbi
8DFC BANK
CO+PANY PROFILE
)D=' ank was incorporated in $ugust 177# in the name of P)D=' ank .imitedP, with
its registered office in !umbai, India. &he ank commenced operations as a ;cheduled
'ommercial ank in Ganuary 177<.
&he )ousing Development =inance 'orporation .imited 4)D='5 was amongst the
first to receive an Pin principleP approval from the 6eserve ank of India 46I5 to set up a
bank in the private sector, as part of the 6IPs liberali1ation of the Indian anking in
177# )D=' ank has a network of over <"1 branches spread over 22> cities across
India. $ll branches are linked on an online real:time basis. 'ustomers in over 12A
locations are serviced through
"2
T$t$ Co"su%t$"c- Ser/ces

Com#$"- Pro&%e1
T$t$ Co"su%t$"c- Ser/ces 2TCS4 is one of the leading information technology
companies in the world. Cith a workforce of over 8#,AAA professionals spread across
more than <A global delivery centers, it helps organi1ations stay ahead with new
technology. Its clients include seven of the top ten corporations in the =ortune <AA list of
the largest corporations in the (nited ;tates.
&'; products and services help companies in various sectors effectively meet their
business challenges. Cith technical expertise and employing a flexible approach to client
relationships, &'; offers its clientsL consulting, I& services, business process outsourcing,
infrastructure outsourcing, and engineering and industrial services.
;ince its inception, the company has invested in new technologies, processes, and people
in order to help its customers succeed. Cith inputs from its innovation labs and university
alliances, and drawing on the expertise of key partners, &'; keeps clients up:to:date with
new technology. &his has helped the company meet various benchmarks of excellence in
software development : it is the worldPs first organisation to achieve an enterprise:wide
!aturity .evel < on -uality improvement models, '!!IX and %:'!!X, using the
most rigorous assessment methodology, ;'$!%I;!.
&he company is listed on the ?ational ;tock +xchange and ombay ;tock +xchange in
India.
""
&'; is a leading provider of highly flexible financial management software that powers
mid:si1ed businesses.
+sso"1
@ur mission is to maximi1e the business success of our customers through the
installation, maintenance, and support of superior financial management software
solutions.
Object/es1
Ce have set a number of strategic and tactical objectives that reflect our mission, aim and
collective goalsL
Y&o establish the company as the best global organi1ation for large:scale deployment of
financial management software solutions on the 'ache platform.
Y&o establish a fully objectriented component based application, which will enable us to
deliver robust software -uicker and more efficiently than any competitor.
Y&o ensure that customers can operate their business software solutions on infrastructures
that matches their needs.
RANBA3Y
6anbaxy .aboratories .imited, head-uartered in India, is an integrated, research
based, international pharmaceutical company, producing a wide range of -uality,
affordable generic medicines, trusted by healthcare professionals and patients across
geographies. &he 'ompany is ranked amongst the top ten global generic companies and
has a presence in 2" of the top 2< pharma markets of the world. &he 'ompany with a
global footprint in #7 countries, world:class manufacturing facilities in 11 and a diverse
product portfolio, is rapidly moving towards global leadership, riding on its success in the
world2s emerging and developed markets.
FINANCIAL
6anbaxy was incorporated in 1791 and went public in 178". =or the year 2AA9, the
'ompanyPs ,lobal ;ales at (; O1""7 !n reflected a growth of 18B. &he +ID&$ at
"#
(;O2A8 reflected an expansion of 19B. %rofit after &ax at (;O 11# !n registered an
increase of 7<B over the previous year.
B8ARTI AIRTEL
harti $irtel is one of IndiaPs leading private sector providers of telecommunications
services based on an aggregate of <7,928,7"8 customers as on Ganuary "1, 2AA>,
consisting of <8,#18,92< ,;! mobile and 2,21A,"12 broadband H telephone customers.
&he businesses at harti $irtel have been structured into three individual strategic
business units 4;(2s5 : mobile services, telemedia services 4$&;5 H enterprise services.
&he mobile services group provides ,;! mobile services across India in 2" telecom
circles, while the $&; business group provides broadband H telephone services in 7#
cities. &he enterprise services group has two sub:units : carriers 4long distance services5
and services to corporate. $ll these services are provided under the $irtel brand.
'ompany shares are listed on &he ;tock +xchange, !umbai 4;+5 and &he ?ational
;tock +xchange of India .imited 4?;+5.
PARTNERS
&he company has a strategic alliance with ;ing&el. &he investment made by ;ing&el is
one of the largest investments made in the world outside ;ingapore, in the company.
&he company2s mobile network e-uipment partners include +ricsson and ?okia. In the
case of the broadband and telephone services and enterprise services 4carriers5,
e-uipment suppliers include ;iemens, ?ortel, 'orning, among others. &he 'ompany also
has an information technology alliance with I! for its group:wide information
technology re-uirements and with ?ortel for call center technology re-uirements. &he
call center operations for the mobile services have been outsourced to I! Daksh,
)induja &!&, and &eletech H !phasis.
NTPC
?&%' .imited is the largest thermal power generating company of India. $ public
sector company, it was incorporated in the year 178< to accelerate power development in
"<
the country as a wholly owned company of the ,overnment of India. $t present,
,overnment of India holds >7.<B of the total e-uity shares of the company and the
balance 1A.<B is held by =IIs, Domestic anks, %ublic and others. Cithin a span of "1
years, ?&%' has emerged as a truly national power company, with power generating
facilities in all the major regions of the country.
?&%'2s core business is engineering, construction and operation of power
generating plants. It also provides consultancy in the area of power plant constructions
and power generation to companies in India and abroad. $s on date the installed capacity
of ?&%' is 28,7A# !C through its 1< coal based 422,>7< !C5, 8 gas based 4",7<< !C5
and # Goint Venture %rojects 41,A<# !C5. ?&%' ac-uired <AB e-uity of the ;$I. %ower
;upply 'orporation .td. 4;%;'.5. &his GV company operates the captive power plants of
Durgapur 412A !C5, 6ourkela 412A !C5 and hilai 48# !C5. ?&%' also has 2>.""B
stake in 6atnagiri ,as H %ower %rivate .imited 46,%%.5 a joint venture company
between ?&%', ,$I., Indian =inancial Institutions and !aharashtra ;+ )olding 'o.
.td. &he present capacity of 6,%%. is 8#A !C.
?&%'2s share on "1 !ar 2AA8 in the total installed capacity of the country was 2A.1>B
and it contributed 2>.<AB of the total power generation of the country during 2AA9:A8.
?&%' has set new benchmarks for the power industry both in the area of power plant
construction and operations. It is providing power at the cheapest average tariff in the
country. Cith its experience and expertise in the power sector, ?&%' is extending
consultancy services to various organi1ations in the power business.
?&%' is committed to the environment, generating power at minimal environmental
cost and preserving the ecology in the vicinity of the plants. ?&%' has undertaken
massive afforestation in the vicinity of its plants. %lantations have increased forest area
and reduced barren land. &he massive afforestation by ?&%' in and around its
6amagundam %ower station 429AA !C5 has contributed reducing the temperature in the
areas by about "Zc. ?&%' has also taken proactive steps for ash utili1ation. In 1771, it set
up $sh (tili1ation Division to manage efficient use of the ash produced at its coal
stations. &his -uality of ash produced is ideal for use in cement, concrete, cellular
concrete, building material.
"9
$ R'entre for %ower +fficiency and +nvironment %rotection 4'+?%++%5R has been
established in ?&%' with the assistance of (nited ;tates $gency for International
Development. 4(;$ID5. 'enpeep is efficiency oriented, eco:friendly and eco:nurturing
initiative : a symbol of ?&%'Ps concern towards environmental protection and continued
commitment to sustainable power development in India.
$s a responsible corporate citi1en, ?&%' is making constant efforts to improve the
socio:economic status of the people affected by the projects. &hrough its 6ehabilitation
and 6esettlement programmers, the company endeavors to improve the overall socio:
economic status of %roject $ffected %ersons.
?&%' was among the first %ublic ;ector +nterprises to enter into a !emorandum
of (nderstanding 4!@(5 with the ,overnment in 17>8:>>. ?&%' has been %laced under
the P+xcellent categoryP 4the best category5 every year since the !@( system became
operative. 6ecogni1ing its excellent performance and vast potential, ,overnment of the
India has identified ?&%' as one of the jewels of %ublic ;ector [?irvanas2: a potential
global giant. Inspired by its glorious past and vibrant present, ?&%' is well on its way to
reali1e its vision of being /$ world class integrated power major, powering India2s
growth, with increasing global presence0
.
INSTALLED CAPACITY
$? @V+6VI+C
NTPC O<NED
'@$. 1< 22,>7<
,$;*.IM. =(+. A8 ",7<<
&@&$. 22 29,><A
O<NED BY 67Cs
'oal " "1#W
,as*.IM. =(+. 1 8#AWW
,6$?D &@&$. 29 28,7A#
"8

CO+PANY PROFILE
<#ro Lmte! 2<#ro4, incorporated in 17#<, is a global information technology
4I&5 services company. &he 'ompany provides a range of I& services, software solutions,
I& consulting, business process outsourcing 4%@5 services, and research and
development services in the areas of hardware and software design to companies
worldwide. Cipro operates in four business segmentsL I& ;ervices and %roducts, which is
referred to as Cipro &echnologies, provides I& services to international companiesD
usiness %rocess @utsourcing 4%@5 ;ervices, which is referred to as Cipro %@, is a
thirdarty offshore %@ provider in IndiaD India and $sia%ac I& ;ervices and %roducts,
which focuses primarily on meeting the I& products and services re-uirements of
companies in India, $sia:%acific and the !iddle +ast region, and 'onsumer 'are and
.ighting, which operates in niche markets in the areas of soaps, toiletries and lighting
products for the Indian market. (ntil Gune "A, 2AA<, I& ;ervices and %roducts and %@
;ervices were reported as ,lobal I& ;ervices and %roducts as an integrated business
segment. +ffective as of Guly 1, 2AA<, the 'ompany reorgani1ed the ,lobal I& ;ervices
and %roducts segment into two operating segmentsL I& ;ervices and %roducts, and %@
;ervices. In December 2AA<, Cipro ac-uired empower ;oftware ;ervice Inc. and its
subsidiaries. %ursuant to the terms of this ac-uisition, the 'ompany also ac-uired Impact
India, a joint venture between !aster'ard International and empowers ;oftware ;ervices
Inc. In December 2AA<, Cipro ac-uired V%+?&+ eteiligungsverwaltung ,mb) and
its subsidiaries 4?ew .ogic &echnologies $,5, a +uropean systemn:chip design
company. In $pril 2AA9, the 'ompany ac-uired c!ango Inc., a provider of business
">
service management 4;!5 solutions. In !ay 2AA9, Cipro ac-uired, subject to
completion of certain closing conditions, +nabler, a +urope:based retail solutions
provider. In !ay 2AA9, the 'onsumer 'are and .ighting segment ac-uired ?orth:Cest
;witches business from ?orth:Cest ;witchgear .td, an Indian company engaged in the
business of switches and sockets.
IT Ser/ces $"! Pro!ucts1
I& ;ervices and %roducts segment accounted for 97B of the 'ompanyPs revenue during
the fiscal year ended !arch "1, 2AA9 4fiscal 2AA95. Cipro provides its clients customi1ed
I& solutions in the areas of enterprise I& services, technology infrastructure support
services, and research and development services. &he 'ompany provides a range of
enterprise solutions primarily to =ortune 1AAA and ,lobal <AA companies.

ONGC
GLOBAL RANKING
Y @?,' ranks as the ?umero (no @il H ,as +xploration H %roduction 4+H%5
'ompany in $sia, as per %latts 2<A ,lobal +nergy 'ompanies .ist for the year 2AA8.
Y @?,' ranks 2"rd .eading ,lobal +nergy !ajor amongst the /&op 2<A +nergy !ajors
of the Corld in the %latt2s .ist0 based on outstanding performance in respect of $ssets,
6evenues, %rofits and 6eturn on Invested 'apital 46I@'5 for the year 2AA8.
Y @?,' is the only 'ompany from India in the =ortune !aga1ine2s list of the Corld2s
!ost $dmired 'ompanies 2AA8. @?,' is 7th position in the Industry of !ining, crude
oil production.
Y @?,' ranks 2"7th position in the prestigious =orbes ,lobal 2AAA and ?umero (no
ranking amongst Indian 'ompanies.
Y @?,' ranks "97th position in =ortune ,lobal <AA list for the year 2AA9 based on
6evenues.
Y @?,' retains ?umeral (no position from India in terms of %rofits with overall global
ranking of 121st.
"7
Y @?,' ranks 21st among the top <A publicly traded 'ompanies in @il H ,as Industry,
based on the year:end 42AA85 market 'apitali1ation by %=' +nergy.

Re#rese"ts I"!$Es E"er*- Securt-
@?,' has single:handedly scripted India2s hydrocarbon saga byL
Y +stablishing 9.#2 billion tonnes of Inlace hydrocarbon reserves with more than "AA
discoveries of oil and gasD in fact, 9 out of the 8 producing basins have been discovered
by @?,'L out of these Inlace hydrocarbons in domestic acreages, (ltimate 6eserves
are 2.27 illion !etric tonnes 4!&5 of @il %lus @il +-uivalent ,as 4@\@+,5.
Y 'umulatively producing 892." !illion !etric &onnes 4!!&5 of crude and ##A.8
illion 'ubic !eters 4'!5 of ?atural ,as, from 11< fields.
INDIAES +OST 7ALUABLE CO+PANY
Y /iggest Cealth 'reator $ward0 for the period 2AAA:2AA9 instituted by !*s !otilal
@swal ;ecurities .td., third time in a row.
Y 6anked as the most respected 'ompany in %;( 'ategory in the 2AA9 usiness Corld
;urvey, with 1"th position in the league of the most respected Indian 'orporate.
Y &ops the usiness India ;uper 1AA list 4among 2># Indian 'ompanies having ;ales in
excess of 6s. <AA 'rore5, based on ;ales, %rofit $fter &ax 4%$&5, ?et =ixed $ssets and
!arket 'apitali1ation 4Dec 2AA95
Y &opped the visibility metrics in Indian @il and ,as ;ector and the only %;( in the top
1A list of Indian 'orporate newsmakers.
Y !oody2s Investor ;ervices awarded the highest:ever 'redit 6ating for an Indian
'orporate N aa1 4indicative =oreign 'urrency debt rating5
Y '6I;I. and I'6$ also reaffirmed @?,' the highest credit rating of $$$ and .$$$
respectively.
FUNCTIONAL DIRECTORS
• !r. 6 ; ;harma 'hairman H !anaging Director
• Dr. $ Q alyan Director 4)65
• !r. $ Q )a1arika Director 4@nshore5
#A
• !r. ? Q !itra Director 4@ffshore5

D$&$ $?$.E;I;
+ET8ODOLOGY
Art'metc $/er$*e or me$"L
&he arithmetic average measures the central tendency. &he purpose of
computing an average value for a set of observations is to obtain a single value, which is
representative of all the items. &he main objective of averaging is to arrive at a single
value which is a representative of the characteristics of the entire mass of data and
arithmetic average or mean of a series 4usually denoted by x5 is the value obtained by
dividing the sum of the values of various items in a series 4sigma x5 divided by the
number of items 4?5 constituting the series.
&hus, if U1, U2FFFFF..Un are the given ? observations. &hen
UK U1\U2\FFF.Un
?
RETURN
'urrent pricerevious price W1AA
#1
%revious price
STANDARD DE7IATION1
&he concept of standard deviation was first suggested by Qarl %earson in 17>".it may be
defined as the positive s-uare root of the arithmetic mean of the s-uares of deviations of
the given observations from their arithmetic mean. In short ;.D may be defined as /6oot
!ean ;-uare Deviation from !ean0
It is by far the most important and widely used measure of studying dispersions.
=or a set of ? observations U1, U2FF..Un with mean U,
Deviations from !eanL 4U1:U5, 4U2:U5,F.4Un:U5
!ean:s-uare deviations from !eanL
K 1*? 4U1:U5 2\4U2:U5 2\FFF. \ 4Un:U5 2
K1*? sigma4U:U5 2
6oot:mean:s-uare deviation from meantime.
7ARIANCE1
&he s-uare of standard deviation is known as Variance.
Variance is the s-uare root of the standard deviationL
#2
Variance K 4;.D5 2
Chere, 4;.D5 is standard deviation
CORRELATION
'orrelation is a statistical techni-ue, which measures and analyses the degree or
extent to which two or more variables fluctuate with reference to one another. 'orrelation
thus denotes the inter:dependence amongst variables. &he degrees are expressed by a
coefficient, which ranges between N1 and \1. &he direction of change is indicated by 4\5
or 4:5 signs. &he former refers to a sympathetic movement in a same direction and the
later in the opposite direction.
Qarl %earson2s method of calculating coefficient 4r5 is based on covariance of the
concerned variables. It was devised by Qarl %earson a great ritish iometrician.
&his measure known as %earson an correlation coefficient between two variables
4series5 U and E usually denoted by [r2 is a numerical measure of linear relationship and
is defined as the ratio of the covariance between U and E 4written as 'ov4U,E5 to the
product of standard deviation of U and E
;ymbolically
r K 'ov 4U, E5
;D of U, E
K ] xy*? K ]UE
;D of U, E ?
Chere x KU:U, yKE:E
]xy K sum of the product of deviations in U and E series calculated with reference to
their arithmetic means.
#"
U K standard deviation of the series U.
E K standard deviation of the series E

$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= @'&:A8


;(!!$6E @= ;&$&I;&I';
mean -0.33
max 8.75
min -6.65
s.no Date
Close Price
BSE
Close Price
NSE difference
1 1-ct 1!058.05 1!057.80 0."5
" 3-ct 1!088.00 1!086.55 1.#5
3 #-ct 1!061.35 1!068.00 -6.65
# 5-ct 1!036.80 1!036.#0 0.#0
5 8-ct 1!016.35 1!0"1."0 -#.85
6 $-ct 1!0#5.75 1!0#5.65 0.10
7 10-ct 1!068.#5 1!070.55 -".10
8 11-ct 1!08$.70 1!0$1."5 -1.55
$ 1"-ct 1!053.00 1!055.00 -".00
10 15-ct 1!0$6.70 1!0$7.#5 -0.75
11 16-ct 1!156.75 1!15$.65 -".$0
1" 17-ct 1!116.85 1!117.10 -0."5
13 18-ct 1!038.80 1!036.50 ".30
1# 1$-ct 1!0"#.05 1!0"".80 1."5
15 ""-ct 1!06".35 1!061.35 1.00
16 "3-ct 1!100.$0 1!10".00 -1.10
17 "#-ct 1!0$7.65 1!0$$.$0 -"."5
18 "5-ct 1!1#6.35 1!1##.65 1.70
1$ "6-ct 1!18#.#5 1!187.50 -3.05
"0 "$-ct 1!"#$.#0 1!"#0.65 8.75
"1 30-ct 1!"#0."5 1!"#0."0 0.05
"" 31-ct 1!"57.00 1!"5#.05 ".$5
##
max%rice 1!"57.00
min %rice 1!016.35

,6$%)I'$. 6+%6+;+?&$&I@?
&he above table and graph represents arbitrage pricing analysis of I'I'I $?Q stock
trading in ;+ and ?;+.)ere arbitrage price difference of I'I'I $?Q stock can be
got by subtracting ?;+ from ;+.In the month of @'&:2AA8 I'I'I $?Q stock
consists minimum value is :9.9< and maximum value \>.8< and !ean is :A."". &he
above differences can shows that there is no scope for arbitrage as profit exists below
five percent.
#<
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= ?@V:A8
s.no date Close %rice &se
Close %rice
NSE difference
1 1-No' 1!"$8.$0 1!"$8.30 0.60
" "-No' 1!330.60 1!333.#0 -".80
3 5-No' 1!"70.85 1!"6$.85 1.00
# 6-No' 1!"#0.80 1!"#1.80 -1.00
5 7-No' 1!"03.80 1!"00.80 3.00
6 8-No' 1!168.65 1!16$.05 -0.#0
7 $-No' 1!1#3.00 1!1##.#5 -1.#5
8 1"-No' 1!1#6.65 1!1#5.35 1.30
$ 13-No' 1!176.15 1!173.70 ".#5
10 1#-No' 1!"77.$0 1!"78.55 -0.65
11 15-No' 1!"#8.60 1!"#1.65 6.$5
1" 16-No' 1!"1$.#5 1!""0.05 -0.60
13 1$-No' 1!186.85 1!187.70 -0.85
1# "0-No' 1!167."5 1!160.#5 6.80
15 "1-No' 1!103.10 1!106.#5 -3.35
16 ""-No' 1!1"6.$0 1!1#5.35 -18.#5
17 "3-No' 1!1#0.35 1!13$.#0 0.$5
18 "6-No' 1!157.65 1!156.80 0.85
1$ "7-No' 1!13".#0 1!13".30 0.10
"0 "8-No' 1!1"6.75 1!1"".$0 3.85
"1 "$-No' 1!16"."0 1!161.75 0.#5
"" 30-No' 1!18#.65 1!178.#0 6."5
;(!!$6E @= ;&$&I;&I';
mean 0."3
max 6.$5
min -18.#5
max%rice 1!333.#0
min %rice 1!103.10
#9
,6$%)I'$. 6+%6+;+?&$&I@?
&he above table and graph represents arbitrage pricing analysis of I'I'I $?Q stock
trading in ;+ and ?;+.)ere arbitrage price difference of I'I'I $?Q stock can be
got by subtracting ?;+ from ;+.In the month of ?@V:2AA8 I'I'I $?Q stock
consists minimum value is :1>.#< and maximum value \9.7< and !ean is \.A.2". &he
above differences can shows that there is no scope for arbitrage as profit exists below
five percent.
#8
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= @'&:A8
no Date
Close
Price
BSE
Close
Price
NSE difference
1 1-ct 1!#0#.00 1!#11.65 -7.65
" 3-ct 1!#"".35 1!#"#.80 -".#5
3 #-ct 1!#0#."0 1!#0$.70 -5.50
# 5-ct 1!#00.#5 1!#03.15 -".70
5 8-ct 1!#06.00 1!#07.35 -1.35
6 $-ct 1!#1$.55 1!#"1.15 -1.60
7 10-ct 1!#"0.10 1!#16.$5 3.15
8 11-ct 1!#56.#5 1!#60.70 -#."5
$ 1"-ct 1!#30.85 1!#3".70 -1.85
10 15-ct 1!#$0.#5 1!#$$."0 -8.75
11 16-ct 1!50#.60 1!507.75 -3.15
1" 17-ct 1!#5$.60 1!#6".75 -3.15
13 18-ct 1!37$."0 1!388."0 -$.00
1# 1$-ct 1!357."5 1!366.35 -$.10
15 ""-ct 1!37".#0 1!371.$0 0.50
16 "3-ct 1!#7#.30 1!#88."0 -13.$0
17 "#-ct 1!506.75 1!513.$5 -7."0
18 "5-ct 1!5#1.05 1!55#.00 -1".$5
1$ "6-ct 1!5#6.05 1!5#6.50 -0.#5
"0 "$-ct 1!638.70 1!6#6.$5 -8."5
"1 30-ct 1!618."5 1!6"0.55 -".30
"" 31-ct 1!653.10 1!653.#0 -0.30
mean -#.65
max 3.15
min -13.$0
max%rice 1!653.#0
min %rice 1!357."5
#>
,6$%)I'$. 6+%6+;+?&$&I@?
&he above table and graph represents arbitrage pricing analysis of )D=' $?Q stock
trading in ;+ and ?;+.)ere arbitrage price difference of )D=' $?Q stock can be
got by subtracting ?;+ from ;+.In the month of @'&:2AA8 )D=' $?Q stock
consists minimum value is :1".7A and maximum value \".1< and !ean is :#.9<. &he
above differences can shows that there is no scope for arbitrage as profit exists below five
percent.
#7
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= ?@V:A8
s.no Date
Close Price
BSE Close Price NSE difference
1 1-No' 1!675.55 1!6$0."0 -1#.65
" "-No' 1!758.75 1!770.50 -11.75
3 5-No' 1!70$.55 1!716.05 -6.50
# 6-No' 1!705.$5 1!708."0 -"."5
5 7-No' 1!617.$5 1!616.85 1.10
6 8-No' 1!55$.#0 1!555.35 #.05
7 $-No' 1!538."0 1!536."5 1.$5
8 1"-No' 1!#75.50 1!#77.35 -1.85
$ 13-No' 1!578.50 1!57#."0 #.30
10 1#-No' 1!7#$.10 1!75".30 -3."0
11 15-No' 1!6$$."0 1!700.#5 -1."5
1" 16-No' 1!687.15 1!687.10 0.05
13 1$-No' 1!655."0 1!65#.55 0.65
1# "0-No' 1!631.60 1!630.30 1.30
15 "1-No' 1!583.00 1!580.$0 ".10
16 ""-No' 1!5$#.05 1!5$1.70 ".35
17 "3-No' 1!56".70 1!56".70 0.00
18 "6-No' 1!6#3.70 1!6#3.35 0.35
1$ "7-No' 1!63".#5 1!63".65 -0."0
"0 "8-No' 1!607.$5 1!606.35 1.60
"1 "$-No' 1!677.15 1!67#.#0 ".75
"" 30-No' 1!71$.00 1!716.15 ".85
;(!!$6E @= ;&$&I;&I';
mean -0.7#
max #.30
min -1#.65
max%rice 1!770.50
min %rice 1!#75.50
<A
,6$%)I'$. 6+%6+;+?&$&I@?
&he above table and graph represents arbitrage pricing analysis of )D=' $?Q stock
trading in ;+ and ?;+.)ere arbitrage price difference of )D=' $?Q stock can be
got by subtracting ?;+ from ;+.In the month of ?@V:2AA8 )D=' $?Q stock
consists minimum value is :1#.9< and maximum value \#."A and !ean is :A.8#. &he
above differences can shows that there is no scope for arbitrage as profit exists below five
percent.
<1
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= @'&:A8
s.no Date
Close Price
BSE
Close Price
NSE Difference
1 1-ct 773.05 773.3 -0."5
" 3-ct 78$.7 788.1 1.6
3 #-ct 7$8.6 7$$.#5 -0.85
# 5-ct 77$.7 77$.05 0.65
5 8-ct 76#.# 76#.35 0.05
6 $-ct 7$1.75 7$6.15 -#.#
7 10-ct 805.85 806.7 -0.85
8 11-ct 830.# 830.55 -0.15
$ 1"-ct 80".1 803.35 -1."5
10 15-ct 818.1 818.3 -0."
11 16-ct 8"1." 8"0.8 0.#
1" 17-ct 808."5 806.$5 1.3
13 18-ct 783.7 7$1.35 -7.65
1# 1$-ct 781 785.15 -#.15
15 ""-ct 77".75 77".$ -0.15
16 "3-ct 7$6.15 7$5.6 0.55
17 "#-ct 77#.65 77#.6 0.05
18 "5-ct 7$3.3 800.6 -7.3
1$ "6-ct 810.# 80#.8 5.6
"0 "$-ct 807.1 807."5 -0.15
"1 30-ct 767.3 767.75 -0.#5
"" 31-ct 757.7 757.85 -0.15
;(!!$6E @= ;&$&I;&I';
mean -0.8068"
max 5.6
min -7.65
(ax%rice 830.55
min %rice 757.7
<2
,6$%)I'$. 6+%6+;+?&$&I@?
&he above table and graph represents arbitrage pricing analysis of &'; stock trading in
;+ and ?;+.)ere arbitrage price difference of &'; stock can be got by subtracting
?;+ from ;+.In the month of @'&:2AA8 &'; stock consists minimum value is :8.9<
and maximum value \<.9 and !ean is \A.>A9. &he above differences can shows that
there is no scope for arbitrage as profit exists below five percent.
<"
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= ?@V:A8
s.no Date
Close Price
BSE
Close Price
NSE Difference
1 1-No' 7##.3 7#6.$5 -".65
" "-No' 755." 75#.8 0.#
3 5-No' 7#0.05 7#0.15 -0.1
# 6-No' 7"3.#5 71$.#5 #
5 7-No' 7"".05 7"0.3 1.75
6 8-No' 706.3 707.55 -1."5
7 $-No' 6$6.3 6$#.8 1.5
8 1"-No' 68#.$5 68#.35 0.6
$ 13-No' 6$".75 6$3.3 -0.55
10 1#-No' 707.3 707.65 -0.35
11 15-No' 6$8.$ 6$8.$5 -0.05
1" 16-No' 6$8.15 6$7.1 1.05
13 1$-No' 70".6 703.1 -0.5
1# "0-No' 707.85 708.#5 -0.6
15 "1-No' 686.5 6$1.3 -#.8
16 ""-No' 6$" 6$#.5 -".5
17 "3-No' 71#.65 71#.35 0.3
18 "6-No' 710." 711.75 -1.55
1$ "7-No' 716.55 71$.75 -3."
"0 "8-No' 7"0.5 7"1."5 -0.75
"1 "$-No' 7"".3 718." #.1
"" 30-No' 733.35 73".#5 0.$
;(!!$6E @= ;&$&I;&I';
mean -0.1$318
max #.1
min -#.8
max%rice 755."
min %rice 68#.35
<#
,6$%)I'$. 6+%6+;+?&$&I@?
&he above table and graph represents arbitrage pricing analysis of &'; stock trading in
;+ and ?;+.)ere arbitrage price difference of &'; stock can be got by subtracting
?;+ from ;+.In the month of ?@V:2AA8 &'; stock consists minimum value is :#.>
and maximum value \#.1 and !ean is :A.17". &he above differences can shows that there
is no scope for arbitrage as profit exists below five percent.
<<
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= @'&:A8
s.no Date Close Price BSE Close Price)nse* difference
1 1-ct $#".3 $#1.#5 0.85
" 3-ct $68.$ $70.6 -1.7
3 #-ct $61.15 $61.65 -0.5
# 5-ct $$3.05 $$#.# -1.35
5 8-ct $8#.8 $85.65 -0.85
6 $-ct 1!0#0.30 1!038.80 1.5
7 10-ct 1!071.$5 1!070.$0 1.05
8 11-ct 1!0$6.10 1!0$6."5 -0.15
$ 1"-ct 1!06$."5 1!068.60 0.65
10 15-ct 1!1"6.75 1!1"5.65 1.1
11 16-ct 1!10$.80 1!108.75 1.05
1" 17-ct 1!10#.05 1!105.55 -1.5
13 18-ct 1!01$.#0 1!01#."5 5.15
1# 1$-ct $68.#5 $76.3 -7.85
15 ""-ct $"7.65 $30."5 -".6
16 "3-ct 1!005.35 1!003.10 "."5
17 "#-ct $86.3 $$6.#5 -10.15
18 "5-ct 1!01$.$0 1!018.$5 0.$5
1$ "6-ct $$3.#5 $$0.7 ".75
"0 "$-ct $$#.65 $$5.#5 -0.8
"1 30-ct $$$.75 $$$.55 0."
"" 31-ct 1!006.60 1!006.60 0
;(!!$6E @= ;&$&I;&I';
mean -0.#5""7
max 5.15
min -10.15
max%rice 11"6.75
min %rice $"7.65
<9
,6$%)I'$. 6+%6+;+?&$&I@?
&he above table and graph represents arbitrage pricing analysis of $I6&+. stock trading
in ;+ and ?;+.)ere arbitrage price difference of $I6&+. stock can be got by
subtracting ?;+ from ;+.In the month of @'&:2AA8 $I6&+. stock consists minimum
value is :1A.1< and maximum value \<.1< and !ean is A.#<2. &he above differences can
shows that there is no scope for arbitrage as profit exists below five percent.
<8
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= ?@V:A8
s.no Date Close Price BSE Close Price NSE difference
1 1-No' $#".$5 $#0.1 ".85
" "-No' 8$#.85 8$#.$5 -0.1
3 5-No' $#"." $#1.8 0.#
# 6-No' $18.#5 $17.7 0.75
5 7-No' $00."5 8$$.85 0.#
6 8-No' 88#.35 883.55 0.8
7 $-No' 870.6 866.7 3.$
8 1"-No' 833."5 83#.05 -0.8
$ 13-No' 833.1 83#."5 -1.15
10 1#-No' 85$.65 85$.# 0."5
11 15-No' $00.1 $0".05 -1.$5
1" 16-No' $11.6 $1".$5 -1.35
13 1$-No' $06.55 $08.6 -".05
1# "0-No' $0".65 $05 -".35
15 "1-No' 8$8.75 $00.1 -1.35
16 ""-No' $06.$ $06.#5 0.#5
17 "3-No' $13.#5 $17.55 -#.1
18 "6-No' $#8 $#6.$5 1.05
1$ "7-No' $16.5 $15.85 0.65
"0 "8-No' $10 $10.05 -0.05
"1 "$-No' $15.65 $1#.75 0.$
"" 30-No' $3$.#5 $3$.5 -0.05
;(!!$6E @= ;&$&I;&I';
mean -0.1318"
max 3.$
min -#.1
max%rice $#8
min %rice 833.1
<>
,6$%)I'$. 6+%6+;+?&$&I@?
&he above table and graph represents arbitrage pricing analysis of $I6&+. stock trading
in ;+ and ?;+.)ere arbitrage price difference of $I6&+. stock can be got by
subtracting ?;+ from ;+.In the month of ?@V:2AA8 $I6&+. stock consists minimum
value is :#.1 and maximum value \".7 and !ean is \A.1"1. &he above differences can
shows that there is no scope for arbitrage as profit exists below five percent.
<7
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= @'&:A8
s.no Date
Close Price
BSE Close Price)nse* difference
1 1-ct 61 61 0
" 3-ct 60."5 60.3 -0.05
3 #-ct 61 61." -0."
# 5-ct 58." 58." 0
5 8-ct 53.05 53.05 0
6 $-ct 5#.65 5#.7 -0.05
7 10-ct 55.#5 55.#5 0
8 11-ct 58.15 58.35 -0."
$ 1"-ct 56.15 56.1 0.05
10 15-ct 56.5 56.55 -0.05
11 16-ct 55 55.15 -0.15
1" 17-ct 5".8 5".75 0.05
13 18-ct 51.1 51."5 -0.15
1# 1$-ct 50.6 50.65 -0.05
15 ""-ct 50.$ 50.$ 0
16 "3-ct 5".75 5".75 0
17 "#-ct 53.05 53.1 -0.05
18 "5-ct 5".1 5" 0.1
1$ "6-ct 53.75 53.55 0."
"0 "$-ct 53.85 53.$5 -0.1
"1 30-ct 56.# 56.# 0
"" 31-ct 56.65 56.5 0.15
;(!!$6E @= ;&$&I;&I';
mean -0.0""73
max 0."
min -0."
max%rice 61."
min %rice 50.6
9A
,6$%)I'$. 6+%6+;+?&$&I@?
&he above table and graph represents arbitrage pricing analysis of +;;$6 stock trading
in ;+ and ?;+.)ere arbitrage price difference of +;;$6 stock can be got by
subtracting ?;+ from ;+.In the month of @'&:2AA8 +;;$6 stock consists minimum
value is :A.2 and maximum value \A.2 and !ean is \A.A22. &he above differences can
shows that there is no scope for arbitrage as profit exists below five percent.
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= ?@V:A8
91
s.no Date
Close Price
BSE
Close Price
NSE difference
1 1-No' 53.55 53.6 -0.05
" "-No' 56."5 56.35 -0.1
3 5-No' 57.05 57.1 -0.05
# 6-No' 6#.6 6#.75 -0.15
5 7-No' 61.3 61.3 0
6 8-No' 66.3 66."5 0.05
7 $-No' 78.6 78."5 0.35
8 1"-No' 87.6 87.#5 0.15
$ 13-No' 88.5 88.5 0
10 1#-No' 1"0.8 1"".7 -1.$
11 15-No' 157.65 158.6 -0.$5
1" 16-No' 1$".35 1$".8 -0.#5
13 1$-No' "0#.35 "0#."5 0.1
1# "0-No' 187.3 187.8 -0.5
15 "1-No' 176.8 177."5 -0.#5
16 ""-No' 17".85 173.1 -0."5
17 "3-No' 1$#.#5 1$#.55 -0.1
18 "6-No' 1$1." 1$1.15 0.05
1$ "7-No' ""1.75 ""1.65 0.1
"0 "8-No' "00.1 "00.1 0
"1 "$-No' "07.55 "07.35 0."
"" 30-No' "#1.$5 "#".35 -0.#
;(!!$6E @= ;&$&I;&I';
mean -0.1$773
max 0.35
min -1.$
max%rice "#".35
min %rice 53.55
,6$%)I'$. 6+%6+;+?&$&I@?
92
&he above table and graph represents arbitrage pricing analysis of +;;$6 stock trading
in ;+ and ?;+.)ere arbitrage price difference of +;;$6 stock can be got by
subtracting ?;+ from ;+.In the month of ?@V:2AA8 +;;$6 stock consists minimum
value is :1.7 and maximum value \A."< and !ean is \A.178. &he above differences can
shows that there is no scope for arbitrage as profit exists below five percent.
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= @'&:A8
9"
s.no Date
Close Price
BSE
Close
Price)nse* difference
1 1-ct $$7.1 $$$.5 -".#
" 3-ct 1!0"#.60 1!0"7.00 -".#
3 #-ct $85.$5 $86.65 -0.7
# 5-ct $66.05 $65.85 0."
5 8-ct $3$.7 $3$.65 0.05
6 $-ct $85.3 $85."5 0.05
7 10-ct 1!00$.30 1!010.00 -0.7
8 11-ct 1!066.#5 1!065.70 0.75
$ 1"-ct 1!0$1.60 1!0$3.80 -"."
10 15-ct 1!1$1.00 1!1$0.50 0.5
11 16-ct 1!176."5 1!175.50 0.75
1" 17-ct 1!130.15 1!1"$.50 0.65
13 18-ct 1!0$3.35 1!0$3.70 -0.35
1# 1$-ct 1!108.10 1!107.30 0.8
15 ""-ct 1!0$7.80 1!0$6.05 1.75
16 "3-ct 1!1##."5 1!1#3.$0 0.35
17 "#-ct 1!107.$0 1!107.$0 0
18 "5-ct 1!11#.00 1!1"0.80 -6.8
1$ "6-ct 1!156.00 1!155.50 0.5
"0 "$-ct 1!"38.60 1!"35.$5 ".65
"1 30-ct 1!"1$.55 1!"18.05 1.5
"" 31-ct 1!"#7.$0 1!"#6.35 1.55
;(!!$6E @= ;&$&I;&I';
mean -0.15$0$
max ".65
min -6.8
max%rice 1"#7.$
min %rice $3$.65
,6$%)I'$. 6+%6+;+?&$&I@?
9#
&he above table and graph represents arbitrage pricing analysis of @?,' stock trading
in ;+ and ?;+.)ere arbitrage price difference of @?,' stock can be got by
subtracting ?;+ from ;+.In the month of @'&:2AA8 @?,' stock consists minimum
value is :9.> and maximum value \2.9< and !ean is \A.1<7. &he above differences can
shows that there is no scope for arbitrage as profit exists below five percent.
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= ?@V:A8
9<
s.no Date
Close Price
BSE
Close Price
NSE difference
1 1-No' 1!330."0 1!3"7.75 ".#5
" "-No' 1!366.10 1!366."5 -0.15
3 5-No' 1!"$$.05 1!"$8.85 0."
# 6-No' 1!300.75 1!303.70 -".$5
5 7-No' 1!"8$."5 1!"$3."5 -#
6 8-No' 1!"36.80 1!"36.70 0.1
7 $-No' 1!"38.75 1!"38.35 0.#
8 1"-No' 1!17$.50 1!181.35 -1.85
$ 13-No' 1!183.30 1!180.35 ".$5
10 1#-No' 1!"35."5 1!"35.65 -0.#
11 15-No' 1!"#0.80 1!"3$.00 1.8
1" 16-No' 1!"#5.65 1!"#5.30 0.35
13 1$-No' 1!"61.#0 1!"67.#0 -6
1# "0-No' 1!""1.50 1!""0.70 0.8
15 "1-No' 1!1$".55 1!1$3.60 -1.05
16 ""-No' 1!1#$.55 1!1#8.#0 1.15
17 "3-No' 1!1#5.85 1!1#".15 3.7
18 "6-No' 1!18#."0 1!183.#0 0.8
1$ "7-No' 1!17".50 1!17".70 -0."
"0 "8-No' 1!150.55 1!150."5 0.3
"1 "$-No' 1!1#1."0 1!137.30 3.$
"" 30-No' 1!170.75 1!167.55 3."
;(!!$6E @= ;&$&I;&I';
mean 0."5
max 3.$
min -6
max%rice 1!366."5
min %rice 1!137.30
,6$%)I'$. 6+%6+;+?&$&I@?
99
&he above table and graph represents arbitrage pricing analysis of @?,' stock trading
in ;+ and ?;+.)ere arbitrage price difference of @?,' stock can be got by
subtracting ?;+ from ;+.In the month of ?@V:2AA8 @?,' stock consists minimum
value is :9.A and maximum value \".7 and !ean is \A.2<. &he above differences can
shows that there is no scope for arbitrage as profit exists below five percent.
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= @'&:A8
98
s.no Date
Close Price
BSE Close Price)nse* difference
1 1-ct "06 "06.5 -0.5
" 3-ct "17 "16.8 0."
3 #-ct ""6.# ""6.35 0.05
# 5-ct "1#.#5 "1#.#5 0
5 8-ct "0#.65 "0#.$ -0."5
6 $-ct "17.7 "18.15 -0.#5
7 10-ct "18.# "1$.3 -0.$
8 11-ct """.# """.55 -0.15
$ 1"-ct "17.5 "17.65 -0.15
10 15-ct ""6.8 ""7.# -0.6
11 16-ct "31."5 "31.5 -0."5
1" 17-ct ""0.8 ""0.#5 0.35
13 18-ct "08.5 "08.35 0.15
1# 1$-ct "01.35 "01.55 -0."
15 ""-ct 1$$.7 1$$.6 0.1
16 "3-ct "17.35 "18.8 -1.#5
17 "#-ct ""1.3 """.15 -0.85
18 "5-ct ""3.15 """.55 0.6
1$ "6-ct ""8.75 ""8.$ -0.15
"0 "$-ct "33."5 "33."5 0
"1 30-ct "33.$5 "3#."5 -0.3
"" 31-ct "3$.# "38.$ 0.5
;(!!$6E @= ;&$&I;&I';
min -1.#5
mean -0.17857
max 0.6
max%rice "3$.#
min %rice 1$$.6
9>
,6$%)I'$. 6+%6+;+?&$&I@?
&he above table and graph represents arbitrage pricing analysis of ?&%' stock trading in
;+ and ?;+.)ere arbitrage price difference of ?&%' stock can be got by subtracting
?;+ from ;+.In the month of @'&:2AA8 ?&%' stock consists minimum value is :1.#<
and maximum value \A.9 and !ean is \A.18> &he above differences can shows that there
is no scope for arbitrage as profit exists below five percent..
97
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= ?@V:A8
s.no Date
Close Price
BSE
Close Price
NSE difference
1 1-No' "3".05 "30.15 1.$
" "-No' "3#.75 "3#.85 -0.1
3 5-No' "36.8 "37.05 -0."5
# 6-No' "3$.55 "#0."5 -0.7
5 7-No' "#1 "#0.75 0."5
6 8-No' "#0.#5 "#0.1 0.35
7 $-No' "#1.35 "#1.15 0."
8 1"-No' "53.5 "53.#5 0.05
$ 13-No' "7"."5 "7".15 0.1
10 1#-No' "77.3 "77.55 -0."5
11 15-No' "6$.# "6$.# 0
1" 16-No' "6#.3 "6#.# -0.1
13 1$-No' "65.6 "6#.$ 0.7
1# "0-No' "60.# "5$.85 0.55
15 "1-No' "3$.5 "3$.# 0.1
16 ""-No' ""7.55 ""7.3 0."5
17 "3-No' "36.6 "36.75 -0.15
18 "6-No' "38.6 "38.7 -0.1
1$ "7-No' "3#.$5 "35 -0.05
"0 "8-No' "30.$5 "30.85 0.1
"1 "$-No' "31.7 "31."5 0.#5
"" 30-No' "36.65 "36.65 0
;(!!$6E @= ;&$&I;&I';
mean 0.15
max 1.$
min -0.7
max%rice "77.55
min %rice ""7.3
8A
,6$%)I'$. 6+%6+;+?&$&I@?
&he above table and graph represents arbitrage pricing analysis of ?&%' stock trading
in ;+ and ?;+.)ere arbitrage price difference of ?&%' stock can be got by subtracting
?;+ from ;+.In the month of ?@V:2AA8 ?&%' stock consists minimum value is :A.8
and maximum value \1.7 and !ean is \A.1<. &he above differences can shows that there
is no scope for arbitrage as profit exists below five percent.
81
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= @'&:A8
s.no Date
Close Price
BSE Close Price)nse* difference
1 1-ct 766.$ 766.8 0.1
" 3-ct 8$".75 8$".# 0.35
3 #-ct 86".# 863.35 -0.$5
# 5-ct 851.7 851.1 0.6
5 8-ct 83$.1 837.75 1.35
6 $-ct 865.6 865.# 0."
7 10-ct 8$".#5 8$#.5 -".05
8 11-ct $18.55 $18.75 -0."
$ 1"-ct 865.65 866.85 -1."
10 15-ct 8$6.75 8$7.$5 -1."
11 16-ct $18.55 $1$.3 -0.75
1" 17-ct 8$6 8$5.15 0.85
13 18-ct 8#3.55 8#3.$ -0.35
1# 1$-ct 81$." 818.35 0.85
15 ""-ct 80".85 80" 0.85
16 "3-ct 86$.5 870." -0.7
17 "#-ct 860.$ 861." -0.3
18 "5-ct 868."5 868.5 -0."5
1$ "6-ct $10.35 $11.#5 -1.1
"0 "$-ct $10.5 $11." -0.7
"1 30-ct $63.15 $5$.15 #
"" 31-ct $#8.8 $#$.# -0.6
;(!!$6E @= ;&$&I;&I';
mean -0.05#55
max #
min -".05
max%rice $63.15
min %rice 766.8
,6$%)I'$. 6+%6+;+?&$&I@?
82
&he above table and graph represents arbitrage pricing analysis of D.= stock trading in
;+ and ?;+.)ere arbitrage price difference of D.= stock can be got by subtracting
?;+ from ;+.In the month of @'&:2AA8 D.= stock consists minimum value is :2.A<
and maximum value \#.A and !ean is \A.A<#<. &he above differences can shows that
there is no scope for arbitrage as profit exists below five percent.
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= ?@V:A8
8"
s.no Date
Close Price
BSE Close Price NSE difference
1 1-No' $"7.$5 $3#.3 -6.35
" "-No' $30.# $31.15 -0.75
3 5-No' $15.05 $1#.5 0.55
# 6-No' $"7.$ $"7." 0.7
5 7-No' $"5." $"7.$5 -".75
6 8-No' $11.$5 $10.1 1.85
7 $-No' $13.$ $13." 0.7
8 1"-No' 871." 871.15 0.05
$ 13-No' $05." $05.6 -0.#
10 1#-No' $"6.7 $"7.55 -0.85
11 15-No' $#5.$5 $#$.1 -3.15
1" 16-No' $36.55 $37."5 -0.7
13 1$-No' $#7.85 $#8.1 -0."5
1# "0-No' $07.$ $08.35 -0.#5
15 "1-No' 870.5 86$.55 0.$5
16 ""-No' 8"".75 8"0.15 ".6
17 "3-No' 868.65 868.5 0.15
18 "6-No' 8$1.$ 8$".15 -0."5
1$ "7-No' 8$7.$5 $00.#5 -".5
"0 "8-No' 87$.5 88" -".5
"1 "$-No' 881.85 880.65 1."
"" 30-No' $#3.$ $##.# -0.5
;(!!$6E @= ;&$&I;&I';
mean -0.575
max ".6
min -6.35
max%rice $#$.1
min %rice 8"0.15
8#
,6$%)I'$. 6+%6+;+?&$&I@?
&he above table and graph represents arbitrage pricing analysis of D.= stock trading in
;+ and ?;+.)ere arbitrage price difference of D.= stock can be got by subtracting
?;+ from ;+.In the month of ?@V:2AA8 D.= stock consists minimum value is :9."<
and maximum value \2.9 and !ean is :A.<8<. &he above differences can shows that there
is no scope for arbitrage as profit exists below five percent.
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= @'&:A8
s.no Date
Close Price
BSE Close Price)nse* difference
8<
1 1-ct ##1 ##".1 -1.1
" 3-ct #38.6 #3$.05 -0.#5
3 #-ct ##".3 ##".35 -0.05
# 5-ct #33." #33.1 0.1
5 8-ct #1".3 #1".6 -0.3
6 $-ct #"6.7 #"8.75 -".05
7 10-ct #"#.8 #"5.6 -0.8
8 11-ct #30.8 #31.6 -0.8
$ 1"-ct #"$.$ #30.$ -1
10 15-ct #30.3 #"$.7 0.6
11 16-ct #30."5 #30.6 -0.35
1" 17-ct #"0.15 #"0.15 0
13 18-ct #"1.85 #18.55 3.3
1# 1$-ct #16.55 #16.#5 0.1
15 ""-ct #15.6 #15.35 0."5
16 "3-ct #"5.6 #"5.7 -0.1
17 "#-ct #"$.1 #"8.75 0.35
18 "5-ct #"$.75 #"8.5 1."5
1$ "6-ct #"5.15 #"6.05 -0.$
"0 "$-ct #"".$5 #"3.3 -0.35
"1 30-ct #1#.85 #1#.7 0.15
"" 31-ct #"7.05 #"6.15 0.$
;(!!$6E @= ;&$&I;&I';
mean -0.0568"
max 3.3
min -".05
max%rice ##".35
min %rice #1".3
,6$%)I'$. 6+%6+;+?&$&I@?
89
&he above table and graph represents arbitrage pricing analysis of 6$?$UE stock
trading in ;+ and ?;+.)ere arbitrage price difference of 6$?$UE stock can be got
by subtracting ?;+ from ;+.In the month of @'&:2AA8 6$?$UE stock consists
minimum value is :2.A< and maximum value \"." and !ean is \.A.A<9>. &he above
differences can shows that there is no scope for arbitrage as profit exists below five
percent.

88
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= ?@V:A8
s.no Date
Close Price
BSE
Close Price
NSE difference
1 1-No' #35.85 #35.5 0.35
" "-No' #38.55 #3$.05 -0.5
3 5-No' #36 #36."5 -0."5
# 6-No' #"$.#5 #"8.# 1.05
5 7-No' #"7." #"8.1 -0.$
6 8-No' #30.$ #31.3 -0.#
7 $-No' #3" #3".75 -0.75
8 1"-No' #"6 #"6.15 -0.15
$ 13-No' #"#.85 #"#.$ -0.05
10 1#-No' #"7.$ #"8.1 -0."
11 15-No' #"3.65 #"#." -0.55
1" 16-No' #11.7 #11.75 -0.05
13 1$-No' #15.8 #15."5 0.55
1# "0-No' #13.85 #1#." -0.35
15 "1-No' 3$8.6 3$7.75 0.85
16 ""-No' 3$3 3$".5 0.5
17 "3-No' 3$".#5 3$".35 0.1
18 "6-No' 3$8 3$8.$5 -0.$5
1$ "7-No' 3$#.6 3$#.1 0.5
"0 "8-No' 38$.35 388.65 0.7
"1 "$-No' 378.$5 377.6 1.35
"" 30-No' 387.15 385.75 1.#
;(!!$6E @= ;&$&I;&I';
mean 0.10""73
max 1.#
min -0.$5
max%rice #3$.05
min %rice 377.6
8>
,6$%)I'$. 6+%6+;+?&$&I@?
&he above table and graph represents arbitrage pricing analysis of 6$?$UE stock
trading in ;+ and ?;+.)ere arbitrage price difference of 6$?$UE stock can be got
by subtracting ?;+ from ;+.In the month of ?@V:2AA8 6$?$UE stock consists
minimum value is :A.7< and maximum value \1.# and !ean is \A.1A2. &he above
differences can shows that there is no scope for arbitrage as profit exists below five
percent.
87
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= @'&:A8
s.no Date
Close Price
BSE Close Price)nse* difference
1 1-ct #53.$5 #5#."5 -0.3
" 3-ct #70.65 #70.# 0."5
3 #-ct #61.3 #6".05 -0.75
# 5-ct #61.15 #60.15 1
5 8-ct #6$.65 #6$.5 0.15
6 $-ct #8$.3 #8$ 0.3
7 10-ct 503.15 503.3 -0.15
8 11-ct #88.1 #88 0.1
$ 1"-ct #86.#5 #86.8 -0.35
10 15-ct #$1.$ #$"." -0.3
11 16-ct #86."5 #85.75 0.5
1" 17-ct #85.$ #88.3 -".#
13 18-ct #$6.#5 #$3.8 ".65
1# 1$-ct 500.55 #$$.$5 0.6
15 ""-ct #$#.6 #$5."5 -0.65
16 "3-ct #$"." #$".55 -0.35
17 "#-ct #86.35 #86.3 0.05
18 "5-ct #$6.35 #$6.$ -0.55
1$ "6-ct #$$.$5 #$$.85 0.1
"0 "$-ct 50$.65 50$.85 -0."
"1 30-ct 50$.7 510.65 -0.$5
"" 31-ct 50#.8 507.15 -".35
;(!!$6E @= ;&$&I;&I';
mean -0.1636#
max ".65
min -".#
max%rice 510.65
min %rice #53.$5
>A
,6$%)I'$. 6+%6+;+?&$&I@?
&he above table and graph represents arbitrage pricing analysis of CI%6@ stock trading
in ;+ and ?;+.)ere arbitrage price difference of CI%6@ stock can be got by
subtracting ?;+ from ;+.In the month of @'&:2AA8 CI%6@ stock consists minimum
value is :2.# and maximum value \2.9< and !ean is \A.19". &he above differences can
shows that there is no scope for arbitrage as profit exists below five percent.
>1
$6I&6$,+ %6I'+ DI==+6+?'+ I&C++? ;+ $?D ?;+ =@6 &)+ !@?&)
@= ?@V:A8
s.no Date
Close Price
BSE
Close Price
NSE difference
1 1-No' #$$.# #$$.# 0
" "-No' #$".05 #$1.8 0."5
3 5-No' #8#.$5 #8#.75 0."
# 6-No' #87.35 #86.$ 0.#5
5 7-No' #77.35 #77."5 0.1
6 8-No' #6$.7 #71.55 -1.85
7 $-No' #60 #5$.5 0.5
8 1"-No' #57.#5 #56.# 1.05
$ 13-No' ##1.05 ##".15 -1.1
10 1#-No' #71." #7".$5 -1.75
11 15-No' #56.#5 #57." -0.75
1" 16-No' #58.3 #60.85 -".55
13 1$-No' #57.# #58.65 -1."5
1# "0-No' ##8.65 ##8.3 0.35
15 "1-No' #36.55 #36.75 -0."
16 ""-No' #37.$5 #37.85 0.1
17 "3-No' ##".05 ##1.#5 0.6
18 "6-No' #5".7 #53.15 -0.#5
1$ "7-No' #57.75 #57.8 -0.05
"0 "8-No' ##$.#5 ##$.75 -0.3
"1 "$-No' #50.5 ##8.1 ".#
"" 30-No' #60.3 #60.65 -0.35
;(!!$6E @= ;&$&I;&I';
mean -0."0$0$
max ".#
min -".55
max%rice #$$.#
min %rice #36.55
>2
,6$%)I'$. 6+%6+;+?&$&I@?
&he above table and graph represents arbitrage pricing analysis of CI%6@ stock trading
in ;+ and ?;+.)ere arbitrage price difference of CI%6@ stock can be got by
subtracting ?;+ from ;+.In the month of ?@V:2AA8 CI%6@ stock consists minimum
value is :2.<< and maximum value \2.# and !ean is \A.2A7. &he above differences can
shows that there is no scope for arbitrage as profit exists below five percent.
CONCLUSIONS
&he study shows that none of the studied ten scripts give any scope for
arbitration. &he reason is explained below. &he scripts are studied for arbitration for a
period of two months /@'&:A8 and ?@V:A80
>"
I'I'I stock prices in @ct:A8 are in the range of rs 1A19 and rs 12<8, the difference
in prices are rs 9.9< and rs >.8<.&he maximum difference is less than 1 percent, so not
beneficial for arbitration purposes.
I'I'I prices in ?ov:A8 are in the range of rs 11A" and rs 1""", the difference in
prices are 1>.#< and 9.7<.&he difference is more than < percent, so beneficial for
arbitration purposes.
)D=' stock prices in @ct:A8 are in the range of rs 1"<8 and rs 19<", the difference
in prices are rs 1".7A and rs ".1<.and in ?ov:A8 are in the range of rs 1#8< and rs 188A,
the difference in prices are 1#.9< and #."A.&he difference is more than < percent, so
beneficial for arbitration purposes.
&'; stock prices in @ct:A8 are in the range of rs 8<8 and rs >"A, the difference in
prices are rs 8.9< and rs <.9A.and in ?ov:A8 are in the range of rs 9>9 and rs 8<<, the
difference in prices are #.>A and #.1A.&he difference is less than 1 percent, so not
beneficial for arbitration purposes.
$I6&+. prices in @ct:A8 are in the range of rs 72> and rs 1128, the difference in prices
are 1A.1< and <.1<.&he difference is more than < percent, so beneficial for arbitration
purposes
$I6&+. prices in ?ov:A8 are in the range of rs >"" and rs 7#>, the difference in
prices are #.1 and ".7.&he difference is less than 1 percent, so not beneficial for
arbitration purposes
+;;$6 prices in @ct:A8 are in the range of rs <1 and rs 91, the difference in prices are
A.2 and A.2. and in ?ov:A8 are in the range of rs <# and rs 2#2, the difference in prices
are 1.7 and A."<.&he difference is less than 1 percent, so not beneficial for arbitration
purposes
@?,' stock prices in @ct:A8 are in the range of rs 7"7 and rs 12#8, the difference
in prices are rs 9.>A and rs 2.9< .&he maximum difference is less than # percent, so not
beneficial for arbitration purposes.
@?,' prices in ?ov:A8 are in the range of rs 11#1 and rs 1"99, the difference in prices
are 9.AA and ".7A.&he difference is less than 2 percent, so not beneficial for arbitration
purposes.
>#
?&%' prices in @ct:A8 are in the range of rs 2AA and rs 2#A, the difference in prices
are 1.#< and A.9.and in ?ov:A8 are in the range of rs 228 and rs 28>, the difference in
prices are A.8 and 1.7.&he difference is less than 1 percent, so not beneficial for
arbitration purposes
D.= prices in @ct:A8 are in the range of rs 898 and rs 79", the difference in prices are
2.A< and #.A.and in ?ov:A8 are in the range of rs >2A and rs 7#7, the difference in prices
are 9."< and 2.9.&he difference is less than 1 percent, so not beneficial for arbitration
purposes
6$?$UE stock prices in @ct:A8 are in the range of rs "87 and rs #"7, the difference
in prices are rs A.7< and rs 1.#A.&he maximum difference is less than " percent, so not
beneficial for arbitration purposes.
6$?$UE prices in ?ov:A8 are in the range of rs #1< and rs ##2, the difference in
prices are 2.A< and "."A.&he difference is less than 1 percent, so not beneficial for
arbitration purposes.
CI%6@ stock prices in @ct:A8 are in the range of rs #<# and rs <11, the difference in
prices are rs 2.9< and rs 2.#A.&he maximum difference is less than 1 percent, so not
beneficial for arbitration purposes.
CI%6@ prices in ?ov:A8 are in the range of rs #"9 and rs #77, the difference in prices
are 2.<< and 2.#A.&he difference is less than 1 percent, so not beneficial for arbitration
purposes.

><
BIBLIOGRAP8Y
Boo.s
;ecurity $nalysis H %ortfolio !anagement : =ishers H Gordon
=inancial !anagement N !.E. Qhan
=inancial !anagement N %rasanna 'handra
Ne)s P$#ers
usiness .ine
&imes of India
+$*$D"es
Ceek
usiness Daily
<ebstes
)))0$m&"!$0com
)))0seb0com
)))0*oo*%e0com
>9

doc_619029598.doc