Introduction

The Indian Automobile industry became the 4th largest in the world with sales
increasing 9.5 per cent year-on-year to 4.02 million units (excluding two
wheelers) in 2017. It was the 7th largest manufacturer of commercial vehicles in
2018.
The Two Wheelers segment dominates the market in terms of volume owing to
a growing middle class and a young population. Moreover, the growing interest
of the companies in exploring the rural markets further aided the growth of the
sector.
India is also a prominent Automobile exporter and has strong export growth
expectations for the near future. Automobile exports grew 14.5 per cent during
FY 2019. It is expected to grow at a CAGR of 3.05 per cent during 2016-2026.
In addition, several initiatives by the Government of India and the major
Automobile players in the Indian market are expected to make India a leader in
the two-wheeler and four wheeler market in the world by 2020.

Market Size
Overall domestic Automobiles sales increased at 6.71 per cent CAGR between
FY13-19 with 26.27 million vehicles getting sold in FY19 .Domestic
Automobile production increased at 6.96 per cent CAGR between FY13-19
with 30.92 million vehicles manufactured in the country in FY19
In FY19, year-on-year growth in domestic sales among all the categories was
recorded in commercial vehicles at 17.55 per cent followed by 10.27 per cent
year-on-year growth in the sales of three-wheelers.
Premium motorbike sales in India crossed one million units in FY18. During
January-September 2018, BMW registered a growth of 11 per cent year-on-year
in its sales in India at 7,915 units. Mercedes Benz ranked first in sales
satisfaction in the luxury vehicles segment according to J D Power 2018 India
sales satisfaction index (luxury).
Sales of electric two-wheelers are estimated to have crossed 55,000 vehicles in
2017-18.

Investments
In order to keep up with the growing demand, several Automobile makers have
started investing heavily in various segments of the industry during the last few
months. The industry has attracted Foreign Direct Investment (FDI) worth US$
21.38 billion during the period April 2000 to March 2019, according to data
released by Department for Promotion of Industry and Internal Trade (DPIIT).
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To maruti Suzuki, Tata motors Mahindra and Mahindra

Some of the recent/planned investments and developments in the Automobile

sector in India are as follows:

 Ashok Leyland has planned a capital expenditure of Rs 1,000 crore (US$

155.20 million) to launch 20-25 new models across various commercial
vehicle categories in 2018-19.
 Hyundai is planning to invest US$ 1 billion in India by 2020. SAIC
Motor has also announced to invest US$ 310 million in India.
 Mercedes Benz has increased the manufacturing capacity of its Chakan
Plant to 20,000 units per year, highest for any luxury car manufacturing
in India.
 As of October 2018, Honda Motors Company is planning to set up its
third factory in India for launching hybrid and electric vehicles with the
cost of Rs 9,200 crore (US$ 1.31 billion), its largest investment in India
so far.
 In November 2018, Mahindra Electric Mobility opened its electric
technology manufacturing hub in Bangalore with an investment of Rs 100
crore (US$ 14.25 million) which will increase its annual manufacturing
capacity to 25,000 units.

Government Initiatives

The Government of India encourages foreign investment in the Automobile

sector and allows 100 per cent FDI under the Automatic route.
Some of the recent initiatives taken by the Government of India are -

 The government aims to develop India as a global manufacturing centre

and an R&D hub.
 Under NAT Rip, the Government of India is planning to set up R&D
centres at a total cost of US$ 388.5 million to enable the industry to be on
par with global standards
 The Ministry of Heavy Industries, Government of India has shortlisted 11
cities in the country for introduction of electric vehicles (EVs) in their
public transport systems under the FAME (Faster Adoption and
Manufacturing of (Hybrid) and Electric Vehicles in India) scheme. The
government will also set up incubation centre for start-ups working in
electric vehicles space.
 In February 2019, the Government of India approved the FAME-II
scheme with a fund requirement of Rs 10,000 crore (US$ 1.39 billion) for
FY20-22.

Achievements
Following are the achievements of the government in the past four years:

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 Number of vehicles supported under FAME scheme increased from 5,197

in June 2015 to 192,451 in March 2018. During 2017-18, 47,912 two-
wheelers, 2,202 three-wheelers, 185 four-wheelers and 10 light
commercial vehicles were supported under FAME scheme.
 Under National Automobile Testing And R&D Infrastructure Project
(NATRIP), following testing and research centres have been established
in the country since 2015
o International Centre for Automobile Technology (ICAT), Manesar
o National Institute for Automobile Inspection, Maintenance &
Training (NIAIMT), Silchar
o National Automobile Testing Tracks (NATRAX), Indore
o Automobile Research Association of India (ARAI), Pune
o Global Automobile Research Centre (GARC), Chennai
 SAMARTH Udyog – Industry 4.0 centres: ‘Demo cum experience’
centres are being set up in the country for promoting smart and advanced
manufacturing helping SMEs to implement Industry 4.0 (Automation and
data exchange in manufacturing technology).

Road Ahead
The Automobile industry is supported by various factors such as availability of
skilled labour at low cost, robust R&D centres and low cost steel production.
The industry also provides great opportunities for investment and direct and
indirect employment to skilled and unskilled labour.
Indian Automobile industry (including component manufacturing) is expected
to reach Rs 16.16-18.18 trillion (US$ 251.4-282.8 billion) by 2026. Two-
wheelers are expected to grow 9 per cent in 2018.
References: Media Reports, Press Releases, Department of Industrial Policy
and Promotion (DIPP), Automobile Component Manufacturers Association of
India (ACMA), Society of Indian Automobile Manufacturers (SIAM), Union
Budget 2015-16, Union Budget 2017-18

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Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

Key players of Automobile industry in india:

1. TATA MOTORS

Tata Motors Limited is India’s largest automobile company, with

consolidated revenues of INR 2,32,834 crores (USD 38.9 billion) in 2018-
19. It is the leader in commercial vehicles in each segment, and among the
top in passenger vehicles with winning products in the compact, midsize car
and utility vehicle segments. The Tata Motors Group’s over 60,000
employees are guided by the mission “to be passionate in anticipating and
providing the best vehicles and experiences that excite our customers
globally.'' Established in 1945, Tata Motors’ presence cuts across the length
and breadth of India. Over 8 million Tata vehicles ply on Indian roads,
since the first rolled out in 1954. The company’s manufacturing base in
India is spread across Jamshedpur (Jharkhand), Pune (Maharashtra),
Lucknow (Uttar Pradesh), Pantnagar (Uttarakhand), Sanand (Gujarat) and
Dharwad (Karnataka). Following a strategic alliance with Fiat in 2005, it has
set up an industrial joint venture with Fiat Group Automobiles at
Ranjangaon (Maharashtra) to produce both Fiat and Tata cars and Fiat
powertrains. The company’s dealership, sales, services and spare parts
network comprises over 6,600 touch points, across the world. Tata Motors is
also expanding its international footprint, established through exports since
1961. The company’s commercial and passenger vehicles are already being
marketed in several countries in Europe, Africa, the Middle East, South East
Asia, South The foundation of the company’s growth over the last 69 years
is a deep understanding of economic stimuli and customer needs, and the
ability to translate them into customer-desired offerings through leading
edge R&D. With over 4,500 engineers, scientists and technicians the
company’s Engineering Research Centre, established in 1966, has enabled
pioneering technologies and products. The company today has R&D centres
in Pune, Jamshedpur, Lucknow, Dharwad in India, and in South Korea,
Italy, Spain, and the UK.

2. MARUTI SUZUKI
Maruti suzuki started out in 1982 in Gurgaon, Haryana. Little did the then
quiet suburb of New Delhi know, that it was going to become the epicenter
of the automobile revolution in India. The year marked the birth of the
Maruti Suzuki factory. India turned out 40,000 cars every year. The new
Maruti Suzuki 800 hit the streets to begin a whole new chapter in the Indian
automobile industry. Maruti suzuki set out with an obsession for customer

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delight, one that was unheard in the corridors of automobile manufacturers

then. It was about a commitment to create value through innovation, quality,
creativity, partnerships, openness and learning. It created a road that was
going to lead the world in to a whole new direction, laid out by Maruti
Suzuki.
Today, Maruti Suzuki alone makes 1.5 million Maruti Suzuki family cars
every year. That’s one car every 12 seconds. Maruti suzuki drove up head
and shoulders above every major global auto company. Yet our story was
not just about making a mark. It was about revolutionary cars that delivered
great performance, efficiency and environment friendliness with low cost of
ownership. Maruti suzuki built our story with a belief in small cars for a big
future. Our story encouraged millions of Indians to make driving a way of
life. India stepped up with our vision to take on the fast lane. A comradeship
had begun. Something incredible had begun. A team of over 12500
dedicated and passionate professionals that turned out 14 cars with over 150
variants. The drive is backed up by a nationwide service network spanning
over 1454 cities and towns and a sales network that spreads across 1097
cities, 2 state of the art factories. A diesel engine plant with a capacity upped
to turn out 7 lakh diesel cars a year. And a commitment to road safety to
make Indian roads safer. Finally, our inspiration comes from one place –
India’s hopes, dreams and aspirations. The Maruti Suzuki journey has been
nothing less than spectacular. But to be honest, we’ve only just begun.

3.Mahindra & Mahindra

Founded in 1945 as a steel trading company, we entered automotive
manufacturing in 1947 to bring the iconic Willys Jeep onto Indian roads.
Over the years, we’ve diversified into many new businesses in order to
better meet the needs of our customers. We follow a unique business model
of creating empowered companies that enjoy the best of entrepreneurial
independence and Group-wide synergies. This principle has led our growth
into a US $16.5 billion multinational group with more than 200,000
employees in over 100 countries across the globe.
Today, our operations span 18 key industries that form the foundation of
every modern economy: aerospace, aftermarket, agribusiness, automotive,
components, construction equipment, consulting services, defense, energy,
farm equipment, finance and insurance, industrial equipment, information
technology, leisure and hospitality, logistics, real estate, retail, and two
wheelers. Our federated structure enables each business to chart its own
future and simultaneously leverage synergies across the entire Group’s
competencies. In this way, the diversity of our expertise allows us to bring
our customers the best in many fields

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OBJECTIVE OF THE STUDY

 To study the fundamental & technical analysis.
 To analyze Indian automobile sector taking into consideration its current
status and future prospects.
 To study various tools used in fundamental & technical analysis to help
investors
 To study the major 3 key players in Indian automobile industry.
 To study the variations in the Indian Stock Market.
 To study the financial position of the selected companies in automobile
industry and analyze them to recommend to the investors.

SCOPE OF THE STUDY

 The study gave a chance to study fundamental & technical analysis and
various tools used in fundamental & technical analysis helps to
understand the basics of financial statements and give you the tools that
help to decide which companies make worthwhile investments
 It is a process of looking at a business on the basic or fundamental
financial level.
 This type of analysis is examines key ratios of a business to determine its
financial health and gives you an idea of the value of its stock.
 The scope of project extends to the study of 3 key players of Indian
automobile sector. To predict investor positions (Buy, sell & hold).
 To know the future trend of Stock Prices of Tata Motors, Maruti Suzuki
and M&M. in capital market

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To maruti Suzuki, Tata motors Mahindra and Mahindra

LIMITATION OF STUDY
 Only 3 companies out of a very large Indian automobile industry could be
studied in this process.
 Availability of data was the main limitation of this study.
 Analysis involves lots of tools, but only selected tools were studied.
 The study frame considered is very limited. It is limited for 2 months only
and it became difficult to understand the trends of the entire sector in 2
months only. The data used is secondary data.

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To maruti Suzuki, Tata motors Mahindra and Mahindra

Company profile

Motilal Oswal Securities Ltd. (MOSL) was founded in 1987 as a small sub-
broking unit, with just 2 people running the show. Focus on customer attitude,
ethical and transparent business practices, respect for professionalism, research
based value investing and implementation of cutting edge technology has enabled
us to blossom into an over 5000 member team.

Today they are a well-diversified financial services firm offering a range of

financial products and services such as Private Wealth Management, Retail
Broking and Distribution, Institutional Broking, Asset Management, Investment
Banking, Private Equity, Commodity Broking, Currency Broking and Home
Finance.

They have a diversified client base that includes retail customers (including High
Net worth Individuals), mutual funds, foreign institutional investors, financial
institutions and corporate clients. They are headquartered in Mumbai and as of
December 2017, had a network spread over 600 cities and towns comprising
2400+ Business Locations operated by our Business Partners and them. As on
December 2017, they have over 900000 registered customers.

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Performance of the company shows an increasing trend in terms of 66.25% boost

in Total revenue from Rs. 1093.7 cr. in 2016 to Rs. 1818.3 cr. in 2017 and which
showed a 112% increase in Profit after tax in FY2017 from FY2016.

Motilal Oswal Management

MEMBERS POSITION

Aashish Somaiyaa CEO - Asset Management Business

Ajay Kumar Menon Managing Director & CEO

Anil Sachidanand Managing Director & CEO

Anupam Agal Head

Girish Nadkarni Chief Executive Officer

Kailash Purohit Co. Secretary & Compl. Officer

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Kailash Purohit Secretary Motilal Oswal Chairman &

M.D & CEO

Navin Agarwal Director

Pankaj Purohit Head – IT

Praveen Tripathi Independent Director

Raamdeo Agrawal CEO & Joint Managing Director

Rajat Rajgarhia Chief Executive Officer

Ramnik Chhabra Head – Marketing

Shalibhadra Shah Chief Financial Officer

Sharda Agarwal Independent Woman Director

Sudhir Dhar Head - HR & Admin

Vijay Kumar Goel Chief Executive Officer

Vishal Tulsyan CEO - Private Equity Business

Vivek Paranjpe Independent Director

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Milestones about the company

a. In 1987 Starts as a Sub Broking Outfit– Prudential Portfolio Services.In

1990 MOSL acquires B.S.E. membership. In 1994 it gets N.S.E.
membership and enters Institutional Equities Business.

b. In 1996 Starts a Wealth Creation Study to identify the biggest, fastest and
the most consistent wealth-creating companies.

c. In 2000 Promoters honoured with Rashtriya Samman Patra and Receives

the Asia money Award for the Best Domestic Equity House.

d. In 2003 FII Client base crosses 100 and FII Client base crosses 100.

e. In 2005 Awarded Best Local Brokerage, Most Independent Research

Brokerage and Best in Sales & Service and DP assets cross 1,000 crores.

f. In 2006 Investment Banking Business advises on one of the largest

investment banking deals of 2006 and tops Bloomberg M&A league,
Places 10.75% with 2 leading Private Equity Investors- Bessemer Venture
and New Vernon Private Equity valuing the company@ `1200 Cr (post
money), Issues about 13% of equity to employees as ESOPs, Private
Equity business launches its maiden fund of USD 125 million and Enters
into Investment Banking, Private Equity and Wealth Management.

g. In 2007 Features as a case study in Harvard Business School and Goes

public. The IPO was oversubscribed 26.4 times.

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h. In 2008 Awarded ‘Best Franchisor in Financial Services’ by Franchising

World Magazine for the second time in succession, Mr. Oswal awarded the
‘Excellent Business Achiever in Financial Services’ Award by the Institute
of Chartered Accountants of India, Awarded the NASSCOM-CNBC TV18
IT User Award, DP Assets cross 5,000 cr Group Profits cross 100 cr and
Group revenues cross 500 cr and Hit Billion Dollar Market
Capitalisation.in 2009 Rated as No. 1 Broker at the ET Now-Star-mine
Analyst Awards, Enters the Limca Book of Records for creating India’s
Largest Dealing Room and Reach expands to over 1,000 business locations
Customer base crosses 5,00,000.

i. In 2010 Asset Management business hosts India’s 1st Value Investing

Forum, Asset Management launches its maiden mutual fund offering –
India’s first fundamentally enhanced ETF, Launched Motilal Oswal
Foundation, Investment Banking Business wins the “India M&A
Investment Banker Award”, and “Asia Pacific Cross-Border Deal of the
Year” at the Asia-Pacific M&A Atlas Awards, Wins Qual-Tech Prize for
Improvement in the Services Category at QIMPRO and DP Assets cross
10,000 cr.

j. In 2011 Mr. Agrawal honored with an award for Special Contribution to

Indian Capital Market at ‘India’s Best Market Analyst Awards Asset
Management Business organizes India’s first ETF Conclave, Bags two
awards for ‘Excellence in HR through Technology’ &‘Managing Health at
Work’ at the 2nd Asia’s Best Employer Brand Awards, Awarded ‘Best
Equity Broking House’ at BSE – Dun & Bradstreet Equity Broking
Awards, Maiden mutual fund offering bags the ‘Most Innovative Fund of
the Year’ at the CNBC TV18-CRISIL Mutual Fund Awards, Asset
Management Company (AMC) becomes India’s 1st AMC to ring the

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NASDAQ Stock Market Opening Bell, Reach expands to over 1,500

business locations Customer base crosses 7,00,000 Group net worth
crosses `1,000 crore , Wins ‘Best Capital Markets & Related NBFC’
Award at CNBC TV18 India Best Banks and Financial Institutions Awards
.

k. In 2012 Awarded ‘Best Equity Broker’ at Bloomberg UTV Financial

Leadership Awards, Awarded the ‘Retailer of the Year’ (Banking &
Financial Services) at the ‘Award for Retail Excellence’ organized by Asia
Retail Congress, Awarded the "Best Public Relations in the Financial
Services Sector" at the India PR & Corporate Communication Awards,
Adjudged ‘Best Performing Equity Broker (National) at the CNBC TV18
Financial Advisor Awards - two years in a row, MOSt Shares Nasdaq 100
ETF bags the ‘Most Innovative ETF - Asia Pacific 2011’ at the 8th Annual
Global ETF Awards 2012, MOFSL shifts into its own corporate
headquarters spread over 2,70,000 square feet and Awarded Depository
Participant of the Year at Money Today FPCIL Awards. In 2013 Motilal
Oswal Investment Banking won ‘M&A Boutique Firm of the Year’ and
‘Best Mid-Market Deal of the Year’ awards at the M&A Atlas Awards in
Mumbai, Adjudged ‘Best Performing Equity Broker (National) at the
CNBC TV18 Financial Advisor Awards - three years in a row, Awarded
‘Best Growth Capital Investor-2012’ at the Awards for Private Equity
Excellence 2013, Completed 25 years of Wealth Creation and Awarded
Depository Participant of the Year at Money Today FPCIL Awards.

l. In 2014 Adjudged ‘Best Performing Equity Broker (National) at the CNBC

TV18 Financial Advisor Awards - four years in a row and Motilal Oswal
Financial Services Awarded ‘Best Local Broker for Trading and
Execution’ at the Trade Asia Awards 2014.

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m. In 2015 Motilal Oswal won highest no of awards in Zee India’s best market
analyst awards. In all we bagged three awards i.e. for Best IT Sector, Best
FMCG Sector and Best Forex, Motilal Oswal Capital Markets Private Ltd
(MOCMPL) have launched an Education initiative called School for
Trading & Investment Research (STIR). Through this initiative, MOCMPL
would reach out to many aspiring Investors & Traders and teach them the
Principles of Investing, Trading & Research., Motilal Oswal Wealth
Management Ltd participated in the CNBC TV18 Financial Advisory
Awards 2014 – 15; and in the very first year of its participation has been
adjudged Best Performing National Financial Advisor (Wealth distribution
category), Motilal Oswal Investment Advisors Pvt Ltd ties up with IMAP
Advisors - one of the Top 6 Global M&A specialists, as their exclusive
India partner, MOAMC has crossed over1 Billion USDin equity mutual
fund and PMS assets making it the fastest growing AMC in the country.,
Aspire Home Finance has been awarded “The Most Admired & Valuable
Housing Finance Company 2015 "at the 6th Annual India Leadership
Conclave & Indian Affairs Business Leadership Awards 2015 held
recently in Mumbai , Aspire Home Finance cumulatively disbursed over
Rs. 1000 Cr. of loans to over 10000 families., Motilal Oswal Securities Ltd
has been awarded the `Best Broking House - Institutional Segment` at Dun
& Bradstreet Best Equity Broking Awards 2015 held in Mumbai., Motilal
Oswal Securities Ltd has been awarded the `Best Broking House - Cash
Segment` at Dun & Bradstreet Best Equity Broking Awards 2015 held in
Mumbai., Aspire Home Finance corporation has been awarded "Financial
Services Institution of the Year" at the ICT 4 Development Awards 2015
by ASSOCHAM INDIA! .In 2016 Motilal Oswal presents 100 % paperless
& fastest 15 minutes Trading & De-mat account - First & the fastest in
India, Aspire Home Finance has been awarded the “Finnoviti 2016”

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Award for their product ‘MALA’ (Mahila Awaas loan from Aspire) from
Banking Frontiers & Deloitte., Motilal Oswal Institutional Equities bags
11 Awards at the ‘Research Bytes Investor Communication Awards
2015’ which includes ‘Favorite Research House, Head of research,
Consumer Staples, Industrials, Utilities, Consumer Directory, Financial,
Materials, Energy and Multi-Sector’., Mr. Anil Sachidanand, MD & CEO,
AHFCL receives ‘Community Leadership Award’ at the 6th
International Conference & Game Changers Award., Motilal Oswal
Investment Advisor Private Ltd is happy to announce the successful
closure of Qualified Institutions Placement of Indian Overseas Bank. Two
to Tango: Best Equity Broker-National & Grand Jury award for Best
Institution for Financial Education & Inclusion by CNBC TV18 Financial
Advisory Awards, Motilal Oswal Commodities Broker Pvt. Ltd. wins “The
Market Excellence Awards for Bullion” at the Zee Business Market
Excellence Awards. And Motilal Oswal Financial Services Pvt. Ltd. has
been honoured by Fortune India as “ONE OF THE GIANTS OF
TOMORROW” at Fortune India the Next 500, 2016., Motilal Oswal
Financial Services Limited got certified as "Great Place to Work" by
GPTW - India.

n. In 2017 Motilal Oswal Financial Services Ltd wins Banking Frontiers

FINNOVITI Awards 2017 for its Watch App, Aspire Home Finance has
been awarded in two categories "Innovative Product and Services" for
MALA & " Innovative Marketing Practice" for Social Media Campaigns
at the 7th National Conference and Game changer Summit, Mr. Anil
Sachidanand, MD & CEO - Aspire Home Finance Corporation Ltd.
received " Entrepreneur of the Year (Finance) Award" at 2016 Leaders
Awards (Enterprise Edition) by 24MRC Network., Motilal Oswal Real
Estate Investment Advisors wins the " Best Real Estate Fund of the Year -

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Domestic" at the CNBC - AWAAZ Real Estate Awards 2016 -17., Motilal
Oswal Asset Management has crossed the milestone of US $ 2.5 Billion
Equity Assets Under Management, Motilal Oswal Commodities Broker
Pvt. Ltd. wins the "Commodity Broker of the Year 2016 - 17" at MCX
Excellence Awards., Aspire Home Finance Corporation Limited awarded
second prize for Best Performing Primary Lending Institution under CLSS
for EWS/LIG by Ministry of Housing and Urban Poverty Alleviation.,
Motilal Oswal Securities Ltd wins the Best performing National Financial
Advisor - Equity Broker at the CNBC TV18 Financial Advisory Awards
2016-17, MOFSL has been featured in Forbes Super 50 Companies 2017,
Aspire Home Finance Corporation Limited has been awarded "Prestigious
Brands 2017" under Home Finance category at Goodwill Brands 2017.,
Aspire Home Finance has been awarded in MSME Banking & NBFC
Excellence Awards 2016 with two categories, Runner up in "Eco-
Technology savvy NBFC" & the winner as " Best NBFC"., Think Equity
Think Motilal Oswal awarded as the best advertising campaign at the
International Association Awards for creative excellence., Corporate
Communications team of Motilal Oswal Financial Services won ‘In-house
Team of the year ( Mid-size)’ at Fulcrum Awards 2017, Aspire Home
Finance has been awarded in URS Asia One as "India’s Greatest Brands
2016-17" and Mr. Anil Sachidanand, MD & CEO - AHFCL, awarded as
"India’s Greatest Leaders 2016-17., Motilal Oswal Asset Management
company ranked among Asia’s Top 100 Money Managers by Institutional
Investor Magazine, MOAMC wins Best Portfolio Manager at the
ASSOCHAM Capital Markets Intermediaries Excellence Awards 2017.,
MOFSL becomes a Fortune (India) 500 company.

o. In 2018 Motilal Oswal Financial Services is now a Fortune 500 Company,

Motilal Oswal Financial Services has been awarded the Finnoviti Award

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for MO GENIE, Motilal Oswal Financial Services Ltd. gets Hottest 50

Brands Award by Paul Writer at Mumbai Brand Summit, Motilal Oswal
Private Equity IBEF II has been awarded Private Equity (Mid-size Fund)
Exit Performance of the Year 2017, by The IVC Association at the IVCA
Conclave, 2018, Motilal Oswal Financial Services Ltd. is among INDIAS
15 BEST WORKPLACE IN BFSI - 2018,Motilal Oswal wins GOLD for
marketing effectiveness at the Global ACEF customer engagement awards
(Awarded for Think Equity. Think Motilal Oswal TV Ad, Motilal Oswal
TV Ad wins 3 awards at the ABBY Awards for Creative Excellence,
Motilal Oswal Financial Services Ltd wins the Brand of the Year Award at
the CNBC TV18 - India Business Leadership Awards and Mr Motilal
Oswal awarded the Outstanding Institution Builder at the 9th AIMA
Managing India Awards.

Products of MOSL

Equity

 One of the best avenues to fight inflation

Inflation drives up the cost of living and eats away the value of savings.
Traditional investment avenues like Fixed Deposits, Bonds, etc. have a
limited upside of 8 to 10 %, whereas equities as an asset class have given an
average annual return of about 13 % in the last 10 years. Hence, when it
comes to beating inflation, equities are undoubtedly your best bet.

 Source of Long-term wealth creation

MOSL philosophy of "Buy Right Sit Tight" has helped a lot of investors in
long-term wealth creation. Investing in good businesses and growth stories

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at an early stage provides unlimited upside potential. For example, your

investment of Rs. 1,000 in the Infosys IPO in 1993 would have fetched you
Rs. 30 Lakhs today. Not participating in growth stories would certainly be
an opportunity missed.

 One of the most Liquid investment options

Equities also provide investors with the flexibility of quickly changing their
holding patterns to suit their requirements and also convert their holdings
into cash instantly. This makes it the most suitable option compared to other
asset classes for investors who are looking for liquidity.

Derivatives

Derivatives do away with the need to invest a large amount of capital upfront
and allowing you to benefit from market movements. This gives you greater
liquidity than most otherassets. They are an excellent avenue to help you
leverage on anticipated market movements and an effective tool to hedge
your risks, speculate and earn returns in a relatively shorter duration. You
can trade in Futures - contracts or an agreement between two parties to either
buy or sell a fixed quantity of assets at a particular time in the future for a
fixed price OR Options - A similar contract, except the parties are not
obligated to fulfil the terms of the agreement. These contracts are then traded
in the market.

 Leverage
Enables investors to get higher trading exposure with a low margin
amount

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 Hedging
Allows investors to safeguard themselves against the potential losses by
hedging their positions
As a part of this, they buy in the cash segment and agree to sell in the
derivatives market or vice versa.

 Risk Flexibility
Allows investor to choose between conservative or high-risk strategies
based on the expected rise and fall of stock prices

 Higher Probability of Returns

Possibility to garner returns irrespective of market moving up, down or
sideways

Commodities

Commodity trading brings a basket full of diverse avenues for investment,

away from the traditional avenues of equity, bonds and real estate. Based on
the historical data, adding commodities exposure to your existing portfolio
helps you increase the returns while lowering the risk. Commodities have
very little or negative correlation with other asset classes.

Currencies

A market that attracts about $5.2 trillion in daily volume, recognized as

world's largest market, accessible globally 24 hours a day - that is exactly

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Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

what the Currency market is made up of! The advantage of small margin
requirements and lower entry barriers makes it an important part of a retail
investor's portfolio. What's more, an investor can trade in currencies through
their existing equity account. Currency Derivatives are also very efficient
risk management instruments offering benefits such as:

 Hedging
Protect your foreign exchange exposure in business and hedge potential
losses by taking appropriate positions

 Investments
Trade or invest on the short term movement of markets through Currency
Futures, also take long-term exposures to various currencies

 Arbitrage
Take advantage of currency exchange rates in different markets and
different exchanges

 Leverage
Trade in the currency derivatives by just paying a margin of 3-4 % of the
total value instead of the full traded value

Mutual Fund

Mutual funds are ideal for investors who want to invest in various kinds of
schemes with different investment objectives but do not have sufficient time
and expertise to pick winning stocks. Mutual funds give the investor the

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Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

advantage of professional management, lower transaction costs, and

diversification, liquidity and tax benefits

Key Benefits of investing in Mutual Funds:

 Diversification
 Professional management and well regulated
 Disciplined investment approach
 Low transaction costs
 Liquidity
 Tax benefits

PMS (Portfolio Management Services)

MOSL have MOAMC discretionary Portfolio Management Service, which

offers professional management of investor’s investments with an aim to
deliver consistent returns. It relieves investor from all monitoring hassles
with benefits like regular reviews, strong risk management flexibility and
makes it an ideal investment avenue for high net worth investors.

Key Benefits for Investing into PMS:

 Strong and Active risk management

 Diversification of portfolio for adequately spreading equity related risks.
 Active and regular monthly review and portfolio rebalancing
 Experienced and Professional fund management team
 Flexibility to switch from one strategy to other
 Additional purchase facility & Partial Withdrawal facility

IPOs (Initial Public Offerings)

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Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

The primary market provides investor's opportunities to buy shares at a

reasonable price prior to its listing price. Additionally, retail investors also
enjoy discounted rates while applying for IPO 's. Holding on to the shares
also provide an opportunity to participate in the future success of these
companies.

Key Benefits for Investing into IPOs:

 Opportunity to get the stock at the lowest possible price

 Can invest in the stock at a discounted price rather than the cut-off price.
 No refund hassles under ASBA process
 The probability of making profits on the listing is High
 No Brokerage and Other Charges
 Opportunity to be a part of the growth story of the issuing company

Insurance

Insurance is there to provide protection for yourself, your investment and

your business. Disaster could take any form; car breaks down, roof leaks, a
major home fire, an automobile accident that leads to a legal action and
someone in the family becomes illustration: Insurance gives you peace of
mind and you know that if anything happens to you, your family or your
business that you will be financially secure. The best course of action is to
prepare for the worst & hope for the best.

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

Fixed Income

Fixed Income is a type of investing style for which periodic income is

received at regular intervals at a secured & unchanged rate. It is safe and
static in nature.

 Ideal instruments for people seeking capital protection & regular coupon
income
 Easy to judge safety level of companies, since most of the instruments
are rated
 Higher Interest rates for senior citizens
 Deposit tenures varying from 6 months to 10 years
 Get tax free income by investing in tax free bonds

Property Advisory

Property Advisory is a one-stop solution for all Real Estate requirements of

Buy/ Sell & Lease for both Residential & Commercial property. At Motilal
Oswal Property Advisory, our experienced Advisor will always get you a
Property at the BEST BUY with exceptional customer service.

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

2.1 Review of Literature

 C Gopalakrishnan,2014 This research investigates the Economic Value

Added (EVA) of BSE listed automobile sector in India using the Prowess
corporate databases developed by CMIE (Centre for Monitoring Indian
Economy) and CLP (Capital Line Plus) data from 2001-02 to 20011-12 for
Light Two & Three Wheelers, Commercial and Heavy Commercial vehicle
and Car and Jeep manufacturing Companies, and employ the findings to
estimate the Economic Profit using EVA Techniques. The study selected
fifteen companies listed in BSE using proportionate sampling with the Net
Sales of 100 crore and above.
 Nidhi Agarwal,2015 One of the major industrial sectors in India is the
automobile sector. Subsequent to the liberalization, the automobile sector
has been aptly described as the sunrise sector of the Indian economy. This
sector has witnessed tremendous growth during the last two decades. On
the canvas of the Indian economy, automobile industry occupies a
prominent place. The study focuses on the growth and development of
Automobile industry in India. A sound transportation system plays a
pivotal role in the country's
 R Manojkumarr,2015 The Indian automotive component industry
manufactures the entire range of parts required by the domestic automobile
industry for various vehicles including cars, jeeps, light and heavy
commercial vehicles (LCV's and HCV's), tractors, two and three wheelers.
The Indian Auto Component Industry has been navigating through a period
of rapid changes. Driven by global competition and the recent shift in focus
of global automobile manufacturers, business rules are changing and
liberalization has sweeping ramifications for the industry. The global auto
components industry is estimated at US$ 1.2trillion. The Indian Auto
Component Sector has been growing at 20% per annum since 2000 and is
projected to maintain the high- growth phase of 15-20% till 2015. The
escalating Indian Automobile Industry has indirectly influenced the
expansion of the auto spare parts sector in the country. India is steadily
surfacing as an international outsourcing destination for producing
different automotive components. Firms like Volvo, Toyota, Daimler
Chrysler, Hyundai, etc are sourcing their auto spare parts from different
automive makers of India.

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Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

 K Rajalakshmi, T Ramachandran,2012 FDI Inflows to Automobile

Industry have been at an increasing rate as India has witnessed a major
economic liberalization over the years in terms of various industries. The
automobile sector in India is growing by 18 percent per year. The major
investing countries are Mauritius (mainly routed from developed
countries), USA, Japan, UK, Germany, the Netherlands and South Korea.
24. India needs to worry on the foreign direct investment (FDI) front.
Direct Investment Inflows in India-Opportunities and Benefits, Important
Aspects of FDI in Automobile Industry, Recent FDI Trends in India, The
major foreign players who have a significant role in the development of
Indian automobile industry, were discussed and the passenger car segment
growth, Production, sales and Investment were analyzed.. Here the
researcher using three statistical tool for analyzing the study, ARIMA,
Linear & Compound Model for analysis purpose to measure future
prediction using time series analysis. Hence this study necessitated the
causes and impact of FDI flows in automobiles sector and also policy
regulation, FDI flows in passenger car segment and recent FDI trend in this
sector were discussed.
 Vikrant Vikram Singh, Jatinder Kaur, Arbin Hassan,2014 A rating
event is defined as a change in credit rating or a change in the imminent
rating action or outlook. Stock market prices are very volatile and are often
affected by various events that happen around the world. Even if the event
is directly impacting the company or not, the degree of change would
probably be determined by how closely the event is related to the company.
That is why events like a credit agency downgrade affect the share price of
a company tremendously. Our study covers a time period from 2004–2013
to present an analysis of the impact that credit rating agencies’ decisions
have on the stock prices with reference to Indian Automobile and Banking
Companies. The sample consists of 107 rating changes covering 17
companies. With an event window of 31 days and an estimation window
of 200 days we have computed the abnormal returns for the event window
and tested the significance using the z-test. We have assumed that if the
value of z-test lies between -1.96 and +1.96 then there is no significant
difference otherwise there is a significant difference. The benefit of using
the market model depends on cumulative average abnormal returns
(CAAR), which increases the power to depict abnormal performance. In
our study the value of average cumulative abnormal return of automobile

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

and banking sector is -0.17703 and -1.24106. Z-test has been applied
whose value is -2.07213 and -10.383 for automobile and banking sector
respectively on the event date and the values do not lie between -1.96 and
1.96 which means that the alternate hypothesis is accepted and that there is
a significant relationship between credit rating changes and stock price.
The graphs also depict that before the announcement date abnormal returns
were positive and moving smoothly. Here it is interesting to note that 6
days before the announcement date there was a significant downward jump
in abnormal returns and after the event date, CAAR decreased
continuously leading to negative abnormal returns. This is the evidence of
information leakage which occurs earlier in the equity market (5 days
before the announcement), hence proving the assumption of event study
that markets are efficient. This leakage may arise as astute investors
develop their own predictions about future results at the same time rating
agencies are developing theirs.
 Shinde Govind P. & Dubey Manisha (2011) the study has been
conducted considering the segments such as passenger vehicle,
commercial vehicle, utility vehicle, two and three wheeler vehicle of key
players performance and also analyze SWOT analysis and key factors
influencing growth of automobile industry.
• Sharma Nishi (2011) studied the financial performance of passenger
and commercial vehicle segment of the automobile industry in the terms
of four financial parameters namely liquidity, profitability, leverage and
managerial efficiency analysis for the period of decade from 2001-02 to
2010-11. The study concludes that profitability and managerial efficiency
of Tata motors as well as Mahindra & Mahindra ltd are satisfactory but
their liquidity position is not satisfactory. The liquidity position of
commercial vehicle is much better than passenger vehicle segment.
 Singh Amarjit & Gupta Vinod (2012) explored an overview of
automobile industry. Indian automobile industry itself as a manufacturing
hub and many joint ventures have been setup in India with foreign
collaboration. SWOT analysis done there are some challenges by the
virtue of witch automobile industry faces lot of problems and some
innovative key features are keyless entry, electrically controlled
mechanisms enhanced driving control, soft feel interiors and also need to
focus in future on like fuel efficiency, emission reduction safety and
durability.

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Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

 Zafar S.M.Tariq & Khalid S.M (2012) the study explored that ratios are
calculated from financial statements which are prepared as desired
policies adopted on depreciation and stock valuation by the management.
Ratio is simple comparison of numerator and a denominator that cannot
produce complete and authentic picture of business. Results are
manipulated and also may not highlight other factors which affect
performance of firm by promoters.
• Ray Sabapriya (2012) studied the sample of automobile companies to
evaluate the performance of industry through indicators namely sales,
production and export trend etc for period of 2003-04 to 2009-10. The
study finds that automobile industry has been passing through disruptive
phases by over debt burden, under utilization of assets and liquidity
instability. The researcher suggested to improving the labour
productivity, labour flexibility and capital efficiency for success of
industry in future.
• Dawar Varun (2012) Study to analyze the effect of various
fundamental corporate policy variables like dividend, debit, capital
expenditure on stock prices of automobile companies of India. The study
tends that dividend & investment policy are relevant and capital structure
irrelevant to stock prices
 Mistry Dharmendra S. (2012) understood a study to analyze the effect
of various determinants on the profitability of the selected companies. It
concluded that debt equity ratio, inventory ratio, total assets were
important determinants which effect positive or negative effect on the
profitability. It suggerted to improve solvency as to reduce fixed financial
burden on the company profit & give the benefit of trading on equity to
the shareholders.
 Murlidhar, A. Lok Hande & Rana Vishal S. (2013) the author tries to
evaluate the performance of Hyundai Motors Company with respect to
export, Domestic Sales, productions and profit after tax. For this purpose,
the pie chart and bar graph are used to show the performance of company
various years.
• Dharmaraj, A.and Kathirvel N. (2013) explored an overview of new
industrial policy act 1991, which allow 100 percent foreign direct
investment. An attempt is made to find out the effect of FDI on financial
performance of automobile industry. It is concluded that the liquidity
ratios shows minor changes and profitability shows an increasing trend

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Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

during post FDI when compared to pre FDI. Post FDI efficiency ratio
shows that companies are efficiently utilizing the available resources. •
Rapheal Nisha (2013) the author tries to evaluate the financial
performance of Indian tyre industry. The study was conducted for period
2003-04 to 2011-12 to analyze the performance with financial indicators,
sales trend, export trend, production trend etc. The result suggests the key
to success in industry is to improve labour productivity and flexibility and
capital efficiency. •
Hotwani Rakhi (2013) the author examines the profitability position and
growth of company in light of sales and profitability of Tata Motors for
past ten years. Data is analyzed through rations, standard deviations and
coefficient of variance. The study reveals that there not exists a strong
relationship between sales & profitability of company.
• Sharma Rashmi, Pande Neeraj & Singh Avinash (2013) for
understanding how social media monitoring can help diving the
consumer decision & also study. The functions of social media i.e.
monitor, responses amplify and lead at maruti Suzuki India ltd. The
researcher had discussion with social media team median managers
for collecting data & also visited the official social media sites of
MSIL.
• Daniel A. Moses Joshunar (2013) the study has been conducted
to identify the financial strength and weakness of the Tata motors
Ltd. using past 5 year financial statements. Trend analysis & ratio
analysis used to comment of financial status of company. Financial
performance of company is satisfactory and also suggested to
increase the loan levels of company for the better performance.
• Dhole Madhavi (2013) Investing the impact of price movement
of share on selected company performance. It advise due investors
consider various factors before choosing the better portfolio.
Sentimental factors do play a role in price movement only in short
term but in long run annual performance is sole factor responsible
for price movement.
• Shende Vikram (2014) this research will be helpful for the new
entrants and existing car manufacturing companies in India to find
out the customer expectations and their market offerings. The
objective of study is the identification of factors influencing
customers performance for particular segment of cars.

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Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

• Azhagaiah R. & Gounasegaran (2014) recognized India’s per

capita real GDP growth as one of key drivers of growth for
country’s automobile industry. The central government would be
set up various task forces on issue related to taxation, land
acquisitions, labour reform and skill development for auto industry.
• Buvaneswari .R & Kanimozhip (2014) to study the credit
worthiness of selected firms in Indian car industry, tiruchy.
Professor Edward Altman of New York University developed
method Z score analysis to predict the company failure or
bankruptcy. To measure the fiscal fitness of a company combined a
set of five financial ratios.
• Idhayajothi, R et al (2014) the main idea behind this study is to
analyze the financial performance of Ashoka Leyland ltd. at
Chennai. The result shows that financial performance is sound and
also suggested to improve financial performance by reducing the
various expenses.
• Huda Salhe Meften & Manish Roy Tirkey (2014) have studied
the financial analysis of Hindustan petroleum corporation ltd. The
study is based on secondary data. The company has got excellent
gross profit ratio and trend is rising in with is appreciable
indicating efficiency in production cost. The net profit for the year
2010-11 is excellent & it is 8 times past year indicating reduction
in operating reduction in operating expenses and large proportion
of net sales available to the shareholders of company.
• Srivastava Anubha (2014) Data analysis has been done using
the top down approach ,i.e. Economic analysis, industry analysis,
company and technical analysis to find relationship between
automobile sector index with market index. Mahindra and
Mahindra have a great position on the stock market and will attract
investor and this could lead to expansion and growth. Thus Tata
motors and Maruti Suzuki need to take care of their stock and
expansion. •
Sarangi Pradeepta K et al (2014) undertook a study to forecast
the future trend of automobile industry. The study highlighted the
six different experiments have been carried out for period of 12
years data to estimate values for next 3 years. In each experiment
graph has been plotted using spreadsheet and then linear trend has

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Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

been drawn and expanded to calculate future values.

• Kumar Sumesh & Kaur Gurbachan (2014) Automobile sector
is the dominant player in economy of world. After liberalization
Indian automobile industry has emerged as a major contributor to
India’s GDP. The study identified that there is no significant in the
means score of various financial ratios of Maruti Suzuki and Tata
motors but in meeting their long term obligations and efficacy of
utilizing the assets show the significant difference in the efficiency
of both the firms.
• • Krishnaveni, M. & Vidya, R. (2015) find that Indian automobile
industry is a high flying sector these days and emerging as an
export hub in wake of liberalisation and globalization. This paper
revises the category wise production, sales and exports of
automobile industry in India. Industry growth can be viewed in
term of pre and post liberalization. As government allows 100
percent FDI, increase 15% in customs duty on cars and MUVs to
encourage local manufacturer and concessional import duty on
specified parts of hybrid vehicles.
• Sarwade Walmik Kachru (2015) analyzed the effects of
liberalization, government delicensing and liberal trade policies on
the growth of Indian auto mobile industry .The study recommends
that investing four- wheeler is going to be smart potion not only in
India but all around the world.
• Becker Dieter (2015) the report shows about the current state and
future prospects of the worldwide automobile industry. This survey
report the manufacturer, executive and consumer views about four
aspects, mobility culture, technological fit, business model
readiness and market share.
• Surekha B. & Krishnalah K. Rama (2015) this study reveals
the prosperity of Tata motors company. It can be concluded that
inner strength of company is remarkable. Company can further
improve its profitability by optimum capital gearing, reduction in
administration and financial expenses for the growth of company.
• Anu B. (2015) made an attempt to examine the relationship
between capital structure indicators, market price per shares and
also to test relationship between debt-equity and market price per
share of selected companies in industry. The study concludes that

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Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

all three companies support the hypothesis that there is relation

between debt-equity and MPS.
• Maheswari, V. (2015) made an attempt to analyze the financial
soundness of the Hero Honda motors limited have identified three
factors, namely liquidity position, solvency position and
profitability position based on the study of period 2002 to 2010
using ratio analysis.
• Agarwal, Nidhi (2015) the study focus on the comparative
financial performance of Maruti Suzuki and Tata motors ltd. The
financial data and information required for the study are drawn
from the various annual reports of companies. The liquidity and
leverage analysis of both the firms are done. To analyze the
leverage position four ratios are considered namely, capital
gearing, debt-equity, total debt and proprietary ratio. The result
shows that Tata motors ltd has to increase the portion of
proprietor’s fund in business to improve long term solvency
position.
• Nandhini, M. & Sivasalthi, V.(2015) have studied the impact of
both financial leverage as well as operating language on the
profitability of TVS motor company. The result shows that
company suffers from certain weakness & suggested to control
fixed cost as well as variable cost to gain adequate profits.
• Jothi, K. & Kalaivani, P. (2015) studied the comparative
performance of Honda Motors and Toyota Motor that both
companies have satisfactory short term liquidity position. As for as
cash ratio concerned Honda company has upper hand upper hand
in sound cash management practice during the study period. In case
of profitability it is rising from the both of companies but remained
much higher earning potential in Honda motor ltd.
• Krishnaveni , M. & Vidya, R (2015) author has selected 87
companies out of 242 companies in capital line database to discuss
the standard current ratio of automobile industry is matched with
tractor and four sectors like engine parts, lamps, gears and
ancillaries with standard norms. The study concludes that current
and liquidity ratio of automobile industry is matched with tractor
and the four sectors but other sectors have to improve the repaying
capacity to strengthen the financial aspects.

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

• Takeh Ata & Navaprabha Jubiliy (2015) Author has made

conceptual model to outline the impact of capital structure on the
financial performance i.e. capital structure is independent variable
that value is measured by using four ratios namely, financial debt,
total debt equity, total asset debt and interest coverage ratio where
as financial performance is dependent variable that value is
measured by using four ratios as return on assets, return on equity ,
operating profit margin and return on capital employed. Researcher
has selected 13 major steel industries and applied various statistical
tools like standard deviation, correlation matrix, anova etc are
employed for testing hypothesis with help of SPSS22.
• Kumar Rakesh Rasiklalajani & Bhatt Satyaki J. (2015) the
proposed research is intended to examine the trend and pattern of
financing the capital structure of Indian companies. The study is to
analyze the determinants of total debt ratios as well as determinants
of short term and long term ratios.
• Kumar Neeraj & Kaur Kuldip (2016) made an attempt to test
the size and profitability relationship in the Indian automobile
industry. To analyze the relationship linear regression model as
well as cross-sectional has been employed for the year 1998to
2014. For profitability analysis two different measures have been
used (i) ratio of net profit to total sales turnover (ii) ratio of net
income to net assets plus working capital and for form size two
indicators used namely, total sales turn over and net assets. The
time series analysis showed the positive relationship between firm
size and profitability but crosssectional show no relationship
between firm size and profitability.
• Ravichandran, M. & Subramanium M Venkata (2016) the
main idea behind this study is to assessment of viability, stability
and profitability of Force motors limited. Operating position of the
company can be measured by using various financial tools such as
profitability ratio, solvency ratio, comparative statement & graphs
etc. This study finds that company has got enough funds to meet its
debts & liabilities. Company can further improve financial
performance by reducing the administrative, selling & operating
expenses.
• Mathur Shivam & Agarwal Krati (2016) Ratio’s are an

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Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

excellent and scientific way to analyze the financial performance of

any firm. The company has received many awards and
achievements due to its new innovations and technological
advancement. These indicators help the investors to invest the right
company for expected profits. The study shows that Maruti Suzuki
limited is better than Tata motors limited.
• Jothi, K. & Geethalakshmi, A. (2016) this study tries to
evaluate the profitability & financial position of selected
companies of Indian automobile industry using statistical tools like,
ratio analysis, mean, standard deviation, correlation. The study
reveals the positive relationship between profitability, short term
and long term capital.
• Kumar Mohan M.S, Vasu. V. and Narayana T. (2016) the
study has been made through using different ratios , mean, standard
deviation and Altman’s Z score approach to study the financial
health of the company. The study reveals there is a positive
correlation between liquidity and profitability ratios except return
on total assets as well as Z score value indicate good health of the
company.
• Kaur Harpreet (2016) the author tries to examine the qualities &
quantities performer of maruti Suzuki co. & how had both impact
on its market share in India, For this study secondary data has been
collected from annual reports, journals, report automobile sites.
Result shows that MSL has been successfully leading automobile
sector in India for last few years.

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

Chapter 3: Research Methodology

Research methodology is a away to systematically solve a research problem. It
may be understood as a science of studying how research is done scientifically.
In this we study various steps that are generally adapted by a researcher in
studying his research problem along with the logic behind them. It is necessary
for the researcher to know not only the researcher methods/technicians but also
methodology. Research Design means a detailed outline of how an investigation
will take place. A research design will typically include how data is to be
collected, what instruments will be employed, how the instruments will be used
and the intended means for analyzing data collected. It is a framework or blue
print for conducting research. There are three types of research design such as
Exploratory Research design, Casual Research design and Descriptive Research
Design. In this study Explorative research as well as Descriptive Research is used.
Exploratory research is used primarily to gain a deeper understanding of
something. As can be seen, studies of this nature are less structured, more flexible
in approach and are not conducted to test or validate any preconceived
propositions. Descriptive research is undertaken to describe the situation,
community, phenomena, outcome or programs. Descriptive research attempts to
determine, describe or identify what is. The main goal of this type of research is
to describe the data and characteristics about what is being studied.

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

3.1 SOURCES OF DATA

In this stage, there is a need to gather primary as well as secondary data. There
are two types of data in research methodology which are as follow:
I. Primary Data
II. Secondary Data
Primary Data Data observed or collected directly from first-handed experience.
Primary research consists of a collection of original primary data collected by the
researcher. It is often undertaken after the researcher has gained some insight into
the issue by reviewing secondary researcher or by analyzing previously collected
primary data. Primary data is information that you collect specifically for the
purpose of your research project.
Secondary Data Published data and the data collected in the past or other parties
are called secondary data. Secondary data refers to data that was collected by
someone other than the user. Secondary data is the data that have been already
collected by and readily available from other sources. Such data are cheaper and
more quickly obtainable than the primary data. The data has been collected from
the Primary as well as various Secondary sources.

Sources of secondary data:-

1. Books
2. Internet & Websites
3. Business Magazines
4. Annual reports of company
The present study data is mainly based on secondary data.

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

INTRODUCTION TO TOPIC

FUNDAMENTAL ANALYSIS
Any investor while making investment is concerned with the intrinsic value of
the asset, which is determined by the future earning potential of the asset. In
case of securities market, an investor has number of securities available for
investment. But, he would like to invest in the one, which has good potential for
future. In order to ensure the future earnings of any security, an individual has
to conduct fundamental analysis of the company. Fundamental analysis of a
company involves in-depth examination of all possible factors, which have
bearing on the prospects of the company as well as its share price. Fundamental
analysis is divided into 3 stages in sequential manner as follows:
1. Economic analysis
2. Industry analysis
3. Company analysis

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

2.Economic analysis
The economic activity of any country has an impact on investment in many
ways. When the state of economy is good and it is at the growing stage, the
investment takes place and stock market is in boom phase. The reverse
situation takes place when the economic activity is low. In view of this it is
necessary to analyze all macro economic variables properly. The parameters,
which are used to analyze all macro economic variables, are given below:
 Growth rate of gross domestic product
GDP represents the aggregate value of the goods and services produced in the
economy. All the major investors, financial institutions, foreign financial
institutions, portfolio manager first tries to estimate the growth rate of GDP of
the country in which they are planning to invest
 Inflation
The assessment of GDP growth rate is to be done in light of increase in inflation
rate. If the rate of inflation grows in direct proportion to GDP, then the real rate
of growth would be insignificant.
 Interest rates
Most of the companies borrow funds from banks and financial institutions for
meeting their capital and revenue expenses. If the rate if interest would increase,
their interest expenses would also increase. This would lead to decrease in their
profitability. Increase in interest rates would be reflected in negative manner in
stock markets. Interest rates have to be increased for controlling inflation. It is a
measure to control the inflation means withdrawing the excess money from the
market in the form of interest.
2. Industry analysis
Classifying them on basis of business cycles does the industry analysis. They
can be classified into following categories:
 Growth industry
Growth industries are the ones those are independent of the business cycles.
These industries show growth irrespective of changes in economy. For
example, the information technology in India exhibited continuous growth
irrespective of the recession and boom in the entire economy of the country.
 Cyclical industry

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

The growth of these industries depends on the business cycle. When there is
boom period in the business cycle of industries or economy as a whole, these
industries also exhibit growth and vice versa. For example, steel industry.
The growth of steel industry mainly depends on auto industry and
construction industry. When there is boom in the auto industry, the steel is in
demand.
 Defensive industry
These categories of industry exhibit constant growth during all phases of
economy. They do not depend on business cycle of other industries. For
example, food industry enjoys constant growth irrespective of growth in
other industry.
 Cyclical growth industry
This type of industry experiences the period of growth and stagnation due to
change in technology. For example, computer hardware industry.
 Product of the industry
The user of the product may be either other industries or the household
sector or both. In case the product is to be used only by industrial sector,
then the growth of other user industry is also need to be analyzed. However,
if it is to be used by household sector, then factors such as inflation, increase
in level of income etc. are to be taken into account while estimation growth
of industry.
 Government policy
If the government offers tax subsidies and tax holidays, the industry has
good prospects. For example, biotechnology industry is being given number
of tax incentives as the government intends to promote the growth of
industry.
 The Market Share
The rate of growth in the market share of the industry over a period of time
shall be examined since it helps in finding the growth prospects and ability
to compete with industry involved in related product.
3. Company analysis
The strength of company can be assessed by examining certain quantitative
factors. The quantitative factors normally comprise of various financial ratios
which are used examine the operating efficiency of the company. They are
enumerated below:

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

QUALITATIVE FACTORS

 Management The management of a company should have expertise,

competence to control the operations of the company. The past track record of
the management towards shareholders should be examined. It should be a
management, which has rewarded its shareholders whenever company has made
good profits.
 Product of the company The growth prospect of demand of product being
manufactured by the company shall be assessed by analyzing the type of users
and existence of related products.
 Raw material The raw material used by the company also has a bearing on its
operating efficiency. If the raw material is to be sourced from indigenous
sources the company would not face any problems but if it has to be imported
from outside countries then the risk of change in government policies on
importing of such material should be taken into consideration

QUANTIATIVE FACTORS

1. Operating profit ratio :-

It helps in finding the amount of margins over manufacturing costs, which a
company is able to earn by selling its product. This ratio establishes the
relationship between operating net profit and sales. This will be calculated by
deducting only operating expenses from gross profits. Debenture holders or
creditors of the company mainly use this as interest paid is out of operating
profit.
2. Gross profit ratio :-
Gross profit is the difference between net sales and cost of goods sold. This
ratio shows the margin left after meeting the manufacturing costs. It measures
the efficiency of production as well as pricing. A high gross profit ratio means a
high margin for covering other expenses other than cost of goods sold.
Therefore, higher the ratio, the better it is.

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

3. Net profit ratio :-

This ratio shows the earnings left for shareholders (equity and preference) as a
percentage of net sales. It measures the overall efficiency of all the functions of
a business firm like production, administration, selling, financing, pricing, tax
management etc. This profit is mainly used by shareholders as dividend is paid
out of net profit of the company.
4. Return on equity :-
This ratio also known as return on shareholders funds indicates the percentage
of net profit available for equity shareholders to equity shareholder funds.
Return on equity =
Net profit available for equity shareholders*100
Equity shareholders funds
This ratio indicates the productivity of the ownership capital employed in the
firm. However, in judging the profitability of a firm, it should not be overlooked
that during inflationary periods, the ratio may show an upward trend because
the numerator of the ratio represents current values whereas the denomination
represents historical values.

5. Earnings per share :-

This ratio indicates the amount of net profit available per equity share of a
business firm.
Net profit after interest, tax, preference dividend
no. of equity shares
EPS is one of the criteria of measuring the performance of a company. If
earnings per share increase, the possibility of higher dividend paid by the
company also increases. The market price of the share of a company may also
be affected by this ratio. EPS may vary from company to company due to stock
in trade, depreciation etc.
6. Price earnings ratio :-
Market price per equity share
EPS
It means that the market value of every rupee of earnings is …....... times.
7 .Dividend payout ratio :-

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

This ratio indicates the percentage of profit distributed as dividends to the

shareholders. A higher ratio indicates that the company follows a liberal
dividend policy, while a lower ratio implies a conservative dividend policy.
Dividend per share*100
EPS
8. Dividend yield ratio :-
Dividend per share*100
Market price per share
This ratio is very important for investors who purchase their shares in the open
market. They will evaluate their return against their investment i.e. the market
price paid by them. The higher the ratio, the more attractive are their
investments.
9. Current ratio :-
This ratio is calculated by dividing current assets by current liabilities. This
ratio indicates how much current assets are there as against each rupee of
current liabilities. If majority of current assets are in the form of inventory, even
a 2:1 ratio will not result into favorable condition because inventory is
considered to be the least liquid assets out of all current assets of a firm.
Current assets
Current liabilities
10. Long term solvency/Debt Equity ratio
Ratio like debt-equity ratio helps in examining long-term solvency of the
company. Higher debt equity is not favorable as it indicates dependence of
company on borrowed funds. Any increase in interest rates may significantly
affect shareholders earnings. It should be assessed whether the company is able
to make use of trading on equity or not.
Long term funds
Shareholders funds
Or

Long term funds

Shareholders funds + long term funds

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

Shareholders funds consist of equity share capital, preference share capital and
reserve and surplus.A low ratio will quite satisfactory from creditor’s angle.

TECHNICAL ANALYSIS
After having the company analyzed by fundamental analysis, an investor likes to
purchase the shares of that company at appropriate time. Technical analysis helps
in estimating the optimum time for purchasing shares short-listed for purchase.
Technical analyst makes use of different types of chart and patterns formed by
movement in the past to make future projections about the movement and also
find appropriate time of buy and sale of stock.
Difference between Technical and Fundamental analysis
 Technical analysis mainly seeks to predict short term price movement, whereas
fundamental analysis tries to establish long term values.
 The focus of technical analysis is mainly concentrate on past price and volume
pattern of the shares whereas they also take into account the general industry and
economic conditions.
 The technical analyst make buying and sell recommendation on the basis of
support and resistance level of the stock whereas in fundamental analysis
recommend by comparing its market price with the intrinsic value of the shares.

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

DATA ANALYSIS AND INTERPRETATION

AUTOMOBILE COMPANIES IN INDIA

Market Capitalization
Company Name
(Rs. cr)

Tata Motors 123,058.92

Eicher Motors 48,804.99

Ashok Leyland 26,680.09

Tata Motors (D) 7,906.44

Force Motors 3,968.69

SML Isuzu 1,878.06

Maruti Suzuki 127,846.32

M&M 79,226.54

Hind Motors 157.96

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

KEY FINANCIAL RATIOS

1. MARUTI SUZUKI

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

2. TATA MOTORS

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

3. MAHINDRA & MAHINDRA

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

SUGGESTIONS
 Before going to invest, an investor should have clear and adequate
knowledge of stock market
 It is better to go for Long term Investment rather than the Short term
Investment. Because it is less risky and also provides sufficient return.
 The investors should know the value of money.
 Practically, stock market activities are very risky. So, investors should be
careful while investing.
 In case of half knowledge about stock market is very dangerous. So,
whenever a person wants to invest in stock market he should take
necessary tips from the experts or Technical Analysts
 In case of half knowledge about stock market is very dangerous. So,
whenever a person wants to invest in stock market he should take
necessary tips from the experts or Technical Analysts
 Investors should also look into global pressure and market movement in
order to look for avenues of investing in different stocks and to take
position; some of the sources for understanding global pressure are
CNBC TV18, News Paper, Economy watch etc.

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

CONCLUSION

 As we all know India is one of the fastest growing economies in the

world. India is consistently achieving growth in automobile sector. The
automotive industry is witnessing tremendous and unprecedented changes
these days.
 The Indian automobile industry is going through a technological change
where each firm is engaged in changing its processes and technologies to
sustain the competitive advantage and provide customers with the
optimized products and services.
 The automobile industry had a growth of 14%-17%, with the average
annual growth of 10-15% over the last decade or so. With the incremental
investment of $35-40 billion, the growth is expected to double in the next
10 years.
 Consistent growth and dedication have made the Indian automobile
industry the second- largest tractor and two-wheeler manufacturer in the
world. It is also the fifth-largest commercial vehicle manufacturer in the
world. The Indian automobile market is among the largest in Asia.
 The Indian automobile industry is going through a phase of rapid change
and high growth. With new projects coming up on a regular basis, the
industry is undergoing technological change.
 The major players are expanding their plants and focusing on mass
customization, mass production, etc Apart from domestic production, the
industry is consistently focusing on the automobile exports.
 The auto component segment is contributing a lot in the export arena. The
liberalized policies of the government are now making the companies go
for more and more exports.
 Because of these reasons, the shares of automobile industry are
performing well and therefore the share market is attracting people to
invest their hard earned money and find fortune.
 But lack of knowledge about shares and stock market is making them
cautious of investing in this market. They need to be educated as well as
guided to minimize the risk and to assess the return on their investment.

Copyright.2019@AIMSR
Topic: Analysis on automobile sector in India with preference
To maruti Suzuki, Tata motors Mahindra and Mahindra

BIBLIOGRAPHY
WEBSITES
http://www.tradingeconomics.com/india/gdp-growth-annual
http://www.nseindia.com/global/content/about_us
http://www.bseindia.com/static/about  http://www.nirmalbang.com/about-
nirmaibang.aspx
http://www.moneycontrol.com/stocks/hist_stock_result.php?ex=N&sc_MARU
TI _SUZUKI 
http://www.moneycontrol.com/stocks/hist_stock_result.php?ex=N&sc_TATA_
MOT ORS
http://www.moneycontrol.com/stocks/hist_stock_result.php?ex=N&sc_MAHIN
DRA _ &_ MAHINDRA
1. www.bseindia.com
2. www.nseindia.com
3. www.stockchart.com
4. www.icicidirect.com
5. www.marutisuzuki.com
6. www.tatamotors.com
7. www.investopedia.com
8. www.moneycontrol.com
9. www.equitymaster.com
10.TICKER PLANT
11.CMIE

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