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(2011) Sugandha rajKulkarni in his research paper titled, “ A study on fundamental


analysis of
ONGC” explains about the relevance of fundamental analysis along with the attempt to find
the
intrinsic value of shares.
•(2011) Venkatesh C K and Madhu Tyagi in their research paper titled, “ Fundamental
analysis as a
method of share valuation in comparison with technical analysis” detailed about different
movement
of share prices in comparison with fundamental and technical analysis. It also emphasized
on the
market capitalization and organizational structureLITERATURE RIVIEW
A

REPORT ON

FINANCIAL ANALYSIS OF SELECTED COMPANIES IN IT SECTOR

Submitted for the partial fulfilment of the degree

Bachelor of business administration (BBA)

Submitted to:

The principal;

AGARWAL VIDYA VIHAR ENGLISH MEDIUM COLLEGE, VESU– SURAT.

Affiliated to:

Veer Narmad South Gujarat University, Surat.

Surbhi Bhansali

02

T.Y.BBA (FINANCE)

UNDER THE GUIDANNCE OF

MS.

Prepared by:

Surbhi Bhansali

02
2

BBA (semester – vi)

Student’s declaration

I hereby declare that the winter internship project report titled “FINANCIAL ANALYSIS
OF SELECTED COMPANIES IN IT SECTOR”is a result of my own work and
myindebtedness to other work publications, references, if I have been duly
acknowledged. If I am found guilty of coping from any other report or published
information and showing as original work, or extending plagiarism limit,
3

Acknowledgement
The successful completion of any task would be incomplete without the mention of the
leaders, whose constant guidance and encouragement crown all the efforts with
success. I am highly obliged to the veer Narmad south Gujarat university for arranging
the programmed of practical in bachelor of business administration in such a manner.

It is my privilege to express my deep sense of gratitude to khoosbhu mam, their efforts,


guidance, valuable comments and suggestions for making this project report. They
helped me to complete the report on the practical study and gave contribution to
improve the practical knowledge. I am also acknowledging the co- operation and
support that I received from the principal.

Finally, I would like to express my deep sense od gratitude to all those who are always
a source of inspiration for me, their involvement, unconditional co-operation and support
in the successful and timely preparation of this report.
4

CHAPTER 1 INTRODUCTION TO INDUSTRY


Information Technology (IT) is defined as the design, development, implementation and
management of computer-based information systems, particularly software applications
and computer hardware. It has grown to cover most aspects of computing and
technology. The largest firms globally include IBM, HP, Dell and Microsoft. Information
Technology is one of the most important industries in the Indian economy. The IT
industry of India has registered huge growth in recent years. In the last ten years the
Information Technology industry in India has grown at an average annual rate of 30%.

The Information Technology (IT) industry has become one of the fastest growing
industries in India because of which it has caught world attention. India is now being
identified as powerhouse for incremental development of computer software. It has
grown from USD 4 billion industry to USD 58.8 billion industry in2008-09 employing over
2 million people. IT-BPO Industry has become growth engine for the economy
contributing substantially to increases in GDP, urban employment and exports to
achieve vision of ‘young and resilient India’. The key segments that have contributed
significantly to industry’s exports include-Software and services and IT enabled
services. In the face of current recession though the mood is that of cautious optimism
but Industry is expected to witness sustainable growth over period of two years. But at
the same time while industry has significant headroom for growth, as the competition is
increasing with China emerging as major threat, all the stakeholders of Indian IT
industry must give concentrated efforts to ensure that India realizes its potential and
maintains its leadership position in future also.

The IT industry is heavily influenced by factors like the global market and sustenance of
its rate of growth. The recession in the United States also impacted the IT community in
5

India negatively. This segment is promising and has vast potential, but there are
concerns regarding the demand-supply gap, which is widening. Some challenges which
the industry is facing are inadequate infrastructure, tax issues and limited preferential
access for local firms. China and Taiwan are examples of low-cost destinations, and
India needs to change its current tax structure so that it can outdo competition from
other countries.

The IT industry is one which is not limited to software development alone. Technology
can be applied in libraries, hospitals, banks, shops, prisons, hotels, airports, train
stations and many other places through database management systems, or through
custom-made software as seen fit.

The IT sector in India has been driving growth for the last decade and more, and has
the potential to continue doing so for the next couple of years if shortcomings are met
and challenges are faced.

India's IT industry is expected to grow at a rate of 12 - 14% during 2016 - 2017 as per a
report by India's software industry body National Association of Software and Services
Companies (NASSCOM.) This clearly shows that information technology is a sector
which will likely be one of the emerging markets in the days to come as India's economy
requires more hardware, software and other IT services. In a NASSCOM-McKinsey
report, India's position in the global offshore IT industry is based on five factors -
abundant talent, creation of urban infrastructure, operational excellence, conducive
business environment and finally, continued growth in the domestic IT sector.

People are the most important asset of any service-basedorganization. People


Management, therefore, attains special importance in services companies. The IT
industry typically suffers from high attrition rates across the segments. The attrition rates
are more pronounced in small scale IT service companies. High attrition adversely
impacts the continuity of project staffing and project deliveries, consistency of quality
and productivity. Uncertain and unpredictable schedules and quality of delivery makes
customers wary of doing business with these companies.
6

Indian IT companies have globally established their superiority in terms of cost


advantages, availability of skilled manpower and the quality of services. They have
been enhancing their global services delivery capabilities through a combination of
organic and inorganic growth initiatives. Global giants like Microsoft, SAP, Oracle and
Lenovo have already established their captive centers in India. These companies
recognize the advantage India offers and the facts that it is among the fastest growing
IT markets in the Asia -Pacific region.

The global sourcing market in India continues to grow at a higher pace compared to the
IT industry. India is the leading sourcing destination across the world, accounting for
approximately 55 per cent market share of the US$ 185-190 billion global services
sourcing business in 2017-18. Indian IT &IT’S companies have set up over 1,000 global
delivery centres in about 80 countries across the world, India has become the digital
capabilities hub of the world with around 75 per cent of global digital talent present in
the country.

Investments and Development


Indian IT's core competencies and strengths have attracted significant investments from
major countries. The computer software and hardware sector in India attracted
cumulative Foreign Direct Investment (FDI) inflows worth US$ 39.47 billion between
April 2000 and June 2019 and ranks second in inflow of FDI, as per data released by
the Department for Promotion of Industry and Internal Trade (DPIIT).
Leading Indian IT firms like Infosys, Wipro, TCS and Tech Mahindra, are diversifying
their offerings and showcasing leading ideas in blockchain, artificial intelligence to
clients using innovation hubs, research and development centers, in order to create
differentiated offerings.

Some of the major developments in the Indian IT and IT ’S sector are as follows:

 Total export revenue of the industry is expected to grow 8.3 per cent year-on-
year to US$ 136 billion in FY19.
7

 UK-based tech consultancy firm, Continues, has been acquired by Cognizant.


 In May 2019, Infosys acquired 75 per cent stake in ABN AMRO Bank's subsidiary
Stater for US$ 143.08 million
 In June 2019, Mind tree was acquired by L&T.
 NASSCOM has launched an online platform which is aimed at up-skilling over 2
million technology professionals and skilling another 2 million potential
employees and students.
 Revenue growth in the BFSI vertical stood at 6.80 per cent y-o-y between July-
September 2018.
 As of March 2018, there were over 1,140 GICs operating out of India.
 PE investments in the sector stood at US$ 2,400 million in Q4 2018.

Market Size

The IT-BPM sector in India stood at US$177 billion in 2019 witnessing a growth of 6.1
per cent year-on-year and is estimated that the size of the industry will grow to US$ 350
billion by 2025. India’s IT &ITeS industry grew to US$ 181 billion in 2018-19. Exports
from the industry increased to US$ 137 billion in FY19 while domestic revenues
(including hardware) advanced to US$ 44 billion. IT industry employees 4.1 million
people as of FY19.

Spending on information technology in India is expected to reach US$ 90 billion in 2019.


Revenue from digital segment is expected to comprise 38 per cent of the forecasted
US$ 350 billion industry revenue by 2025.
Achievements
Following are the achievements of the government during 2017-18:

 About 200 Indian IT firms are present in around 80 countries.


 IT exports from India are expected to reach highest ever mark of US$ 137 billion
of revenues in FY19 growing at 8.3 per cent.
 Revenue of GICs is expected to touch US$ 50 billion by 2025.
8

 Highest ever revenue was generated by Indian IT firms at US$ 181 billion in
2018-19.

Road Ahead

India is the topmost off shoring destination for IT companies across the world.
Having proven its capabilities in delivering both on-shore and off-shore services to
global clients, emerging technologies now offer an entire new gamut of opportunities
for top IT firms in India. Export revenue of the industry is expected to grow 7-9 per
cent year-on-year to US$ 135-137 billion in FY19. The industry is expected to grow
to US$ 350 billion by 2025 and BPM is expected to account for US$ 50-55 billion out
of the total revenue.

The sector has been classified into many categories:

1. IT services.
2. Engineering services.
3. ITES-BPO services.
4. E-business.

It sector can be further be categorized into information services(IS) outsourcing,


packaged software support and installation, system interion, processing services,
hardware support and installation and it training and education.

Engineering services includes industrial design, mechanical design, electronical


system design (it includes chip/board and Embedded software design), Design
Validation Testing, Industrialization And Prototyping.

E Business (Electronic Business) is carrying out business on the internet; it includes


buying n selling, serving customers and collaboration with business partners.
9

Information Technology is
fragmented industry and
not a concentrated one. In
fragmented
industries, there is
absence of big dominant
10

players such that small


companies also prevail in
the market but
it is difficult for one
company to establish a
vigorous operation.
Information technology
industry is a
fragmented industry,
which emphasis on free
entry and exit of firms into
the sector. Even though
such a
situation prevails in the
market, the major role is
played by the big giant
11

corporate like IBM, Infosys,


TCS,
Inforte, Wipro and others
Information Technology is
fragmented industry and
not a concentrated one. In
fragmented
industries, there is
absence of big dominant
players such that small
companies also prevail in
the market but
it is difficult for one
company to establish a
vigorous operation.
12

Information technology
industry is a
fragmented industry,
which emphasis on free
entry and exit of firms into
the sector. Even though
such a
situation prevails in the
market, the major role is
played by the big giant
corporate like IBM, Infosys,
TCS,
Inforte, Wipro and others
Information Technology is
fragmented industry and
13

not a concentrated one. In


fragmented
industries, there is
absence of big dominant
players such that small
companies also prevail in
the market but
it is difficult for one
company to establish a
vigorous operation.
Information technology
industry is a
fragmented industry,
which emphasis on free
entry and exit of firms into
14

the sector. Even though


such a
situation prevails in the
market, the major role is
played by the big giant
corporate like IBM, Infosys,
TCS,
Inforte, Wipro and others
Information Technology is
fragmented industry and
not a concentrated one. In
fragmented
industries, there is
absence of big dominant
players such that small
15

companies also prevail in


the market but
it is difficult for one
company to establish a
vigorous operation.
Information technology
industry is a
fragmented industry,
which emphasis on free
entry and exit of firms into
the sector. Even though
such a
situation prevails in the
market, the major role is
played by the big giant
16

corporate like IBM, Infosys,


TCS,
Inforte, Wipro and others
Information Technology is
fragmented industry and
not a concentrated one. In
fragmented
industries, there is
absence of big dominant
players such that small
companies also prevail in
the market but
it is difficult for one
company to establish a
vigorous operation.
17

Information technology
industry is a
fragmented industry,
which emphasis on free
entry and exit of firms into
the sector. Even though
such a
situation prevails in the
market, the major role is
played by the big giant
corporate like IBM, Infosys,
TCS,
Inforte, Wipro and others
Information Technology is
fragmented industry and
18

not a concentrated one. In


fragmented
industries, there is
absence of big dominant
players such that small
companies also prevail in
the market but
it is difficult for one
company to establish a
vigorous operation.
Information technology
industry is a
fragmented industry,
which emphasis on free
entry and exit of firms into
19

the sector. Even though


such a
situation prevails in the
market, the major role is
played by the big giant
corporate like IBM, Infosys,
TCS,
Inforte, Wipro and others
Information Technology is
fragmented industry and
not a concentrated one. In
fragmented
industries, there is
absence of big dominant
players such that small
20

companies also prevail in


the market but
it is difficult for one
company to establish a
vigorous operation.
Information technology
industry is a
fragmented industry,
which emphasis on free
entry and exit of firms into
the sector. Even though
such a
situation prevails in the
market, the major role is
played by the big giant
21

corporate like IBM, Infosys,


TCS,
Inforte, Wipro and others.
Information Technology is
fragmented industry and
not a concentrated one. In
fragmented
industries, there is
absence of big dominant
players such that small
companies also prevail in
the market but
it is difficult for one
company to establish a
vigorous operation.
22

Information technology
industry is a
fragmented industry,
which emphasis on free
entry and exit of firms into
the sector. Even though
such a
situation prevails in the
market, the major role is
played by the big giant
corporate like IBM, Infosys,
TCS,
Inforte, Wipro and others.
Information Technology is
fragmented industry and
23

not a concentrated one. In


fragmented
industries, there is
absence of big dominant
players such that small
companies also prevail in
the market but
it is difficult for one
company to establish a
vigorous operation.
Information technology
industry is a
fragmented industry,
which emphasis on free
entry and exit of firms into
24

the sector. Even though


such a
situation prevails in the
market, the major role is
played by the big giant
corporate like IBM, Infosys,
TCS,
Inforte, Wipro and others.
Government can make
their interference into the
technology sector which
has its own effect in the
industry. Government
interference and
intervention can be
explained in two
25

fundamental parts i.e.


directly
and indirectly. Direct
method means support
given by the government
for the development of
new
technology and market
mechanisms to present
incentives for change done
by the industry. On the
other
Jour of Ad
26

CHAPTER 2 INTRODUTION TO COMPANY

The introduction of five companies are as follows:

1.TATA CONSULTANCY SERVICE (TCS):

Tata Consultancy Services Limited (TCS) is an


Indian multinational information technology (IT) service and consulting and
business solutions  company headquartered in Mumbai, Maharashtra. It is
a subsidiary of Tata Group and operates in 46 countries.

TCS is the largest Indian company by market capitalization. Tata


consultancy services is now placed among the most valuable IT services
27

brands worldwide. TCS alone generates 70% dividends of its parent


company. TCS was ranked 64th overall in the Forbes World's Most
Innovative Companies ranking, making it both the highest-ranked IT
services company and the top Indian company. It is the world's largest IT
services provider. As of 2018, it is ranked eleventh on the Fortune India
500 list.

Tata Consultancy Services Limited was founded in 1968 by division of Tata


Sons Limited. Its early contracts included punched card services to sister
company TISCO (now Tata Steel), working on an Inter-Branch
Reconciliation System for the Central Bank of India, and providing bureau
services to Unit Trust of India.

In 1980, TCS established India's first dedicated software research and


development center, the Tata Research Development and Design Centre
(TRDDC) in Pune. In 1981, it established India's first client-dedicated
offshore development Centre, set up for clients Tandem. TCS later (1993)
partnered with Canada-based software factory Integrity Software
Corporation which TCS later acquired.

On 25 August 2004, TCS became a Publicly Listed Company.

In 2005, TCS became the first India-based IT services company to enter


the bioinformatics market. In 2006, it designed an ERP system for
the Indian Railway Catering and Tourism Corporation. By 2008, its e-
business activities were generating over US$500 million in annual
revenues.

TCS entered the small and medium enterprises market for the first time in
2011, with cloud-based offerings. On the last trading day of 2011, it
28

overtook RIL to achieve the highest market capitalization of any India-


based company. In the 2011/12 fiscal year, TCS achieved annual revenues
of over US$10 billion for the first time.

In May 2013, TCS was awarded a six-year contract worth over ₹1100 crore
to provide services to the Indian Department of Posts. In 2013, the firm
moved from the 13th position to 10th position in the League of top 10
global IT services companies and in July 2014, it became the first Indian
company with over Rs 5 lakh crore market capitalization .

In Jan 2015, TCS ends RIL's 23-year run as most profitable firm

In Jan 2017, the company announced a partnership with Auras, Inc., a


payments technology company, to deliver payment solutions for retailers
using TCS Omni Store, a first of its kind unified store commerce platform.

TCS Honored with Four Stevie’s at the 2019 American Business Awards.

TCS and its 67 subsidiaries provides a wide range of information


technology-related products and services including application
development, business process outsourcing, capacity planning, consulting,
enterprise software, hardware sizing, payment processing, software
management and technology education services. The firm's established
software products are TCS Ba NCS and TCS Master Craft.

Tata Consultancy Services has 285 offices across 46 countries and 147
delivery centers in 21 countries. At the same date TCS had a total of 58
subsidiary companies.

Service lines

TCS services are currently Organized into the following service lines:
29

 Application development and maintenance (43.80%) value.


 Asset leverage solutions (2.70%)
 Assurance services (7.70%)
 Business process outsourcing (12.50%)
 Consulting (2.00%)
 Engineering and Industrial services (4.60%)
 Enterprise solution (15.21%) and
 IT infrastructure services (11.50%)

Tata Research Development and Design Centre

TCS established the first software research center in India, the Tata
Research Development and Design Centre, in Pune ,India in 1981. Tata
research development and design center (TRDDC) undertakes research
in Software engineering, Process engineering and systems research.
Researchers at TRDDC also developed Master Craft. A Model Driven
Development software that can automatically create code based on a
model of a software, and rewrite the code based on the user's needs.TCS
deployed thousands of these filters in the Indian Ocean tsunami disaster of
2004 as part of its relief activities .This product has been marketed in India
as Tata Swachh, a low cost water purifier.
30

2. INFOSYS:

Infosys was co-founded in 1981 by CEO NarayanMurthy, Nandan Nilekani,


S. Gopalkrishanan, S. D. Shibulal , K. Dinesh, N. S. Raghavan and Ashok
Arora all of whom were former employees of Patni Computer Systems.

Infosys Limited i an Indian multinational corporation that provides business


consulting, information technology and outsourcing services. It has its
headquarters in Bangalore, Karnataka, India.

Infosys is the second-largest Indian IT company after Tata Consultancy


Services by 2017 revenue and 596th largest public company in the world
31

based on revenue. On March 29, 2019, its market Capitalization was


$46.52 billion.

The company changed its name to Infosys Technologies Private Limited in


April 1992 and to Infosys Technologies Limited when it became a public
limited company in June 1992. It was later renamed to Infosys Limited in
June 2011.

An initial public offer (IPO) in February 1993 with an offer price


of 95 (equivalent to 510 or US$7.20 in 2018) per share against book value
of 20 (equivalent to 110 or US$1.50 in 2018) per share was
undersubscribed but it was "bailed out" by US investment bank Morgan
Stanley, which picked up 13% of equity at the offer price. Its shares were
listed in stock exchanges in June 1993 with trading opening
at 145 (equivalent to 790 or US$11 in 2018) per share.Its annual revenue
reached US$100 million in 1999, US$1 billion in 2004 and US$10 billion in
2017.

In 2012, Infosys announced a new office in Milwaukee, Wisconsin, to


serve Harley-Davidson, being the 18th international office in the United
States.Infosys hired 1,200 United States employees in 2011, and expanded
the workforce by an additional 2,000 employees in 2012. In April 2018
Infosys announced expanding in Indianapolis, Indiana. The development
will include more than 120 acres and is expected to result in 3,000 new
jobs—1,000 more than previously announced.

In July 2014, Infosys started a product subsidiary called EdgeVerve


Systems, focusing on enterprise software products for business operations,
customer service, procurement and commerce network domains.In August
32

2015, the Finacle Global Banking Solutions assets were officially


transferred from Infosys and became part of the product
company EdgeVerve Systems product portfolio.

Infosys provides software development, maintenance and independent


validation services to companies in finance, insurance, manufacturing and
other domains.

One of its known products is Finacle which is a universal banking solution


with variousmodules for retail & corporate banking

Its key products and services are:

 NIA – Next Generation Integrated AI Platform (formerly known as


Mana)
 Infosys Consulting – a global management consulting service
 Infosys Information Platform (IIP) – Analytics platform
 EdgeVerve Systems which includes Finacle, a global banking
platform
 Panaya Cloud Suite

Infosys has 82 sales and marketing offices and 123 development centers
across the world as of March 31, 2018, with major presence in India, United
States, China, Australia, Japan, Middle East and Europe.

In 2019, 60%, 24% and 3% of its revenues were derived from projects in
North America, Europe and India, respectively. Remaining 13% of
revenues were derived from rest of the world.

In India, shares of Infosys are listed on the BSE where it is included in BSE


SENSEX and NSE where it is included in CNX Nifty. Its shares are listed by
33

way of American depositary receipts (ADRs) at the New York Stock


Exchange.

Over a period of time, the shareholding of its promoters has gradually


reduced, starting from June 1993 when its shares were first listed. The
promoters' holdings reduced further when Infosys became the first Indian-
registered company to list Employees Stock Options Schemes and ADRs
on NASDAQ on 11 March 1999. The promoter holding on 31 March 2002
was 28.72% and at 30 June 2017 it dropped to 12.75% as they gradually
sold their shares and reduced involvement in active management of the
company.

Infosys had a total of 243,454 employees at the end of December 2019, out
of which 37.8% were women. Out of its total workforce, 229,658 are
software professionals and remaining 13,796 work for support and sales. In
2016, 89% of its employees were based in India.

During financial year 2019, Infosys received 2,333,420 applications from


prospective employees, interviewed 180,225 candidates and had a gross
addition of 94,324 employees, a 4% hiring rate. These numbers do not
include its subsidiaries.

The attrition rate of Infosys Ltd. including its subsidiaries, for financial year
2019 was 21.5%.

As the world's largest corporate university, the Infosys global education


Centre in the 337acrecampus has 400 instructors and 200+
classrooms, with international benchmarks at its core. Established in 2002,
it had trained around 1,25,000 engineering graduates by June 2015. It can
train 14,000 employees at a given point of time on various technologies.
34

The Infosys Leadership Institute (ILI), based in Mysuru, has 96 rooms and
trains about 400 trainees (called Infoscions) annually. Its purpose is to
prepare and develop the senior leaders in Infosys for current and future
executive leadership roles. The Infosys Training Centre in Mysuru also
provides a number of extracurricular facilities like tennis, badminton,
basketball, swimming pool and gym.

In 2019, Infosys was ranked as the 3rd Best Regarded Company in the
World by Forbes.

3. WIPRO:

The third-largest company in India, Bangalore-based Wipro Limited is an


ever-growing and ever-diversifying global company that manufactures and
sells products and services ranging from cooking oil and soaps to health
care instruments and information technology (IT) consulting. Although
Wipro's chairman and managing director Azim Hasham Premji is committed
35

to the company's diversified business model, its future clearly lies in its
continued successes in software and IT services, which make up nearly
half of the company's sales and has consistently outpaced the growth of
Wipro's other businesses. Wipro's world-class technologies division
provides a range of high-tech services such as global IT consulting, e-
business integration, and legacy systems maintenance to clients such as
Cisco Systems, Thomas Cooke, and NEC. Wipro's IT efforts are so reliable
that in 1998 the company became the first in the world to have been
awarded the Software Engineering Institute's (SEI) coveted Level 5
Certification for quality. After an impressive debut on the New York Stock
Exchange in 2000, Premji, who owns 75 percent of Wipro, became one of
the top billionaires in the world.

The company's first departure from its main cooking oil business came
about in 1975. Drawing Azim Premji's his engineering background, and at
the suggestion of one of the new IIM recruits, M. Cenesthopathy Rao,
Premji launched Wipro Fluid Power, an operation that manufactured
hydraulic and pneumatic cylinders. And under the direction of P.S. Pai,
Wipro's consumer care division expanded beyond oil in 1979, establishing
operations in soaps, toiletries, and baby care products. Along with major
expansions in distribution, Wipro's consumer care division gained so much
financial strength for the company that the company was able to further
diversify into IT and healthcare instruments.

Wipro would diversify into computers almost as soon as India's computer


industry began to develop in the mid-1970s. At the time, the Indian
government was the largest purchaser of computers sold in India, and was
standardized on the Unix-based platform, which helped Indian companies
36

build a solid reputation in Unix-based software development. The growing


IT industry in India attracted multinationals such as IBM, Motorola, and
Texas Instruments, who took advantage of India's wealth of low-cost
engineering labor.

In 1980 Wipro launched information technology services for the domestic


market, setting up in Bangalore a crack-team of R&D and marketing
managers, headed by Ashok Narasimhan. Their professionalism,
innovation and insistence on quality were to make Wipro the No. 1 listed
information technology company in the country within the next 15 years. By
1984 the company diversified into software, which it would discontinue by
1990, but it led to Wipro's foray into its growth business, software services.
Wipro began manufacturing PCs and workstations in 1985, quickly building
brand recognition and securing the enviable position of commanding a
premium price over the competitions' cheap clones. Wipro assembled and
redistributed hardware for U.S. companies like Nortel, Sun Microsystems,
and Cisco Systems.

Wipro began to shift its IT business away from costly on-site development
projects in the United States, to more profitable offshore development
closer to home. To help keep its competitive edge, the company replicated
the development labs of some of its major clients, including AT&T, IBM,
and Intel Corporation. And while Wipro continued to offer a range of
programming services, including hardware design, networking, and
communications and operating system support—it continued to diversify
into other lines of business.
37

In 1992 the company established a new lighting business, offering a range


of lighting solutions for domestic, commercial, industrial, and
pharmaceutical lab environments. Wipro discarded its PC brand in 1995
when it formed a joint venture with Acer, a Taiwan-based computer and
peripherals manufacturer and distributor.

By 1998, Bangalore became one of the many IT centers in India, with about
250 high-tech firms, plus about 100 just outside the city's limits. And Wipro
became the center of this Indian "Silicon Valley," as India's second-biggest
software exporter. Both software and hardware businesses generated 57
percent of the company's sales, and 75 percent of its profits, with software
employees numbering over 5,600 of the company's 9,000 total. Still, Premji
saw continued value in keeping Wipro's non-IT businesses, which he was
always quick to point out were the best in their niche markets. 

Along with diversifying its customer base, Wipro set out to expand and
deepen its IT service offerings and become a global tech powerhouse that
directly competes with giants such as IBM Global Consulting, Accenture,
and Electronic Data Service. Even though Wipro came out of 2000 quite
well, India's IT industry quickly became flanked with growing competition
from countries such as Ireland, China, Vietnam, and the Philippines. And
even though 60 percent of Indian software exports were absorbed by
businesses in the U.S. in 1999, that accounted for only 2 percent of the
global total.
Wipro decided to go beyond the unglamorous back-office code-writing on
contract, and pursue even more high-profile, high-paying projects that
involved e-business development, new software products, and end-to-end
business/system consulting. Instead of doing small portions of large IT
38

software solutions, Wipro would set out to develop comprehensive, end-to-


end solutions, which included both software services and hardware, and
often involved outsourcing the simpler code work to other countries.

In February 2002, Wipro became the first software technology and services


company in India to be ISO 14001 certified.Wipro Consumer Care and
Lighting Group entered the market of compact fluorescent lamps, with the
launch of a range of CFL, under the brand name of Wipro Smartlite.

In 2004 Wipro joined the Billion Dollar club.It also partnered with Intel for I-
Shiksha.

In 2006, Wipro acquired MangoInc. a US-based technology infrastructure


consulting firm, and a Europe-based retail provider.

In 2007, Wipro signed a deal with Lockheed Martin.It also agreed to


acquire Oki Techno Centre Singapore Pte Ltd (OTCS)and signed an R&D
partnership contract with Nokia Siemens Networks in Germany.

In 2008, Wipro's entered the clean energy business with Wipro Eco Energy.

InApril 2011, Wipro signed an agreement with Science Applications


International Corporation (SAIC) for the acquisition of their global oil and
gas information technology practice.

In 2012, Wipro acquired Australian Trade Promotions Management firm


Promax Applications Group (PAG) for $35 million.

In 2014, Wipro signed a 10-year $1.2 billion contract with ATCO, a


Canadian Energy and Utilities corporation based in Calgary, Alberta. This
was the largest deal in Wipro's history.In October 2016, Wipro announced
that it was buying Appirio, an Indianapolis-based cloud services company
for $500 million. In 2017, the company expanded its operations in London.
39

In 2017, Wipro Limited won a five-year IT infrastructure and applications


managed services engagement with Grameenphone (GP), a major telecom
operator in Bangladesh and announced it would set up a new delivery
Centre there.

In 2018, the company began building software to help with the General


Data Protection Regulation (GDPR) in Europe

In 2019, Wipro Consumer Care and the Ang-Hortaleza Corporation signed


a share purchase agreement for the sale of 100% of the latter's stake in the
personal care business of Splash Corporation, the companies announced
on Monday, April 29.

Wipro has been ranked 1st in the 2010 Asian Sustainability Rating (ASR) of
Indian companies and is a member of the NASDAQ Global Sustainability
Index as well as the Dow Jones Sustainability Index.
40

4. HCL:

HCL Technologies is on the Forbes Global 2000 list. It is among the top 20


largest publicly traded companies in India with a market capitalization of
$18.7 billion as of May 2017.As of September 2019, the company, along
with its subsidiaries, had a consolidated revenue of $9.3 billion.

In 1976, a group of six engineers, all former employees of Delhi Cloth &
General Mills, led by Shiv Nadar, started a company that would make
personal computers. Initially floated as Microcomp Limited, Nadar and his
team (which also included Arjun Malhotra, AjaiChowdary, D.S.Puri, Yogesh
Vaidya and Subhash Arora) started selling teledigital calculators to gather
41

capital for their main product. On 11 August 1976, the company was
renamed Hindustan Computers Limited (HCL).

On 12 November 1991, a company called HCL Overseas Limited was


incorporated as a provider of technology development services. It received
the certificate of commencement of business on 10 February 1992 after
which it began its operations. Two years later, in July 1994, the company
name was changed to HCL Consulting Limited and eventually to HCL
Technologies Limited in October 1999.

HCL Technologies is one of the four companies under HCL Corporation,


the second company being HCL Infosystems. In February 2014 HCL
launched HCL Healthcare. HCL TalentCare is the fourth and latest venture
of HCL Corporation.

HCL Technologies began as the R&D Division of HCL Enterprise, a


company which was a contributor to the development and growth of the IT
and computer industry in India. HCL Enterprise developed an indigenous
microcomputer in 1978, and a networking OS and client-server architecture
in 1983. On 12 November 1991, HCL Technologies was spun off as a
separate unit to provide software services.

HCL Technologies was originally incorporated as HCL Overseas Limited.


The name was changed to HCL Consulting Limited on 14 July 1994. On 6
October 1999, the company was renamed 'HCL Technologies Limited' for
"a better reflection of its activities." Between 1991 and 1999, the company
expanded its software development capacities to the US, European and
APAC markets.
42

In 1976, a group of six engineers, all former employees of Delhi Cloth &
General Mills, led by Shiv Nadar, started a company that would make
personal computers.Initially floated as Micro comp Limited, Nadar and his
team started selling tele-digital calculators to gather capital for their main
product.

On 11 August 1976, the company was renamed Hindustan Computers


Limited (HCL).

On 12 November 1991, a company called HCL Overseas Limited was


incorporated as a provider of technology development services. It received
the certificate of commencement of business on 10 February 1992 after
which it began its operations.

In July 1994, the company name was changed to HCL Consulting Limited
and eventually to HCL Technologies Limited in October 1999.

HCL Technologies is one of the four companies under HCL Corporation,


the second company being HCL Infosystems. In February 2014 HCL
launched HCL Healthcare. HCL Talent Care is the fourth and latest venture
of HCL Corporation.

HCL Technologies began as the R&D Division of HCL Enterprise, a


company which was a contributor to the development and growth of the IT
and computer industry in India. HCL Enterprise developed an indigenous
microcomputer in 1978, and a networking OS and client-server architecture
in 1983. On 12 November 1991, HCL Technologies was spun off as a
separate unit to provide software services.
43

HCL Technologies was originally incorporated as HCL Overseas


Limited. The name was changed to HCL Consulting Limited on 14 July
1994. On 6 October 1999, the company was renamed 'HCL Technologies
Limited' for "a better reflection of its activities."Between 1991 and 1999, the
company expanded its software development capacities to the US,
European and APAC markets.

HCL Technologies operate in 44 countries, including its headquarters


in Noida, India. It has establishments in Australia, China, Hong Kong, India,
Indonesia, Israel, Japan, Malaysia, New Zealand, Saudi Arabia, Singapore,
South Africa, the United Arab Emirates and Qatar. In Europe it covers
Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany,
Italy, Netherlands, Norway, Poland, Sweden, Switzerland, Portugal, and
the United Kingdom. In the Americas, the company has offices in Brazil,
Canada, Mexico, Puerto Rico, and the United States.

Business lines

1. Applications Services and Systems Integrations 


2. BPO/Business Services: This division has "delivery centers" in India,
the Philippines, Latin America, USA, HCL BPO Northern Ireland, and
Europe.
3. Engineering and R&D Services (ERS)
4. Infrastructure Management Services (IMS)
5. Digital & Analytics
6. Cyber Security
44

HCL Infrastructure Services Division (ISD) is an IT services company.


Headquartered in Delhi, NCR, India, HCL ISD was instituted in 1993 with
the objective to address the demand for cost-effective management of
technology infrastructure across geographically dispersed locations. HCL
ISD, also known as HCLComnetSystems and Services Ltd. in India,
diversified its portfolio to provide end-to-end enterprise IT
infrastructure solutions globally in 1993 winning the first order to establish
India's first floorless stock exchange in order to achieve superior
infrastructure performance and significantly reduced costs.

5. TECH MAHENDRA:

Tech Mahindra Limited is an Indian multinational  provider of  information


technology (IT), networking technology solution and business process
outsourcing (BPO) to the telecommunication industry. Anand Mahindra is the Chairman
of Tech Mahindra, which is headquartered at Pune and has its registered office
in Mumbai.

Tech Mahindra began a joint venture with British Telecom and the company began as


Mahindra-British telecom in the year 1986. This was the time when IT revolution was
unthinkable.
45

The name of the company was changed from Mahindra-British Telecom Limited to the
present name Tech Mahindra Limited on 3rd February of the year 2006.British Telecom
was initially a partner of 30% with Mahindra but later on gradually sold its entire share to
investors by the year 2012. The Tech Mahindra bought Satyam Computer Services
through a subsidiary and doubled its number of employees. Tech Mahindra then finally
merged with Mahindra Satyam in the year 2012 and thus created a $2.5 billion company
IT Company.

Tech Mahindra bid for Satyam Computer Services, and emerged as a top bidder with an
offer of Rs 58.90 a share for a 31 per cent stake in the company, beating a strong
rival Larsen & Toubro. After evaluating the bids, the government-appointed board of
Satyam Computer announced on 13 April 2009: "its Board of Directors has selected
Ventura Consultants Private Limited, a subsidiary controlled by Tech Mahindra Limited
as the highest bidder to acquire a controlling stake in the Company, subject to the
approval of the Hon'ble Company Law Board.

Tech Mahindra announced its merger with Mahindra Satyam on March 21, 2012, after


the boards of the two companies gave their approval, to create a 2.5 billion $ IT
Company. The two firms had received the go-ahead for the merger from the Bombay
Stock Exchange and the National Stock Exchange. On June 11, 2013, Andhra Pradesh
High Court gave its approval for the merger of Mahindra Satyam with Tech Mahindra,
after the Bombay high court had already given its approval.

Tech Mahindra announced the completion of its merger with Mahindra Satyam to create
the nation's fifth largest software services company. 

Vision Statement

“We will Rise to be among the top three leaders in each of our chosen market segments
while fostering innovation and inclusion.

Products and Services Offered


46

Tech Mahindra's digital and design experience, innovative platforms and reusable
assets bring together a number of technologies together to deliver a tangible business
value and experience to their clients. Tech Mahindra provides a wide range of
information technology related products and services such as

 ADMS Java & Open Source


 Cloud Computing
 Consulting
 Enterprise Architecture
 Integrated Engineering Solutions
 Infrastructure Management Services
 Mobility Solutions
 Product Life Cycle Management
 Enterprise Security Risk Management
 Testing
 Socio
 Uno- Robotic Process Automation
 PRISM
 Retirement & Wealth
47

CHAPTER 3: LITERETURE RIVIEW


Literature review is a study involving a collection of literatures in the selected area of
research in which the researcher has limited experience, and critical examination and
comparison of them to have a better understanding. It also helps the researchers to
update the past data, data sources and results and identify the gaps, if any in the
researches.

Nabhi Kumar Jain6 (1992) specified certain tips for buying shares for holding and
also for selling shares. He advised the investors to buy shares of a growing company
of a growing industry. Buy shares by diversifying in a number of growth companies
operating in a different but equally fast-growing sector of the economy. He suggested
selling the shares the moment company has or almost reached the peak of its growth.
Also, sell the shares the moment you realize you have made a mistake in the initial
selection of the shares. The only option to decide when to buy and sell high priced
shares is to identify the individual merit or demerit of each of the shares in the portfolio
and arrive at a decision.
48

Carter Randal7 (1992) offered to investors the underlying principles of winning on


the stock market. He emphasized on long term vision and a plan to reach the goals.
He advised the investors that to be successful, they should never be pessimists. He
revealed that - though there has been a major economic crisis almost every year, it
remains true that patient investors have consistently made money in the equities
market. He concluded that investing in the stock market should be an un-emotional
endeavor and suggested that investors should own a stock if they believe it would
perform well.

Sunil Damodar'o (1993) evaluated the 'Derivatives' especially the 'futures' as a


tool for short-term risk control. He opined that derivatives have become an
indispensable tool for finance managers whose prime objective is to manage or reduce
the risk inherent in their portfolios. He disclosed that the over-riding feature of 'financial
futures' in risk management is that these instruments tend to be most valuable when
risk control is needed for a short- term or for a year or less. They tend to be cheapest
and easily available for protecting against or benefiting from short term price. Their low
execution costs also make them very suitable for frequent and short-term trading to
manage risk, more effectively.

John Colnan (1994), senior Research Analyst from SHAN Stock broking’s
Research Department provides some briefs pointers on what information to look for
and how to make sense of what is available.

Mark P. Bauman (1996) conducted a study named, “A Review of Fundamental


Analysis Research in Accounting”. This paper has outlined the development of
fundamental valuation model and reviewed related empirical work. First, an accounting-
based expression for a firm’s equity value has been developed into a rich theoretical
framework. They verified its descriptive validity regarding the mapping of accounting
numbers into stock prices. This paper identified three major issues associated with
49

practical implementation of the model; the prediction of future profitability, the length of
appropriate forecast horizon, and the determination of the appropriate discount rate.

Jon Lynch conducted a study, “Share Market Analysis-Fundamental Vs Technical


Analysis”, which reveals that in recent times, there has been a bigger push towards
stock market research, which is being conducted by private individuals. This has been
possible through the vast amount of information on the Australian stock market, now
available online to any subscriber. This article explains the difference between the
fundamental and technical analysis; the most common methods adopted to conduct
research on the performance of stock markets.

Jim Berg (1999) conducted a study – “Fundamental Analysis Using Internet”. This
study examined that fundamental analysis looks at the fundamental issues that drive the
value of the particular company. These issues include its financial position, its industry
sector, and the current economic environment. The objective was to identify companies
that may be considered undervalued in the market with a view to investing when the
time is right.

Vanstone B. Finnie G. and Tan C. (2004) conducted a study entitled- “Enhancing


Security Selection in the Australian Stock Market Using Fundamental Analysis
and Neural Networks”. This paper examines financial trading from the aspect of
security selection. In practice, it is unrealistic for a financial trader to participate in the fill
market of tradable securities competing for investment capital. Essentially, there are two
main methodologies used namely, fundamental analysis and technical analysis. This
paper examines the practice of fundamental analysis and demonstrates how neural
networks can be practically employed to enhance the fundamentalist selection process.
50

Dr. Maria Nevis Soris and V. Sornaganesh (2012) conducted a study


entitled-“Fundamental Analysis of NBFC in India”. This study conducted to examine
the economic sustainability of the five major NBFC in Indian NBFC sector and its
financial performance.

(2016) J Hema and V


Ariram in their research
paper titled, “
Fundamental analysis with
special
reference to
pharmaceutical companies
listed in NSE” stated that
an investor should analyze
the
market fundamentally and
technically before
investing in shares. They
also noticed growth in the
51

pharmaceutical industry in
India.
•(2009) Hemraj Verma
and Prakash
(2016) J Hema and V
Ariram in their research
paper titled, “
Fundamental analysis with
special
reference to
pharmaceutical companies
listed in NSE” stated that
an investor should analyze
the
market fundamentally and
technically before
52

investing in shares. They


also noticed growth in the
pharmaceutical industry in
India.
•(2009) Hemraj Verma
and Prakash
(2016) J Hema and V
Ariram in their research
paper titled, “
Fundamental analysis with
special
reference to
pharmaceutical companies
listed in NSE” stated that
an investor should analyze
the
53

market fundamentally and


technically before
investing in shares. They
also noticed growth in the
pharmaceutical industry in
India.
•(2009) Hemraj Verma
and Prakash
(2011) Venkatesh C K
and Madhu Tyagi in their
research paper titled, “
Fundamental analysis as a
method of share valuation
in comparison with
technical analysis”
54

detailed about different


movement
of share prices in
comparison with
fundamental and technical
analysis. It also
emphasized on the
market capitalization and
organizational structure.
(2011) Venkatesh C K
and Madhu Tyagi in their
research paper titled, “
Fundamental analysis as a
method of share valuation
in comparison with
technical analysis”
55

detailed about different


movement
of share prices in
comparison with
fundamental and technical
analysis. It also
emphasized on the
market capitalization and
organizational structure.
(2011) Venkatesh C K
and Madhu Tyagi in their
research paper titled, “
Fundamental analysis as a
method of share valuation
in comparison with
technical analysis”
56

detailed about different


movement
of share prices in
comparison with
fundamental and technical
analysis. It also
emphasized on the
market capitalization and
organizational structure.
(2011) Venkatesh C K
and Madhu Tyagi in their
research paper titled, “
Fundamental analysis as a
method of share valuation
in comparison with
technical analysis”
57

detailed about different


movement
of share prices in
comparison with
fundamental and technical
analysis. It also
emphasized on the
market capitalization and
organizational structure.
Venkates CK, Dr. Madhu Tyagi, Dr. Ganesh L. (2012), This paper aims to
investigate the relationship between accounting information and stock returns of
selected Indian stocks pertaining to IT, Banking and Pharmacy sectors over the
past ten years starting from 2001 to 2010. In this research work, a simple financial score
is designed to capture short term changes in firms operating efficiency, Profitability and
Financial policy. Investigating accounting information and stock returns is a method
adopted in Fundamental analysis .The score values and market Returns as provided by
the companies were correlated to investigate the relationship between the score and the
market adjusted returns.

Shakti Prasanna D.& Ashish Kumar P.(2013),this paper presents the market
technical charts and their correlation to demonstrate the profitability pattern in
stock, future, commodities and currencies market. The empirical literature is
categorized into two groups „Early‟ and „Modern‟ studies. Early studies indicate that
technical trading strategies are profitable in foreign exchange markets and futures
58

market, but not in stock markets. Modern studies indicate that technical trading
strategies consistently generate economic profits in a variety of speculative markets.

S. UmaPrabha, M. Malavika (2014), the aim of this paper is to make technical


analysis of selected stocks of pharmaceutical sector and interpret whether to buy
or sell them and which stocks give higher return. The major tools and techniques
used in this study are Beta, Relative Strength index and simple moving average. to get
good returns investor must invest considering the time horizon of at least two to three
years.

Mrs. J. Nithya, Dr. G. Thamizhchelvan (2014),the objective of this paper is to make


technical analysis of selected companies included in the CNX nifty. The
descriptive method is used to study the price trend of fifteen stocks. MACD and RSI
techniques are used for the study. Secondary data is used for the analysis. Simple
random sampling method is used. According to RSI, there is increase in RSI value,
which indicates that there is increase in the share price. This states to the investors that
it is a strong sell signal. When RSI value decreases it is a strong buy signal.

Dr. Pooja Taraji (2014), in this paper exponential moving average is used to
predict future share prices. The study is conducted on taking five years historical data
sample on daily bases of Indian stock market. As a result, they found out the trends in
different stocks which are going upward or downward. It increases the chances for the
investors to predict the prices more accurately and hence increased profit in share
markets.

C. Boobalan (2014), the objective of this paper is to carry out technical analysis of
the securities of the selected companies and to assist investment decisions in
the Indian market. The five Indian companies, Wipro, SBI, GAIL, ONGC and ITC are
taken for the study. The different patterns of stock prices of these companies give an
idea of future trend of these companies.

Kevin L, Partha Moharram (2014), this paper covers fundamental analysis


strategies based on rational analysis such as FSCORE and GSCORE with
strategies based on intrinsic value such as the v/p ratio. The finding shows that all
59

three strategies generate significant hedge returns. Combining the V/P ratio with
FSCORE or GSCORE leads to a significant increase in hedge returns that hold for a
variety of partitions, persist over time and remain after controlling for risk factors. This
result suggests a new and powerful method to conduct fundamental analysis .

George j. Saranya D.Amrudha R. (2015), the study on the formation of candlestick


pattern was done to find out the different candlestick patterns and identify its
accuracy. This study is conducted based on the past five years Nifty index.
Candlesticks are one of the most powerful technical analysis tools. The advantage of
using candlestick charting in place of Bar charts is that you have the ability to use same
techniques and analysis that bar charts offer plus the diversity and unique signals that
candlesticks generate. The main findings from this study are candlestick patterns are
not 100% accurate as per the past Five year Nifty index.

Dr. K. Ramesh, Dr. V. Devendra (2017), the study focused 13 Indian listed Equities
from each sector in NSE Nifty for the period of one year. The aim of the study is to
predict the future price and to interpret on whether to buy or sell the selected equities.
The Purposive Sampling Technique is used and the Research Design is Descriptive in
nature. MACD and RSI tools are used to identify the Buy and Sell signals in the
Candlestick Chart. Strong Buy signal for Bharti Airtel Ltd, ITC Ltd, Adani Ports and
Special Economic Zone Ltd, Ambuja Cements Ltd, Sun Pharmaceutical Industries Ltd
and Zee Entertainment Enterprises Ltd. And Strong Sell signal for Infosys Ltd.

(2016) J Hema and V


Ariram in their research
paper titled, “
60

Fundamental analysis with


special
reference to
pharmaceutical companies
listed in NSE” stated that
an investor should analyze
the
market fundamentally and
technically before
investing in shares. They
also noticed growth in the
pharmaceutical industry in
India.
•(2009) Hemraj Verma
and Praka George j., Saranya D., Amrudha R. (2015), the study on
the formation of candlestick pattern was done to find out the different candlestick
patterns and identify its accuracy. This study is conducted based on the past five years
Nifty index. Candlesticks are one of the most powerful technical analysis tools. The
61

advantage of using candlestick charting in place of Bar charts is that you have the ability
to use same techniques and analysis that bar charts offer plus the diversity and unique
signals that candlesticks generate. .The main findings from this study are candlestick
patterns are not 100% accurate as per the past five year Nifty index

CHAPTER 4RESEARCH METHODOLOGY

The chapter focuses on the methodology and the techniques used for the collection,
classification and tabulation of the data.

Research methodology is a way to systematically solve the problem. It is a game plan


for conducting research. In this we describe various steps that are taken by the
researcher.

Research is a common context is a search for knowledge. Research is an art of


scientific and systematic investigation. Thus research comprises defining and redefining
problems, formulating hypothesis or suggested solutions; collecting, organizing and
evaluating data, making deduction and researching conclusions. Research methodology
is a conceptual structure within which research is conducted. It is a frame work for the
study and is used a guide in collecting and analyzing the data. In addition to this, it is a
strategy specifying which approach will be used for gathering and analyzing the data
and also includes time and cost budget since most of studies are done under these two
constraints. The research methodology includes objectives of the research study, over
all research design, population under study, sampling procedure, the data collection
method, analysis procedure, limitations of the work and scope for future studies.

RESEARCH DESIGN
62

Research design is a framework of conducting research for a Project.The research


design used in this study is Descriptive research design.The purpose of descriptive
design is getting an insight over the issue. In this type of researcher has no control over
the variables; he can only report what has happened or what is happening.

Descriptive design is those designs which are concerned with describing the
characteristics of particular individual or the group. In descriptive and diagonostic study,
the researcher must be able to define clearly what he wants to measures and must find
adequate method for measuring it.

POPUALATION:

A researcher population is generally a large collection of individuals or objects that is


the main focuses of a scientific query. It is for the benefits of the population that
researcher is done. Due to the large size of population, researcher often cannot test
every individual in the population because it is too expensive and time- consuming. This
is the reason why the Researcher rely on sampling techniques .

SAMPILING:

Sampling is a method of studying from a few selected items, instead of entire big
number of units the small selection is called sample. The large number of items of units
of particular characteristic is called population. Some of the types of sampling are:

(1) Simple random sampling: it is mostly used for the type of population which is
homogeneous.
(2) Stratified sampling: strata’s help us classify the population hen the population is
heterogeneous and take simple random samples from each class.
(3) Sequential sampling: it is done by selection of the samples sequentially at
regular intervals. The purpose of all the sampling techniques is to give the equal
chance of any item to be selected without bias.

TYPES OF DATA COLLECTION:


63

The next step was to select the source of data. There are mainly two types of data are:

 Secondary data
 Primary data

SECONDARY DATA:

Secondary data are originally collected by someone else for same, similar of different
purpose. They economical can be collected faster. It is advisable to check Compatibility,
Correctness and obsolescence risk for secondary data. There is an abundance of data
available in these sources about your research area in business studies, almost
regardless of the nature of the research area. Therefore, application of appropriate set
of criteria to be selected for secondary data .The sources of secondary data are as
follows:

1. Books & publication


2. Government data
3. Other researches
4. Professional data providers
5. Internal experts
6. Different reports

PRIMARY DATA

Primary data are collected by researcher for the purpose of same research. Primary
data are tailor made data collected exclusively for the purpose of research. The
methods for primary data Collection are as follows:

1. Field Survey
2. Observation method
3. Experiments

SAMPALING TECHNIQUES:
64

There are mainly two sample techniques classified into one of two categories:

 Probability sampling techniques: Sample has a known probability of being


selected.
 Non- probability sampling techniques: Sample does not have known probability
of being selected as in convenience or voluntary response surveys.

PROBABILTY SAMPLING:

In probability sampling it is possible to both determine which sampling units belong to


which sample and the probability that each sample will be selected.

1. Simple Random Sampling Method


2. Stratified Random Sampling Method
3. Cluster Sampling Method
4. Systematic Sampling

NON PROBANILITY:

Non-probability sampling is a sampling technique where the sampling is gathered in a


process that does not give all the individuals in the population equal chances of being
selected.

1. Convenience sampling
2. Judgmental sampling
3. Quota sampling
4. Snowball sampling

OBJECTIVES:
65

1. To carry out the financial analysis of IT sector in order to suggest the script for
the investment.
2. To study the financial performance of selected IT companies.
3. To study the growth of the IT sector in order to invest.

DATA COLLECTION:

This study is based on secondary data and shall be drawn from the published annual
report of the IT companies.

The data is collected from the balance sheet and profit and loss statement of selected
companies.

There are two types of data are:

A. Qualitative data
B. Quantitative data

Qualitative data includes


1. Nominal: The variables do not have a specific order.
2. Ordinal: The variables have a specific order.

Quantitative data includes


1. Continuous data: The variable can be in theory is any value within a certain
range can be measured.
2. Discrete: The variable can only have certain values, usually can be counted.

DATA ANALYISIS:
66

The project contains secondary data and it is analysis using the statistical tools. The
tools used for analysis the data are:

1. Ratio analysis
2. ANOVA
3. Comparative statement

JUSTIFICATION OF TITLE:

 Financial analysis of it sector helps us to understand the position in the market


as the IT sector is in growing trend in current market and has the possibility to
grow in the future in it sector.
 It helps us the investor to invest in the companies as it has the possibility of
giving the high return on investment.
 It is the sector of the technology which is developing in the many countries. In
today’s era, everything is done through technology, so there is the possibility for
the growth in this sector.

SCOPE OF FUTURE STUDY:

 By analysis the financial status and other related information of selected


companies of it sector of five years, will help to choose shares that outperform
the market and provided consistent gain to the investor.
 This study makes an attempt to provide the necessary information to the data.
 This study covers the five years of the data.

LIMITATIONS:

The researcher method is used in this study are secondary, which have some
limitations:
67

 There are different methods of analyzing the data apart from the methods used in
this study.
 Technical analysis is also used for calculating the intrinsic value which is not
considered.
 As the data sources are Secondary, the data collected cannot be accurate and
complete.
 There are also some inherent disadvantages in ratio analysis, which is not
considered.
68

CHAPTER 5 DATA ANALYISIS

RATIO ANALYSIS:

Ratio analysis is a quantitative analysis of information contained in a company’s


financial Statements. Ratio analysis is used to evaluate various aspects of a company’s
operating and financial performance such as its efficiency, liquidity, profitability and
solvency.

Ration analysis involves evaluating the performance and financial health of a company
by using data from the current and historical financial statements. The data retrieved
from the statements is used to compare a company’s performance over time to assess
whether the company’s is improving or deteriorating.

The ratios used to evaluate the financial performance of company are:

1. CURRENT RATIO:
The current ratio is a liquidity ratio that measures a company’s ability to pay
short- term and long-term obligations. To gauge this ability, the current ratio
considers the current total assets of a company relative to that company’s
current total Liabilities. The formula for calculating a company’s current ratio is:

Current ratio = current assets / current liability


69

Year TCS INFOSYS WIPRO HCL TECH


MAHINDRA
2015 2.78 3.41 2.16 3.13 2.30
2016 3.41 4.50 1.71 3.80 2.26
2017 3.09 3.80 1.50 3.02 2.42
2018 2.85 3.83 1.37 3.04 2.25
2019 2.85 3.03 1.34 2.89 1.69

Ho: there is no significant difference between in current ratio of companies in


different year.

H0: there is no significant difference between in current ratio of companies in


different year.

Groups Count Sum Average Variance


TCS 5 14.98 2.996 0.06738
INFOSYS 5 18.57 3.714 0.29973
WIPRO 5 8.08 1.616 0.11373
HCL 5 15.88 3.176 0.12903
TECH
MAHINDRA 5 10.92 2.184 0.08083

ANOVA
Source of Variation SS df MS F P-value F crit
Between Groups 13.8839 4 3.470976 25.12651 1.48E-07 2.866081
Within Groups 2.7628 20 0.13814

Total 16.6467 24        

INTERPRETATION:

The null hypothesis states that the mean hardness values of five different companies
are not different. The P value is 1.48
70

2. QUICK RATIO
The quick ratio is a measurement of how well a company can meet its short-
term finance liabilities. Also known as the acid test ratio, it can be calculated as
follows:

QUICK RATIO= CASH + MARKETABLE SECURITIES +ACCOUNTS


RECEIVABLES / CURRENT LIABILITIES

YEAR TCS INFOYSES WIPRO HCL TECH


MAHINDERA
2015 2.80 3.88 2.95 3.08 2.23
2016 3.27 4.47 2.49 3.54 2.20
2017 2.93 3.77 2.17 2.82 2.41
2018 2.67 3.74 1.85 2.75 2.20
2019 2.74 2.96 2.35 2.59 1.67

Ho: there is no significant difference between in quick ratio of companies


in different year.

H0: there is no significant difference between in quick ratio of companies in


different year.

Anova: Single Factor


Groups Count Sum Average Variance
71

TCS 5 14.41 2.882 0.05617


INFOYSES 5 18.82 3.764 0.28973
WIPRO 5 11.81 2.362 0.16532
HCL 5 14.78 2.956 0.13783
TECH MAHINDERA 5 10.71 2.142 0.07727

ANOVA
Source of
Variation SS df MS F P-value F crit
Between Groups 7.914584 4 1.978646 13.62103 1.62E-05 2.866081
Within Groups 2.90528 20 0.145264

Total 10.81986 24        

3. OPERATING PROFIT:
The operating profit margin ratio indicates how much profit a company makes
after paying for variables costs of production such as wages, raw material, etc. it
is also expressed as a percentage of sales and then shows the efficiency of a
72

company controlling the costs and expenses associated with business


operations. The formula calculated are as follows:

YEAR TCS INFOSYS WIPRO HCL TECH


MAHINDERA
2015 28.57 121.57 37.26 39.98 16.83
2016 31.50 68.93 37.68 38.22 16.27
2017 29.22 74.91 39.31 40.65 15.85
2018 28.56 79.19 19.79 42.30 16.49
2019 28.38 42.87 14.52 40.05 18.98

OPERATING PROFIT =OPERATING INCOME*100 / SALES

Ho: there is no significant difference between in Operating Ratio of


companies in different year.

H0: there is no significant difference between in Operating ratio of companies


in different year.

Anova: Single Factor


73

Groups Count Sum Average Variance


TCS 5 146.23 29.246 1.68968
INFOSYS 5 387.47 77.494 806.1027
WIPRO 5 148.56 29.712 135.4565
HCL 5 201.2 40.24 2.14895
TECH MAHINDERA 5 84.42 16.884 1.49938

ANOVA
Source of Variation SS df MS F P-value F crit
Between Groups 10767.22 4 2691.806 14.21383 1.2E-05 2.866081
Within Groups 3787.589 20 189.3794

Total 14554.81 24        

INTERPRETATION:

4. GROSS PROFIT MARGIN:


Gross profit margin is a financial metric used to asses a company’s financial
health and business model by revealing the proportion of money left over from
revenues after accounting for the cost of goods sold (cogs) gross profit margin,
also known’s as gross margin, is calculated by dividing gross profit by revenues.
The formula for calculated gross profit margin is as follows:

GROSS PROFIT MARGIN = GROSS PROFIT *100 / SALES

YEAR TCS INFOYSES WIPRO HCL TECH


MAHINDERA
2015 26.68 ~ 20.43 38.24 14.36
2016 29.80 27.03 18.87 36.16 13.67
2017 27.52 26.77 18.47 38.17 13.16
2018 26.86 25.67 17.75 38.26 13.72
2019 26.99 23.35 16.26 35.14 16.57
74

Ho: there is no significant difference between in gross profit margin of


companies in different year.

H0: there is no significant difference between in gross profit margin of


companies in different year.

Anova: Single Factor


Groups Count Sum Average Variance
TCS 5 137.85 27.57 1.652
INFOYSES 5 102.82 20.564 134.2587
WIPRO 5 91.78 18.356 2.33478
HCL 5 185.97 37.194 2.11778
TECH MAHINDERA 5 71.48 14.296 1.79733

ANOVA
Source of Variation SS df MS F P-value F crit
Between Groups 1619.195 4 404.7986 14.23737 1.18E-05 2.866081
Within Groups 568.6423 20 28.43211

Total 2187.837 24        
INTERPRETATION:

5. NET PROFIT MARGIN:


75

Net profit margin is the percentage of revenue remaining after all operating
expenses, interest, taxes and preferred stocks dividends (but not Common stock
dividends) have been deducted from a company’s total revenue. The formula is
given below:

NET PROFIT MARGIN = NET PROFIT *100 / SALES

YEAR TCS INFOSYS WIPRO HCL TECH


MAHINDERA
2015 26.17 25.71 19.88 36.99 11.77
2016 26.87 23.51 18.35 35.12 15.35
2017 25.51 23.30 17.72 35.57 13.15
2018 25.92 26.08 17.27 33.35 16.90
2019 24.40 20.11 15.82 31.46 16.09

Ho: there is no significant difference between in Net Profit Margin of companies


in different year.

H0: there is no significant difference between in Net Profit Margin of companies in


different year.

Anova: Single Factor

Groups Count Sum Average Variance


TCS 5 128.87 25.774 0.83423
INFOSYS 5 118.71 23.742 5.69497
WIPRO 5 89.04 17.808 2.20907
HCL 5 172.49 34.498 4.57337
TECH
MAHINDERA 5 73.26 14.652 4.54262
76

ANOVA
Source of Variation SS df MS F P-value F crit
1183.3053
Between Groups 8 4 295.82635 82.8447513 3.72E-12 2.866081
Within Groups 71.41704 20 3.570852

1254.7224
Total 2 24        

INTERPRETATION:

6. DEBT TO EQUITY RATIO:


Debt to equity ratio is a long -term solvency ratio that indicates the soundness of
long terms financial policies of a company. it shows the relation between the
portion of assets financed by creditors and the portion of assets financed by
stockholders. as the debt to equity ratio expresses the relationship between
external equity (liability) and internal equity stockholder’s equity), it is also known
as “external- internal equity

DEBT EQUITY RATIO = TATAL LIABILITY / SHAREHOLDER’S FUNDS


77

Year TCS INFOSYS WIPRO HCL TECH


MAHINDERA
2015 0.01 - 0.17 - -
2016 - - 0.16 - 0.01
2017 - - 0.13 - 0.01
2018 - - 0.11 - 0.01
2019 - - 0.10 - -

Ho: there is no significant difference between in debt equity ratio of


companies in different year.

H0: there is no significant difference between in debt equity ratio of companies in


different year.

Anova: Single Factor


Groups Count Sum Average Variance
TCS 5 0.01 0.002 0.00002
INFOSYS 5 0 0 0
WIPRO 5 0.67 0.134 0.00093
HCL 5 0 0 0
TECH
MAHINDERA 5 0.03 0.006 0.00003

ANOVA
Source of Variation SS df MS F P-value F crit
0.06981
Between Groups 6 4 0.017454 89.05102 1.89E-12 2.866081
Within Groups 0.00392 20 0.000196

0.07373
Total 6 24        
78

7. RETURN ON CAPITAL EMPLOYEED:


Return on capital employed (ROCE) is a profitability ratio that measures
efficiently a company can generate profits its capital employed by comparing net
operating profit to capital employed the formula is given below:

ROCE = EBIT * 100 / CAPITAL ENPLOYED

YEAR TCS INFOSYS WIPRO HCL TECH


MAHENDERA
2015 52.77 - 26.85 39.92 23.04
2016 45.03 28.81 23.25 27.07 26.59
2017 38.43 27.84 21.09 32.03 21.54
2018 42.00 31.45 22.17 33.14 23.79
2019 32.64 24.99
79

Ho: there is no significant difference between in return on capital employed of


companies in different year.

H0: there is no significant difference between in return on capital employed of


companies in different year.

8. RETURN ON NET WORTH OR RETURN ON EQUITY:


Return on equity is the amount of net income returned as a percentage of
shareholders equity. Return on equity measures a corporation’s profitability by
reveling how much profit a company generates with the money shareholders
have invested. ROE is expressed as a percentage and calculated as:

RETURN ON EQUITY = NET WORTH * 100 / SHAREHOLDER’S EQUITY

YEAR TCS INFOYSES WIPRO HCL TECH


MAHINDRA
2015 42.40 - 23.66 32.70 20.04
2016 35.49 20.78 19.89 21.95 23.75
2017 30.31 20.31 17.47 26.46 18.04
2018 33.27 25.44 18.27 26.70 20.46
2019 38.10 23.44 15.41 26.88 21.36
80

Ho: there is no significant difference between in of return on equity


companies in different year.

H0: there is no significant difference between in return on equity of companies


in different year.

Anova:SingleFacto
r
Groups Count Sum Average Variance
TCS 5 179.57 35.914 21.35553
INFOYSES 5 89.97 17.994 105.5029
WIPRO 5 94.7 18.94 9.5629
HCL 5 134.69 26.938 14.59232
TECH MAHINDRA 5 103.65 20.73 4.3256

ANOVA
Source of Variation SS df MS F P-value F crit
0.00025 2.86608
Between Groups 1114.453 4 278.6132 8.967894 6 1
Within Groups 621.3569 20 31.06785

Total 1735.81 24        
81

9. INTEREST COVERAGE RATIO:


The interest coverage ratio is used to determine how easily a company can pay
their interest expenses on outstanding debt. The ratio is calculated by dividing a
company’s earnings expenses for the same period. The lower the ratio, the more
the company is burdened by debt expense.

INTEREST COVERAGE RATIO: EBIT / INTEREST EXPENSE

YEAR TCS INFOYSES WIPRO HCL TECH


(IN Cr.) MAHINDRA
2015 302.89 - 30.09 127.95 334.63
2016 2,257.85 - 20.27 127.18 74.61
2017 1,880.13 - 23.84 151.47 61.79
2018 1,065.37 - 27.11 397.74 70.30
2019 240.44 - 19.80 621.69 126.92

Ho: there is no significant difference between in interest coverage ratio of


companies in different year.

H0: there is no significant difference between in interest coverage ratio of


companies in different year.

Anova: Single
82

Factor

SUMMARY
Groups Count Sum Average Variance
TCS 5 5746.68 1149.336 828119.1
INFOYSES 5 0 0 0
WIPRO 5 121.11 24.222 19.52307
HCL 5 1426.03 285.206 48368.09
TECH MAHINDRA 5 668.25 133.65 13275.26

ANOVA
Source of Variation SS df MS F P-value F crit
Between Groups 4568041 4 1142010 6.417361 0.001718 2.866081
Within Groups 3559128 20 177956.4

Total 8127169 24        
83

10. ASSET TURNOVER RATIO:


Asset turnover ratio measures the value of a company's sales or revenues
generated relative to the value of its assets. The assets turnover ratio can often
be used as an indicator of the efficiency with which a company is deploying its
assets in generating revenue.

ASSETS TURNOVER RATIO = SALES / AVERAGE TOTAL ASSETS

YEAR TCS INFOYSES WIPRO HCL TECH


MAHENDERA
2015 1.64 1.05 1.11 0.97 1.72
2016 1.55 0.99 1.01 0.66 1.53
2017 1.29 0.92 0,91 0.81 1.39
2018 1.26 0.94 0.90 0.82 1.21
2019 1.59 1.16 0.95 0.90 1.27

Ho: there is no significant difference between in assets turnover ratio of


companies in different year.

H0: there is no significant difference between in assets turnover ratio of


companies in different year.

Anova:SingleFacto
r
Groups Count Sum Average Variance
TCS 5 7.33 1.466 0.03153
INFOYSES 5 5.06 1.012 0.00937
WIPRO 5 4.88 0.976 0.00748
84

HCL 5 4.16 0.832 0.01347


TECH MAHENDERA 5 7.12 1.424 0.04238

ANOVA
Source of
Variation SS df MS F P-value F crit
Between Groups 1.62528 4 0.40632 19.49151 1.13E-06 2.866081
0.02084
Within Groups 0.41692 20 6

Total 2.0422 24        

11.EPS (EARNING PER SHARE):


85

EARNINGS PER SHARE (EPS) is the portion of a company’s profit allocated to


each outstanding share of common stock. Earnings per share serve as an
indicator of a company’s profitability. Earnings Per Share is calculated as:

EPS = (NET INCOME - DIVIDENDS ON PREFFERED STOCK) /


AVERAGE OUTSTANDING SHARES

YEAR TCS INFOYSES WIPRO HCL TECH


MAHANDERA
2015 17.38 56.15 63.83 62.41 73.61
2016 65.37 56.12 56.51 42.84 63.91
2017 61.27 49.49 56.51 50.74 54.76
2018 63.22 53.58 92.95 77.02 74.10
2019 66.46 61.27 92.84 86.58 68.58

Ho: there is no significant difference between in earning par shareof


companies in different year.

H0: there is no significant difference between in earning per share of


companies in different year.
86

12. DPS (DIVIDEND PER SHARE):


Dividend per share is a measure of the dividend payout per share of common
stock. The measures is used to estimate the amount of dividends that an income
investor night to receive if he or she were to buy a company’s common stock.
Dividend per share can be calculated as below:

DPS = D – SD / S
Whereas; D = sum of dividend over a period
SD = special, one Time dividend
S = share outstanding for the period

YEAR TCS INFOYSE WIPRO HCL TECH


87

S MAHINDRA
2015 79.00 59.50 12.00 30.00 6.00
2016 43.50 24.25 6.00 16.00 12.00
2017 47.00 25.75 2.00 24.00 9.00
2018 50.00 43.50 2.00 12.00 14.00
2019 30.00 21.50 2.00 8.00 14.00

Ho: there is no significant difference between in dividend per share of


companies in different year.

H0: there is no significant difference between in dividend per share of


companies in different year.

Anova: Single Factor


Groups Count Sum Average Variance
TCS 5 249.5 49.9 323.05
INFOYSES 5 174.5 34.9 263.9563
WIPRO 5 24 4.8 19.2
HCL 5 90 18 80
TECH
MAHINDRA 5 55 11 12

ANOVA
Source of Variation SS df MS F P-value F crit
2.86608
Between Groups 6814.34 4 1703.585 12.19973 3.49E-05 1
2792.82
Within Groups 5 20 139.6413

9607.16
Total 5 24        
88

13. P/E RATIO:


The price-to-earnings ratio (P/E) is a valuation method used to compare a
company’s current share price to its per-share earnings. The ratio can be
calculated as below:

P/E RATIO = MARKET VALUE PER SHARE / EARNING PER SHARE

Ho: there is no significant difference between in price earnings ratio of


companies in different year.

H0: there is no significant difference between in price earnings ratio of


companies in different year.
89

COMPARATIVE SATEMENT:

A comparative statement is a document that compares a particular financial


statement with prior statements or with the same financial report generated
by another company.

COMPARATIVE STATEMENT OF BALANCE SHEET OF TCS:


90

PARTICULARS 2019 2018 Absolute % change


change
SOURCES OF FUNDS
Total share capital 375.00 191.00 184 96.34
Equity share capital 375.00 191.00 184 96.34
Preference share capital - - - -
Reserves 89,071.00 84,937.00 4,134 4.86
NET WORTH 89,446.00 85,128.00 4,318 5.07
Secured loans 44.00 54.00 -10 18.52
Unsecured loans 00.00 181.00 -181 100
Total debt 44.00 235.00 -191 -81.27
Minority Interest 453.00 402.00 51 12.86

TOTAL LIABILITIES 89,943.00 85,765.00 4,178 4.87

APPLICATION OF FUNDS
Gross block 26,401.00 24,477.00 31,924 130.42
Less depreciation 14,111.00 12,504.00 1,607 12.85
Net Block 12,290.00 11,973.00 317 2.65
Capital work in progress 963.00 1,278.00 -342 -26,76
Investments 29,330.00 36,008.00 -6,678 -18.54
Inventories 10.00 26.00 -16 -61.54
Sundry debtors 27,346.00 24,943.00 2,403 9.63
Cash and bank balance 12,848.00 7,161.00 5,687 79.42
TOTAL CURRENT ASSETS 12,848.00 32,130.00 -19,282 -60.01
Loans and advances 32,156.00 24,907.00 7,249 29.10
Total ca, loans & advances 72,360.00 57,037.00 15,323 26.86
Current liabilities 24,761.00 20,265.00 4,496 22.18
Provisions 239.00 266.00 -27 -10.15
Total CL and provisions 25,000.00 20,531.00 4,469 21.76
Net current assets 47,360.00 36,506.00 10,854 29.73
Total assets 89,943.00 85,765.00 4,178 4.87

COMPARATIVE STATEMENTS OF PROFIT & LOSS OF TCS:


PARTICULARS 2019 2018 ABSOLUTE %
CHANGE CHANGE
91

INCOME
Sales turnover 1,23,170.00 97,356.00 25,814 26.52
Excise duty 0.00 0.00 0.00 0.00
Net sales 1,23,170.00 97,356.00 25,814 26.52
Other income 7,627.00 5,803.00 18,24 31.43
Stock adjustment 0.00 0.00 0.00 0.00
Total income 1,30,797.00 1,03,159.00 27,638 26.79
EXPENDITURE
Operating and direct expenses 2,003.00 1,920.00 83 4.32
Finance cost 170.00 30.00 140 466.67
Employee cost 59,377.00 51,499.00 7,878 15.29
Depreciation and amortization 1,716.00 1,647.00 69 4.18
expenses
Other expenses 26,826.00 16,046.00 10,780 67.18
Total expenditure 90,092.00 71,142.00 18,950 26.64
Operating profit 42,591.00 33,608.00 8,983 26.73
EBITDA 42,591.00 33,608.00 8,983 26.73
(+)Exceptional item 0 0 0 0
(-)Interest 170.00 30.00 140.00 466.67
EBIT 42,421.00 33,578.00 8,843 26.34
(-)Depreciation 1,716.00 1,647.00 69 4.18
EBT 40,705.00 31,931.00 8,774 27.47
(-)Taxes 9,943.00 6,878.00 3,065 44.56
Profit and loss of the year 30,762.00 25,053.00 5,709.00 22.78
92

COMPARATIVE STATEMENT OF BALANCE SHEET OF INFOSYS:

PARTICULARS 2019 2018 Absolute % change


change
SOURCES OF FUNDS
Total share capital 1,086 99.45
2,178.00 1,092.00
Equity share capital 2,178.00 1,092.00 1,086 99.45
Reserves and surplus 60,533.00 62,410.00 -1,877 -3.01
TOTAL SHAREHOLDERS 62,711.00 63,502.00 -791 -1.25
FUNDS
TOTAL LIABILITIES 62,711.00 63,502.00 -791 -1.25

APPLICATION OF FUNDS
Gross block 20,578.00 18,079.00 2499 13.82
Less depreciation 10,081.00 8,922.00 1159 12.99
Net Block 10,497.00 91,57.00 1,340 14.63
Capital work in progress 1,212.00 1,442.00 -230 -15.95
Investments 18,139.00 17,899.00 240 1.34
Inventories 0.00 0.00 0.00 0.00
Sundry debtors 13,370.00 121,51.00 1,219 10.03
Cash and bank balance 15,551.00 16,770.00 -1,219 -7.26
Loans and advances 11,225.00 9,263.00 1,962 21.18
TOTALCURRENT ASSETS 40,146.00 38,184.00 1,962 5.14
TotalCA,loans & advances 51,371.00 47,447.00 3924 8.27
CURRENT LIABILITIES 13,467.00 9,250.00 4,217 45.58
Provisions 1,963.00 2,412.00 - 449 -18.62
Total CL&provisions 15,430.00 11,662.00 3,768 32.31
Net current assets 24,716.00 26,522.00 -1,806 -6.80
Total assets

COMPARATIVE STATEMENTS OF Profit &Loss OF INFOSYS:


93

PARTICULARS 2019 2018 ABSOLUTE %


CHANGE CHANGE

Sales turnover 73,107.00 61,941.00 11166.00 18.03


Excise duty 0.00 0.00 0.00 0.00

Net sales 73,107 61,941 11,166.00 18.03


Other income 2,852 4,019 -1,167 -29.04
Stock adjustment 0.00 0.00 0.00 0.00
Total income 75,959 65,960 9,999 15.15
EXPENDITURE
Operating and direct expenses 171.00 162.00 9 5.56
Finance cost 0.00 0.00 0.00 0.00
Employee cost 38,296 32,472 5,824 17.94
Depreciation and amortization 0.00 0.00 0.00 0.00
expenses
Other expenses 12,633 9,399 3,234 34.41
Total expenditure 51,100 42,033 9,067 21.57
Operating profit 18,674 17,297 1,377 7.96
EBITDA 18,674 17,297 1,377 7.96
(+)Exceptional item 0.00 0.00 0.00 0.00
(-)Interest 0.00 0.00 0.00 0.00
EBIT 18,674.00 17,297.00 1,377 7.96
(-)Depreciation 1,599.00 1,408.00 191 13.56
EBT 17075.00 15889.00 1186.00 7.46
(-)Taxes 5,225.00 3,753.00 1472.00 39.22
Profit and loss of the year 11850.00 12136.00 -286 -2.356
94

COMPARATIVE STATEMENT OF BALANCE SHEET OF WIPRO:


PARTICULARS 2019 2018 Absolute % change
change
SOURCES OF FUNDS
Total share capital 1,206.80 904.80 -302.00 -33.37
Equity share capital 1,206.80 904.80 -302.00 33.37

Reserves 48,185.20 41,357.80 -6,827.40 -16.50

NET WORTH 49,392.00 42,262.60 -7,129.40 -16.87

Secured loans 5,074.20 53.90 -5,020.30 -9314.10

Unsecured loans 0.00 4,666.20 4,666.20 100


Total debt 5,074.20 4,720.10 -354.10 -7.502

TOTAL LIABILITIES 54,466.20 46,982.70 -7,483.50 -15.93

APPLICATION OF FUNDS
Gross block 11,721.20 11,237.80 -483.40 -33.37
95

Less depreciation 7,320.20 6,870.80 -449.40 -33.37


Net Block 4,401.00 4,367.00 -34.00 16.86
Capital work in progress 2,112.70 1,290.60 -822.10 -63.69
Investments 30,249.10 30,682.80 433.70 1.41
Inventories 340.30 294.30 -46.00 15.63
Sundry debtors 10,648.60 9,502.00 -1,146.60 12.06
Cash and bank balance 10,390.20 2,322.00 -8,068.20 347.46
TOTAL CURRENT ASSETS 21,379.10 12,118.30 -9,260.80 -76.42
Loans and advances 8,856.20 10,212.60 1,356.40 13.28
Total ca, loans & advances 30,235.30 22,330.90 -7,904.40 35.39
Current liabilities 11,483.30 10,726.40 -756.90 7.05
Provisions 1,048.60 962.20 -86.40 -8.97
Total cl and provisions 12,531.90 11,688.60 -843.30 -7.215
Net current assets 17,703.40 10,642.30 -7,061.10 -66.35
Total assets 54,466.20 46,982.70 -7,483.50 -15.93

COMPARATIVE STATEMENTS OF P&L OF WIPRO:

PARTICULARS 2019 2018 ABSOLUTE %


CHANGE CHANGE

Sales turnover 48,123.80 44,710.00 3413 7.63


Excise duty 0.00 0.00 0.00 0.00
96

Net sales 48,123.80 44,710.00 3413 7.63


Other income 2,568.60 2,479.60 89.00 3.58
Stock adjustment 0.00 0.00 0.00 0.00
Total income 98816.2 91899.6 6916.6 7.53
EXPENDITURE
Operating and direct expenses 12,505.10 0.00 12,505.10 0.00
Finance cost 524.90 384.30 140,6 36.58
Employee cost 23,808.50 21,756.20 2052.3 9.433
Depreciation and amortization 934.30 1,014.80 -80.5 -7.93
expenses
Other expenses 1,962.40 12,472.70 -10,510.3 -84.26
Total expenditure
Operating profit 8,761.10 8,953.80 -192.8 -2.15
EBITDA 8,761.10 8,953.80 -192.8 -2.15
(+)Exceptional item 0.00 0.00 0.00 0.00
(-)Interest 0.00 0.00 0.00 0.00
EBIT 8,761.10 8,953.80 -192.8 -2.15
(-)Depreciation 0.00 0.00 0..00 0.00
EBT 8,761.10 8,953.80 -192.8 -2.15
(-)Taxes
Profit and loss of the year
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COMPARATIVE STATEMENT OF BALANCE SHEET OF TECH


MAHINEDRA:

PARTICULARS 2019 2018 Absolute % change


change
SOURCES OF FUNDS
Total share capital 491.70 489.70 -298.00 -60.85
Equity share capital 491.70 489.70 -298.00 -60.85
Preference share capital ~ ~ 0.00 0.00
Reserves 20,153.70 19,049.10 1104.6 5.79
NET WORTH 21,877.80 20,771.50 1106.3 5.33
Secured loans 4.30 145.00 -140.7 -97.03
Unsecured loans 0.00 0.00 0.00 0.00
Total debt 4.30 145.00 -140.7 -97.03
Minority Interest 0.00 0.00 0.00 0.00

TOTAL LIABILITIES 21,882.10 20,916.50 965.6 4.616

APPLICATION OF FUNDS
Gross block 6,709.90 7,073.90 -364.00 -5.145

Less depreciation 3,924.40 3,843.50 80.9 2.105


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Net Block 2,785.50 3,230.40 -44490 -1377.23


Capital work in progress 271.30 235.40 35.9 15.25
Investments 12,960.70 10,108.10 2852.6 28.22
Inventories 0.00 0.00 0.00 0.00
Sundry debtors 5,963.30 5,070.00 893.3 17.62
Cash and bank balance 1,208.50 1,929.30 -720.8 -37.36
TOTAL CURRENT ASSETS 7,171.80 7,171.80 0.00 0.00
Loans and advances 7,150.30 6,225.60
Total ca, loans & advances 6,225.60 13,224.90
Current liabilities 7,847.80 7,847.80
Provisions 609.70 633.60
Total CL and provisions 8,457.50 5,882.30
Net current assets 5,864.60 7,342.60
Total assets 21,882.10 20,916.50

COMPARATIVE STATEMENTS OF P&L OF TECH MAHINEDRA:

PARTICULARS 2019 2018 ABSOLUTE %


CHANGE CHANGE

Sales turnover 27,219.60 23,661.20 3558.4 15.04


Excise duty 0.00 0.00 0.00 0.00
Net sales 27,219.60 23,661.20 3558.4 15.04
Other income 960.90 1,743.50 -782.6 -44.88
Stock adjustment 0.00 0.00 0.00 0.00
Total income 28,180.50 25,404.70 2775.8 10.93
EXPENDITURE
Operating and direct expenses 10,257.00 9,012.90 1244.1 13.80
Finance cost 43.10 70.80 -27.7 -39.12
Employee cost 8,444.00 8,106.50 337.5 4.16
Depreciation and amortization 658.70 656.20 2.5 0.0038
expenses
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Other expenses 3,349.60 2,639.00 710.6 26.93


Total expenditure 22752.4 20485.4 2267 11.066
Operating profit 5,169.00 3,902.80 1266.2 32.44
EBITDA 5,169.00 3,902.80 1266.2 32.44
(+)Exceptional item 0.00 0.00 0.00 0.00
(-)Interest 0.00 0.00 0.00 0.00
EBIT 5,169.00 3,902.80 1266.2 32.44
(-)Depreciation 0.00 0.00 0.00 0.00
EBT 5,169.00 3,902.80 1266.2 32.44
(-)Taxes
Profit and loss of the year
COMPARATIVE STATEMENT OF BALANCE SHEET OF HCL:
PARTICULARS 2019 2018 Absolute % change
change
SOURCES OF FUNDS
Total share capital 271.00 278.00 -7 -2.52
Equity share capital 271.00 278.00 -7 -2.52
Reserves 30,168.00 27,285.00 2883 10.56
NET WORTH 30,439.00 27,563.00 2876 10.43
Secured loans 32.00 33.00 -1 -3.03
Unsecured loans 00.00 00.00 00.00 00.00
Total debt 32.00 33.00 -1 -3.03
TOTAL LIABILITIES 30,471.00 27,596.00 2875 10.42

APPLICATION OF FUNDS
Gross block 14,556.00 13,444.00 1112 8.27
Less depreciation 3,321.00 3,016.00 305 10.11
Net Block 11,235.00 10,428.00 807 7.74
Capital work in progress 212.00 298.00 -86 -28.85
Investments
Inventories 18.00 40.00 -22 -55
Sundry debtors 6,245.00 5,427.00 818 15.07
Cash and bank balance 6,273.00 2,325.00 3948 169.80
TOTAL CURRENT ASSETS 12,536.00 7,792.00 4744 60.88
Loans and advances 7,663.00 8,102.00 -439 -5.42
Total ca, loans & advances 20,199.00 15,894.00 4305 27.08
Current liabilities 6,291.00 4,622.00 1669 36.10
100

Provisions 694.00 600.00 94 15.67


Total cl and provisions 6,985.00 5,222.00 1763 33.76

Net current assets 13,214.00 10,672.00 2542 23.81


Total assets 30,471.00 27,596.00 2875 10.43

COMPARATIVE STATEMENTS OF P&L OF HCL:


PARTICULARS 2019 2018 ABSOLUTE %
CHANGE CHANGE

Sales turnover 26,012.00 22,073.00 3939 17.85


Excise duty 0.00 0.00 0.00 0.00
Net sales 26,012.00 22,073.00 3939 17.85
Other income 26,805.00 22,753.00 4052 17.80
Stock adjustment 0.00 0.00 0.00 0.00
Total income 26,805.00 22,753.00 4052 17.80
EXPENDITURE
Operating and direct expenses 4,901.00 2,918.00 1983 67.95
Finance cost 16.00 23.00 -7 -30.43
Employee cost 8,079.00 7,365.00 714 9.69
Depreciation and amortization 1,276.00 893.00 383 42.88
expenses
Other expenses 2,450.00 2,263.00 187 8.26
Total expenditure 16722.00 13462 3260 24.216
Operating profit 10,418.00 10,418.00 0 0
EBITDA 10,418.00 10,418.00 0 0
(+)Exceptional item 0.00 0.00 0.00 0.00
(-)Interest 0.00 .00 0.00 0.00
EBIT 10,418.00 10,418.00 0 0
(-)Depreciation 0.00 0.00 0.00 0.00
EBT 10,418.00 10,418.00 0 0
(-)Taxes
Profit and loss of the year
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CHAPTER 6 FINDINGS AND CONCLUSION

FINDINGS:
 By considering the average of current ratio, the financial services ltd has more
assets to pay off the short term and long term obligation which is followed by
Infosys and HCL. The current ratio of various companies has significant
difference in different years. They are not equal in different years.
 In the quick ratio, the Infosys has the capability to meet the short term financial
requirement. Wipro, TCS, tech Mahindra has also ability to pay the short term
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financial requirement. The quick ratio of five companies does not have significant
difference in their ratio as they are equal in any terms.
 In operating profit margin, in this HCL and TCS has the efficiency in controlling
the cost and expenses associated with business operations. The operating profit
among the different companies does not differ significantly.
 In gross profit margin, HCL and TCS HAS the ability of proportion of the
revenues after the cost of goods sold. The gross profit does not differ with the
different companies.
 In net profit margin the remaining income is calculated after deducting operation
expenses, interest, taxes and dividend. The companies like HCL and TCS have
more net profit margin as compared to other companies which is financial
sounded company. The net profit margin of various companies does not have
any significant difference among them.
 Infosys and HCL Company do not have debt. They may possess the all equity
firm. Wipro have the long term financial soundness. The debt to equity posses
that the total equity, how much debt is there. The debt to equity has not any
significant difference among various years.
 The return on capital employed i9ndicates how effectively a firm generates
revenues from capital employed. TCS can effectively generate capital from it,
whereas Infosys cannot take into consideration. There is no significant difference
in ratio of different company.
 The return on net or return on equity of various companies does not differ
significantly. The TCS and HCL have high return on equity in compare to other
companies. They have the capability to make the high return on money invested
by the shareholders.
 TCS, tech Mahindra and HCL have high Interest coverage ratio which indicates
that they have the ability to pay the interest and the outstanding debt. The
interest coverage ratio of various companies may differ significantly.
 The assets turnover ratio among different companies does not differ significantly.
TCS and WIPRO have high assets turnover ratio which indicates how much
revenue is generated by using the assets of the company.
103

 The high EPS indicates the high profitability of the company. The companies like
Infosys and TCS have high EPS among the different years.
 The P/E ratio indicates valuing a company that measures its current share price
relative to it’s per share earnings.
 TCS shows the increasing trend in profit after interest and taxes which indicates
the high growth of the firm. The company is overall good from the paying of
interest, generating more return on the shareholders money , to pay off the
liabilities, high profitability to generate more return etc.
 Infosys may be the all equity firm has the high return on equity and also it shows
that the same or decreasing trend in the profit. But the firm has mantined the
profit.
 Wipro has the ability to pay the short term requirement and the long term
obligations and also have the financial soundness of the company. As the
Infosys, Wipro also have the same trend in the profit.
 HCL is also overall good firm as it is efficiently in controlling cost, ability to meet
short term obligations, generates revenues from the assets, high profitability, etc.
It has the high trend of increasing profit and performing well from the previous
years.

CONCLUSION:
 Here by it is concluded from the financial results, ANOVA and ratio analysis that
the companies like TCS and HCL has better performance than the other
companies.
 The investor should invest their money in these companies in order to make the
high return out of it.
 From the above findings, HCL, TCS, Infosys are showing the beast liquidity,
efficiently, profitability position and the best option available to investor to make
their investment decision in the it industry.
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Suggestions:
 Apart from this analysis the investor should analysis the market by the other
methods also.
 The market functions from the demand and supply of the shares, so sometime it
is not possible to predict accurately.
 While investing the investor has to take the other factors into the consideration.

Bibliography:
 Https://www.ibef.org/industry/information-technology-india.aspx
 https://www.tcs.com/
 www.moneycontol.com>markets>share/price> computers – software
 http://www,hcltechh.com
 http://www.wipro.com/en-IN/
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