Fundamental Analysis of Selected Shares of Banking Companies Listed in BSE India

Abstract

Fundamental analysis is a way of scientific analysis as it tries to estimate the intrinsic worth of the company. Fundamental analysis pays attention to assess the financial performance and strength of a company in terms of Debt-equity ratio, Profit margins, Dividend payout, Earning per share, Sales penetration, Market share, Interest, Asset and Dividend coverage, Product and Market innovation and the Promoters track record. The study is purely based on secondary data. This study covers a period of seven years from 2000-2007. The researcher has selected 7 Public Sector Banks and seven Private Sector Banks using convenient sampling technique.This study reveals that the financial performance of Andhra Bank and State Bank of India is highest and stable among the selected public sector banks during the study period. It indicates the financial strength of these two banks and these banks are fundamentally strong among the selected public sector Bank. On the other hand, among the selected private sector banks Kotak Mahindra Bank, IDBI, HDFC and Federal Banks performs well and these banks are fundamentally strong among the selected Private sector banks during the study period. The comparative fundamental financial analysis shows that, the public sector Banks performance is good and better than the private sector banks.