A Summer Internship at

Sujay S Phatak

Analysing Indian Stock Market

School of Economics, DAVV Indore

Summer Internship Report on

Analysis of Indian Stock Market

Submitted To -

Submitted By -

School of Economics

Sujay S Phatak

Declaration

I, Sujay S Phatak,
Phatak declare that the internship report entitled:
Analysis
Analysis of Indian Stock Market
Market is an original piece of work
carried out by me under the guidance and supervision of Mr.
Ankesh Baria (Director, GroundWork Services). The work has been
submitted in partial fulfillment of the requirement of MA
[Economics] course to our college.

19th August 2014

Indore

Sujay S Phatak

Acknowledgements
A summer project is a golden opportunity for learning and self-development. I consider
myself very lucky and honored to have so many wonderful people to back me through
completion of this project.
I wish to express my indebted gratitude and special thanks to Mr. Ankesh Baria, Director
at GroundWork Services
Services who in spite of being extraordinarily busy with his duties, took
time out to hear, guide and keep me on the correct path and allowing me to carry out
my summer internship training at their esteemed organization. I do not know where I
would been without him.
I also thank Ms. Mita Bashani & Mr. Sanjay Marathe for giving necessary advices and
guidance and arranging all necessary facilities to make my life at GroundWork easier. I
choose this moment to acknowledge their contribution gratefully.
I express my deepest thanks to Dr. Rekha Acharya,
Acharya Dr. Sakharam Mujalde,
Mujalde Ms. Era Tiwari
and Mr. Mohitash Nagotra for their guidance and support. All of them supported me by
helping me in selecting the best field out of my areas of interest along with choosing an
appropriate organization for internship.
Finally, I move towards acknowledging all those individuals who collectively form a major
part of my life. These are: my parents, who taught me the basics of ethics and humility;
my friends, who, at times, gave a new definition to my life; my teachers, who guided me
through all the difficulties I went through at different levels; and many others. There is no
doubt in my mind, that all of them have contributed greatly, for me to complete this
report. I thank all of them.

Sujay S Phatak
19th August 2014, Indore

Table of Contents
SR. NO.

TITLE

P AG E

Introduction

1.1

GroundWork Stock Advisory Pvt. Ltd.

1.2

School of Economics, DAVV

1.3

The Program

The Coursework

2.1

Training

2.2

Job

2.3

Analysis

Conclusion

13

Introduction
Internships are known for giving students the opportunity to apply their knowledge in
real world environments. At the same time, they will also develop skills which will help
them perform better at their jobs. This report provides insight of a summer internship
program at GroundWork Stock Advisory Private Limited from May 15th, 2014 to June 30th,
2014 as part of the third semester curriculum for MA [Economics] at School of Economics,
DAVV.

- GroundWork Stock Advisory Pvt. Ltd.

Founded on 1st of April, 2013 by Mr. Ankesh Baria and Mr. Nitesh Bashani with a
mission to facilitate long term relations with clients by drawing maximum profit,
GroundWork is an investment advisory company, where recommendation for
various Stocks [Cash and F&O] traded in NSE and BSE is provided. Their services
are not only restricted to stock market but they also provide research on:

- Cash Segment
A service made especially for NSE and BSE Stock
Cash Traders, with our excellent Intraday Cash Market
Calls

- Future Segment
Future segment are the Stock Future Tips made
to improve the future life of customer. Groundwork
provides Intraday Calls on Stock.

- Option Segment
Intraday Calls are provided to clients regarding
Call/Put option tips. Also, premarket calls are
generated on a regular basis.

- NIFTY+BANKNIFTY
In Nifty & Bank nifty Futures Tips Nifty Levels
are provided. Customers get calls for Current Month.

- BTST/STBT
Buy Today Sell Tomorrow (BTST) is a facility
offered by ICICIDirect wherein the customer will be
able to sell the shares that he/she purchased even
before he/she receives the delivery of the shares from
the Exchange. He/she will not wait till the time he/she
receives the delivery from the Exchange thus increasing
his liquidity. GW provides Daily follow-ups and news
updates along with calls.

- Bulls Eye
A one eye-one call target of 10,000 with small Stop
loss.

- GW Ultimate
Ultimate is the word for long targets and holding
purpose; with an emphasis on the Risk to Reward ratio. 10-12
calls are provided in a month with minimum stop loss of INR
2000 (with minimum target of INR 5000).
- HNI (High Net Worth)
This package made for those traders who want to take
more than 5 lots in F&O and in Commodities.

- FOREX
FOREX services are uniquely designed for the FOREX
traders trading in MCXSX market. With its huge volume and
liquidity, it acts as a brilliant platform for day traders for
making profits.

- Bullion Metal
The best service for intraday recommendations in
Bullions Commodities like Gold, Silver traded in MCX. Clients
get calls in Bullions metal Current Month.

- Base Metal
A complete strategy along with Targets & SL much
before time. Clients get calls in Base Metal Current Month
with full-to information about the base metal in the Stock
market

- Energy
Purely intraday calls in Energy for Full time traders and
Stock Brokers to trade maximum and to earn maximum.
Company focuses on facilitating long term relations with clients by providing them
excellent market research. Their services are purely based on technical analysis.
GroundWork is on the toil, teaching the nave investors or players the strategies
of the stock market, or you can say the strategies of winning in the stock market.
GroundWork Clubs provide its members an opportunity to increase their
communication area and gain variety of knowledge by interacting with investors
with variety of backgrounds.
Following are the clubs that any individual can join and discuss their strategies
accordingly:
- GroundWork Learning Centre
- GroundWork Entrepreneurs Club
- GroundWork Investors Club

- School of Economics, DAVV

School of Economics, a pioneering institute of Devi Ahilya University was
established in 1976 as the University Teaching Department under the faculty of
Social Science to impart quality education and research in the field of economics.
The department offers a wide range of post graduate programmes in economics
and management. It has been attracting lot of sponsored Research Projects from
various National Research Agencies.

- The Program
The internship program at GroundWork is a certified full time on-job training
program scheduled for 6-8 weeks (~ 45 days). Certificate is provided with ratings
mentioned on each certificate based on individual performance in test, discipline
and code of conduct carried by a student throughout his/her training program.

The Coursework
Coursework of my summer internship program is categorized in following parts:
-

Training
Job
Analysis

The categories mentioned above were covered in 6 weeks, whose descriptive schedule is
mentioned below:

Training
The building is only as tall as the foundation is strong enough to build on! The very first
part of my internship was designed to build a strong foundation of knowledge on which
the rest of my work in the company would stand. During first week of internship, the
theoretical part was covered by Mr. Ankesh Baria which indeed helped all the interns in
understanding the system of financial market prevailing in India. The details are mentioned
below:

- Getting started with Finance Market

As an introduction, the interns were acquainted with Indian financial
market. Market structure was taught in a summarized way.

- Basics of Stock Market, Commodity and FOREX Market

The basics included the common market terminology and structure of each
of the market. Some other concepts which were covered are fiscal cliff;
various government policies and their impact on market etc.

- Introduction to World Markets and Global Indices

Global markets (NYSE, NASDAQ, Euronext, Shanghai Stock Exchange, Hong
Kong Stock Exchange etc.) and their indexes were introduced.

- Introduction to Derivative
Concept of derivatives was taught and theoretical aspects of the area were
covered. Derivative market structure was made aware of.

- Getting started with ODIN (Open Dealer Integrated Network)

The Multi-Exchange, Multi-Currency Front Office trading and risk
management system - makes trading on multiple markets easier through the
use of a single application. It incorporates appealing features and works on
advanced technology which facilitates higher accessibility, ensuring speedy
performance and advanced risk management.

- Understanding Dealing
Trading activities (buy; sell; short sell) in various markets along with other
concepts such as trade limit; stop loss; lot size; finding the script etc. were
made aware of.

- Live market watch

Each of the intern was assigned to watch the market and study script(s) of
his/her own choice.

- Concept of TVM
Time Value of Money as a part of market analysis was taught.

- Understanding CRM
Customer relationship management (CRM) is a system for managing a
companys interactions with current and future customers. It involves using
technology to organize, automate and synchronize sales, marketing,
customer service, and technical support.

- NISM/NCFM preparation
Interns were made aware of various certifications provided by NSE, BSE,
and other agencies.

- Technical Analysis
Technical analysis is a security analysis methodology for forecasting the
direction of prices through the study of past market data, primarily price
and volume. Basically, it is a study of supply and demand in a market in an
attempt to determine what direction, or trend, will continue in the future.
In other words, technical analysis attempts to understand the emotions in
the market by studying the market itself, as opposed to its components. The
study covered general description; principles; and charts.

- Fundamental Analysis
Fundamental analysis of a business involves analyzing its financial statements
and health, its management and competitive advantages, and its
competitors and markets. Fundamental analysis is performed on historical
and present data, but with the goal of making financial forecasts.
-

How to find hot stocks for intraday trade

The process of finding hot stocks for intraday trade was explained. Certain
rules applicable in selection of stock for intraday trading were discussed.

Job
After being trained in theoretical aspects of market, each intern was assigned a job which
was focused to expose them into the corporate world. Sales profile was assigned with an
objective of converting clients for various finance market services offered by GroundWork.
All the calls were forwarded through CRM. All interns were provided with a CRM-ID and
were assigned a job to call various individuals and try to persuade them into accepting a
Free Trial. After registration, the list of clients who accepted the trial (called as leads)
was sent to the Sales Head who then activated the free trial period (of 2 days). The leads
were then persuaded to join the company membership or to opt for a suitable service out
of the available services. Once a lead opted for either a service or membership at one of
the clubs at GroundWork, i.e. when a lead became a client, daily calls were forwarded to
them based on the information provided by the analytical team. A feedback was also
taken from clients after completion of one week. This feedback was then reported to the
Sales Head as part of the daily report. The job also included providing suitable advices to
the clients regarding their investments and portfolio management.
Following is a statistical study of the work done by me on job:
In the first week of job, 65 leads were registered (for free trials) by me in the company
out of which 20 became clients for services offered by GroundWork.
Presented below is a detailed view of the statistical study.
Table 1 Leads Registered

Day

Cash/
Equity

F&O

HNI

N+BN

FOREX

1
2
3
4
5

7
4
10
5

3
1
2
3
1

1
-

2
1
-

Total
Average Leads
per day

26

10

5.2

0.2

Commodities

Total

Base

Bullion

Energy

1
1
2
-

2
2
3

1
1
2
3
2

1
1
1
2

15
09
16
12
13

65

0.6

0.8

1.4

1.8

13

F&O: Future & Options; N+BN: NIFTY+BANKNIFTY

Table 1 shows the registered leads for 5 days in various services. As san be seen, highest
number of leads were registered in Cash/Equity segment, followed by F&O then Bullion
Commodities and so on. Only 1 HNI lead was registered in a 5 day span.

Table 2 Registered Clients and CCR

Leads
Clients
CCR (in %)

Cash/
Equity

F&O

HNI

N+BN

FOREX

26
05
19.2

10
4
40

1
1
100

3
2
66.7

4
1
25

Commodities

Base

Bullion

Energy

7
2
28.6

9
3
33.3

5
2
40

Total

65
20
30.8

CCR: Client Conversion Ratio= (Clients/Leads)*100

Table 2 shows the number of leads who converted into clients. Here, Client Conversion
Ratio (CCR) is used to define the percentage value of leads who were successfully
converted into clients. By deriving data from the table, we can see that CCR of HNI is
highest amongst all the service segments (100%), despite of the fact that average leads per
day were 0.2 HNI segment, while the Cash/Equity segment, having highest average leads
per day (5.2), had lowest CCR equal to 19.2%. On an average, 30.8% leads provided by
me were converted into clients.

Analysis
As the final part of summer internship at GroundWork Services, analysis of market was
carried out by all the interns in a specific area assigned to them. I was assigned the area of
technical analysis of Cash/Equity segment in NSE.
For this purpose, stocks of banking sector companies were taken into account and with
the help of candle stick chart, different patterns in these stocks were explored and the
future expected trend in these stocks was recommended. Also BANKNIFTY index of NSE
was also studied. Bank Nifty represents the 12 most liquid and large capitalized stocks from
the banking sector which trade on the National Stock Exchange (NSE). It provides investors
and market intermediaries a benchmark that captures the capital market performance of
Indian banking sector. The study was based on historical prices/index value.
The details of my study are given below:
State Bank of India (SBIN)
(SBIN
Candlestick chart for SBI (NSE) was analyzed to predict the future trend of its prices. Prices
of April-June 2014 were studied and the results are shown below in Table 3 and Figure 1.
Table 3 Price History of SBI

DATE
27/05
28/05
29/05
09/06
19/06

PARTICULARS
Left Shoulder
1st Support
2nd Support
Head
3rd Support

OPEN
2697
2637
2602.95
2755
2647

HIGH
2700
2645.90
2642.60
2761.50
2688.35

LOW
2616.70
2590.15
2580
2697.10
2595.40

CLOSE
2627
2612.30
2595.35
2706.10
2608

VOLUME
21,14,104
22,10,312
38,17,762
16,76,220
21,44,663

26/06

Right Shoulder

2700

2717.55

2639.45

2653.75

17,97,309

Figure 1 Candlestick Chart for SBI

Table 3 shows the price history of SBI based on which a head and shoulder pattern was
identified in the candlestick chart. Head and shoulders is a reversal chart pattern that when
formed, signals that the security is likely to move against the previous trend. As can be
seen in Figure 1, this pattern was formed and hence it was concluded that the trend will
be reversed into downward sloping.
The results of this analysis were positive. The trend line sloped downwards in July 2014,
as can be seen in Figure 2.
Figure 2 Trend Line of SBI

ICICI Bank Limited (ICICIBANK)

ICICIBANK)
When analyzed, ICICI Bank Limited showed a descending triangle. The descending triangle
is a bearish formation that usually forms during a downtrend as a continuation pattern.
Prices of April-June 2014 were studied. Following are statistics of the study:
Table 4 Price History of ICICIBANK

DATE
16/05
21/05
09/06
11/06
13/06
24/06

PARTICULARS
Support
Support
Down Trend 1
Down Trend 2
Support
Support

OPEN
1450
1455
1486.15
1,478
1462.30
1,426

HIGH
1593.20
1456.95
1511.70
1,502.10
1479
1,445.90

LOW
1417.70
1421.10
1483.50
1,460
1421.60
1,416.70

CLOSE
1470.30
1435
1484
1462.50
1424
1441.85

VOLUME
117,29,001
51,383.76
38,55,080
23,18,042
30,51,395
22,81,372

25/06

Support

1,434

1,434

1,417.30

1418.10

12,57,222

30/06

Down Trend 3

1,392

1,430.70

1,392.00

1415.65

24,20,118

Table 4 shows the prices of ICICI BANK stock in NSE which were observed during the
analysis that showed a descending triangle pattern which can be seen in Figure 3.
Figure 3 Patterns in ICICIBANK Stock

Figure 3 shows the Descending Triangle pattern marked in blue shaded region. As this is a
bearish continuous pattern, the conclusion drawn was that the prices of this stock will fall, which
held true till 15th July, 2014 as can be seen in Figure 3. After that it retained the support line by
boosting up.

Canara Bank (CANB

(CANBK
CANBK)
When analyzed, Canara Bank also showed Head and Shoulder pattern. A Head and
Shoulders reversal pattern forms after an uptrend, and its completion marks a trend
reversal. The pattern contains three successive peaks with the middle peak (hea
head
head) being
the highest and the two outside peaks (shoulders
shoulders)
shoulders being low and roughly equal. The
reaction lows of each peak can be connected to form support, or a neckline.
neckline Hence, it
was concluded that the trend will be downward in the coming months. Following are
statistics of the study:
Table 5 Price History: CANBK

DATE
26/05
27/05
09/06
20/06
23/06

PARTICULARS
Left Shoulder
1st Support
Head
nd
2 Support
3rd Support

OPEN
478
448.50
475
426.40
424

HIGH
491.85
452.10
498
434
440.35

LOW
417.95
417.15
471.90
420.05
418

CLOSE
452.25
425.55
491.20
423.20
438.50

VOLUME
102,56,528
59,60,664
60,68,441
26,34,121
32,98,595

30/06

Right Shoulder

433

465

433

461.60

38,90,547

Figure 4 Head and Shoulders: CANBK

Table 5 shows the key prices of the head and shoulder pattern observed in Canara Bank share
prices. As can be seen in Figure 4, before the left shoulder, there is an upward trend in the stock
prices, and after forming the right shoulder, the upward trend reverses to downward trend. This
confirms the conclusion to be true.

BANK Nifty (CNX

(CNX BANK)
BANK)
Bank Nifty, an index of banking sector companies in NSE, when analyzed for a period of
approximately 1.5 months (15th May to 30th June, 2014), showed rectangle pattern. A
Rectangle is a continuation pattern that forms as a trading range during a pause in the
trend. The pattern is easily identifiable by two comparable highs and two comparable
lows. The highs and lows can be connected to form two parallel lines that make up the
top and bottom of a rectangle. A rectangle formed can also be called as trading range, i.e.
a range in which the stock is traded. As a continuation pattern was observed, the expected
trend of BANK Nifty was to retain the trading range.
Following are the statistics of my study:
Table 6 shows the value of CNX Bank by which the rectangle pattern was confirmed in
the index. As can be seen in the shaded region of Figure 5, a rectangle is formed between
support and resistance levels of the index. As no major fluctuations in volume can be
observed, the index can be assumed to retain the trading range.

Figure 5 Rectangle Pattern in CNX Bank

Table 6 Historical Value of CNX Bank

DATE
21/05
06/06
10/06
13/06
16/06

PARTICULARS
Support
Resistance
Resistance
Resistance
Support

OPEN
15126.60
15405.75
15585.40
15506.75
15055.20

HIGH
15126.60
15576.05
15585.40
15599.75
15091.30

LOW
14857.50
15320.75
15337.85
15083.90
14858.90

CLOSE
14952.10
15543.15
15427.80
15106.90
15030.00

VOLUME
369,14,763
397,19,688
304,67,964
330,36,708
327,28,056

A test based on training given by GW was taken at the end of the program
and certificate was awarded on 15th July, 2014.

Conclusion
This internship program has provided valuable exposure and ample
opportunity to explore the exiting world of Stock Markets. Started right from
the initial theoretical stage, it went through a variety of work involving client
service and support; ascertaining the possible fluctuations and trends in
market; technical and fundamental analysis of market; marketing various
services offered by the company; and providing live market updates to
customers.
It has not only provided me a learning opportunity, but it also has provided
me with an inspiration to proceed in the chosen path and delivered a sense
of purpose and will to achieve my long term goals and a clear sense of
direction as to my future course of action.
Many things remain unspoken and many tasks are tedious and require hard
work and persistence, but it actually is the amount of involvement and
dedication thrown up during the project. Eventually, I had a great time
working with GroundWork Securities as this was, as I felt, the perfect
platform for having an insight on the structure of Indian Stock Market. It also
has provided theoretical and practical knowledge about online trading.