TABLE CONTENTS Sl.no TITLE 1. 2. 3. 4. 5. 6.

Introduction to fundamental analysis Economic analysis Industry analysis Company analysis Research methodology Data analysis Economic Industry Company 7. 8. 9. Finding & Limitations Conclusion & Suggestion Bibliography Page no. 6 14 17 26 33 36 38 45 52 72 76 80

INTRODUCTION TO FUNDAMENTAL ANALYSIS [CHAPTER-1]

INTRODUCTION:
INDUSTRIAL BACKGROUND:
Industries are the pointing light to the growth of an economy and are the backbone of the country. The department and growth of a country largely depends on the industrialization of its economy. India is basically an agriculture based country. It is after the independence, India has given importance to the growth of the industries through 5 years planning programmer. Government has taken a leading march to upheaval the movement of industrialization. For any country small or big developed need good infrastructure facilities, are the primary need for the transportation or movement of goods, roads play an important role in this aspects. Tremendous development has taken place in science and technology, which has mechanized every work in every field. Manually carried out work is less productive and time consuming. Foreigners have rules India for many years. And as such, after independence, India has given priority to strengthen the countrys defense force. Several industries producing defense equipments have been started by the Indian government thereafter. In this view, the ministry of defense has established BEML. BEML was mainly established to produce defense equipments and heavy capital equipments like railways coaches, earth mover machineries, etc. Two aggressive wars with Pakistan and china have made defense ministry to start one more unit BEML. It was started in the kolar gold fields, in the year 1964. It is one of the biggest units in Asia. BEML has number of branches all over India. Its various units in different parts of the country have immensely contributed to the growth of the economy. It is also earning foreign to the country. It has emerged as a powerful industrial unit of Indian economy. Indias heavy earth moving equipments and spare parts manufacturers manufacture various capacities ranging from mini version to giant. Overseas manufacturers are also manufacturing the equipments and spares and exports to our country, hence, providing a stiff competition. There are four major earth movers and around 500 spare parts manufactures in the country. The four major manufactures are BEML L&T- KOMASTU TATA-HITACHI, ESCORTS Among them BEML is dominating. The major customers for the above products are coal mines ministry, defense ministry, fleet owners in the construction industry, state government civil engineering and irrigation department and some small individual operator.

THEORETICAL BACKGROUND:
FUNDAMENTAL ANALYSIS:
Fundamental analysis is the examination of the underlying forces that affect the well being of the economy, industry groups, and companies. As with most analysis, the goal is to derive a forecast and profit from future price movements. At the company level, fundamental analysis may involve examination of financial data, management, business concept and competition. At the industry level, there might be an examination of supply and demand forces for the products offered. For the national economy, fundamental analysis might focus on economic data to assess the present and future growth of the economy. To forecast future stock prices, fundamental analysis combines economic, industry, and company analysis to derive a stock's current fair value and forecast future value. If fair value is not equal to the current stock price, fundamental analysts believe that the stock is either over or under valued and the market price will ultimately gravitate towards fair value. Fundamentalists do not heed the advice of the random walkers and believe that markets are weak form efficient. By believing that prices do not accurately reflect all available information, fundamental analysts look to capitalize on perceived price discrepancies.

STRENGTHS ANALYSIS
Long-term Trends:

AND

WEAKNESS

OF

FUNDAMENTAL

Fundamental analysis is good for long-term investments based on long-term trends, very long-term. The ability to identify and predict long-term economic, demographic, technological or consumer trends can benefit patient investors who pick the right industry groups or companies.

Value Spotting:
Sound fundamental analysis will help identify companies that represent good value. Some of the most legendary investors think long-term and value. Graham and Dodd, Warren

Buffett and John Neff are seen as the champions of value investing. Fundamental analysis can help uncover companies with valuable assets, a strong balance sheet, stable earnings and staying power

WEAKNESS Time Constraints:

Fundamental analysis may offer excellent insights, but it can be extraordinarily time consuming. Time-consuming models often produce valuations that are contradictory to the current price.

Industry/Company Specific:
Valuation techniques vary depending on the industry group and specifics of each company. For this reason, a different technique and model is required for different industries and different companies. This can get quite time consuming and limit the amount of research that can be performed.

Subjectivity:
Fair value is based on assumptions. Any changes to growth or multiplier assumptions can greatly alter the ultimate valuation. Fundamental analysts are generally aware of this and use sensitivity analysis to present a base-case valuation, a best-case valuation and a worst-case valuation. However, even on a worst case, most models are almost always bullish, the only question is how much so.

Analyst Bias:
The majority of the information that goes into the analysis comes from the company itself. Companies employ investor relations managers specifically to handle the analyst community and release information.

What is fundamental analysis?

Fundamental Analysis involves examining the economic, financial and other qualitative and quantitative factors related to a security in order to determine its intrinsic value. It attempts to

study everything that can affect the security's value, including macroeconomic factors (like the overall economy and industry conditions) and individually specific factors (like the financial condition and management of companies). Fundamental analysis, which is also known as quantitative analysis, involves delving into a companys financial statements (such as profit and loss account and balance sheet) in order to study various financial indicators (such as revenues, earnings, liabilities, expenses and assets). Such analysis is usually carried out by analysts, brokers and savvy investors. Many analysts and investors focus on a single number--net income (or earnings)--to evaluate performance. When investors attempt to forecast the market value of a firm, they frequently rely on earnings. Many institutional investors, analysts and regulators believe earnings are not as relevant as they once were. Due to nonrecurring events, disparities in measuring risk and management's ability to disguise fundamental earnings problems, other measures beyond net income can assist in predicting future firm earnings.

Two Approaches of fundamental analysis:

While carrying out fundamental analysis, investors can use either of the following approaches: 1 .Top-down approach: In this approach, an analyst investigates both international and national economic indicators, such as GDP growth rates, energy prices, inflation and interest rates. The Search for the best security then trickles down to the analysis of total sales, price levels and foreign competition in a sector in order to identify the best business in the sector 2. Bottom-up approach: In this approach, an analyst starts the search with specific businesses, irrespective of their industry/region.

How does fundamental analysis works?

Fundamental analysis is carried out with the aim of predicting the future performance of a company. It is based on the theory that the market price of a security tends to move towards its 'real value' or 'intrinsic value.' Thus, the intrinsic value of a security being higher than the securitys market value represents a time to buy. If the value of the security is lower than its market price, investors should sell it

The steps involved in fundamental analysis are:

1. Macroeconomic analysis, which involves considering currencies, commodities and indices. 2. Industry sector analysis, which involves the analysis of companies that are a part of the sector. 3. Situational analysis of a company. 4. Financial analysis of the company. 5. Valuation. The valuation of any security is done through the discounted cash flow (DCF) model, which takes into consideration:

1. Dividends received by investors 2. Earnings or cash flows of a company 3. Debt, which is calculated by using the debt to equity ratio and the current ratio (current assets/current liabilities)

Fundamental Analysis Tools

These are the most popular tools of fundamental analysis. Earnings per Share EPS Price to Earnings Ratio P/E Projected Earnings Growth PEG Price to Sales P/S Price to Book P/B Dividend Payout Ratio Dividend Yield Book Value Return on Equity Ratio analysis Financial ratios are tools for interpreting financial statements to provide a basis for valuing securities and appraising financial and management performance. A good financial analyst will build in financial ratio calculations extensively in a financial modeling exercise to enable robust analysis. Financial ratios allow a financial analyst to: Standardize information from financial statements across multiple financial years to allow comparison of a firms performance over time in a financial model. Standardize information from financial statements from different companies to allow apples to apples comparison between firms of differing size in a financial model. Measure key relationships by relating inputs (costs) with outputs (benefits) and facilitates comparison of these relationships over time and across firms in a financial model.

In general, there are 4 kinds of financial ratios that a financial analyst will use most frequently, these are:

Performance ratios Working capital ratios Liquidity ratios Solvency ratios

These 4 financial ratios allow a good financial analyst to quickly and efficiently address the following questions or concerns:

Performance ratios
What return is the company making on its capital investment? What are its profit margins?

Working capital ratios

How quickly are debts paid? How many times is inventory turned?

Liquidity ratios
Can the company continue to pay its liabilities and debts?

Solvency ratios (Longer term)

What is the level of debt in relation to other assets and to equity? Is the level of interest payable out of profits?

CHAPTER PLAN
It is proposed to divide the project into following chapters. CHAPTER 1: INTRODUCTION TO STUDY This chapter will be introductory in nature covering the relevance of study. CHAPTER 2: ANALYSIS CONCEPTUAL FRAMEWORK OF FUNDAMENTAL

This chapter will include a comprehensive study of the concept of Fundamental analysis and its tools. CHAPTER 3: DATA SOURCE AND RESEARCH METHODOLOGY This chapter will give an inside into source of data and method of undertaking research. CHAPTER 4: DATA ANALYSIS This is the chapter of all observations, inferences, analysis and conclusions that will be made out of the data analysis during the course of study. CHAPTER 5: LIMITATIONS AND SUGGESTIONS All the limitations and stumbling blocks that will be encountered during the study will be discussed in this chapter along with the future scope and suggestions. BIBLIOGRAPHY

ECONOMIC ANALYSIS [CHAPTER-2]

The economic analysis aims at determining if the economic climate is conclusive and is capable of encouraging the growth of business sector, especially the capital market. When the economy expands, most industry groups and companies are expected to benefit and grow. When the economy declines, most sectors and companies usually face survival problems. Hence, to predict share prices, an investor has to spend time exploring the forces operating in overall economy. Exploring the global economy is essential in an international investment setting. The selection of country for investment has to focus itself to examination of a national economic scenario. It is important to predict the direction of the national economy because economic activity affects corporate profits, not necessarily through tax policies but also through foreign policies and administrative procedures.

Tools for Economy Analysis

The most used tools for performing economic analysis are: Gross Domestic Product (GDP) Monetary policy and Liquidity Inflation Interest rates International influences Fiscal policy Influences on long term expectations Influences on short term expectations

1) Gross Domestic product

GDP is one measure of economic activity. This is the total amount of goods and services produced in a country in a year. It is calculated by adding the market values of all the final goods and services produced in a year. It is a gross measurement because it includes the total amount of goods and services produced, of which some merely replace goods that have depreciated or have worn out. It is domestic production because it includes only goods and services produced within the country.

2) Inflation
Inflation can be defined as a trend of rising prices caused by demand exceeding supply. Over time, even a small annual increase in prices of say 1 % will tend to influence the purchasing power of the nation. In others word, if prices rise steadily, after a number of years, consumers will be able to buy only fewer goods and services assuming income level does not change with inflation.

3) Interest rate
Interest rate is the price of credit. It is the percentage fee received or paid by individual or organization when they lend and borrow money. In general, increases in interest rate, whether caused by inflation, government policy, rising risk premium, or other factors, will lead to reduced borrowing and economic slowdown.

4) International influences
Rapid growth in overseas market can create surges in demand for exports, leading to growth in export sensitive industries and overall GDP. In contrast, the erection of trade barriers, quotas, currency restrictions can hinder the free flow of currency, goods, and services, and harm the export sector of an economy. 5) Fiscal policy The fiscal policy of the government involves the collection and spending of revenue. In particular, fiscal policy refers to the efforts by the government to stimulate the economic directly, through spending.

INDUSTRY ANALYSIS [CHAPTER-3]

An industry analysis helps inform business managers about the viability of their current strategy and on where to focus a business among its competitors in an industry. The analysis examines factors such as competition and the external business environment, substitute products, management preferences, buyers and suppliers. Industry analysis involves reviewing the economic, political and market factors that influence the way the industry develops. Major factors can include the power wielded by suppliers and buyers, the condition of competitors. And the likelihood of new market entrants.

Data needs for industry analysis:

Industry analysis requires a variety of quantitative and qualitative data. Though one single source for all the data needs might not found, industry associates, business publications and the department of economic analysis perform a comprehensive industry analysis. A suggestive list of data categories that are utilized for performing industry analysis is listed below. Product lines Product growth Complementary product Economics of scale Suppliers Labors Substitute products Buyers and their behavior Product pattern (cyclical, seasonal) Cost structure Tools for industry analysis Cross-sectional industry Industry performance over time Differences in industry risk Prediction about market behavior Competitors over the industry life cycle

INDUSTRY PROFILE:
The Indian construction equipment sector has an estimated market size of US$ 2.4 2.6 billion for the year 2012. The industry has been growing due to the large investments made by the government and private sector infrastructure developments. The prospects of the construction equipment industry look attractive with projected investment of US$320 billion in the infrastructure sector over the next few years. The imports markets are estimated around US$375 million. Of these, the earthmoving, excavation and hauling equipment categories command around 25%. Imported used equipment, which include high-end hydraulic mobile cranes, excavators, motors graders, vibratory compactors comprise a negligible 0.4 per cent of the total construction equipment market.

SECTOR COMPOSITION AND SIZE: 1. Product consumption constitutes the bulk of the segment with around 56%. 2. While the unorganized sector contributes to around 15 percent. 3. Unorganized players are more prevalent in the relatively less technology intensive material handling, material preparation and concrete equipment segment. INDUSTRY STRUCTURE: India produces the entire range of construction equipment for different applications. The industry can be broadly classified under the following categories. Earth moving equipment Road construction equipment Material handling equipment Tunneling and drilling equipment COMPETITOR ANALYSIS:
After the new economic policy OF 1991, the economy opened its floodgates to foreign companies to start their business in India. as a result of this many multinational came into existence to compete with the domestic industries in all sectors of the economy. As much BEML is also facing competition from many MNCs and domestic industries such as 1. Earth movers equipment Hindustan motors, India

Caterpillar, Russia Larsen & turbo, Japan Telco-wabco Volvo-Swiss

2. Small loaders

JCB Larsen & turbo, Japan Hindustan motors, India 3. Rail & coaches Integral coach factory- Perambur- Tamilnadu Rail coach factory-kapurtala, Punjab

JCB INDIA:
JCB came to india in 1979 The company has a turnover of US $335 million The company is growing by 25-30% annually JCB INDIA is a subsidiary of JC bam ford excavators ltd. (JCB) The product range from backhoe loaders, wheeled loaders to excavators and skid steel loaders The company has 70% market share in the backhoe loaders segment and around 13%market share in the overall INDIAN economy It has facilities at ballabgarh in Haryana and pune in Maharashtra It has 38 dealers and 206 outlets It has a dedicated parts centre in ballabgarh and parts distribution depots in Chennai, pune and Kolkata

BEML:
BEML is its largest player in earthmoving equipment The company turnover is around US$484 million The mining and construction equipment segment is around US$306.6 million Defence segment is about US$154.2 million, and railways around US$23 million The company is the largest public sector undertaking in this industry.

1. PORTERS FIVE FORCE MODEL OF BEML:

(a) New Entrants Medium

Supply side economies of scale, huge capital requirements and high exit costs deter entry of new players. However, MNCs looking to diversify their business could find India as an attractive destination.

(b) Supplier Power - Low to Medium

Raw materials used in capital goods companies are mostly standardized and largely domestic in origin, which leaves little scope for a bargain. However, if production Line is set up adjacent to suppliers manufacturing facility; manufacturer may face switching cost in changing suppliers.

(c) Buyer Power Medium to High

Large volume buyers like industrial customers are major purchasers of capital goods which pressurize manufacturers to offer products on thin margins. Indian capital goods sectors are characterized by a large array of standardized products which provides ample scope for buyers to switch between suppliers. (d) Substitute Products - Low There is less number of products that can be substituted with other products in the sector.

(e) Rivalry Intensity Medium to High

The Indian capital goods space is highly fragmented industry with dominance of PSEs in heavy engineering, machine tools, boiler manufacturing while private firms exist in industrial segments such as cement, sugar and non-electrical machinery. There is high level of competition among organized players.

Company analysis [Chapter-4]

Company Profile:
BEML Limited (formerly Bharat Earth Movers Limited) was established in May 1964 as a Public Sector Undertaking for manufacture of Rail Coaches & Spare Parts and Mining Equipment at its Bangalore Complex. The Company has partially disinvested and presently Government of India owns 54 percent of total equity and rest 46 percent is held by Public, Financial Institutions, Foreign Institutional Investors, Banks and Employees. During the financial year 2008-09, BEML achieved a sales turnover of INR 3013 corers and a pretax profit of INR 387 corers. The export earnings touched INR 304 corers.

Vision & Mission: Vision:

To become a market leader, as a diversified company supplying products and services to Mining& Construction, Railway & Metro and Defense Services and emerge as an International Player.

Mission:
1. Improve competitiveness through organizational transformation and collaboration / strategic alliances / joint ventures in technology. 2. Grow profitably by aggressively pursuing opportunities in national and international markets. 3. Attract and build people in a rewarding and inspiring environment by fostering creativity and innovation

Objectives:
1. To maintain a dominant position in design, development, manufacture and marketing of Defense, Earthmoving & Construction and Rail & Metro equipment. 2. To diversify and grow. 3. To provide total engineering solutions to its customers. 4. To internationalize operations by enhancing exports. 5. To improve profitabilit y. 6. To maintain State-of-the-Art technology for all products. 7. Re-orientation of the business operations to match present scenario 8. Continuous building of skills and competencies to bring about Executive Effectiveness for Management Succession . Analysis of the company consists of measuring its performance and ascertaining the cause of this performance. When some companies have done well irrespective of economic or industry failure, this implies that there are certain unique characteristics for this particular company that had made it a success. The identification of these characteristics, whether quantitative or qualitative, is referred to as company analysis. Quantitative indicators of company analysis are the financial indicators and operational efficiency indicators. Financial indicators are the profitability indicators and financial position indicators analyzed through the income and balance sheet statements, respectively, of the company. Operational indicators are capacity utilization and cost versus sales efficiency of the company, which includes the marketing edge of the company. Besides the quantitative factors, qualitative factors of a company also influence investment decision process of an institutional investor. The focus of the qualitative data, as revealed in the

annual report- as in the directors speech. Rather than on quantitative data.

Tools for company analysis

Company analysis involves choice of investment opportunities within a specific industry that comprises of several individual companies. The choice of an investible company broadly depends on the expectations about its future performance in general. Here, the business cycle that a company is undergoing is a very useful tool to assess the future performance from the company. Company analysis ought to examine the levels of competition, demand, and other forces that affect the companys ability to be profitable. Of these factors, understanding the competitive environment is most important. A business faces five forces of competition (porters model) namely, sellers competition, buyers competition, competition from new entrants, exit competition. Competitive forces include the power of those who sell the business, those who buy the business; those who buy from the business, how easily new businesses can enter the industry, how costly it is to exit, and finally, the competition from those who already in the industry. How well a company deals with each of these forces will determine whether the company earns above or below average profit. Each of these forces is discussed below.

1. The financial statements of the company: Records that outline the financial activities of a business, an individual or any other entity. Financial statements are meant to present the financial information of the entity in question as clearly and concisely as possible for both the entity and for readers. Financial statements for businesses usually include: income statements, balance sheet, statements of retained earnings and cash flows, as well as other possible statements 2. Ratio analysis: A tool used by individuals to conduct a quantitative analysis of information in a company's financial statements. Ratios are calculated from current year numbers and are then compared to previous years, other companies, the industry, or even the economy to judge the performance of the company. Ratio analysis is predominately used by proponents of fundamental analysis. There are many ratios that can be calculated from the financial statements pertaining to a company's performance, activity, financing and liquidity. Some common ratios include the price-earnings ratio, debt-equity ratio, earnings per share, asset turnover and working capital.

3. ROA: Return on assets, which, offering a different take on management's effectiveness reveals how much profit a company earns for every dollar of its assets. Assets include things like cash in the bank, accounts receivable, property, equipment, inventory and furniture. ROA is calculated like this:

Annual net income/Total assets

4. ROI: Return on Investment is one of several commonly used approaches for evaluating the financial consequences of business investments, decisions, or actions. ROI analysis compares the magnitude and timing of investment gains directly with the magnitude and timing of investment costs. A high ROI means that investment gains compare favorably to investment costs GAINS- INVESTMENT COSTS INVESTMENT COSTS
5. ROE: Of all the fundamental ratios that investors look at, one of the most important is return on equity. It's a basic test of how effectively a company's management uses investors' money - ROE shows whether management is growing the company's value at an acceptable rate. ROE is calculated as:

Annual Net Income Average Shareholders' Equity

6. EPS: 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. Calculated

7. DPS: The sum of declared dividends for every ordinary share issued. Dividend per share (DPS) is the total dividends paid out over an entire year (including interim dividends but not including special dividends) divided by the number of outstanding ordinary shares issued.

DPS can be calculated by using the following D - Sum of dividends over a period (usually 1 year) SD - Special, one time dividends S - Shares outstanding for the period 8. P/O RATIO: The amount of earnings paid out in dividends to shareholders. Investors can use the payout ratio to determine what companies are doing with their earnings Calculated

9. DIVIDEND YEILD: financial ratio that shows how much a company pays out in dividends each year relative to its share price. In the absence of any capital gains, the dividend yield is the return on investment for a stock. Dividend yield is calculated as follows

RESEARCH DESIGN [CHAPTER-5]

RESEARCH DESIGN OF THE STUDY

INTRODUCTION:
Every stock available in the markets has a value called market price, which is the indicator of the companys performance. According to fundamental analysis we will try to find the intrinsic value of a particular stock, which is the true value of the stock, based on which investment arguments take place.

STATEMENT OF PROBLEM:
Every asset, financial as well as real, has value. The key to successfully investing in and managing these assets lies in understanding not only what the value is, but the sources of the value. Any asset at can be valued but some assets are easier to value than others, and the details of the valuation will vary from case to case. Thus, the valuation of a share of a real estate property will require different information and follow a different format from the valuation of a publicly traded stock. What is surprising; however, is not the difference in valuation techniques across assets, but the degree of similarity in basic principles. There is undeniably uncertainty associated with valuation. Often the Uncertainty comes from the asset being valued, although the valuation model may add to that ascertained. A postulate of sound investing is that an investor does not pay more for asset than its worth. This statement may seem logical and obvious as financial assets are acquired for the cash flows expected from owning them, which implies that the price that is paid for any asset should reflect the cash flows it is expected to generate. The problem in valuation is not that there are not enough models to value an asset; it is that there are too many. Choosing the right model to use in valuation is as critical to arriving at a reasonable value as understanding how to use the model. Analysts use a wide variety of models from simple to the sophisticated. These models often make different assumptions about pricing, but they do share some common characteristics so in the study we tried to use price-earnings multiples and discounted cash flow models of valuation.

OBJECTIVES OF THE STUDY:

2. To understand the macroeconomic variables those will an impact on the company progress. 3. To study the various trends, opportunities, challenges of the industry in which the company operates. 4. To understand the various policies of the company those have impact on the financial performance of the company. 5. To understand the various investment valuation models that can be used. 6. To select the appropriate model that suits the stock. 7. Find the intrinsic value of the stock and compare with market value of the study. 8. To recommend whether to buy, hold or sell the stock based on the analysis.

SCOPE OF THE STUDY:

The study basically tries to identify the intrinsic value of the company by using the published financial details of the company. The study is restricted to one particular company in the sector. The study also includes testing the intrinsic value of the company.

RESEARCH METHODOLOGY:
Type of research:
Research design is the conceptual structure within which research is conducted. It constitutes the blue print for the collection, measurement, and analysis of data. The type of research adopted for the study is descriptive research as the research does not require any manipulation of variables and does not establish causal relationship between events; it just simply describes the variables.

Sources of data:
Primary data

Those are the data that are obtained by a study specially designed to fulfill the data needs of the problem. Meeting the company professionals personally collected the information

necessary for the study.

Secondary data
The sources of secondary data for solve the problems are:Company Annual Report ACE equity database Internet-websites

Period of study
The period of the study is 5 years i.e. (2009-20112). Company 4 years data has been taken for the analysis.

Tools
These are the most popular tools of fundamental analysis. They focus on earnings, growth, and value in the market. Earnings per Share EPS Price to Earnings Ratio P/E Projected Earnings Growth PEG Price to Sales P/S Price to Book P/B Dividend Payout Ratio Dividend Yield Book Value Ratio Analysis Liquid ratio

LIMITATIONS OF THE STUDY:

The study was confined only to one particular sector. The study was more confined with secondary data. The study assumes no changes in the tax rates in the country. The study was done for a short period of time, which might not hold true over a long period of time. As the scope is defined by the researcher it restricts the number of variables which Influence the industry.

DATA ANALYSIS [CHAPTER-6]

The process of evaluating data using analytical and logical reasoning to examine each component of the data provided. This form of analysis is just one of the many steps that must be completed when conducting a research experiment. Data from various sources is gathered, reviewed, and then analyzed to form some sort of finding or conclusion. There are a variety of specific data analysis method, some of which include data mining, text analytics, business intelligence, and data visualizations Data can be of several types Quantitative data is a number Qualitative data is a pass/fail or the presence of a characteristic Quantitative data is data measured or identified on a numerical scale. Numerical data can be analyzed using statistical methods, and results can be displayed using tables, charts, histograms and graphs. The term qualitative data is used to describe certain types of information. This is almost the converse of quantitative data, in which items are more precisely described as data in terms of quantity and in which numerical values are used. However, data originally obtained as qualitative information about individual items may give rise to quantitative data if they are summarized by means of counts. Qualitative data described items in terms of some quality or categorization that may be 'informal' or may use relatively ill-defined characteristics such as warmth and flavor. However, qualitative data can include well-defined aspects such as gender, nationality or commodity type.

BALANCE SHEET:

MAR12 Sources Of Funds Total Share Capital Equity Share Capital Share Application Money Preference Share Capital Reserves Revaluation Reserves Networth Secured Loans Unsecured Loans Total Debt Total Liabilities

MAR11

MAR10

MAR09

MAR08

41.77 41.77 0.00 0.00

41.77 41.77 0.00 0.00

41.77 41.77 0.00 0.00

41.77 41.77 0.00 0.00

41.77 41.77 0.00 0.00

2,130.31 2,097.27 1,996.07 1,873.60 1,663.93 0.00 0.00 0.00 0.00 0.00

2,172.08 2,139.04 2,037.84 1,915.37 1,705.70 781.71 161.22 942.93 676.22 140.90 817.12 753.05 155.50 908.55 470.91 96.73 567.64 303.27 0.00 303.27

3,115.01 2,956.16 2,946.39 2,483.01 2,008.97 Mar '12 12 mths Mar '11 12 mths Mar '10 12 mths Mar '09 12 mths Mar '08 12 mths

Application Of Funds Gross Block Less: Acumen. Depreciation Net Block Capital Work in Progress Investments Inventories Sundry Debtors Cash and Bank Balance Total Current

1,128.45 945.43 599.23 529.22 23.86 555.90 389.53 79.58

798.71 524.84 273.87 32.21

749.51 494.02 255.49 23.61

680.28 469.70 210.58 24.63

4.43 8.20 8.20 7.95 7.95 2,420.64 1,888.91 1,653.00 1,620.58 929.58 792.46 192.47 1,287.53 1,360.74 1,545.27 1,496.06 48.28 417.10 98.51 156.10

3,405.57 3,224.72 3,430.84 3,264.36 2,581.74

Assets Loans and Advances Fixed Deposits Total CA, Loans & Advances Deffered Credit Current Liabilities Provisions Total CL & Provisions Net Current Assets Miscellaneous Expenses Total Assets

972.00 0.00

598.93 0.00

536.53 150.05

459.46 165.00

202.23 365.00

4,377.57 3,823.65 4,117.42 3,888.82 3,148.97 0.00 0.00 0.00 0.00 0.00

1,501.05 1,025.65 925.88 319.02 319.14 560.88

1,164.99 1,329.35 536.15 67.75

1,820.07 1,344.79 1,486.76 1,701.14 1,397.10 2,557.50 2,478.86 2,630.66 2,187.68 1,751.87 0.00 0.00 1.45 8.30 13.94

3,115.01 2,956.17 2,946.39 2,483.03 2,008.97 179.21 513.64 206.49 489.34 150.71 459.93 125.55 409.59

Contingent 212.52 Liabilities Book Value 521.58 (Rs)

PROFIT & LOSS:

MAR12 Income Sales Turnover Excise Duty Net Sales Other Income Stock Adjustments Total Income Expenditure Raw Materials Power & Fuel Cost Employee Cost Other Manufacturing Expenses Selling and Admin Expenses Miscellaneous Expenses Preoperative Exp Capitalized Total Expenses MAR11 MAR10 MAR09 MAR08

2,920.58 2,824.54 3,005.93 2,949.67 2,733.38 194.09 197.05 150.09 127.32 186.19 2,726.49 2,627.49 2,855.84 2,822.35 2,547.19 73.91 62.79 53.08 39.37 52.13 428.81 145.08 150.99 280.72 113.60

3,229.21 2,835.36 3,059.91 3,142.44 2,712.92 2,920.58 2,824.54 3,005.93 2,949.67 2,733.38 194.09 197.05 150.09 127.32 186.19

2,726.49 2,627.49 2,855.84 2,822.35 2,547.19 73.91 62.79 53.08 39.37 52.13

428.81

145.08

150.99

280.72

113.60

3,229.21 2,835.36 3,059.91 3,142.44 2,712.92 0.00 0.00 0.00 0.00 -0.46

3,032.15 2,646.92 2,685.65 2,722.24 2,336.00 Mar '12 12 mths Mar '11 12 mths 125.65 188.44 72.04 116.40 33.64 6.87 75.89 120.21 196.10 Mar '10 12 mths 321.18 374.26 60.60 313.66 32.22 0.00 281.44 40.71 322.15 Mar '09 12 mths 380.83 420.20 43.18 377.02 27.31 2.36 347.35 54.91 402.26 Mar '08 12 mths 324.79 376.92 26.61 350.31 17.70 6.29 326.32 21.69 348.01

Operating Profit PBDIT Interest PBDT Depreciation Other Written Off Profit Before Tax Extra-ordinary items PBT (Post Extra-ord

123.15 197.06 88.43 108.63 43.92 0.00 64.71 1.73 66.44

Items) Tax Reported Net Profit Total Value Addition Preference Dividend Equity Dividend Corporate Dividend Tax Per share data (annualized) Shares in issue (lakhs) Earnings Per Share (Rs) Equity Dividend (%) Book Value (Rs)

9.21 57.25

46.31 149.76

99.23 222.85 855.74 0.00 41.64 7.08

133.43 268.84 846.92 0.00 49.97 8.49

122.36 225.65 705.00 0.00 53.87 4.60

1,169.45 974.52 0.00 20.82 3.38 0.00 41.64 6.92

416.45 13.75 50.00 521.58

416.45 35.96 100.00 513.64

416.45 53.51 100.00 489.34

416.45 64.56 120.00 459.93

416.45 54.19 120.00 409.59

CASH FLOW STATEMENTS:

MAR12 MAR11 MAR10 MAR09 MAR08 Net Profit Before Tax Net Cash From Operating Activities Net Cash (used in)/from Investing Activities Net Cash (used in)/from Financing Activities Net (decrease)/increase In Cash and Cash Equivalents Opening Cash & Cash Equivalents Closing Cash & Cash Equivalents 66.46 241.82 106.43 8.80 186.75 158.33 161.75 198.79 518.87 567.15 48.28 319.55 98.18 -28.06 387.47 412.40 -37.94 348.01 476.86 -56.93

233.52

192.75

707.04

144.19

303.64

257.59 521.10 263.51

173.26

48.28 192.47

263.51 567.15

347.84 521.10

BEML YEARLY RESULTS:

MAR12 Net Sales/Income from operations Other Operating Income Total Income From Operations EXPENDITURE Consumption of Raw Materials Purchase of Traded Goods Increase/Decrease in Stocks Power & Fuel Employees Cost Depreciation Excise Duty Admin. And Selling Expenses R & D Expenses Provisions And Contingencies Exp. Capitalized Other Expenses P/L Before Other Inc. , Int., Except. Items & Tax Other Income P/L Before Int., Except. Items & Tax Interest P/L Before Exceptional Items & Tax Exceptional Items P/L Before Tax Tax P/L After Tax from Ordinary Activities Prior Year Adjustments Extra Ordinary Items Net Profit/(Loss) For the Period Equity Share Capital Reserves Excluding MAR11 MAR10 MAR09 MAR08

2,692.97 2,630.37 2,838.24 2,797.17 2,539.60 33.52 -------

2,726.49 2,630.37 --

1,793.28 1,605.30 1,788.17 1,778.99 1,493.49 45.91 -428.81 -721.73 43.92 -----469.49 80.97 45.09 126.06 88.42 37.64 28.82 66.46 9.21 57.25 --57.25 --145.08 -683.15 33.64 -----430.82 22.54 222.84 245.38 58.63 186.75 -186.75 36.99 149.76 --149.76 --150.99 -555.14 32.22 -----382.63 -137.41 -48.93 319.55 --96.70 ---222.85 --280.72 -569.19 27.31 -----385.66 -109.97 -39.25 ---118.62 ---268.84 --113.60 -446.72 17.70 -----419.02 -94.83 -23.09 ---122.36 ---225.65

41.64 41.64 41.64 41.64 41.64 2,130.31 2,097.27 1,996.07 1,873.60 1,663.93

Revaluation Reserves Equity Dividend Rate (%) EPS Before Extra Ordinary Basic EPS Diluted EPS EPS After Extra Ordinary Basic EPS Diluted EPS Public Share Holding No Of Shares (Crores) Share Holding (%) Promoters and Promoter Group Shareholding a) Pledged/Encumbered - Number of shares (Crores) - Per. of shares (as a % of the total sh. of prom. and promoter group) - Per. of shares (as a % of the total Share Cap. of the company) b) Non-encumbered - Number of shares (Crores) - Per. of shares (as a % of the total sh. of prom. and promoter group) - Per. of shares (as a % of the total Share Cap. of the company)

--

--

--

--

--

13.75 13.75

35.96 35.96

---

---

---

13.75 13.75 1.91 45.97

35.96 35.96 1.91 45.97

--1.91 45.97

--1.91 45.97

--1.91 45.97

--

--

--

--

--

--

--

--

--

--

--

--

--

--

--

2.25

2.25

--

--

--

100.00

100.00

--

--

--

54.03

54.03

--

--

HALF YEARLY RESULTS:

Net Sales/Income from operations Other Operating Income Total Income From Operations EXPENDITURE Consumption of Raw Materials Purchase of Traded Goods Increase/Decrease in Stocks Power & Fuel Employees Cost Depreciation Excise Duty Admin. And Selling Expenses R & D Expenses Provisions And Contingencies Exp. Capitalized Other Expenses P/L Before Other Inc. , Int., Excpt. Items & Tax Other Income P/L Before Int., Excpt. Items & Tax Interest P/L Before Exceptional Items & Tax Exceptional Items P/L Before Tax Tax P/L After Tax from Ordinary Activities Prior Year Adjustments Extra Ordinary Items Net Profit/(Loss) For the Period

994.83 15.52

1,348.88 1,346.38 1,594.25 1,036.12 18.97 ---1,036.12

1,010.35 1,367.85 1,346.38 --

677.94 11.08 -181.65 -353.49 23.88 -----201.11 -75.50 37.34 -38.16 63.84 -102.00 0.12 -101.88 --101.88 ---101.88

943.65 38.01 -337.54 -393.47 23.63 -----272.14 34.49 25.21 59.70 49.88 9.82 15.58 25.40 -0.68 26.08 --26.08

849.63 7.90 -91.27 -328.26 20.29 -----197.35 34.22 32.14 66.36 38.54 27.82 13.24 41.06 9.89 31.17 --31.17

870.50 -60.27 -410.66 17.65 -----226.37 -174.89 -31.90 151.79 --31.17 ---120.62

734.80 --205.35 -272.49 15.99 -----204.45 13.74 47.95 61.69 26.73 34.96 -34.96 5.82 29.14 --29.14

Equity Share Capital Reserves Excluding Revaluation Reserves Equity Dividend Rate (%) EPS Before Extra Ordinary Basic EPS Diluted EPS EPS After Extra Ordinary Basic EPS Diluted EPS Public Share Holding No Of Shares (Crores) Share Holding (%) Promoters and Promoter Group Shareholding a) Pledged/Encumbered - Number of shares (Crores) - Per. of shares (as a % of the total sh. of prom. and promoter group) - Per. of shares (as a % of the total Share Cap. of the company) b) Non-encumbered - Number of shares (Crores) - Per. of shares (as a % of the total sh. of prom. and promoter group) - Per. of shares (as a % of the total Share Cap. of the company)

41.64 ---

41.64 ---

41.64 ---

41.64 ---

41.64 ---

-24.46 -24.46

---

7.48 7.48

---

7.00 7.00

-24.46 -24.46 1.91 45.97

--1.91 45.97

7.48 7.48 1.91 45.97

--1.91 45.97

7.00 7.00 1.91 45.97

--

--

--

--

--

--

--

--

--

--

--

--

--

--

--

2.25

2.25

2.25

--

2.25

100.00

100.00

100.00

--

100.00

54.03

54.03

54.03

--

54.03

KEY RATIOS:
MAR12 MAR11 MAR10 MAR09 Investment Valuation Ratios Face Value Dividend Per Share Operating Profit Per Share (Rs) Net Operating Profit Per Share (Rs) Free Reserves Per Share (Rs) Bonus in Equity Capital Profitability Ratios Operating Profit Margin(%) Profit Before Interest And Tax Margin(%) Gross Profit Margin(%) Cash Profit Margin(%) Adjusted Cash Margin(%) Net Profit Margin(%) Adjusted Net Profit Margin(%) Return On Capital Employed(%) Return On Net Worth(%) Adjusted Return on Net Worth(%)

10.00 5.00 29.57

10.00 10.00 30.16

10.00 10.00 77.11

10.00 12.00 91.45

654.71

630.93

685.77

677.73

---

503.36 --

478.70 --

447.65 --

4.51

4.78

11.24

13.49

2.85

3.41

9.89

12.31

2.90 2.54 2.54 2.06 2.06

3.50 2.67 2.67 5.56 5.56

10.11 7.67 7.67 7.63 7.63

12.52 8.81 8.81 9.36 9.36

3.99 2.63 1.22

5.06 7.00 1.46

11.93 10.94 9.42

16.10 14.09 11.70

Return on Assets Excluding Revaluations Return on Assets Including Revaluations Return on Long Term Funds(%) Liquidity And Solvency Ratios Current Ratio Quick Ratio Debt Equity Ratio Long Term Debt Equity Ratio Debt Coverage Ratios Interest Cover Total Debt to Owners Fund Financial Charges Coverage Ratio Financial Charges Coverage Ratio Post Tax Management Efficiency Ratios Inventory Turnover Ratio Debtors Turnover Ratio Investments Turnover Ratio

521.58

513.64

488.99

457.94

521.58

513.64

488.99

457.94

5.13

6.99

17.25

20.87

1.39 1.04 0.43 0.11

1.35 1.38 0.38 --

1.31 1.61 0.45 --

1.42 1.31 0.30 --

1.41 0.43

2.55 0.38

7.19 0.45

10.19 0.30

1.90

2.64

6.33

9.95

2.14

3.64

5.21

7.91

1.21

1.90

2.40

1.87

2.62

1.98

1.97

1.86

1.21

1.90

2.40

1.87

Fixed Assets Turnover 2.49 Ratio Total Assets Turnover 0.89 Ratio Asset Turnover 0.90 Ratio Average Raw Material Holding Average Finished Goods Held Number of Days In Working Capital Profit & Loss Account Ratios Material Cost Composition Imported Composition of Raw Materials Consumed Selling Distribution Cost Composition Expenses as Composition of Total Sales Cash Flow Indicator Ratios Dividend Payout Ratio Net Profit Dividend Payout Ratio Cash Profit Earning Retention Ratio Cash Earning

2.86

3.58

3.77

0.90

0.97

1.14

0.89

1.05

1.26

--

132.67

99.82

112.07

--

61.52

31.97

75.15

337.69

339.63

331.61

279.04

68.31

63.65

64.07

66.44

--

--

--

--

--

1.23

1.16

1.29

4.25

6.82

4.68

10.01

42.27

32.42

21.86

21.74

23.92

25.52

19.10

19.58

9.33 65.73

-54.74 32.46

74.61 78.26

73.82 76.89

Retention Ratio AdjustedCash 13.36 Flow Times

11.37

4.05

2.24

Mar '12 Earnings Per 13.75 Share Book Value 521.58

Mar '11 35.96 513.64

Mar '10 53.51 489.34

Mar '09 64.56 459.93

ECONOMIC ANALYSIS

Analysis of Indian Economy

India's economy expanded 8.8% in the second quarter from a year earlier, compared to an 8.6% on-year expansion in the first, lifted by robust activity in manufacturing. Agricultural output along with strong development in the Industrial, Mining and banking sector have helped to boost the Indian economy. Agricultural output raised 2.8 per cent y-o-y thanks to improved harvests. Industrial production increased by 12% and in the mining sector by 9%. According to 2010 data the shares of banking sector value add in GDP has been increased 7.7% from 2.5%. The forecasters have assigned highest 29.6 per cent chance that it will fall in 6.0-6.9 per cent in 201011. They raised their forecasts slightly for agriculture growth to 4.0 percent from 3.5 percent, for industry to 9.0 percent from 8.1 percent and for services it was steady at 9.0 percent. The survey showed the economists expect GDP growth in the April-June quarter to be 8.1 percent up from 7.9 percent in the last survey. For the July-September quarter, GDP growth is placed at 8.3 percent. The Reserve Bank of India has stated that it had seen an annual growth of 8.5% steadily. The main priority of the Reserve Bank is to curb the ongoing inflation, which peaked at 11% last month. Interest rates have been increased by the banks to contain the inflation, but it could slow down the growth of the Indian economy in the coming months. But even thought there has been a rise in the interest rates there Hasnt been much change in the distribution of loans, the Indian customer is hardly affected with the hiked interest rates. Almost every sector of the economy is poised to grow faster and a 9 per cent growth in 2011-12 is not difficult if domestic policies and external factors do not come in the way. Expert expects that India s economy to grow by 8.1% in 2013 based on a steep gain in industrial output and resurgent private consumption investment and exports. Were these scenarios to continue growth would lift further to 8.3% in 2013 said Chief Economist. They also expect the Reserve Bank of India (RBI) to continue gradually raising interest rates and to keep a tight leash on liquidity to tame inflation. Recently RBI changed the repo rate from 5.75% to 6% and reverse repo rate 4.5% to 5%. CRR rate they keeping unchanged. This six time I a year they revise key parameter to control inflation.

INDIA GDP SURGES 8.9% IN THE THIRD QUARTER

India's domestically-powered economy grew more than expected in the September quarter, defying weakness elsewhere and putting pressure on the Reserve Bank of India (RBI) to tighten monetary policy although a rate increase next month still looks unlikely. Annual gross domestic product grew 8.9 percent in the September quarter -- matching the revised figure for the previous quarter. Consumer price inflation eased to an annual 9.7 percent in October from 9.82 percent the previous month, data showed on Tuesday. Wholesale price inflation, which is more closely watched as it covers a higher number of products, eased to 8.58 percent in October from 8.62 percent a month earlier. Investment growth slowed on an annualized basis to 11.1 percent from

19 percent in the previous quarter, while annualized private consumption accelerated to 9.3 percent from 7.8 percent in the previous quarter, pointing to inflationary risks. The services sector, which accounts for over 50 percent of GDP, grew 9.8 percent in the September quarter, higher than 9.3 percent in the previous quarter. Signs of easing inflation, a fragile global economy and weaker industrial output in September were likely to forestall any rise in rates in the near-term, some analysts said. "Unless the full year growth looks likely to cross 9 percent, the central bank is unlikely to get aggressive again in raising rates," said Anjali Varma, economist at MF Global in Mumbai. Industrial output growth -- a key indicator of growth momentum -- in Asia's third-largest economy slowed unexpectedly in September to 4.4 percent from a year earlier, down from the previous month's upwardly revised 6.92 percent growth The Gross Domestic Product (GDP) in India was worth 1847.98 billion US dollars in 2011. The GDP value of India represents 2.98 percent of the world economy. GDP in India is reported by the The World Bank Group. Historically, from 1960 until 2011, India GDP averaged 368.8 USD Billion reaching an all time high of 1848.0 USD Billion in December of 2011 and a record low of 36.6 USD Billion in December of 1960. The gross domestic product (GDP) measures of national income and output for a given country's economy. The gross domestic product (GDP) is equal to the total expenditures for all final goods and services produced within the country in a stipulated period of time. This page includes a chart with historical data for India GDP.

INDIA INFLATION RATE

The inflation rate in India was recorded at 4.89 percent in April of 2013. Inflation Rate in India is reported by the Ministry of Commerce and Industry. Historically, from 1969 until 2013, India

Inflation Rate averaged 7.74 Percent reaching an all time high of 34.68 Percent in September of 1974 and a record low of -11.31 Percent in May of 1976. In India, the wholesale price index (WPI) is the main measure of inflation. The WPI measures the price of a representative basket of wholesale goods. In India, wholesale price index is divided into three groups: Primary Articles (20.1 percent of total weight), Fuel and Power (14.9 percent) and Manufactured Products (65 percent). Food Articles from the Primary Articles Group account for 14.3 percent of the total weight. The most important components of the Manufactured Products Group are Chemicals and Chemical products (12 percent of the total weight); Basic Metals, Alloys and Metal Products (10.8 percent); Machinery and Machine Tools (8.9 percent); Textiles (7.3 percent) and Transport, Equipment and Parts (5.2 percent). This page includes a chart with historical data for India Inflation Rate.

INDIA INTEREST RATE

The benchmark interest rate in India was last recorded at 7.25 percent. Interest Rate in India is reported by the Reserve Bank of India. Historically, from 2000 until 2013, India Interest Rate averaged 6.57 Percent reaching an all time high of 14.50 Percent in August of 2000 and a record low of 4.25 Percent in April of 2009. In India, interest rate decisions are taken by the Reserve Bank of India's Central Board of Directors. The official interest rate is the benchmark repurchase rate. This page includes a chart with historical data for India Interest Rate.

RATIO ANALYSIS

MEANING OF RATIO:A ratio is only a comparison of the numerator with the denominator. The tern ratio reefers to the numerical or quantitative relationship between two figures and obtained by dividing the former by the latter. Ratio analysis is an important and age old technique of financial analysis. The data given in financial statements ratio are relative form of financial data and very useful techniques to check upon the efficiency of a firm . S o m e r a t i o indicates the trend or progress or downfall of the firm

IMPORTANCE OF RATIO:
Ratio analysis of firms financial statement is of interest to a number of parties mainly. Shareholders, creditor, financial executives etc. shareholders are interested with earning capacit y of the firm: creditors are interested in knowingt h e a b i l i t y o f f i r m t o m e e t f i n a n c i a l o b l i g a t i o n a n d f i n a n c i a l e x e c u t i v e s a r e concerned with evolving analytical tools that will measures and compare costs, efficiency liquidity and profitability with a view to making intelligent decisions.

1. OPERATING PROFIT RATIO

YEAR
MAR09 MAR10 MAR11 MAR12

PERCENTAGE
4.40 4.49 16.50 13.79

18 16 14 12 10 8 6 4 2 0 MAR'09 MAR'10 MAR'11 MAR'12 4.4 PERCENTAGE

INTERPRETATION: Operating profit ratios increasing with 205% from march09 to

march12. It s h o w s t h a t f i r m s o p e r a t i n g p r o f i t i s g r o w i n g . I t a l s o s h o w s that firms cost of operation is low and operating in very good s i t u a t i o n . I t r e f l e c t s a n e f f i c i e n t management of a company. Firms position is good.

2. GROSS PROFIT RATIO:

YEAR
MAR09 MAR10 MAR11 MAR12

PERCENTAGE
3.16 3.18 15.18 12.86

16 14 12 10 8 6 4 2 0 MAR'09 MAR'10 MAR'11 MAR'12 PERCENTAGE

INTERPRETATION: Gross profit ratio shows the relationship between gross

profit and sales .Here gross profit ratio increasing with 306.96% from year 09 to 12.it indicates that firms selling is increasing .it also may continue to grow in future. It suggests that selling price is competitive and earning good profit by selling larger volume. So it shows that firms position is good

3. NET PROFIT: YEAR

MAR09 MAR10 MAR11 MAR12

PERCENTAGE
1.65 1.42 9.92 8.90

PERCENTAGE
12 10 8 6 4 2 0 MAR'09 MAR'10 MAR'11 MAR'12

PERCENTAGE

INTERPRETATION: Net profit ratio has been decreased by 16.63%March 09 to March

12. So i t i n d i c a t e s t h a t n e t p r o f i t d e c r e a s i n g w h i c h i n d i c a t e s t h a t f i r m i s n o t a b l e t o survive in the face of rising cost of production and falling prices. So it indicates firm is running in not so good position.

4. EARNING PER SHARE:

YEAR MAR09 MAR10 MAR11 MAR12 PERCENTAGE 21.29 19.50 57.03 55.58

PERCENTAGE
60 50 40 30 20 10 0 MAR'09 MAR'10 MAR'11 MAR'12

PERCENTAGE

INTERPRETATION:
Earnings per share have been increased with 17.56%compare to previous year. Here the portion of a companys profit allocated to each outstanding share of a common stock is high and it is good for investors as the returns are high. So it shows that firms position is good.

5. DIVIDEND PER SHARE:

YEAR MAR09 MAR10 MAR11 MAR12

PERCENTAGE 2.00 2.00 10.00 10.00

PERCENTAGE
12 10 8 6 4 2 0 MAR'09 MAR'10 MAR'11 MAR'12

PERCENTAGE

INTERPRETATION: Dividend per share has been increased with 20% compare
to previous year. Here the portion of a companys profit allocated to each outstanding share of a common stock is high and it is good for investors as the returns are high. So it shows that firms position is good.

6. BOOK VALUE PER SHARE:

YEAR MAR09 MAR10 MAR11 MAR12

PERCENTAGE 2.00 2.00 10.00 10.00

PERCENTAGE
12 10 8 6 4 2 0 MAR'09 MAR'10 MAR'11 MAR'12

PERCENTAGE

INTERPRETATION:
Book value per share has been increased 500% from March 09 to March012and 20% from the previous year. So book value per share also increased. So it indicates good sign for investors and shows good position of a firm.

7. CURRENT RATIO:

YEAR MAR09 MAR10 MAR11 MAR12

PERCENTAGE 1.33 1.39 1.48 1.59

PERCENTAGE
1.65 1.6 1.55 1.5 1.45 1.4 1.35 1.3 1.25 1.2 MAR'09 MAR'10 MAR'11 MAR'12 PERCENTAGE

INTERPRETATION: Current ratio is 1.71 which is near about ideal criteria 2:1.it reflects
that company can easily able to meet short term obligation as a measure of current financial liquidity.

8. QUICK RATIO:
YEAR MAR09 MAR10 MAR11 MAR12 PERCENTAGE 0.71 0.89 1.00 1.05

PERCENTAGE
1.2 1 0.8 0.6 0.4 0.2 0 MAR'09 MAR'10 MAR'11 MAR'12

PERCENTAGE

INTERPRETATION: An ideal criterion to test liquidity of a firm is 1:1 and here quick ratio lies near about this ratio in 2012. So it indicates that liquidity position of a firm is near about satisfactory.

9. INVENTORY TURNOVER RATIO:

YEAR MAR09 MAR10 MAR11 MAR12 PERCENTAGE 2.29 3.15 3.06 3.49

PERCENTAGE
4 3.5 3 2.5 2 1.5 1 0.5 0 MAR'09 MAR'10 MAR'11 MAE'12 PERCENTAGE

INTERPRETATION:
ITOR of the company is increasing which shows decline in Inventory holding period. It also reflects good sales policy which indicates good progress of the company. So firm is in very good condition currently.

10.DEBT EQUITY RATIO:

YEAR MAR09 MAR10 MAR11 MAR12

PERCENTAGE 0.05 0.05 0.10 0.02

percentage
0.12 0.1 0.08 0.06 0.04 0.02 0 MAR'09 MAR'10 MAR'11 MAR'12

percentage

INTERPRETATION: I t i s u s e d t o m e a s u r e l o n g - t e r m s o l v e n c y p o s i t i o n
of a concern. Here debt/equity ratio is declining which is good for a c o m p a n y . I t a l s o s h o w s t h a t companys policies are sound.

11.DIVIDEND PAYOUT RATIO:

YEAR MAR09 MAR10 MAR11 MAR12 PERCENTAGE 1.33 1.39 1.48 1.59

PERCENTAGE
1.65 1.6 1.55 1.5 1.45 1.4 1.35 1.3 1.25 1.2 MAR'09 MAR'10 MAR'11 MAR'12 PERCENTAGE

INTERPRETATION:
Dividend payout ratio has been increased by 7.54% which shows that percentage of income has been issued to the owner at the end of the year. Here it has been increasing with 7.54% that shows good returns for the investors. So firm is able to meet investors expectation.

12. RETURN ON LONG TERM FUNDS:

YEAR MAR09 MAR10 MAR11 MAR12 PERCENTAGE 12.10 13.01 39.40 33.37

PERCENTAGE
45 40 35 30 25 20 15 10 5 0 MAR'09 MAR'10 MAR'11 MAR'12 PERCENTAGE

INTERPRETATION: Companys return on long term funds has been increased with1 2 6 . 3 0 % f r o m 0 3 t o 1 2 . i t s h o w s t h a t c o m p a n y i s g e t t i n g h i g h r e t u r n o n t o t a l capital employed. It shows that firm is operating in very good condition.

13. P/E RATIO:

YEAR MAR09 MAR10 MAR11 MAR12 PERCENTAGE 2.76 9.01 6.42 30.24

PERCENTAGE
35 30 25 20 15 10 5 0 MAR'09 MAR'10 MAR'11 MAR'12 PERCENTAGE

INTERPRETATION: Companys price earnings ratio has been decreased from the
previous year so it shows that its market price compared to earnings per share is low so it is not good sign for the firm. So firm is not operating in very good condition.

TREND ANALYSIS

NET SALES:
YEAR MAR09 MAR10 MAR11 MAR12 NET SALES (RS. IN CR.) 1681.17 1765.75 1856.01 2201.65 PERCENTAGE 100 105.03 110.40 130.96

2500

2000

1500 NETSALES 1000 PERCENTAGE

500

0 MAR'09 MAR'10 MAR'11 MAR'12

VALUATION OF SECURITIES:

YEAR MAR09 MAR10 MAR11 MAR12

DIVIDEND PER SHARE(RS) 2 2 10 10 TOTAL

GROWTH RATE(%) 0% 0% 400.00% 0.00 400.00%

AVERAGE ANNUAL GROWTH RATE (g) =420/4 =105% D1=D0 (1+g) =12(1+1.05) =12(2.05) =24.6 Rs. P1= (273.45+114)/2 =193.73

Ke = (D1/P1) +g = (5.86/193.73)+1.17 =1.20% Po= D1/(Ke-g) =5.86/(1.20-1.17) =5.86/0.03 =195.33 Rs. CURRENT MARKET PRICE (C0) = 185.85 Rs.

Where,

DI= Expected dividend of next year P1= Average of 52 weeks high low Ke= investors required rate of return Po= Expected price of share

Current market price (C0) of the share is lower than Expected p r i c e o f Share (P0).Here share price is undervalued so investors are advised to buy the share of the company.

LIMITATIONS OF THE PROJECT:

1. As the data available to me has been taken from the secondary sources (like internet). It is not sure that collected data are accurate and complete. 2. Because of the time limitations, it may be possible that some important data are left out. 3. As the time available was very less, so fundamental analysis has been done for four years. 4. Todays stock market is totally running on the investors perception so the conclusion derived on the basis if fundamental analysis would not viable in long run. 5. The study was confined only to one particular sector. 6. The study was done for a short period of time, which might not hold true over a long period of time.

FINDINGS:
1. BEML has good earnings per share so it indicates good sign for investors. 2. BEML has also very good condition so far as liquidity is concerned. So it reflects that the firm position is good. 3. BEML has good financial liquidity. So it able to meet current financial requirement. 4. BEMLs P/E ratio is high so it shows good earnings and in very good position.

SUGGESTIONS: SUGGESTIONS FOR INVESTORS

CONCLUSION:
1. BEML is acting as pioneer in the markets of the earth moving equipments. The company has grown progressively and shown tremendous profit since its inception. 2. BEML has good earnings per share so it indicates good sign for investors. 3. BEML has also very good condition so far as liquidity is concerned. So it reflects that the firm position is good. 4. BEML has good financial liquidity. So it able to meet current financial requirement. 5. BEMLs P/E ratio is high so it shows good earnings and in very good position 6. Current market price (C0) of the share is lower than Expected p r i c e o f Share (P0).Here share price is undervalued so investors are advised to buy the share of the company