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A

Report on
"Relationship of Economic Value Added, Market Value Added &
Return on Capital Employed with
respect to Share Price”

A Dissertation Submitted In Partial Fulfilment


Of
The Requirement For The Award Of MBA Degree Of
Bangalore University.

Submitted by

Mr. Vijay Kumar Agarwal


(REGD. NO: 06XQCM6084)

UNDER THE GUIDANCE & SUPERVISION OF


Prof. Praveen Bhagawan. M

M.P.BIRLA INSTITUTE OF MANAGEMENT


ASSOCIATE BHARTIYA VIDYA BHAVAN
43, RACE COURSE ROAD,
BANGALORE-560001
2006-2008

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DECLARATION

I, hereby, declare that this project report entitled, “Relationship of Economic Value
Added, Market Value Added, Return on Capital Employed with respect to share
prices” Submitted in partial fulfillment for the award of Master of Business
Administration of Bangalore University is a record of independent work carried out
by me under the guidance of Prof. Praveen Bhagawan faculty member, M. P. Birla
Institute of Management, Bangalore.

I, also declare that this report is a result of my own effort and has not been submitted
earlier for the award of any degree or diploma of Bangalore University or any other
University.

Place: Bangalore Vijay Kumar Agarwal


Date: (REGD. NO: 06XQCM6084)

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ACKNOWLEDGEMENT

I am extremely grateful to all those who have shared their views, opinions, ideas and
experiences which have significantly improved my inputs for this Project.

I am indebted to my Internal guide Prof. Praveen Bhagawan M for his encouragement


and support for the completion of the study.

I extended my sincere gratitude to our Principal Dr. Nagesh Malavalli.

Finally I would like to extend my warm respects and regards to my family, friends and
well-wishers for their constant support and valuable suggestions.

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M. P. Birla Institute of Management
ASSOCIATE BHARATIYA VIDYA BHAVAN
#43, RACE COURSE ROAD, BANGALORE -560001, INDIA

Prof. Praveen Bhagawan M Tel 080-22382798/9634, Fax 080-22389635


Email: info@mpbim.com, Website:www.mpbim.com

Certificate
This is to certify that this report entitled, “Relationship of Economic Value
Added, Market Value Added, Return on Capital Employed with respect
to share prices” is a compilation of the project carried out by Mr. Vijay
Kumar Agarwal (Reg. No. 06XQCM6084), a Student Executive of M.P.
Birla Institute of Management, Associate Bharatiya Vidya Bhavan,
Bangalore.

Mr. Vijay Kumar Kumar worked under my guidance and supervision.

Bangalore
Date:-
( Prof. Praveen Bhagawan M )

Page - 4 -
M. P. Birla Institute of Management
ASSOCIATE BHARATIYA VIDYA BHAVAN
#43, RACE COURSE ROAD, BANGALORE -560001, INDIA

Dr. N. S. Malavalli
PRINCIPAL

Certificate

This is to certify that this report entitled “Relationship of Economic Value


Added, Market Value Added, Return on Capital Employed with respect
to share prices” is the output of final report carried out by Mr. Vijay
Kumar Agarwal, a Student Executive of MP Birla Institute of
Management, Bangalore under the guidance and supervision of Prof
Praveen Bhagawan M , MPBIM, Bangalore (Internal Guide)

Bangalore.
Date:- ( Dr.N. S. Malavalli)

Page - 5 -
ABSTRACT
Market prices of the shares reflect the performance of the company. Today, wealth
created by the company is more important than the profit it earns or the dividend it pays
to the shareholders. The objective of this research is to study the relationship that exists
between the wealth/value/ROCE for the shareholders created by the company and market
prices of the shares.

The hypothesis of the study is that, there is significant relationship between EVA, MVA,
ROCE and share prices .EVA is the most significant measure, which is better reflected in
the market prices of the shares as compared to other traditional measures of performance,
MVA is the present value of a series of EVA values and finally ROCE is the rate of
return a business is making on the total capital employed in the business..This is tested on
20 companies of the stock market for a period of 4years beginning from FY 2003-2004 to
FY 2006-2007. Analysis is done using the Regression tool.

From the analysis, it is found that EVA.MVA& ROCE has no significant relationship
with the Market prices and also is not a major influencing factor among the performance
metrics.

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CHAPTERS PARTICULARS PAGE NO’S
ABSTRACT
1 INTRODUCTION 1-7
1.1 Introduction 2
1.2 Background of the study 3
1.3 Purpose of the study 3
1.4 Problem statement 4
1.5 Objectives of the study 4
1.6 Significance Of the Study 4
1.7 Theoretical Framework 5-7
2 REVIEW OF LITERATUR 8-11
3 METHODOLOGY 12-19
3.1 Study Type 13
3.2 Population of the study 13
3.3 Sample Frame 13
3.4 Sampling Technique 13
3.5 Sampling Profile 13
3.6 Data Gathering Procedure 14
3.7 Hypothesis of the study 15
3.8 Testing of hypothesis 15
3.9 Description of tools used 15-17
3.10 Limitations of the study 17
3.11 Industry Profile 18-19
4 ANALYSIS AND INTERPRETATION 20-52
5 CONCLUSION 53-54
5.1 Conclusion 54
BIBLIOGRAPHY 55-56

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List of Charts

Company Particulars Particulars Page No.


Chart Showing Share
Ashokleyland Chart Showing ROCE 21
Price , EVA & MVA

Chart Showing Share


Eicher Motors Chart Showing ROCE 22
Price , EVA & MVA

Chart Showing Share


Hero Honda Chart Showing ROCE 23
Price , EVA & MVA

Chart Showing Share


Hindustan Motors Chart Showing ROCE 24
Price , EVA & MVA

Chart Showing Share


kinetic Motors Chart Showing ROCE 25
Price , EVA & MVA

Chart Showing Share


LML Chart Showing ROCE 26
Price , EVA & MVA

Chart Showing Share


Punjab Tractors Chart Showing ROCE 27
Price , EVA & MVA

Mahindra & Chart Showing Share


Mahindra
Chart Showing ROCE 28
Price , EVA & MVA

Chart Showing Share


Tata Motors Chart Showing ROCE 29
Price , EVA & MVA

Chart Showing Share


TVS Motors Chart Showing ROCE 30
Price , EVA & MVA

Chart Showing Share


Bank Of India Chart Showing ROCE 31
Price , EVA & MVA

Chart Showing Share


Canara Bank Chart Showing ROCE 32
Price , EVA & MVA

Chart Showing Share


Corporation Bank Chart Showing ROCE 33
Price , EVA & MVA

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Chart Showing Share
Dena Bank Chart Showing ROCE 34
Price , EVA & MVA

Chart Showing Share


HDFC Bank Chart Showing ROCE 35
Price , EVA & MVA

Chart Showing Share


ICICI Bank Chart Showing ROCE 36
Price , EVA & MVA

Chart Showing Share


IndusInd Bank Chart Showing ROCE 37
Price , EVA & MVA

State Bank Of Chart Showing Share


India
Chart Showing ROCE 38
Price , EVA & MVA

Chart Showing Share


Syndicate Bank Chart Showing ROCE 39
Price , EVA & MVA

Chart Showing Share


Vijaya Bank Chart Showing ROCE 40
Price , EVA & MVA

Page - 9 -
List of Table
Page
Tables Particulars
No.
21
4.1 Table Showing Share Price, EVA,MVA,& ROCE of Ashokleyland
22
4.2 Table Showing Share Price, EVA,MVA,& ROCE of Eicher Motors
23
4.3 Table Showing Share Price, EVA,MVA,& ROCE of Hero Honda
24
4.4 Table Showing Share Price, EVA,MVA,& ROCE of Hindustan Motors
25
4.5 Table Showing Share Price, EVA,MVA,& ROCE of Kinetic Motors
26
4.6 Table Showing Share Price, EVA,MVA,& ROCE of LML
27
4.7 Table Showing Share Price, EVA,MVA,& ROCE of Punjab Tractor
28
4.8 Table Showing Share Price, EVA,MVA,& ROCE of Mahindra & Mahindra
29
4.9 Table Showing Share Price, EVA,MVA,& ROCE of Tata Motors
30
4.10 Table Showing Share Price, EVA,MVA,& ROCE of TVS Motors
31
4.11 Table Showing Share Price, EVA,MVA,& ROCE of Bank Of India
32
4.12 Table Showing Share Price, EVA,MVA,& ROCE of Canara Bank
33
4.13 Table Showing Share Price, EVA,MVA,& ROCE of Corporation Bank
34
4.14 Table Showing Share Price, EVA,MVA,& ROCE of Dena Bank
35
4.15 Table Showing Share Price, EVA,MVA,& ROCE of HDFC Bank
36
4.16 Table Showing Share Price, EVA,MVA,& ROCE of ICICI Bank
37
4.17 Table Showing Share Price, EVA,MVA,& ROCE of IndusInd Bank
38
4.18 Table Showing Share Price, EVA,MVA,& ROCE of State Bank Of India
39
4.19 Table Showing Share Price, EVA,MVA,& ROCE of Syndicate Bank
40
4.20 Table Showing Share Price, EVA,MVA,& ROCE of Vijaya Bank
41
4.21 Table Showing Multliple R , R square, a, B1, B2, T1,T2, P1, P2, & F
42
4.22 Table Showing Multliple R , R square, a, b, t, p, F, & Observation

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Chapter-1

INTRODUCTION

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1.1 Introduction
Market prices of the shares reflect the performance of the company. Today, wealth
created by the company is more important than the profit it earns or the dividend it pays
to the shareholders. Creation of shareholder’s value is the core of every business. This is
natural since shareholders own the company and as rational investors they expect good
long-term yield on their investment. Commonly used accounting measures are EPS
(Earnings per Share), ROI (Return on Investment), NPR (Net Profit Ratio) etc.

Apart from this, value based metrics of performance evaluation like EVA (Economic
Value Added), MVA (Market Value Added), CVA (Cash Value Added) and CFROI
(Cash Flow Return on Investment) have come into existence. These new performance
metrics seek to measure the periodic performance in terms of change in value.
Maximizing value means maximizing long-term yield on shareholders’ investment.

(Economic Value Added): A measure of a company's financial performance based


on the residual wealth calculated by deducting cost of capital from its operating profit
(adjusted for taxes on a cash basis). (Also referred to as "economic profit".)

The formula for calculating EVA is as follows:


= Net Operating Profit after Taxes (NOPAT) - (Capital * Cost of Capital)

MVA (Market Value Added): A calculation that shows the difference between the market
value of a company and the capital contributed by investors (both bondholders and
shareholders). In other words, it is the sum of all capital claims held against the company
plus the market value of debt and equity.

Calculated as:

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Return On Capital Employed (ROCE)
A ratio that indicates the efficiency and profitability of a company's capital investments.

Calculated as:

ROCE should always be higher than the rate at which the company borrows; otherwise
any increase in borrowing will reduce shareholders' earnings.

1.2 Background of the study

Investors are currently demanding Shareholder value more strongly than ever. So the
value created by the company is more linked to the market price of the shares. This study
is undertaken to show the relationship that exists between the various performance
metrics and the share prices as the performance of the company is reflected in the share
prices in the market.

1.3 Purpose of the study


The purpose of the study is to show that EVA, MVA & ROCE have relationship with
share prices and this relationship is significant. This shows that value addition by the
company is also a dependant factor for the movement in the share prices. So this study is
helpful to the investors for their investment decision as the study also allows them to
easily identify companies that pursue business strategies with the goal of shareholders
value creation.

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1.4 Statement of the problem:
There are various views with respect to whether traditional measures or value-based
measures influence the share prices. Considering this, it is interesting to examine which
of the performance measures has more influence on the share prices. Question to be
addressed is whether there is relationship between EVA, MVA & ROCE with respect to
share prices and whether this relationship is significant.

™ 1.5 Objective of study:


¾ To measure EVA, MVA & ROI for sample companies.
¾ To analyse the relationship between EVA, MVA, & ROCE with
respect to share prices.
¾ To find out which of the performance metrics is better reflected in the
share prices.

™ Scope of the study:


The scope of the study is limited to two sectors i.e. banking & automobile industry under
which 10 companies from each industry has been taken for my study. And the analysis is
based on the last 4 year data.

™ 1.6 Significance of the study:


The Purpose of the study is to show that EVA, MVA & ROI have relationship with share
prices and this relationship is significant. This shows that value addition by the company
is also a dependant factor for the movement in the share prices.

So this study is helpful to the investors for their investment decision as the study also
allows them to easily identify companies that pursue business strategies with the goal of
shareholders value creation.

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1.7 Theoretical framework

Investors analyze and interpret the financial statements so that they can get an insight into
the firm’s performance. Ratio analysis is one of the tools of financial analysis. It shows
the relationship between two figures in the financial statements. There are various types
of ratios used. Investors of more interested in profitability ratios like Net profit ratio,
Return on capital employed, Return on Equity, etc., and valuation ratios like Price-
Earnings ratio, Earnings per share, Yield, etc

Earnings Before Interest & Tax (EBIT)

An indicator of a company's profitability, calculated as revenue minus expenses,


excluding tax and interest. EBIT is also referred to as "operating earnings", "operating
profit" and "operating income", as you can re-arrange the formula to be calculated as
follows:

EBIT = Revenue - Operating Expenses

Return On Assets (ROA)

An indicator of how profitable a company is relative to its total assets. ROA gives an
idea as to how efficient management is at using its assets to generate earnings. Calculated
by dividing a company's annual earnings by its total assets, ROA is displayed as a
percentage. Sometimes this is referred to as "return on investment".

ROA

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Return On Equity (ROE)

A measure of a corporation's profitability that reveals how much profit a company


generates with the money shareholders have invested.

Calculated as:

Also known as "return on net worth" (RONW).

ROI (Return on Investment):


A performance measure used to evaluate the efficiency of an investment or to compare
the efficiency of a number of different investments. To calculate ROI, the benefit (return)
of an investment is divided by the cost of the investment; the result is expressed as a
percentage or a ratio.

Net profit ratio


NPR shows the earnings left for the shareholders as a percentage of net sales. It measures
the overall efficiency of production, administration, selling, financing, pricing and
provides a valuable understanding of the cost profit structure of the company. It enables
the analysts to identify the sources of business efficiency/inefficiency.

NPR= Net Profit *100


Sales

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Earnings per share

EPS is also a measure of the profitability of the firm. It indicates the


Profitability on a per-share basis.
EPS = Earnings for Equity shareholders * 100
No. of equity shares

Economic Value Added:


A measure of a company's financial performance based on the residual wealth calculated
by deducting cost of capital from its operating profit (adjusted for taxes on a cash basis).

The formula for calculating EVA is as follows:


= Net Operating Profit after Taxes (NOPAT) - (Capital * Cost of Capital)

MVA (Market Value Added):

A calculation that shows the difference between the market value of a company and the
capital contributed by investors (both bondholders and shareholders). In other words, it
is the sum of all capital claims held against the company plus the market value of debt
and equity.

Calculated as:

Return On Capital Employed (ROCE)


A ratio that indicates the efficiency and profitability of a company's capital investments.

Calculated as:

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Chapter-2

LITERATURE REVIEW

™ Review of literature:

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My preliminary review of the current literature indicates that the application of perceptual
mapping of Relationship of Economic Value Added, Market Value Added & Return on
Investment with respect to Share Price has not been adequately researched. The available
research data is sketchy and scanty. Thus, there is a vital gap in the current research. This
has prompted me to take up this research investigation.

The share prices in the market can be measured by the MVA-Market value added for the
company which is the total market value of the company. This relationship between EVA
and MVA has been studied in the recent years in many studies with many methods - and
with different results

™ Purpose : Lehn and Makhija

Lehn and Makhija (1996) first studied this relationship with market data of 618 U.S.
companies i.e. relationship between MVA & EVA.

Methodology

The data consists of 241 U.S.companies and cover years 1987, 1988, 1992 and 1993. The
researchers first find out that both measures correlate positively with stock returns and
that the correlation is slightly better than with traditional performance measures like
return on assets (ROA), return on equity (ROE) and return on sales (ROS).

Conclusion

Lehn and Makhija conclude that their results suggest EVA and MVA to be effective
performance measures that contain information about the quality of strategic decisions
and serve as signals of strategic change.

™ Purpose : Dodd and Chen

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Dodd and Chen (1996) study the correlation between stock returns and different
profitability measures

Methodology:

The study was based on 566 U.S. companies from 1983-1992. In the study ROA
explained stock returns best with R squared of 24.5%. The R squared for other metrics
are: EVA 20.2%, residual income 19.4% and EPS, ROE approximately 5-7%.

Conclusion

The writers concluded that firms adopting EVA might as adopt simple residual income
concept, while residual income correlates with share prices almost as well as its adjusted
version called EVA.

™ Purpose : David M. Szymanski, Sundar G. Bharadwaj and P. Rajan Varadarajan

David M. Szymanski, Sundar G. Bharadwaj and P. Rajan Varadarajan studied


relationship between market share price and profitability.

Methodology:

David M. Szymanski, Sundar G. Bharadwaj and P. Rajan Varadarajan, performed a meta-


analysis on 276 market share profitability findings from forty-eight studies to address
whether market share and profitability are possibility related and to examine the factors
that moderate the magnitude of that relationship.

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Conclusion

The authors found that, on average, market share has a positive effect on business
profitability.

™ Purpose: Nikil Varaiya and Roger A. Kerin and David Weeks

Nikil Varaiya and Roger A. Kerin and David Weeks research on “The relationship
between growth, profitability and firm value examined predictions drawn from value-
based planning models

Result indicates that profitability and growth do influence shareholder value in the
manner predicated; however the relationships are conditional. This study also shows that,
the market to book value of equity ratio and Tobin’s q ratio are theoretically &
empirically equivalent measures of value creation.

™ Benefits derived from literature review:


Provide a context for the research
Justify the research
Ensure the research hasn't been done before
Show where the research fits into the existing body of knowledge
Enable the researcher to learn from previous theory on the subject
Illustrate how the subject has been studied previously
Highlight flaws in previous research
Outline gaps in previous research
Show that the work is adding to the understanding and knowledge of the field
Help refine, refocus or even change the topic

Page - 21 -
Chapter-3

METHODOLOGY

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Methodology
™ 3.1 Study type
The study type is analytical, quantitative and historical.
Analytical as facts and existing information is used for the analysis.
Quantitative as EVA & MVA is calculated and the variables are expressed in
measurable terms.
Historical as the historical information is used for analysis and interpretation.

™ 3.2 Study population


Population includes all the domestic companies.

™ 3.3 Sampling frame


Sampling frame includes all those companies that are listed in the stock Exchange
i.e. banking & automobile sector

™ 3.4 Sampling technique


Simple Random sampling is used because only particular units are selected from the
sampling frame. Such a selection is undertaken as these units represent the population in
a better way. The companies listed in the stock exchange are considered since the market
prices can be obtained.
™ 3.5 Sample Profile
Sample includes 20 companies in the Stock market (for which relevant data was
available), for a period of 5 years starting from FY 2002-2003 to 2006-2007
The following are the sample 20 companies:
1. Tata motors.
2. AshokLeyland
3. Punjab Tractors.
4. Mahindra & Mahindra.
5. Eicher Motors.

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6. Hindustan motors.
7. TVS Motors.
8. Hero Honda Motors
9. LML.
10. Kinetic Motors.
11. Canara Bank.
12. Corporation Bank
13. ICICI Bank
14. SBI Bank
15. Vijaya Bank.
16. HDFC Bank
17. Dena Bank.
18. Syndicate Bank.
19. Bank of India.
20. IndusInd Bank.

™ 3.6 Data gathering procedure and instrumentation

Data type: Secondary data

Data:
¾ Historical share prices of the sample companies.
¾ Index values of BSE Sensex
¾ Financial Information of the sample companies.

Data Source:
Historical share prices of the sample companies and the index points for the period has
been taken from the database of Capital Market Publishers (India) Ltd., Capitaline.
Financial statements of the sample companies have also been taken from the same source.

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™ 3.7 Hypothesis :

Hypothesis 1

H0: There is no significant relationship between EVA and Share prices.


H1: There is significant relationship between EVA and Share prices.

Hypothesis 2

H0: There is no significant relationship between MVA and Share prices.


H1: There is significant relationship between MVA and Share prices.

Hypothesis 3

H0: There is no significant relationship between ROCE and Share prices.


H1: There is significant relationship between ROCE and Share prices.

™ 3.8 Testing of Hypothesis

The hypothesis is tested using Multliple regression and F statistic.


Regression is the process of predicting one variable from another by statistical means
using previous data.
F statistic is used to test the significance of the regression as a whole.
If the Fcal < Ftab, then the null hypothesis is accepted.
The hypothesis is tested using multiple regression tool and F statistic.
Multiple regressions are a statistical process by which several independent variables are
used to predict one dependant variable.

™ 3.9 Description about the analysis tools used


Simple Regression
Y=a+bx
Where,
Y is the dependant variable – market price of shares
a is the constant
x is the independent variable ROCE
b is the coefficient of the independent variable

Multiple Regression

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Y=a+b1x1+b2x2+b3x3
Where,
Y is the dependant variable – market price of shares
a is the constant
xi are the independent variables – performance metrics like NOCE,
MVA and EVA
bi are the coefficient of the independent variables

™ Method adopted to calculate EVA is as follows

EVA = NOPAT – WACC* WACC

where-
1. NOPAT is net operating profit after taxes.
2. WACC is weighted average cost of capital (equity and debt)
It is calculated as follows:
WACC = Kd (1-T)*W1+Ke *W2+Kp*W3
W1 is weight of debt
W2 is weight of equity
W3 is weight of preference

Kd is the effective cost of Debt, which is calculated by dividing the total interest by the
total debt.
Ke is calculated using the Capital Asset Pricing Model developed by Modigliani and
Miller.
Ke=Rf+Beta (Rm-Rf)

Kp is the effective cost of preference, which is calculated by dividing the total Dividend
Prefernce by the total preference capital.
Rf is the risk free rate, i.e., the rate of interest for 1-year government securities. These
rates are obtained from the website of Reserve Bank of India.
Rm is the return for the market. It is calculated by using the formula

Page - 26 -
given below for the index values. Rm=Average of return on market for all the 4 years
Return = Closing index value-opening index value * 100
Opening index value

Beta values for all the sample companies for all the 4 years are calculated by finding the
slope between log normal of share prices of all the companies and log normal of the
index values. Log normal of the values is considered to remove abnormalities if any and
convert them into normal distribution.

3. Invested Capital is the total long term funds and includes equity shares and the total
debt as at the end of the year.

MVA (Market Value Added): A calculation that shows the difference between the
market value of a company and the capital contributed by investors (both bondholders
and shareholders). In other words, it is the sum of all capital claims held against the
company plus the market value of debt and equity.

Calculated as:

Return On Capital Employed (ROCE)


A ratio that indicates the efficiency and profitability of a company's capital investments.
Calculated as:

ROCE

™ 3.10 Limitations of the study


¾ The Study is limited to the 20 companies that are included in BSE-SENSEX.
¾ Availability of dressed data with respect to the financial statements of companies

3.11 Industry Profile

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™ Banking sector
The growth in the Indian Banking Industry has been more qualitative than quantitative
and it is expected to remain the same in the coming years. Based on the projections made
in the "India Vision 2020" prepared by the Planning Commission and the Draft 10th Plan,
the report forecasts that the pace of expansion in the balance-sheets of banks is likely to
decelerate. The total assets of all scheduled commercial banks by end-March 2010 are
estimated at Rs 40, 90,000 crores. That will comprise about 65 per cent of GDP at current
market prices as compared to 67 per cent in 2002-03. Bank assets are expected to grow at
an annual composite rate of 13.4 per cent during the rest of the decade as against the
growth rate of 16.7 per cent that existed between 1994-95 and 2002-03. It is expected that
there will be large additions to the capital base and reserves on the liability side.

The Indian Banking Industry can be categorized into non-scheduled banks and scheduled
banks. Scheduled banks constitute of commercial banks and co-operative banks. There
are about 67,000 branches of Scheduled banks spread across India. As far as the present
scenario is concerned the Banking Industry in India is going through a transitional phase.

The Public Sector Banks which are the base of the Banking sector in India account for
more than 78 per cent of the total banking industry assets. Unfortunately they are
burdened with excessive Non Performing assets massive manpower and lack of modern
technology. On the other hand the Private Sector Banks are making progress. They are
leaders in Internet banking, mobile banking, ATMs. As far as foreign banks are
concerned they are likely to succeed in the Indian Banking Industry.

In the Indian Banking Industry some of the Private Sector Banks operating are IDBI, ING
Vyasa Bank, SBI Commercial and International Bank Ltd, Bank of Rajasthan Ltd. and
banks from the Public Sector include Punjab National bank, Vijaya Bank, UCO Bank,
Oriental Bank, Allahabad Bank among others. ANZ Grindlays Bank, ABN-AMRO Bank,
American Express Bank Ltd, Citibank are some of the foreign banks operating in the
Indian Banking Industry.

Page - 28 -
™ Automobile sector

A well developed transport network indicates a well developed economy. For rapid
development a well-developed and well-knit transportation system is essential. As India's
transport network is developing at a fast pace, Indian Automobile Industry is growing
too. Also, the Automobile industry has strong backward and forward linkages and hence
provides employment to a large section of the population. Thus the role of Automobile
Industry cannot be overlooked in Indian Economy. All kinds of vehicles are produced by
the Automobile Industry. India Automobile Industry includes the manufacture of trucks,
buses, passenger cars, defense vehicles, two-wheelers, etc. The industry can be broadly
divided into the Car manufacturing, two-wheeler manufacturing and heavy vehicle
manufacturing units.

The major Car manufacturer are Hindustan Motors, Maruti Udyog, Fiat India Private
Ltd., Ford India Ltd ., General Motors India Pvt. Ltd., Honda Siel Cars India
Ltd.,Hyundai Motors India Ltd., Skoda India Private Ltd., Toyota Kirloskar Motor Ltd.,
to name a few.

The two-wheeler manufacturing is dominated by companies like TVS, Honda Motorcycle


& Scooter India (Pvt.) Ltd., Hero Honda, Yamaha, Bajaj, etc. The heavy motors like
buses, trucks, defence vehicles, auto rickshaws and other multi-utility vehicles are
manufactured by Tata-Telco, Ashok Leyland, Eicher Motors, Bajaj, Mahindra and
Mahindra, etc.

Page - 29 -
Chapter-4

ANALYSIS AND
INTREPRETATION

Page - 30 -
Ashokleyland
Table 4.1
Ashokleyland Share Price EVA MVA ROCE
2003-04 24.36 275.79 289.94 22
2004-05 21 319.78 363.36 22.04
2005-06 40.25 400.75 461.53 24.18
2006-07 38.45 509.02 570.71 27.77
2007-08 343.3 629.43 705.72 34.73

C hart Sho wing Share Prices,EV A & M V A

800
600
400 Share Price
200
0
EV A
2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8 M VA

Years

Interpretation: - The above graph clearly shows that Share Price, EVA & MVA have an
increasing trend i.e. from 2003-04 to 2007-08 except for share price which decrease in
2004-05 & 2006-2007. The share price during 2007-2008 i.e. projected shows a very
high growth rate.

ROCE

40

30

20 ROCE
10

2003-04 2004-05 2 0 0 5- 0 6 2 0 0 6 -0 7 2 0 0 7-0 8


Y ears

Interpretation: - The above graph clearly shows that ROCE have shown an increasing
trend from 2003-04 to 2006-07 i.e. from 22% to 34.43%.

Page - 31 -
Eicher Motors
Table 4.2
Eicher Motors Share Price EVA MVA ROCE
2003-04 231.70 79.62 82.71 27.31
2004-05 310.00 92.60 153.87 55.69
2005-06 305.40 172.27 81.73 25.63
2006-07 247.65 91.50 94.34 18.80
2007-08 277.60 105.63 108.90 37.37

C hart Sho wing Share Price, EV A & M V A

350

300

250
Share Price
200
EV A
150
M VA
100

50

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation: - The above graph clearly shows that Share Price, EVA & MVA have
increased in the 1st coming year but in 2005-06 have decreased except for EVA. Again in
2006-07 shares Price of Eicher Motor dip further to 247.65 & EVA to 91.50. In 2007-08
all have increased in comparison to previous year .The above graph clearly shows that
Share Price, EVA & MVA previous year.

ROCE

60

40
ROCE
20

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation:- In the year 2004-05 ROCE has increased by more than 100% but for
2005-06 & 2006-07 have decreased from 55.69% to 25.63% & 18.80% respectively. And
in the year 2007-08 ROCE is 37.37%.

Page - 32 -
Hero Honda
Table 4.3
Hero Honda Share Price EVA MVA ROCE
2003-04 490.45 -8.25 -3.52 83.21
2004-05 548.15 -3.93 -7.27 81.04
2005-06 888.3 -8.11 -3.10 72.75
2006-07 685.15 -3.46 -3.14 51.66
2007-08 NA -3.5 -3.18 85.95

C hart Showing Share Price , EV A & M V A

1000

800

600
Share Price
400 EV A
200 M VA

-200
2003-04 2004-05 2 0 0 5- 0 6 2006-07

Y ears

Interpretation: - In 2003-04 to 2006-07 the share Price of Hero Honda is 490.45, 548.15,
888.3, & 685.15 respectively. Both EVA & MVA were negative for all the years.

R OC E

100
80

60
R OCE
40

20
0

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation: - The above graph clearly shows that ROCE is decreasing from 2003-04 to
2006-07. And during 2007-08 have increased from 55.66% to 88.95%.

Page - 33 -
Hindustan Motors
Table 4.4
Hindustan Motors Share Price EVA MVA ROCE
2003-04 14.05 -30.71 101.78 13.41
2004-05 31.55 112.68 -27.44 -15.72
2005-06 39.9 -30.38 16.17 67.77
2006-07 33.9 17.90 -20.17 -11.16
2007-08 27.57 -22.33 25.16 15.67

C har t Sho wing Shar e Pr ice, M V A & EV A

120

100

80

60 Shar e Pr ice
40 EV A
20 M VA
0

-20 2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


-40

Y ear s

Interpretation: - In 2003-04 Share Price was 14.05 & EVA was negative. In 2004-05 &
2006-07 MVA was negative & EVA negative for the year 2007-08.

R OC E

80

70

60

50

40

30 R OC E
20

10

-10
2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8

-20

Y ear s

Interpretation: - ROCE was positive for all in years except for 2004-05 & 2006-07. In the
year 2003-04 ROCE was 13.41% and in the year 2007-08 ROCE 15.67%.

Page - 34 -
Kinetic Motors
Table 4.5

kinetic Motors Share Price EVA MVA ROCE


2003-04 29.05 6.43 -52.64 -83.68
2004-05 52.65 -57.88 -29.17 -65.64
2005-06 63.4 -32.07 -56.73 -20.22
2006-07 31.05 -62.38 72.55 4.91
2007-08 24.2 79.79 -92.80 -32.21

C hart Showing Share Price , EV A & M V A

100
80
60
40
20 Share Price
0
-20
EV A
2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8
-40 M VA
-60
-80
-100
-120

Y ears

Interpretation: - Share price of Kinetic Motors have shown an increasing trend from
2003-04 to 2005-06 then declined to 31.05 & 24.2 in 2006-07 & 2007-08 respectively.
EVA was negative for all years except in the year 2003-04 & 2007-08. And MVA was
also negative for all year except in the year 2006-2007.

R OC E

10

-10 2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


-20

-30

-40 R OC E
-50

-60

-70

-80

-90

Y ear s

Interpretation: - ROCE was also negative for all the years for Kinetic Motors except for
the year 2006-07 in which ROCE was 4.91%.

Page - 35 -
LML
Table 4.6
LML Share Price EVA MVA ROCE
2003-04 31.75 16.18 -82.83 -11.13
2004-05 43.85 -90.70 -103.84 -37.87
2005-06 35.20 -113.71 -21.37 -26.51
2006-07 9.31 -23.41 18.81 -1.68
2007-08 NA 20.60 -16.57 -8.42

C hart Showing Share Price , EV A & M V A

100

50
Share Price
0

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8 EV A


-50
M VA
-100

-150

Y ears

Interpretation: - Share price of LML has decreased from 2004-05 i.e. 43.85 to 9.31 in the
year 2006-07. EVA & MVA were both negative for the year 2004-05 & 2005-06.

R OC E

-5
2003-04 2004-05 2005-06 2006-07 2007-08
-10

-15

-20 R OC E
-25

-30

-35

-40

Y ears

Interpretation: - ROCE of LML was negative for all the years i.e. 2003-04 to 2007-08.

Page - 36 -
Punjab Tractors
Table 4.7

Punjab Tractors Share Price EVA MVA ROCE


2003-04 224.80 43.34 69.94 17.21
2004-05 159.50 76.20 114.78 26.58
2005-06 252.35 125.05 75.95 19.36
2006-07 305.25 82.75 97.10 12.24
2007-08 96.05 105.80 124.16 34.73

C hart Sho wing Share Price , M V A & EV A

350

300

250
Share Price
200
EV A
150

100
M VA
50

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ear s

Interpretation: - Share Price of Punjab Tractors was 224.80, 159.50, 252.35, 305.25 &
96.05 in the year 2003-04 to 2007-08 respectively. And EVA & MVA were highest in the
year 2005-06 & 2007-08 respectively.

R OC E

40

30

20 R OC E
10

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation: - ROCE of Punjab Tractor was 17.21%, 26.58%, 19.367%, 12.24% &
finally 34.43% from 2003-04 to 2007-08 respectively.

Page - 37 -
Mahindra & Mahindra
Table 4.8

Mahindra & Mahindra Share Price EVA MVA ROCE


2003-04 464.55 426.24 518.75 20.06
2004-05 497.15 603.47 730.30 27.16
2005-06 627.10 849.58 910.98 26.33
2006-07 780.15 1059.76 1225.85 32.25
2007-08 935 1426.07 1649.56 41.57

C hart Sho wing Share Pr ice , M V A & EV A

1800
1600
1400
1200 Shar e Price
1000
EV A
800
600 M VA
400
200
0

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation: - The above graph clearly shows that Share Price, EVA & MVA have
shown an increasing trend starting from the year 2003-04 to 2007-08.

R OC E

45

40

35

30

25
R OC E
20

15

10

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation: - The above graph clearly shows that ROCE of Mahindra & Mahindra
have increased during the years.

Page - 38 -
Tata Motors
Table 4.9

Tata Motors Share Price EVA MVA ROCE


2003-04 485.70 1155.34 1376.62 33.77
2004-05 413.95 1501.79 1681.59 32.76
2005-06 932.60 1834.49 2123.94 31.25
2006-07 727.75 2317.06 2671.34 30.52
2007-08 NA 2914.22 3359.81 40.08

C hart Showing Share price, EV A & M V A

4000

3000 Share Price


2000 EV A
1000 M VA
0

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation: - The above graph clearly shows that EVA & MVA have increased over
the years. Share Price of Tata Motors was highest in the year 2005-2005.

ROCE

50
40
30
20
ROCE
10

2 0 0 3 -0 4 2 0 0 4 -0 5 2 0 0 5-0 6 2 0 0 6 -0 7 2 0 0 7-0 8
Y ears

Interpretation: - The above graph clearly shows that ROCE have shown a decreasing
trend from year 2003-04 to year 2006-07. And in the year ROCE of Tata Motors will be
40.08 %.

Page - 39 -
TVS Motors
Table 4.10
TVS Motors Share Price EVA MVA ROCE
2003-04 86.10 198.63 174.12 36.68
2004-05 69.00 195.67 164.01 22.84
2005-06 140.01 184.30 128.38 18.16
2006-07 59.60 144.27 114.14 10.79
2007-08 64.20 128.26 101.47 12.56

C hart Sho wing Share p rice , EV A & M V A

250

200

150 Share Price


EV A
100
M VA
50

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation: - The above graph clearly shows that EVA & MVA have decreased over
the years. The price of TVS Motors is highest in the year 2005-06.

R OC E

40

35

30

25

20 R OC E
15

10

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ear s

Interpretation: - The above graph clearly shows that ROCE have decreased over the
years i.e. from 2003-04 to 2006-07. And in the year 2007-08 it is 12.56%.

Page - 40 -
Bank of India
Table 4.11
Bank Of India Share Price EVA MVA ROCE
2003-04 58.9 970.36 890.15 7.52
2004-05 103.5 1042.13 939.26 7.26
2005-06 132.0 1099.64 1139.12 7.49
2006-07 167.8 1333.61 1279.13 8.91
2007-08 285.45 1497.53 1436.35 8.08

Chart Showing Share Prices,EV A & M V A

2000

1500 Share Price


1000 EV A
500 M VA
0

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation: - The above graph clearly shows that Share Prices, EVA & MVA have
showing an increasing trend from the year 2003-04 to the year 2007-08.

ROCE

10

6
R OC E
4

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation: - The above graph clearly shows that ROCE have showing an increasing
trend from the year 2003-04 to the year 2006-07. And during the year 2007-2008 will be
8.08% slightly lower than 2006-07.

Page - 41 -
Canara Bank
Table 4.12
Canara Bank Share Price EVA MVA ROCE
2003-04 144.6 1102.98 1121.04 7.66
2004-05 200.4 1222.95 1243.51 7.59
2005-06 266.9 1356.54 1360.53 8.44
2006-07 194.7 1484.20 1500.75 9.29
2007-08 360.0 1637.17 1655.43 8.26

C har t Sho wing Shar e Price, EV A & M V A

1800

1600

1400

1200
Shar e Price
1000
EV A
800

600 M VA
400

200

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation:- The above graph clearly shows that Share Prices, EVA & MVA have
showing an increasing trend from the year 2003-04 to the year 2007-08 except in the year
2006-07 in which share price was Rs194.7 per share.

ROCE

10

5 ROCE
0

2003-04 2004-05 2005-06 2006-07 2007-08


Y ears

Interpretation:- The above graph clearly shows that ROCE have showing an increasing
trend from the year 2003-04 to the year 2007-08 except in the year 2007-08 in which
ROCE will be 8.26%.

Page - 42 -
Corporation Bank
Table 4.13
Corporation Bank Share Price EVA MVA ROCE
2003-04 194.70 297.86 306.20 7.82
2004-05 348.45 337.13 339.51 7.90
2005-06 381.70 373.81 366.85 8.41
2006-07 288.90 403.90 404.72 9.62
2007-08 763.40 445.60 446.51 8.45

C hart Sho wing Share Price, EV A & M V A

900
800
700
600 Share Price
500
400
EV A
300 M VA
200
100
0

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation:- The above graph clearly shows that Share Prices, EVA & MVA have
showing an increasing trend from the year 2003-04 to the year 2007-08 except in the year
2006-07 in which share price was Rs288.90 per share.

R OC E

12

10
8

6 R OC E
4

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation:- The above graph clearly shows that ROCE have showing an increasing
trend from the year 2003-04 to the year 2007-08 except in the year 2007-08 in which
ROCE will be 8.45%.

Page - 43 -
Dena Bank
Table 4.14

Dena Bank Share Price EVA MVA ROCE


2003-04 29.0 270.64 305.37 8.04
2004-05 31.9 339.25 271.68 8.13
2005-06 36.4 301.83 305.57 8.30
2006-07 35.0 339.47 328.39 11.26
2007-08 76.1 364.82 352.90 8.69

C hart Showing Share Price, EV A & M V A

400

300
200 Share Price
100
EV A
0

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8 M VA

Y ears

Interpretation: - The above graph clearly shows that Share Prices, EVA & MVA have
showing an increasing trend from the year 2003-04 to the year 2007-08.

R OC E

12

10

6 R OC E
4

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation:- The above graph clearly shows that ROCE have showing an increasing
trend from the year 2003-04 to the year 2007-08 except in the year 2007-08 in which
ROCE will be 8.69%.

Page - 44 -
HDFC Bank
Table 4.15
HDFC Bank Share Price EVA MVA ROCE
2003-04 378.35 402.81 440.37 9.40
2004-05 544.25 519.66 753.61 7.49
2005-06 773.50 889.31 998.00 7.31
2006-07 949.40 1177.70 1448.30 7.47
2007-08 1157.00 1709.08 2101.79 10.17

C hart Sho wing Share Pr ice, EV A & M V A

2500

2000
Share Pr ice
1500
EV A
1000

500 M VA
0

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation: - The above graph clearly shows that Share Prices, EVA & MVA have
showing an increasing trend from the year 2003-04 to the year 2007-08.

R OC E

12
10
8
6 R OC E
4
2
0
2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8
Y ears

Interpretation: - The above graph clearly shows that ROCE have showing a decreasing
trend for the year 2004-05 & 2005-06. And in the year 2006-07 & 2007-08 it was 7.47%
& 10.17% respectively.

Page - 45 -
ICICI Bank
Table 4.16
ICICI Bank Share Price EVA MVA ROCE
2003-04 295.90 1054.69 1139.22 8.69
2004-05 393.01 1316.77 1493.41 7.66
2005-06 589.25 1726.16 1949.54 7.73
2006-07 853.10 2253.38 2520.97 9.64
2007-08 1168.01 2913.88 3259.90 9.94

C hart Sho wing Share Price , EV A & M V A

3500

3000

2500
Share Price
2000
EV A
1500
M VA
1000

500

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation: - The above graph clearly shows that Share Prices, EVA & MVA have
showing an increasing trend from the year 2003-04 to the year 2007-08 i.e. 295.90,
1054.90, & 1139.69 respectively in 2003-04 to 1168.01, 2913.88, & 3259.90 respectively
in the year 2007-08.

R OC E

12
10
8
6 R OC E
4
2
0

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation: - The above graph clearly shows that ROCE have showing an increasing
trend from the year 2003-04 to the year 2007-08.

Page - 46 -
IndusInd Bank
Table 4.17
IndusInd Bank Share Price EVA MVA ROCE
2003-04 39.15 84.77 90.83 8.59
2004-05 50.05 103.22 126.68 9.15
2005-06 46.85 143.96 130.62 8.80
2006-07 41.95 148.44 157.40 10.18
2007-08 69.51 178.87 189.67 9.35

Chart Showing Share price , EV A & M V A

200
150
100 Share Price
50
0
EV A
2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8 M VA

Y ears

Interpretation: - The above graph clearly shows that Share Prices, EVA & MVA have
showing an increasing trend from the year 2003-04 to the year 2007-08 i.e. 39.15, 84.77,
& 90.83 respectively in 2003-04 to 69.51, 178.87, & 189.67 respectively in the year
2007-08.

R OC E

10. 5

10

9. 5

9 R OC E
8. 5

7. 5

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation:- The above graph clearly shows that ROCE have showing an increasing
trend from the year 2003-04 to the year 2007-08 except in the year 2005-2006 & 2007-
2008 in which ROCE was 8.80% & 9.35% respectively.

Page - 47 -
State Bank of India
Table 4.18
State Bank Of India Share Price EVA MVA ROCE
2003-04 642.60 5571.88 5150.02 9.40
2004-05 584.80 6041.16 6015.12 7.49
2005-06 913.65 7055.96 5893.62 7.31
2006-07 1,105.25 6913.43 6316.59 7.47
2007-08 2,486.00 7409.59 6769.93 10.17

C hart Showing Share Price , EV A & M V A

8000
6000 Share Price
4000 EV A
2000
M VA
0

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ears

Interpretation: - The above graph clearly shows that Share Prices, EVA & MVA have
showing an increasing trend from the year 2003-04 to the year 2007-08.

ROCE

15

10
ROCE
5

2 0 0 3 -0 4 2 0 0 4 -0 5 2 0 0 5-0 6 2 0 0 6 -0 7 2 0 0 7-0 8
Y ears

Interpretation: - The above graph clearly shows that ROCE have showing an increasing
trend from the year 2003-04 to the year 2007-08.

Page - 48 -
Syndicate Bank
Table 4.19
Syndicate Bank Share Price EVA MVA ROCE
2003-04 34.45 669.67 651.75 7.40
2004-05 53.35 712.72 704.26 7.55
2005-06 96.95 770.14 711.58 8.43
2006-07 63.95 778.14 746.04 8.28
2007-08 NA 815.82 78.16 7.98

C hart Sho wing Share Pr ice , EV A & M V A

900

800

700

600
Shar e Price
500
EV A
400
M VA
300

200

100

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ear s

Interpretation: - The share Price of Syndicate Bank was 34.45, 53.35, 96.95 & 63.95. And
EVA has shown an increasing trend over the years. Also MVA have increased in first
4years then decrease in 2007-08.

R OC E

8.6

8.4

8.2

7.8
R OC E
7.6

7.4

7.2

6.8

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ear s

Interpretation:- The above graph clearly shows that ROCE have showing an increasing
trend from the year 2003-04 to the year 2005-06 except in the year 2006-2007 & 2007-
2008 in which ROCE was 8.28% & 7.98% respectively.

Page - 49 -
Vijaya Bank
Table 4.20
Vijaya Bank Share Price EVA MVA ROCE
2003-04 61.45 225.52 223.88 7.49
2004-05 64.30 249.71 269.68 8.47
2005-06 52.55 300.79 285.30 8.71
2006-07 42.50 318.21 319.98 10.55
2007-08 76.11 356.90 358.88 8.11

C hart Sho wing Share Pr ice , EV A & M V A

400

350
300

250 Shar e Price


200 EV A
150
M VA
100
50

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8


Y ear s

Interpretation: - The above graph clearly shows that in 2004-05 share prices have
increased over the previous year. And in the next 2 years the share price of Vijaya Bank
has come down to 42.50 per share from 64.30 in the year 2004-2005. And in the year
2007-08 share price was 76.11. EVA & MVA has shown an increasing trend since from
year 2003-04 to year 2007-08.
R OC E

12

10

6 R OC E

2003-04 2004-05 2 0 0 5- 0 6 2006-07 2 0 0 7- 0 8

Years

Interpretation: - ROCE of Vijaya Bank has shown an increasing trend for the years2004-
05, 2005-06 & 2006-07. And in the year 2007-08 ROCE has come down to 8.11% from
10.55% that was during 2006-07.

Page - 50 -
Table 4.21

R
Company Multliple R
Square
a B1 B2 T1 P1 T2 P2 F

Ashokleyland
0.824728 0.6802 4.075 -0.035 0.096 -0.06 0.959 0.205 0.871 1.063

Eicher Motors
0.961132 0.9238 -163.4 0.083 0.176 0.348 0.787 0.849 0.552 167.7

Hero Honda
0.473109 0.2238 852.3 2.729 42.96 0.04 0.975 0.49 0.71 0.144
Hindustan
Motors
0.934476 0.8732 35.94 -0.111 -0.24 -1.37 0.401 -2.57 0.237 3.445

Kinetic Motors
0.912219 0.8321 19.07 -0.539 -0.32 -1.87 0.312 -2.14 0.279 2.479

LML
0.973175 0.9471 13.25 -0.122 -0.22 -2.16 0.276 -3.62 0.171 8.946

Punjab Tractors
0.465844 0.217 296 0.493 -1.13 0.308 0.81 -0.43 0.741 0.139
Mahindra &
Mahindra
0.981338 0.963 202.6 0.192 0.294 0.263 0.836 0.434 0.739 13.02

Tata Motors
0.752871 0.5668 44.27 -2.593 2.551 -0.55 0.678 0.621 0.646 0.654

TVS Motors
0.92927 0.8635 -74.42 2.702 -2.24 2.49 0.243 -2.35 0.256 3.164

Bank Of India
0.961132 0.9238 -163.4 0.083 0.176 0.348 0.787 0.849 0.552 6.059

Canara Bank
0.860465 0.7404 160.8 4.918 -4.83 1.338 0.409 -1.29 0.419 1.426
Corporation
Bank
0.878776 0.7722 391.2 12.23 -12.4 1.558 0.363 -1.44 0.386 1.695

Dena Bank
0.635635 0.404 -1.56 0.052 0.061 0.674 0.622 0.55 0.68 39.36

HDFC Bank
0.993708 0.9875 128.3 0.408 0.251 1.076 0.477 0.794 0.573 0.112

ICICI Bank
0.999996 1 -231.1 1.026 -0.49 33.37 0.019 -18.1 0.035 63413

IndusInd Bank
0.362459 0.1314 37.24 -0.062 0.117 -0.21 0.87 0.341 0.791 0.076
State Bank Of
India
0.851096 0.7244 -994.6 0.303 -0.02 1.118 0.465 -0.06 0.964 1.314

Syndicate Bank
0.93033 0.8655 -106.7 0.935 -0.73 1.977 0.298 -1.18 0.447 3.218

Vijaya Bank
0.911187 0.8303 109 -0.266 0.069 -0.96 0.514 0.229 0.856 2.446

Page - 51 -
Table 4.22
R
Company Multliple R a b t p f Observation
Square
Ashokleyland 0.7892002 0.62284 -37.03 2.836 1.817 0.211 3.303 4

Eicher Motors 0.6147258 0.37789 225.8 1.502 1.102 0.385 1.215 4

Hero Honda 0.4252759 0.18086 1030 -5.22 -0.66 0.575 0.442 4

Hindustan Motors 0.3110136 0.09673 28.63 0.09 0.463 0.689 0.214 4

kinetic Motors 0.1140235 0.013 45.97 0.047 0.162 0.886 0.026 4

LML 0.9092623 0.82676 13.94 -0.83 -3.09 0.091 9.545 4

Punjab Tractors 0.9433212 0.88985 416.6 -9.61 -4.02 0.057 16.16 4


Mahindra &
0.8514839 0.72502 -54.68 24.46 2.296 0.149 5.273 4
Mahindra
Tata Motors 0.7630117 0.58219 4595 -123 -1.67 0.237 2.787 4

TVS Motors 0.0631959 0.00399 84.08 0.208 0.09 0.937 0.008 4

Bank Of India 0.72602 0.52711 -231.6 44.51 1.493 0.274 2.229 4

Canara Bank 0.3312391 0.10972 29.56 20.86 0.496 0.669 0.246 4

Corporation Bank 0.1183888 0.01402 204.9 11.67 0.169 0.882 0.028 4

Dena Bank 0.4504389 0.2029 24.54 0.955 0.713 0.55 0.509 4

HDFC Bank 0.7576909 0.5741 2185 -192 -1.64 0.242 2.696 4

ICICI Bank 0.5740059 0.32948 -743 151.3 0.991 0.426 0.983 4

IndusInd Bank 0.0443559 0.00197 47.33 -0.31 -0.06 0.956 0.004 4

State Bank Of India 0.4802275 0.23062 1744 -118 -0.77 0.52 0.599 4

Syndicate Bank 0.8904303 0.79287 -299 45.61 2.767 0.11 7.656 4

Vijaya Bank 0.8816095 0.77724 115.1 -6.8 -2.64 0.118 6.978 4

Page - 52 -
Interpretation: Table 4.21 & 4.22

Ashokleyland:
™ Since the Multiple R is more than 50% for EVA, MVA & ROCE, It shows that there
is a highly positively Correlation between EVA, MVA & ROCE with respect to Share
Price.
™ Since the Value of R square is 68% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 68% and remaining 32% by some other
factor. Similarly for ROCE R square is 68% approximately, it shows that Share Price
is affected by EVA & MVA by 68% and remaining 32% by some other factor.
™ Since value of P1, P2 & P are greater than 5% level of significance; therefore it shows
that there is no significant relationship between EVA & Share Price, MVA & Share
Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted.
Alternative Hypothesis is rejected.

Eicher Motors:
™ Since the Multiple R is more than 50% for EVA, MVA & ROCE, It shows that there
is a highly positively Correlation between EVA, MVA & ROCE with respect to Share
Price.
™ Since the Value of R square is 92% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 92% and remaining 8% by some other
factor. Similarly for ROCE R square is 38% approximately, it shows that Share Price
is affected by EVA & MVA by 38% and remaining 62% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted.
Alternative Hypothesis is rejected.

Page - 53 -
Hero Honda Motors:
™ Since the Multiple R is less than 50% for EVA, MVA & ROCE, It shows that there is
a less positively Correlation between EVA, MVA & ROCE with respect to Share
Price.
™ Since the Value of R square is 22% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 22% and remaining 78% by some other
factor. Similarly for ROCE R square is 18% approximately, it shows that Share Price
is affected by EVA & MVA by 18% and remaining 82% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted.
Alternative Hypothesis is rejected.
Hindustan Motors:
™ Since the Multiple R is more than 50% for EVA & MVA, It shows that there is a
highly positively Correlation between EVA & MVA with respect to Share Price.
Similarly Multiple R is less than 50% for ROCE, It shows that there is a less
positively Correlation with respect to Share Price.
™ Since the Value of R square is 87% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 87% and remaining 13% by some other
factor. Similarly for ROCE R square is 10% approximately, it shows that Share Price
is affected by EVA & MVA by 10% and remaining 90% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted.
Alternative Hypothesis is rejected.

Page - 54 -
Kinetic Motors:
™ Since the Multiple R is more than 50% for EVA & MVA, It shows that there is a
highly positively Correlation between EVA & MVA with respect to Share Price.
Similarly Multiple R is less than 50% for ROCE, It shows that there is a less
positively Correlation with respect to Share Price.
™ Since the Value of R square is 83% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 83% and remaining 17% by some other
factor. Similarly for ROCE R square is 1% approximately, it shows that Share Price is
affected by EVA & MVA by 1% and remaining 99% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted
Alternative Hypothesis is rejected.

LML
™ Since the Multiple R is more than 50% for EVA, MVA & ROCE, It shows that there
is a highly positively Correlation between EVA, MVA & ROCE with respect to Share
Price.
™ Since the Value of R square is 94approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 94% and remaining 6% by some other
factor. Similarly for ROCE R square is 83% approximately, it shows that Share Price
is affected by EVA & MVA by 83% and remaining 17% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted.
Alternative Hypothesis is rejected.

Page - 55 -
Punjab Tractors:
™ Since the Multiple R is less than 50% for EVA & MVA, It shows that there is a less
positively Correlation between EVA & MVA with respect to Share Price. Similarly
Multiple R is more than 50% for ROCE, It shows that there is a highly positively
Correlation with respect to Share Price.
™ Since the Value of R square is 22% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 72% and remaining 38% by some other
factor. . Similarly for ROCE R square is 88% approximately, it shows that Share
Price is affected by EVA & MVA by 88% and remaining 12% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted
Alternative Hypothesis is rejected.

Mahindra & Mahindra:


™ Since the Multiple R is more than 50% for EVA, MVA & ROCE, It shows that there
is a highly positively Correlation between EVA, MVA & ROCE with respect to Share
Price.
™ Since the Value of R square is 96% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 96% and remaining 04% by some other
factor. Similarly for ROCE R square is 88% approximately, it shows that Share Price
is affected by EVA & MVA by 88% and remaining 12% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted
Alternative Hypothesis is rejected.

Page - 56 -
Tata Motors:
™ Since the Multiple R is more than 50% for EVA, MVA & ROCE, It shows that there
is a highly positively Correlation between EVA, MVA & ROCE with respect to Share
Price.
™ Since the Value of R square is 56% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 56% and remaining 44% by some other
factor. Similarly for ROCE R square is 58% approximately, it shows that Share Price
is affected by EVA & MVA by 58% and remaining 42% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted.
Alternative Hypothesis is rejected.

TVS Motors:
™ Since the Multiple R is more than 50% for EVA, MVA & ROCE, It shows that there
is a highly positively Correlation between EVA, MVA & ROCE with respect to Share
Price.
™ Since the Value of R square is 86% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 86% and remaining 14% by some other
factor. Similarly for ROCE R square is 03% approximately, it shows that Share Price
is affected by EVA & MVA by 03% and remaining 97% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted.
Alternative Hypothesis is rejected.

Page - 57 -
Bank of India:
™ Since the Multiple R is more than 50% for EVA, MVA & ROCE, It shows that there
is a highly positively Correlation between EVA, MVA & ROCE with respect to Share
Price.
™ Since the Value of R square is 92% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 92% and remaining 08% by some other
factor. Similarly for ROCE R square is 53% approximately, it shows that Share Price
is affected by EVA & MVA by 53% and remaining 47% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted.
Alternative Hypothesis is rejected.

Canara Bank:
™ Since the Multiple R is more than 50% for EVA & MVA, It shows that there is a
highly positively Correlation between EVA & MVA with respect to Share Price.
Similarly Multiple R is less than 50% for ROCE, It shows that there is a less
positively Correlation with respect to Share Price.
™ Since the Value of R square is 74% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 74% and remaining 16% by some other
factor. Similarly for ROCE R square is 11 % approximately, it shows that Share Price
is affected by EVA & MVA by 11% and remaining 89% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted
Alternative Hypothesis is rejected.

Page - 58 -
Corporation Bank:
™ Since the Multiple R is more than 50% for EVA & MVA, It shows that there is a
highly positively Correlation between EVA & MVA with respect to Share Price.
Similarly Multiple R is less than 50% for ROCE, It shows that there is a less
positively Correlation with respect to Share Price.
™ Since the Value of R square is 77% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 77% and remaining 13% by some other
factor. Similarly for ROCE R square is 01 % approximately, it shows that Share Price
is affected by EVA & MVA by 01% and remaining 99% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted.
Alternative Hypothesis is rejected.

Dena Bank:
™ Since the Multiple R is more than 50% for EVA & MVA, It shows that there is a
highly positively Correlation between EVA & MVA with respect to Share Price.
Similarly Multiple R is less than 50% for ROCE, It shows that there is a less
positively Correlation with respect to Share Price.
™ Since the Value of R square is 40% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 40% and remaining 60% by some other
factor. Similarly for ROCE R square is 20 % approximately, it shows that Share Price
is affected by EVA & MVA by20 % and remaining 80% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted
Alternative Hypothesis is rejected.

Page - 59 -
HDFC Bank:
™ Since the Multiple R is more than 50% for EVA, MVA & ROCE, It shows that there
is a highly positively Correlation between EVA, MVA & ROCE with respect to Share
Price.
™ Since the Value of R square is 99% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 99% and remaining 01% by some other
factor. Similarly for ROCE R square is 57% approximately, it shows that Share Price
is affected by EVA & MVA by 57% and remaining 43% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted.
Alternative Hypothesis is rejected.
ICICI Bank:
™ Since the Multiple R is more than 50% for EVA & MVA, It shows that there is a
highly positively Correlation between EVA & MVA with respect to Share Price.
Similarly Multiple R is less than 50% for ROCE, It shows that there is a less
positively Correlation with respect to Share Price.
™ Since the Value of R square is 100% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA 100%. Similarly for ROCE R square is 33 %
approximately, it shows that Share Price is affected by EVA & MVA by 33% and
remaining 67% by some other factor.
™ Since value of P1, & P2 are less than 5% of level of significance; therefore it shows
that there is significant relationship between EVA & Share Price, & MVA & Share
Price a.
Therefore, Null Hypothesis is rejected.
Alternative Hypothesis is accepted.
™ Since value of P is greater than 5% of level of significance; therefore it shows that
there is no significant relationship between ROCE & Share Price.
Therefore, Null Hypothesis is accepted.
Alternative Hypothesis is rejected

Page - 60 -
IndusInd Bank:
™ Since the Multiple R is less than 50% for EVA, MVA & ROCE, It shows that there is
a less positively Correlation between EVA, MVA & ROCE with respect to Share
Price.
™ Since the Value of R square is 13% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 13% and remaining 87% by some other
factor. Similarly for ROCE R square is 29% approximately, it shows that Share Price
is affected by EVA & MVA by 29% and remaining 71% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted.
Alternative Hypothesis is rejected.

State Bank of India:


™ Since the Multiple R is more than 50% for EVA, MVA & ROCE, It shows that there
is a highly positively Correlation between EVA, MVA & ROCE with respect to Share
Price.
™ Since the Value of R square is 72% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 72% and remaining 28% by some other
factor. Similarly for ROCE R square is 23% approximately, it shows that Share Price
is affected by EVA & MVA by 23% and remaining 77% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted.
Alternative Hypothesis is rejected.

Page - 61 -
Syndicate Bank:
™ Since the Multiple R is more than 50% for EVA, MVA & ROCE, It shows that there
is a highly positively Correlation between EVA, MVA & ROCE with respect to Share
Price.
™ Since the Value of R square is 87% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 87% and remaining 13% by some other
factor. Similarly for ROCE R square is 79% approximately, it shows that Share Price
is affected by EVA & MVA by 79% and remaining 21% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted.
Alternative Hypothesis is rejected.
Vijaya bank:
™ Since the Multiple R is more than 50% for EVA, MVA & ROCE, It shows that there
is a highly positively Correlation between EVA, MVA & ROCE with respect to Share
Price.
™ Since the Value of R square is 83% approximately for EVA & MVA, it shows that
Share Price is affected by EVA & MVA by 83% and remaining 17% by some other
factor. Similarly for ROCE R square is 88% approximately, it shows that Share Price
is affected by EVA & MVA by 88% and remaining 12% by some other factor.
™ Since value of P1, P2 & P are greater than 5% of level of significance; therefore it
shows that there is no significant relationship between EVA & Share Price, MVA &
Share Price and ROCE & Share Price.
Therefore, Null Hypothesis is accepted.
Alternative Hypothesis is rejected.

Page - 62 -
Chapter-5

CONCLUSION

Page - 63 -
5.1 CONCLUSION

Creating shareholder value is a fundamental requirement for all the companies.


Therefore, most of the leading companies adopt the mantra of shareholder value to meet
the increasing expectations of the share holders.

Academicians, professional communities and evaluating firms do not give importance to


EVA, MVA, ROCE and more over many other factors are also sconsider for the
investment decisions. There is a no significant relationship between EVA; MVA &
ROCE with respect to Share Price. Investors do not use all the available information.
Investors cannot take all investment decisions on the basis of EVA, MVA & ROCE.

Page - 64 -
BIBLIOGRAPHY

Page - 65 -
Bibliography

Websites:
• www.Yahoofinance.com
• www.EVA.com
• www.Capitaline.com
• www.MoneyControl.com
• www.JSTOR.COM

BOOKS:

™ Chandra, Prasanna Investment Analysis and Portfolio Financial


Management, Sixth edition, New Delhi Tata McGraw-Hill Publising
Company Limited,2005
™ Pandey, M.J and Copeland T..E , “Beta Changes around Stock splits A Note”

Page - 66 -
Annexure
Ashokleyland
Ashokleyland Share Price EVA MVA ROCE
2003-04 24.36 275.79 289.94 22
2004-05 21 319.78 363.36 22.04
2005-06 40.25 400.75 461.53 24.18
2006-07 38.45 509.02 570.71 27.77
2007-08 343.3 629.43 705.72 34.73

Eicher Motors
Eicher Motors Share Price EVA MVA ROCE
2003-04 231.70 79.62 82.71 27.31
2004-05 310.00 92.60 153.87 55.69
2005-06 305.40 172.27 81.73 25.63
2006-07 247.65 91.50 94.34 18.80
2007-08 277.60 105.63 108.90 37.37

Hero Honda
Hero Honda Share Price EVA MVA ROCE
2003-04 490.45 -8.25 -3.52 83.21
2004-05 548.15 -3.93 -7.27 81.04
2005-06 888.3 -8.11 -3.10 72.75
2006-07 685.15 -3.46 -3.14 51.66
2007-08 NA -3.5 -3.18 85.95

Hindustan Motors
Hindustan Motors Share Price EVA MVA ROCE
2003-04 14.05 -30.71 101.78 13.41
2004-05 31.55 112.68 -27.44 -15.72
2005-06 39.9 -30.38 16.17 67.77
2006-07 33.9 17.90 -20.17 -11.16
2007-08 27.57 -22.33 25.16 15.67

Page - 67 -
Kinetic Motors

kinetic Motors Share Price EVA MVA ROCE


2003-04 29.05 6.43 -52.64 -83.68
2004-05 52.65 -57.88 -29.17 -65.64
2005-06 63.4 -32.07 -56.73 -20.22
2006-07 31.05 -62.38 72.55 4.91
2007-08 24.2 79.79 -92.80 -32.21

LML
LML Share Price EVA MVA ROCE
2003-04 31.75 16.18 -82.83 -11.13
2004-05 43.85 -90.70 -103.84 -37.87
2005-06 35.20 -113.71 -21.37 -26.51
2006-07 9.31 -23.41 18.81 -1.68
2007-08 NA 20.60 -16.57 -8.42

Punjab Tractors

Punjab Tractors Share Price EVA MVA ROCE


2003-04 224.80 43.34 69.94 17.21
2004-05 159.50 76.20 114.78 26.58
2005-06 252.35 125.05 75.95 19.36
2006-07 305.25 82.75 97.10 12.24
2007-08 96.05 105.80 124.16 34.73

Mahindra & Mahindra

Mahindra & Mahindra Share Price EVA MVA ROCE


2003-04 464.55 426.24 518.75 20.06
2004-05 497.15 603.47 730.30 27.16
2005-06 627.10 849.58 910.98 26.33
2006-07 780.15 1059.76 1225.85 32.25
2007-08 935 1426.07 1649.56 41.57

Page - 68 -
Tata Motor

Tata Motors Share Price EVA MVA ROCE


2003-04 485.70 1155.34 1376.62 33.77
2004-05 413.95 1501.79 1681.59 32.76
2005-06 932.60 1834.49 2123.94 31.25
2006-07 727.75 2317.06 2671.34 30.52
2007-08 NA 2914.22 3359.81 40.08

TVS Motors

TVS Motors Share Price EVA MVA ROCE


2003-04 86.10 198.63 174.12 36.68
2004-05 69.00 195.67 164.01 22.84
2005-06 140.01 184.30 128.38 18.16
2006-07 59.60 144.27 114.14 10.79
2007-08 64.20 128.26 101.47 12.56

Bank of India
Bank Of India Share Price EVA MVA ROCE
2003-04 58.9 970.36 890.15 7.52
2004-05 103.5 1042.13 939.26 7.26
2005-06 132.0 1099.64 1139.12 7.49
2006-07 167.8 1333.61 1279.13 8.91
2007-08 285.45 1497.53 1436.35 8.08

Canara Bank
Canara Bank Share Price EVA MVA ROCE
2003-04 144.6 1102.98 1121.04 7.66
2004-05 200.4 1222.95 1243.51 7.59
2005-06 266.9 1356.54 1360.53 8.44
2006-07 194.7 1484.20 1500.75 9.29
2007-08 360.0 1637.17 1655.43 8.26

Page - 69 -
Corporation Bank
Corporation Bank Share Price EVA MVA ROCE
2003-04 194.70 297.86 306.20 7.82
2004-05 348.45 337.13 339.51 7.90
2005-06 381.70 373.81 366.85 8.41
2006-07 288.90 403.90 404.72 9.62
2007-08 763.40 445.60 446.51 8.45

Dena Bank

Dena Bank Share Price EVA MVA ROCE


2003-04 29.0 270.64 305.37 8.04
2004-05 31.9 339.25 271.68 8.13
2005-06 36.4 301.83 305.57 8.30
2006-07 35.0 339.47 328.39 11.26
2007-08 76.1 364.82 352.90 8.69

HDFC Bank

HDFC Bank Share Price EVA MVA ROCE


2003-04 378.35 402.81 440.37 9.40
2004-05 544.25 519.66 753.61 7.49
2005-06 773.50 889.31 998.00 7.31
2006-07 949.40 1177.70 1448.30 7.47
2007-08 1157.00 1709.08 2101.79 10.17

ICICI Bank
ICICI Bank Share Price EVA MVA ROCE
2003-04 295.90 1054.69 1139.22 8.69
2004-05 393.01 1316.77 1493.41 7.66
2005-06 589.25 1726.16 1949.54 7.73
2006-07 853.10 2253.38 2520.97 9.64
2007-08 1168.01 2913.88 3259.90 9.94

Page - 70 -
IndusInd Bank

IndusInd Bank Share Price EVA MVA ROCE


2003-04 39.15 84.77 90.83 8.59
2004-05 50.05 103.22 126.68 9.15
2005-06 46.85 143.96 130.62 8.80
2006-07 41.95 148.44 157.40 10.18
2007-08 69.51 178.87 189.67 9.35

State Bank of India

State Bank Of Share


India Price EVA MVA ROCE
2003-04 642.60 5571.88 5150.02 9.40
2004-05 584.80 6041.16 6015.12 7.49
2005-06 913.65 7055.96 5893.62 7.31
2006-07 1,105.25 6913.43 6316.59 7.47
2007-08 2,486.00 7409.59 6769.93 10.17

Syndicate Bank
Share
Syndicate Bank Price EVA MVA ROCE
2003-04 34.45 669.67 651.75 7.40
2004-05 53.35 712.72 704.26 7.55
2005-06 96.95 770.14 711.58 8.43
2006-07 63.95 778.14 746.04 8.28
2007-08 NA 815.82 78.16 7.98

Vijaya Banks
Vijaya Bank Share Price EVA MVA ROCE
2003-04 61.45 225.52 223.88 7.49
2004-05 64.30 249.71 269.68 8.47
2005-06 52.55 300.79 285.30 8.71
2006-07 42.50 318.21 319.98 10.55
2007-08 76.11 356.90 358.88 8.11

Page - 71 -

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