Sandeep S

A PROJECT REPORT ON
IMPACT OF BONUS ISSUE ON STOCK

RETURNS VOLATILITY
Dissertation submitted in partial fulfillment of the
Requirements for award of the Degree of
MASTER OF BUSINESS ADMINISTRATION
OF
BANGALORE UNIVERSITY
By
SANDEEP.S
Register Number: 06XQCM 6072
Under the guidance of

PROF.PRAVEEN BHAGAWAN
FACULTY
M.P BIRLA INSTITUTE OF MANAGEMENT
BHARATIYA VIDYA BHAVAN
BANGALORE
2007-08
DECLARATION
I hereby declare that this dissertation title IMPACT OF BONUS ISSUE ON STOCK
RETURNS VOLATILITY submitted by me to Department of Management, Bangalore
University in partial fulfillment of Masters in Business Administration programme is a
bonafide work carried by me under the guidance of Prof.Praveen Bhagwan, Faculty, M.P.
Birla Institute of Management (Bharatiya Vidya Bhavan).
I further declare that this report has not been submitted earlier to any other university or
institution for the award of any Degree/Diploma/Certificate or published any time before.
Place: Bangalore
Date:
SANDEEP.S
CERTIFICATE
Certified that the dissertation titled IMPACT OF BONUS
ISSUE ON STOCK RETURNS VOLATILITY by
SANDEEP.S, bearing Reg.No.06 XQCM6072 has been prepared
under my guidance & supervision.
The work has been satisfactory & is recommended for

consideration towards partial fulfillment of requirement for the
M.B.A. Degree.
External Examiner
(PROF.PRAVEEN BHAGWAN)
Guide
Principal
(MPBIM)
DATE:
CERTIFICATE
This is to certify that the study titled IMPACT OF BONUS ISSUE ON STOCK
RETURNS VOLATILITY by SANDEEP.S. Register No. 06 XQCM6072 relates to
Finance stream of specialization. This is to enable the student to claim the benefit of dual
specialization (Finance & Marketing) as per the regulations of M.B.A. Programme of
Bangalore University.
(Prof. Praveen Bhagwan)

Guide
Date:
ACKNOWLEDGEMENT
The successful completion of dissertation report is dedicated to few people, as with their
help, guidance, suggestions & co-ordination of them has helped me to complete the work
with honesty.
I express my sincere gratitude to Dr.Nagesh Malavalli Principal, MPBIM in getting an

opportunity for take up the project & complete in stipulated time.
I would express sincere thanks & gratitude to my dissertation guide

Prof. Praveen Bhagwan, Faculty; MPBIM for providing me an opportunity to undertake
the project work with his guidance, knowledge & valuable suggestions in completion of
project report.
As my dissertation is mainly done on applying through testing basis, I am thankful to

various researchers & statisticians who have given idea about various testing tools
between two samples.
SANDEEP.S
TABLE OF CONTENTS
CHAPTER NO
CONTENTS
PAGE NUMBER
EXECUTIVE
SUMMARY
2
INTRODUCTION
REVIEW
8-12
OF 13-14
LITERATURE
4
METHODOLOGY
15-18
ANALYSIS OF DATA & 19-59

INTERPRETATION
SUMMARY
& 60-61
CONCLUSION
Bibliography - 62
Annexure
- 63-65
TABLE OF CHARTS
CHAPTER NUMBER
CONTENTS
PAGE NUMBER
Table showing calculation 20-50

of stock prices before the
bonus issue & after the
bonus issue with calculation
of mean, standard deviation,
volatility of stock returns,
standard
error
of
the
estimate
Statistics for applying t-test
52
Conducting t-test for two

independent samples
53
EXECUTIVE SUMMARY
Bonus issue includes an offer of free additional shares to existing shareholders. A

company may decide to distribute further shares as an alternative to increase the dividend
payout. Also known as Capitalization Issue. For example, the company may give one
bonus shares for every 5 shares held.
This is mainly done to conserve cash by declaring a bonus issue in lieu of a cash
dividend. It also increases the number of shares in the market; it therefore increases the
liquidity/marketability of the stock.
Regarding, volatility & market efficiency these are two important features which will
ultimately determine the effectiveness of the stock market in economic development.
In this dissertation, report it reveals that the closing stock prices before the bonus issue &
after the bonus issue is entirely different.
Because of this, there is a difference between mean, standard deviation & volatility.
Researcher, applied t-test as a testing tool for two different mean samples to make the
required interpretation.
CHAPTER 2
(2.1)
CONCEPTUAL FRAMEWORK ON BONUS ISSUE &
STOCK RETURNS VOLATILITY

MEANING OF BONUS ISSUE:
An offer of free additional shares to the existing shareholders. A company may decide to
distribute further shares as an alternative to increase the dividend payout. Also known as
Capitalization Issue.
New shares are issued to the shareholders in proportion to their holdings. For example,
the company may give one bonus share for every five shares held.
PURPOSE:
If a company holds, some of its own shares in treasury make a bonus issue in respect of
shares of that class.
i) To conserve cash by declaring a bonus issue in lieu of a cash dividend.
ii) To align the E.P.S due to the smaller number of share capital, the E.P.S would also not
been properly align to other similar companies which would have already take on a bonus
issue re-capitalization of reserves.
iii) To make use of a companies security premium account. As bonus issue can be
created, vide capitalization from the security premium account this might be one reason
that a company want to have a bonus issue.
iv) As issuing bonus shares has the effect of diluting E.P.S & lowering a share price, the
shares would become affordable which would then encourage the potential investors to
invest in the stock.
v) As the bonus issue would have increase the number of shares in the market, it
therefore increases the liquidity/marketability of the stock.
vi) Applies often for stocks that are generally cheaper & smaller in market capitalization.
To grow faster, these small companies may want to expand their capital base. The bonus
issue will reduce the price of a stock initially, but this could attract investors & portfolio
managers to buy the counter in the hope that there could be a potential upswing in the
stock in the longer term.
vii) If a company came-up with further new shares issues by way of private placement,
the earlier bonus issue will only be a capital split which would still allow higher
percentage stake to new investors.
viii) It helps to reinforce the fact that those reserves, which have been invested into longterm assets, cannot be used anymore for dividend distribution. This is particularly true, if
we see a small capital base very substantial Fixed Assets investments are higher than
normal EPS & dividend payout.
(Dividend payout is based on the nominal value of the issued share capital & not on the
shareholders funds.)
STOCK RETURN VOLATILITY:

While empirical tests of return-volatility behavior are plentiful for developed stock
markets, the focus on developing & emerging stock markets has begun in recent years.
The interest in these emerging markets has arisen from the increased globalization &
integration of the world economies in general.
Financial markets in particular. The globalization & integration of these markets has
created enormous opportunities for domestic & international investors to diversify their
portfolios across the globe.
While the relationship between volatility & return the capital market efficiency has been
examined for some emerging markets, it has not been examined to some extent for a
frontier capital market like India.
However, volatility & market efficiency are two important features, which will ultimately
determine the effectiveness of the stock market in economic development. If investors are
not rewarded for taking on high risk by investing in the stock market, or if excess
volatility weakens investors confidence, they will not invest their savings in the stock
market, & hence deter economic growth. The emerging stock markets offer an
opportunity to examine the evolution of stock return distributions in response to
economic & political changes in these emerging economies.
EFFECTS ON ISSUE OF BONUS SHARES:
i) Share capital is increased according to the bonus issue:

This is obvious that when there is a bonus issue, the no of shares will increase &
automatically the total share capital will increase.
ii) Liquidity in the stock increases:

Marketability of the equity stock increases.
iii) Effective EPS, B.V per share values stand reduced:

When the denominator increases regarding the no of shares, the value of EPS & the B.V
per share starts reduce.
iv) Market Price is adjusted on issue of bonus shares.
v) Accumulated profits are reduced:

There is a reserve known as capital redemption reserve where in all the divisible profits
are transferred to the reserve that is utilized exclusively for the issue of bonus shares.
2.2) STATEMENT OF THE PROBLEM:
There is a substantial risk to the investors who are too risk averse. By putting too much
into stocks, investors reduce their market risks but run the risk in getting such anemic
growth that they will not be able to fund their future income needs. Some of the investors
simply invest their money regardless of volatility. They ignored Beta & volatility &
loaded into high tech stocks in the dot com boom where in they lost majority of their net
worth.
2.3) SIGNIFICANCE OF THE STUDY:
i) The investigation can be used to decide upon the ratio of the bonus to control the
returns volatility around bonus issue.
ii) The investigation can also be used by the investors to decide upon the timing of their
investment while dealing with the stocks going for the bonus issue.
2.4) RESEARCH OBJECTIVES:
The present study has been undertaken with the following objectives:-
i) To examine the effects of bonus issue on equity prices during the period Jan 2003 to
Jan 2008
ii) To investigate the changes in implied volatility of returns around, i.e. before the bonus
issue & after the bonus issue
iii) To investigate the impact of bonus issue on stock returns volatility
iv) To identify the causes of bonus issue & volatility of stock returns
CHAPTER 3
3.1 PURPOSE
To tackle volatility is by investing on a regular basis through Systematic investment plans
(SIP). This means making periodic investments of the same amount of money in an
equity fund, regardless of whether the stock market is declining or ascending. i.e by
investing the same amount over a period, without worrying about the timing. SIP can
protect in a volatile market. When this kind of an advantage is available through
Systematic investment plans, investors should come forward to invest their amount of
money in an equity fund to protect against volatility.
3.1.1) PREVIEW OF THE PREVIOUS STUDIES:
Past researchers have revealed significant abnormal returns for bonus issues even though
the bonus issue date is known in advance & the distribution contains no new information.
Samples of 46 bonus issues have been used to study the announcement effect by using
event study methodology. The results indicate that there are significant positive abnormal
returns for a five-day period prior to bonus announcement in line with evidence from
developed stock market. On the announcement day the average abnormal returns of 0.10% is observed.
Many econometric models have been tested & no single model is found to be superior.
The authors M KAKATI & DR.RINALINI PATHAK listed different models like
Random Walk Model, Historical Mean Model, Historical Moving Average Model,
Exponential Smoothening model, Exponential weighted average moving model, Simple
Auto Regression Model. They deduce that the choice of a best model depends on the
error measurement that depends on the ultimate purpose of the forecasting procedure.
3.2) METHODOLOGY FOLLOWED:
15 Companies closing stock prices has been collected to conduct the research process. 15
days prior the bonus issue & after the bonus issue has been collected to consider them as
samples for conducting T-test.
3.3) CONCLUSION:
To conclude, investors before investing their money in any of the stocks should consider
the volatility & beta factor. May be Systematic investment plans is the best option, but
volatility & beta factors has to be taken into account, otherwise they are going to suffer in
the long run.
BENEFITS DERIVED IN THE LITERATURE REVIEW:

For the investors to protect in the volatile market, SIPs is the best option available.
CHAPTER 4
4.1
TYPE OF RESEARCH:
Research adopted here, is the qualitative research.
Quantitative research cannot be done for this kind of testing projects; where-in
nonparametric test liket-test is adopted.
4.2
PROFILE OF SAMPLE INDUSTRY & FIRMS THAT HAVE BEEN
SELECTED FOR RESEARCH INVESTIGATION
TATA IRON & STEEL: (MANUFACTURING SECTOR)
They issued bonus shares as on 22-7-04 in the ratio of 1:2. This is subject to the
approval of shareholders.
SIEMENS LTD: (SOFTWARE COMPANY)

They issued bonus shares in the ratio of 1:1 as on 23-11-07. It traded down 4.41%
(BSE) traded at Rs.1,600 in afternoon trade.
SAH PETROLEUMS MUMBAI: (PETROLEUM INDUSTRY)

They issued bonus shares in the ratio of 3:5 as on 30-9-05.
The bonus shares were Rs.5 each. The AGM also gave its nod to increase the
authorized share capital of the company from Rs.11 cr to Rs.16 cr for issuing bonus
shares.
PARENTERAL DRUGS LTD: (PHARMACEUTICAL CO)

They issued bonus shares as on 4-9-07 in the ratio of 1:1.
USHDEV INTERNATIONAL: (TRADING CO)

NATIONAL MINERAL DEVELOPMENT CORPORATION

LTD:(DEVELOPMENT SECTOR)
ELECON ENGINEERING LTD :( ENGG SECTOR)

AXON INFOTECH LTD (IT SECTOR):

ASHIANA HOUSING (CONSTRUCTION CO):
They issued 5 new shares of A.H. LTD for every 2 shares held as on 29-10-07.
KANORIA CHEMICALS & INDUSTRIES LTD (CHLORIDE

ALKALI):
They issued 1 equity share for every 2 shares held as on 7-1-08. The face value of
equity share got subdivided from Rs.10 to Rs.5.
RAJESH
EXPORTS
LTD
(DIAMOND
CUTTING
&
JEWELLERY):
They issued 2 bonus shares for every 1 share held by the shareholders as on 23-10-07.
WALCHANDNAGAR INDUSTRIES LTD (ENGG CO)
They issued bonus shares in the ratio of 1:1 as on 26-11-07

These equity shares are subdivided into the face value of Rs.10 each into 5 equity
shares of Rs.2 each.
PARLE SOFTWARE LTD(COMPUTER SOFTWARE)
They issued bonus shares in the ratio of 3:1 as on 30-11-07(3 equity shares of Rs.10
each fully paid-up for every 1 share held).
MAHALAXMI
RUBTECH
LTD(MANUFACTURE
OF
RUBBER PRODUCTS):
They issued bonus shares in the ratio of 1:4 as on 24-11-06. The company at EGM raised
the borrowing limit of the company up to Rs.50 crores.
CRANES SOFTWARE INTERNATIONAL LTD(S/W CO):
They issued bonus shares in the ratio of 1:1 as on 28-9-05 & issued 12 lakh equity shares
on preferential basis. The AGM decided to split equity shares of Rs.10 each into 5 shares
of Rs.2 each, the company informed the BSE. The AGM also approved the dividend of
Rs.5 per share including regular div of Rs.2 per share & special div of Rs.3 per share.
4.3
SAMPLE SIZE
N1=15 & N2=1
N1=15, says that mean value prior the bonus issue & N2=15, says mean value after the
bonus issue.
4.4
TOOLS USED FOR TESTING OF HYPOTHESIS
Since, these are independent samples n1 & n2 with small sample sizes, normally
distributed populations & the assumption of equal population variance, thet-test is
appropriate.
4.5
ACTUAL COLLECTION OF DATA
Data has been collected regarding 15 companies, the closing stock prices of it &
calculation of mean for the sampling technique. Apart from this, calculation of price
relatives, volatility of stock returns, STD deviation, STD error of the estimates.
Table has been drawn for applying thet-test.
4.6
OTHER SOFTWARE USED
Excel application has been used to calculate mean, price relative, stock returns, volatility,
std deviation, std error of the estimate. For calculatingt-stat, this application was
employed.
CHAPTER 5
ANALYSIS OF DATA & INTERPRETATION
5.1
HYPOTHESIS:
Ho: There is no change in the stock returns following the bonus issue
Ha: There is a change in the stock returns following the bonus issue
5.2
PRESENTATION OF DATA
15 companies data has been collected regarding the pre-bonus issue & post bonus issue.
Data is presented in a table format, all possible calculations has been done through excel
application.
NAME OF THE COMPANY:TATA

STEEL(BONUS ISSUE ON 22-7-04)
PRE BONUS ISSUE
DATE
DAY
CL.PRICE(NSE)
PRICE RELATIVE
DAILY RETURN
22-7-04
214.17
21-7
210.23
0.981603399
-0.018567923
20-7
202.77
0.964515055
-0.036129838
19-7
203.78
1.004981013
0.004968649
16-7
199.8
0.980469133
-0.019724114
15-7
192.76
0.964764765
-0.035870974
14-7
184.89
0.959172027
-0.041684838
13-7
181.36
0.980907567
-0.019277047
185.33
1.021890163
0.021654014
180.38
0.973290887
-0.027072283
10
174.52
0.967513028
-0.033026388
11
186.42
1.068187027
0.065962844
12
184.56
0.99002253
-0.010027579
13
178.09
0.96494365
-0.035685573
14
179.26
1.006569712
0.006548225
15
180.74
1.008256164
0.008222269
1-Jul
TATA STEEL
MEAN OF DAILY RETURN
-0.011314037
STD DEVIATION OF DAILY RETURN
0.028868975
STD DEV OF DAILY RET IN %
ASSUME THERE ARE 252 TRADIND

DAYS IN A YEAR
2.8868975
E 252 TRADING
SQRT OF 252
VOLATILITY OF THE STOCK PER A
STD ERROR OF THE ESTIMATE
252
15.87450787
STOCK P.A
0.458280771
S/SQRT(2n)
SQRT OF 2n
5.477225575
STD ERROR OF THE ESTIMATE
0.083670239
TATA STEEL
POST BONUS ISSUE (AFTER 22-7-04)

DATE
DAY
CL.PRICE
PRICE RELATIVE
DAILY RETURN
22-Jul
214.17
23-Jul
214.29
1.000560303
0.000560146
26-Jul
220.24
1.027766111
0.027387623
223.07
1.012849619
0.012767763
222.6
0.997893038
-0.002109185
231.49
1.039937107
0.039160237
230.94
0.997624087
-0.00237874
230.56
0.998354551
-0.001646804
233.39
1.012274462
0.012199742
234.6
1.005184455
0.005171062
10
240.23
1.023998295
0.023714862
11
237.96
0.990550722
-0.009494205
12
237.75
0.999117499
-0.000882891
13
239.49
1.007318612
0.007291961
14
228.59
0.954486617
-0.046581656
15
232.66
1.017804803
0.017648155
12-Aug
STD DEV OF THE DAILY RETURN
0.019577644
MEAN OF THE DAILY RETURN
0.005520538
STD DEV OF THE DAILY RETURN(%)
1.957764394
ASSUMING THERE ARE 252 TRADING
252
DAYS IN A YEAR
SQRT OF 252
VOLATILITY OF THE STOCK PER
A
15.87450787
STOCK P.A
0.310785463
SQRT OF 2n
5.477225575
STD ERROR OF ESTIMATE
0.056741403
SIEMENS
CO
ISSUED SIEMENS CO ISSUED BONUS SHARES ON
23-11-07
BONUS
PRE BONUS ISSUE
DATE
DAY
23-Nov
22-Nov
2-Nov
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
CL.PRICE
989.13
963.25
969.2
1000.93
1037.35
985.13
983.43
942.03
885.35
894.23
866.18
876.08
879.8
890
933.55
953.3
MEAN OF THE DAILY RETURN
PRICE RELATIVE
DAILY RETURN
0.973835593
1.006177005
1.032738341
1.036386161
0.949660192
0.998274339
0.957902443
0.939832065
1.010029932
0.968632231
1.011429495
1.004246188
1.011593544
1.048932584
1.021155803
-0.002459741
STD DEV OF THE DAILY RETURN
0.033222543
STD DEV OF DAILY RETURN (%)
3.32225434
ASSUME THAT THERE ARE 252

TRADING DAYS PER YEAR
252
SQRT OF 252
15.87450787
VOLATILITY OF THE STOCK P.A
0.527391526
SQRT OF 2N
5.477225575
0.096288079
-0.026512785
0.006158005
0.032213858
0.035739817
-0.051651051
-0.001727151
-0.04300934
-0.062054074
0.009979966
-0.031870274
0.011364672
0.004237198
0.011526854
0.047773061
0.020935126
POST BONUS
ISSUE(SIEMENS)
DATE
23-Nov
26-Nov
14-Dec
DAY
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
CL.PRICE
989.13
973.28
963.55
919.1
905.08
908.03
920.78
931.28
947.15
971.88
967.45
975.28
980.53
980.73
971.9
975.62
UE(AFTER 23-11-07)
PRICE RELATIVE
0.983975817
0.990002877
0.953868507
0.984745947
1.00325938
1.014041386
1.011403375
1.017041062
1.026109909
0.995441824
1.008093442
1.005383069
1.000203971
0.990996503
1.003827554
MEAN OF STOCK RETURN
-0.00091684
STD DEV OF DAILY STOCK RETURN
0.017547406
STD DEV OF STOCK RETURN(%)
1.754740597
ASSUME THAT THERE ARE 252

TRADING DAYS IN A YEAR
252
SQRT OF 252
15.87450787
0.278556434
SQRT OF 2N
5.477225575
0.050857214
STOCK RETURN
-0.016153958
-0.01004743
-0.04722945
-0.015371593
0.00325408
0.013943719
0.011338847
0.016897492
0.025774864
-0.004568596
0.008060865
0.005368633
0.000203951
-0.009044274
0.003820248
AXON INFOTECH(B.I:49-07)
PRE BONUS ISSUE
DATE
DAY
4-Sep
30-Aug
12-Aug
CL.PRICE(BSE)
PRICE RELATIVE
DAILY RETURNS
167.69
162.85
0.971137217
-0.029287505
164.03
1.007245932
0.007219806
160.96
0.981283911
-0.018893451
162.38
1.008822068
0.008783381
161.38
0.993841606
-0.006177435
156.55
0.970070641
-0.030386385
149.71
0.956307889
-0.044675358
147.13
0.982766682
-0.01738354
147.34
1.001427309
0.001426292
10
146.29
0.992873626
-0.007151888
11
147.5
1.008271242
0.008237223
12
145.85
0.988813559
-0.011249479
13
147.5
1.011312993
0.011249479
14
149.64
1.014508475
0.014404234
15
148.63
0.993250468
-0.006772413
MEAN OF DAILY STOCK RETURNS

STD DEV OF DAILY RETURNS
ASSUMING THERE ARE 252 TRADING
-0.008043803
0.017444822
252
DAYS A YEAR
SQRT OF 252
15.87450787
0.276927961
STD DEV OF STOCK RETURNS(%)
1.744482182
SQRT OF 2N
5.477225575
0.050559897
POST B.I OF
AXON
INFOTECH
DATE
DAY
CL.PRICE(BSE)
PRICE RELATIVE
STOCK RET
4-Sep
167.69
5-Sep
171.25
1.02122965
0.02100744
6-Sep
168.18
0.982072993
-0.018089643
179.51
1.067368296
0.065196082
182.33
1.015709431
0.015587315
179.8
0.986124061
-0.01397311
162.05
0.901279199
-0.103940192
178.25
1.099969145
0.09528213
169.95
0.953436185
-0.047682783
168.75
0.9929391
-0.007085946
10
173.16
1.026133333
0.025797693
11
172.84
0.998151998
-0.001849712
12
172.79
0.999710715
-0.000289327
13
169.35
0.98009144
-0.020109405
14
167.23
0.987481547
-0.012597469
15
163.1
0.975303474
-0.025006601
25-Nov
MEAN OF STOCK RET
STD DEV OF STOCK RET
ASSUME THERE ARE 252 TRADING
-0.001850235
0.045879878
252
DAYS A YEAR
SQRT OF 252
15.87450787
0.728320491
STD DEV OF STOCK RET(%)
4.58798784
SQRT OF 2N
5.477225575
0.132972521
ELECON ENGG(B.I:-11-1007)
DATE
DAY
CL.PRICE
PRICE RELATIVE
DAILY RETURNS
11-Oct
230.65
10-Oct
233.55
1.012573163
0.012494777
9-Oct
229.24
0.981545708
-0.018626697
8-Oct
227.63
0.992976793
-0.007047986
238.61
1.048236173
0.047108916
229.41
0.961443359
-0.039319624
233.98
1.019920666
0.019724846
228.41
0.976194547
-0.024093382
28-Sep
229.38
1.004246749
0.004237757
27-Sep
230.56
1.005144302
0.005131115
10
230.21
0.998481957
-0.001519196
11
226.6
0.984318666
-0.015805587
12
223.28
0.985348632
-0.014759759
13
223.36
1.000358295
0.00035823
14
217.71
0.974704513
-0.025620918
15
209.28
0.961278765
-0.039490834
19-Sep
MEAN OF DAILY RETURNS

STD DEV OF DAILY RETURNS(%)
-0.006481889
0.02297159
2.297158982
252
DAYS A YEAR
SQRT OF 252
15.87450787
0.364662683
SQRT OF 2N
5.477225575
0.066577993
ELECON
ENGG
POST B.I
DATE
DAY
CL.PRICE
PRICE RELATIVE
DAILY
RETURNS
11-Oct
230.65
12-Oct
228.3
0.989811403
-0.010240856
15-Oct
230.65
1.010293473
0.010240856
245.4
1.063949707
0.061988122
262.4
1.069274654
0.066980525
258.15
0.983803354
-0.016329246
253.5
0.981987217
-0.018176988
259.05
1.021893491
0.02165727
269.9
1.041883806
0.041030427
24-Oct
300.5
1.113375324
0.107396234
25-Oct
10
305.9
1.01797005
0.017810497
26-Oct
11
297.8
0.973520758
-0.026836131
12
295.4
0.9919409
-0.00809175
13
298.8
1.011509817
0.011444083
14
305
1.020749665
0.020537323
15
303.62
0.99547541
-0.004534857
1-Nov
0.018325034
0.037283928
STD DEV OF DAILY

RETURNS
RETURNS(%)
3.728392848
252
DAYS A YEAR
SQRT OF 252
15.87450787
0.591864016
SQRT OF 2N
5.477225575
0.108059091
NMDC(BONUS ISSUE:-27-12-07)
DATE
27-Dec
26-Dec
24-Dec
20-Dec
18-Dec
17-Dec
14-Dec
DAY
4-Dec
3-Dec
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
CL.PRICE(BSE)
12,539.40
11,942.30
11,373.65
10,832.05
10,316.25
9,825.00
10,340.00
9,851.00
9,387.35
8,940.35
8,514.65
8,600.00
8,770.00
9,231.75
9,717.60
10,229.00
PRICE RELATIVE
DAILY RETURNS
0.952382092
0.952383544
0.952381162
0.952382051
0.952380952
1.052417303
0.95270793
0.952933712
0.952382728
0.952384414
1.0100239
1.019767442
1.052651083
1.052628158
1.052626163
-0.013576591
0.045946864
4.594686411

DAYS A YEAR
252
SQRT OF 252
15.87450787
VOLATILITY OF STOCK P.A
0.729383856
SQRT OF 2N
5.477225575
0.133166664
-0.048788968
-0.048787443
-0.048789944
-0.04878901
-0.048790164
0.051089711
-0.048446896
-0.048209935
-0.0487883
-0.048786529
0.009973994
0.019574603
0.051311823
0.051290045
0.051288149
NMDC(POST B.I)
DATE
DAY
CL.PRICE(BSE)
PRICE RELATIVE
DAILY RETURNS
27-Dec
12,539.40
28-Dec
13,166.35
1.049998405
0.048788645
31-Dec
13,824.65
1.049998671
0.048788898
1-Jan
14,515.85
1.049997649
0.048787925
2-Jan
15,241.60
1.049997072
0.048787376
3-Jan
15,492.85
1.01648449
0.016350096
14,975.00
0.966574904
-0.033996483
14,872.65
0.993165275
-0.006858188
14,129.05
0.950002185
-0.051290994
13,475.00
0.953708848
-0.047396845
10
12,802.00
0.950055659
-0.051234708
11
12,800.00
0.999843774
-0.000156238
12
12,355.00
0.965234375
-0.035384331
13
12,532.40
1.014358559
0.014256451
14
12,498.00
0.997255115
-0.002748659
15
13,122.90
1.05
0.048790164
8-Jan
0.003032207
0.039820082
3.982008151
252
DAYS A YEAR
SQRT OF 252
15.87450787
0.632124197
SQRT OF 2N
5.477225575
0.115409561
USHDEV INTERNATIONAL(TRADING)[B.I
ON 16.10.07]
DATE
DAY
CL.PRICE(BSE)
PRICE RELATIVE
DAILY RETURNS
16-Oct
94.83
15-Oct
94.6
0.997574607
-0.002428339
12-Oct
78.85
0.833509514
-0.182110163
11-Oct
65.73
0.833608117
-0.181991871
10-Oct
66.5
1.01171459
0.011646505
9-Oct
70
1.052631579
0.051293294
66
0.942857143
-0.0588405
68.55
1.038636364
0.037908664
70
1.021152443
0.020931836
72.13
1.030428571
0.029974804
10
71.8
0.995424927
-0.00458557
11
71.53
0.996239554
-0.003767534
12
70.7
0.988396477
-0.011671369
13
67.4
0.953323904
-0.047800555
14
72.4
1.074183976
0.071561281
15
69.55
0.960635359
-0.040160381

-0.020669326
0.074678113
7.46781128
252
DAYS
SQRT OF 252
15.87450787
1.185478289
SQRT OF 2N
5.477225575
0.216437733
USHDEV
INTER
POST B.I
DATE
DAY
CL.PRICE(BSE)
PRICE RELATIVE
DAILY RETURNS
16-Oct
94.83
17-Oct
86.33
0.910365918
-0.093908653
18-Oct
89.6
1.03787791
0.037178158
19-Oct
85.4
0.953125
-0.048009219
22-Oct
83.5
0.977751756
-0.022499469
23-Oct
87.15
1.043712575
0.04278414
24-Oct
89.15
1.022948939
0.022689572
25-Oct
91.85
1.030286035
0.029836467
91
0.990745781
-0.009297305
98.3
1.08021978
0.077164521
10
95.95
0.976093591
-0.024196805
11
98.68
1.028452319
0.028055069
12
97
0.982975274
-0.017171313
13
99.48
1.02556701
0.02524564
14
99.08
0.995979091
-0.004029014
15
96.75
0.97648365
-0.023797273
0.001336301
0.042383458
RETURNS(%)
4.238345802
252
DAYS
SQRT OF 252
15.87450787
0.672816538
SQRT OF 2N
5.477225575
0.122838932
PARENTERAL DRUGS
(India) LTD[B.I:4.9.07]
DATE
DAY
CL.PRICE(BSE)
PRICE RELATIVE
DAILY RETURNS
4-Sep
98.03
3-Sep
94.38
0.9627665
-0.037944368
31-Aug
89.9
0.952532316
-0.048631245
30-Aug
93.18
1.036484983
0.035835165
29-Aug
88.75
0.952457609
-0.048709678
28-Aug
84.53
0.952450704
-0.048716927
27-Aug
80.5
0.952324618
-0.048849317
24-Aug
76.68
0.952546584
-0.048616266
23-Aug
77.48
1.010432968
0.01037892
22-Aug
75.4
0.973154362
-0.027212564
21-Aug
10
79.35
1.052387268
0.051061172
20-Aug
11
83.53
1.052678009
0.051337402
17-Aug
12
87.9
1.052316533
0.050993956
16-Aug
13
83.73
0.952559727
-0.048602468
14-Aug
14
79.75
0.952466261
-0.048700595
13-Aug
15
75.98
0.952727273
-0.048426594

-0.016986894
0.04311684
4.311684009
252
DAYS A YEAR
SQRT OF 252
15.87450787
VOLATILITY OF STOCK RETURNS
0.684458617
SQRT OF 2N
5.477225575
0.124964475
PARENTERAL
DRUGS(POST
B.I)
DATE
4-Sep
5-Sep
6-Sep
7-Sep
10-Sep
11-Sep
12-Sep
13-Sep
14-Sep
DAY
25-Sep
CL.PRICE(BSE)
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
PRICE RELATIVE
98.03
98.08
98.25
93.68
93.95
92.93
92.05
87.83
86.18
88.4
92.8
95.18
92.38
87.78
83.48
84.8
DAILY RETURNS
1.000510048
1.001733279
0.953486005
1.002882152
0.989143161
0.990530507
0.95415535
0.981213708
1.025760037
1.049773756
1.025646552
0.970582055
0.950205672
0.951013898
1.015812171
-0.009665201
0.031130537
3.113053654

DAYS
252
SQRT OF 252
15.87450787
VOLATILITY OF STOCK RETURNS
0.494181947
SQRT OF 2N
5.477225575
0.090224867
0.000509918
0.001731779
-0.047630531
0.002878007
-0.010916204
-0.009514614
-0.04692878
-0.018964996
0.025433837
0.04857467
0.025323196
-0.029859331
-0.051076821
-0.050226602
0.015688461
SAH PETROLEUMS
LTD(MUMBAI)[B.I.30.9.05]
DATE
DAY
PRICE
RELATIVE
CL.PRICE
DAILY RETURNS
30-Sep
22.56
29-Sep
23.28
1.031914894
0.031416196
28-Sep
24
1.030927835
0.030459207
27-Sep
23.88
0.995
-0.005012542
26-Sep
24.41
1.022194305
0.021951596
23-Sep
21.28
0.871773863
-0.13722522
22-Sep
21.25
0.998590226
-0.001410769
21-Sep
23.16
1.089882353
0.086069757
20-Sep
24.06
1.038860104
0.038124058
24.38
1.013300083
0.013212414
10
24.47
1.00369155
0.003684753
11
24.5
1.001225991
0.00122524
12
24.38
0.995102041
-0.004909993
13
24.69
1.01271534
0.012635179
14
24.53
0.993519644
-0.006501445
15
24.97
1.01793722
0.017778246
9-Sep
0.006766445
0.046414978
4.641497789
252
DAYS
SQRT OF 252
15.87450787
0.736814932
SQRT OF 2N
5.477225575
0.134523386
SAH
PETROLEUMS
(POST B.I)
DATE
DAY
CL.PRICE
PRICE RELATIVE
DAILY RETURNS
30-Sep
22.56
3-Oct
23.59
1.045656028
0.044644467
4-Oct
24.09
1.021195422
0.020973923
5-Oct
23.75
0.98588626
-0.014214286
6-Oct
23.44
0.986947368
-0.013138566
7-Oct
23.47
1.001279863
0.001279045
10-Oct
23.75
1.011930124
0.011859521
11-Oct
23.56
0.992
-0.008032172
13-Oct
23.78
1.009337861
0.009294532
14-Oct
22.84
0.960470984
-0.040331506
17-Oct
10
22.63
0.990805604
-0.009236925
11
23.09
1.020327
0.020123164
12
21.28
0.921611087
-0.081631959
13
20.5
0.963345865
-0.037342778
21-Oct
14
20.7
1.009756098
0.009708814
24-Oct
15
20.4
0.985507246
-0.014598799
-0.006709568
0.030364634
3.036463419
252
DAYS A YEAR
SQRT OF 252
15.87450787
0.482023624
SQRT OF 2N
5.477225575
0.088005071
CRANES
SOFTWARE(PRE
BONUS ISSUE)
DATE
DAY
CL.PRICE
PRICE RELATIVE
DAILY RETURNS
28-Sep
96.08
27-Sep
91.51
0.95243547
-0.048732922
26-Sep
90.16
0.985247514
-0.014862386
23-Sep
90
0.998225377
-0.001776199
22-Sep
94.42
1.049111111
0.047943245
21-Sep
98.78
1.046176657
0.04514224
20-Sep
99.09
1.003138287
0.003133373
19-Sep
98.02
0.989201736
-0.010856989
16-Sep
99.45
1.014588859
0.014483466
15-Sep
99.89
1.004424334
0.004414575
14-Sep
10
98.46
0.985684253
-0.014419206
11
100.05
1.01614869
0.016019687
12
100.7
1.006496752
0.006475739
13
102.03
1.013207547
0.013121088
8-Sep
14
103.62
1.015583652
0.015463474
6-Sep
15
101.59
0.980409187
-0.019785256
0.003717595
0.024486411

2.44864114
252
DAYS A YEAR
SQRT OF 252
15.87450787
0.38870973
SQRT OF 2N
5.477225575
0.070968363
CRANES
SOFTWARE
POST B.I
DATE
DAY
28-Sep
29-Sep
30-Sep
3-Oct
4-Oct
5-Oct
6-Oct
7-Oct
10-Oct
11-Oct
13-Oct
14-Oct
19-Oct
20-Oct
CL.PRICE
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
PRICE RELATIVE
96.08
100.89
105.18
109.67
107.03
107.75
103.14
102.75
100.77
102
107.36
104.59
99.97
98.99
94.51
92.84
-0.002286906

STD DEV OF DAILY
RETURNS
1.050062448
1.042521558
1.042688724
0.975927783
1.006727086
0.957215777
0.996218732
0.980729927
1.012206014
1.05254902
0.974198957
0.955827517
0.990197059
0.954742903
0.982329912
0.034627939
RETURNS(%)

DAYS A YEAR
3.462793851
252
SQRT OF 252
15.87450787
0.549701482
SQRT OF 2N
5.477225575
0.100361301
DAILY RETURNS
0.048849637
0.041642354
0.041802689
-0.024366688
0.00670456
-0.04372644
-0.003788435
-0.019458161
0.012132121
0.05121486
-0.026139728
-0.045177804
-0.009851306
-0.046313186
-0.017828068
MAHALAXMI
RUBTECH
LTD(B.I-24-1106)
DATE
24-Nov
23-Nov
22-Nov
21-Nov
20-Nov
17-Nov
16-Nov
15-Nov
14-Nov
DAY
6-Nov
3-Nov
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
CL.PRICE(BSE)
51.36
53.44
50.92
48.52
46.24
48.6
50.76
53.4
54.44
53.04
51.44
49
46.68
46.12
43.96
41.88
PRICE RELATIVE
DAILY RETURNS
1.040498442
0.952844311
0.952867243
0.953009068
1.051038062
1.044444444
1.052009456
1.019475655
0.974283615
0.969834087
0.952566096
0.952653061
0.988003428
0.953165655
0.952684258
-0.013603418
0.041593089
4.159308928

DAYS A YEAR
252
SQRT OF 252
15.87450787
0.660269823
SQRT OF 2N
5.477225575
0.120548225
0.03969987
-0.048303756
-0.04827969
-0.04813086
0.049778307
0.043485112
0.050702103
0.019288432
-0.026052832
-0.030630266
-0.048595782
-0.048504491
-0.012069112
-0.047966566
-0.048471744
MAHALAXMI
RUBTECH
LTD(POST B.I)
DATE
DAY
CL.PRICE(BSE)
PRICE RELATIVE
DAILY RETURNS
24-Nov
51.36
27-Nov
49.32
0.960280374
-0.040529981
28-Nov
48.48
0.98296837
-0.017178337
29-Nov
50.88
1.04950495
0.048318577
30-Nov
50.28
0.988207547
-0.011862535
1-Dec
52.76
1.049323787
0.048145944
4-Dec
55.36
1.049279757
0.048103983
5-Dec
58.12
1.049855491
0.048652527
6-Dec
58.76
1.0110117
0.010951513
58.16
0.989788972
-0.010263518
10
57.72
0.992434663
-0.007594099
11
55.64
0.963963964
-0.036701367
12
52.92
0.951114306
-0.050121028
13-Dec
13
50.68
0.957671958
-0.043249984
14-Dec
14
53.2
1.049723757
0.048527041
15-Dec
15
55.84
1.04962406
0.048432062
0.005575387
0.039332967
3.933296671
252
DAYS A YEAR
SQRT OF 252
15.87450787
0.624391489
SQRT OF 2N
5.477225575
0.113997768
PARLE
SOFTWARE
LTD(B.I:30.11.07)
DATE
DAY
CL.PRICE(BSE)
PRICE RELATIVE
DAILY RETURNS
30-Nov
454.25
29-Nov
412.96
0.909102917
-0.095296971
28-Nov
375.43
0.909119527
-0.0952787
27-Nov
341.3
0.909090909
-0.09531018
26-Nov
365.59
1.071169059
0.068750631
23-Nov
363.69
0.994802921
-0.00521063
22-Nov
402.48
1.106656768
0.10134355
21-Nov
366.04
0.90946134
-0.094902789
20-Nov
334.15
0.912878374
-0.091152623
19-Nov
320.23
0.958342062
-0.042550506
10
312.74
0.976610561
-0.023667313
11
345.48
1.1046876
0.09956258
12
383.85
1.111062869
0.105317097
13
400.4
1.0431158
0.042212196
12-Nov
14
412.5
1.03021978
0.029772158
9-Nov
15
434.89
1.054278788
0.05285692
-0.002903639
0.079414803
7.941480276
252
DAYS IN A YEAR
SQRT OF 252
15.87450787
1.260670911
SQRT OF 2N
5.477225575
0.230165965
PARLE
S/W LTD
DATE
DAY
CL.PRICE(BSE)
PRICE RELATIVE
DAILY RETURNS
30-Nov
454.25
3-Dec
476.96
1.049994496
0.048784923
4-Dec
479.4
1.005115733
0.005102692
5-Dec
455.44
0.950020859
-0.051271337
6-Dec
433.84
0.952573336
-0.048588182
7-Dec
427.76
0.985985617
-0.014113512
10-Dec
427.9
1.000327286
0.000327233
11-Dec
408
0.953493807
-0.047622349
12-Dec
428.4
1.05
0.048790164
13-Dec
449.81
1.049976657
0.048767933
14-Dec
10
453.94
1.009181654
0.009139759
17-Dec
11
441.26
0.972066793
-0.02833076
18-Dec
12
438.38
0.993473236
-0.006548157
19-Dec
13
437.36
0.997673252
-0.00232946
14
431.89
0.987493141
-0.012585728
24-Dec
15
441.5
1.022251036
0.022007094
-0.001897979

STD DEV OF DAILY
RETURNS
0.033958688
RETURNS(%)
3.395868834
252
DAYS A YEAR
SQRT OF 252
15.87450787
0.539077465
SQRT OF 2N
5.477225575
0.098421629
WALCHANDNAGAR
INDUSTRIES
LTD(BI 26-11-07)
DATE
DAY
CL.PRICE
PRICE RELATIVE
DAILY RETURNS
26-Nov
843.53
23-Nov
803.36
0.952378694
-0.048792535
22-Nov
765.11
0.952387473
-0.048783318
21-Nov
799.88
1.045444446
0.044442102
20-Nov
841.51
1.052045307
0.050736181
19-Nov
884.24
1.050777769
0.049530622
16-Nov
930.78
1.052632769
0.051294425
15-Nov
979.67
1.052525839
0.051192836
14-Nov
1031.23
1.052629967
0.051291763
13-Nov
982.12
0.952377258
-0.048794043
10
935.35
0.952378528
-0.04879271
11
984.58
1.052632704
0.051294364
12
1036.4
1.052631579
0.051293294
7-Nov
13
1090.94
1.052624469
0.05128654
6-Nov
14
1148.36
1.052633509
0.051295128
5-Nov
15
1093.67
0.952375562
-0.048795824

0.017313255
0.04841468
4.841467962
252
DAYS
SQRT OF 252
15.87450787
0.768559213
SQRT OF 2N
5.477225575
0.140319072
WALCHANDNAGAR
INDUSTRIES(POST
BI)
DATE
DAY
CL.PRICE
PRICE RELATIVE
DAILY RETURNS
26-Nov
843.53
27-Nov
885.71
1.050004149
0.048794116
28-Nov
930
1.050005081
0.048795003
29-Nov
896.34
0.963806452
-0.036864781
30-Nov
864.56
0.964544704
-0.036099098
3-Dec
907.79
1.050002313
0.048792367
4-Dec
890.31
0.980744445
-0.019443358
5-Dec
891.17
1.000965956
0.000965489
6-Dec
867.76
0.973731162
-0.026620027
7-Dec
844.85
0.973598691
-0.026756082
10-Dec
10
831.35
0.984020832
-0.016108211
11-Dec
11
817.85
0.983761352
-0.01637194
12
814.69
0.996136211
-0.003871273
13
855.43
1.050006751
0.048796594
14-Dec
14
840.73
0.98281566
-0.017333704
17-Dec
15
799.86
0.951387485
-0.04983385
-0.003543917
0.034976777
3.497677708
252
DAYS A YEAR
SQRT OF 252
15.87450787
0.555239123
SQRT OF 2N
5.477225575
0.101372331
RAJESH
EXPORTS
LTD(B.I 23-1007)
DATE
DAY
CL.PRICE
PRICE RELATIVE
DAILY RETURNS
23-Oct
151.93
22-Oct
147.7
0.972158231
-0.028236699
19-Oct
143.99
0.974881517
-0.025439337
18-Oct
142.44
0.989235364
-0.010822994
17-Oct
140.36
0.98539736
-0.014710308
16-Oct
147.09
1.047948133
0.046834094
15-Oct
150.34
1.022095316
0.021854751
12-Oct
151.84
1.009977385
0.009927939
154.53
1.017716017
0.017560917
10-Oct
154.3
0.998511616
-0.001489493
9-Oct
10
150.26
0.973817239
-0.026531632
11
146.84
0.977239452
-0.023023568
5-Oct
12
147.75
1.006197221
0.006178098
4-Oct
13
149.95
1.014890017
0.014780249
3-Oct
14
148.97
0.993464488
-0.006556962
1-Oct
15
156.14
1.048130496
0.047008097
0.00182221
0.02471526

2.471526036
252
DAYS
SQRT OF 252
15.87450787
0.001556915
SQRT OF 2N
5.477225575
0.000284252
RAJESH
EXPORTS
LTD(POST BI)
DATE
DAY
CL.PRICE
PRICE RELATIVE
DAILY RETURNS
23-Oct
151.93
24-Oct
148.19
0.9753834
-0.024924654
26-Oct
147.76
0.99709832
-0.002905898
29-Oct
148.11
1.002368706
0.002365905
30-Oct
148.49
1.002565661
0.002562375
1-Nov
145.61
0.980604755
-0.019585801
2-Nov
145.64
1.00020603
0.000206009
5-Nov
145.32
0.997802801
-0.002199616
6-Nov
144.04
0.991191852
-0.008847169
7-Nov
144.35
1.00215218
0.002149867
10
143.49
0.994042258
-0.00597556
9-Nov
11
143.52
1.000209074
0.000209052
12-Nov
12
144.29
1.005365106
0.005350765
13-Nov
13
143.67
0.995703098
-0.00430616
14-Nov
14
145.84
1.015104058
0.014991127
15-Nov
15
143.64
0.984914975
-0.015199961
-0.003740648
0.010149016
1.014901584
252
DAYS A YEAR
SQRT OF 252
15.87450787
0.161110632
SQRT OF 2N
5.477225575
0.029414642
KANORIA
CHEMICALS &
INDUSTRIES
LTD(B.I:7-108)
DATE
DAY
CL.PRICE
PRICE RELATIVE
DAILY RETURN
7-Jan
59.1
4-Jan
61
1.0321489
0.03164294
3-Jan
62
1.016393443
0.016260521
2-Jan
61.85
0.997580645
-0.002422286
1-Jan
60.1
0.97170574
-0.028702257
31-Dec
57.2
0.951747088
-0.049455943
28-Dec
54.43
0.951573427
-0.049638426
27-Dec
55.62
1.021862943
0.021627376
26-Dec
53.75
0.966379
-0.034199182
24-Dec
52.92
0.98455814
-0.015562328
20-Dec
10
50.6
0.956160242
-0.044829763
19-Dec
11
51.63
1.020355731
0.020151323
18-Dec
12
49.18
0.952546969
-0.048615862
13
46.83
0.952216348
-0.048963014
14-Dec
14
44.6
0.952380952
-0.048790164
13-Dec
15
43.43
0.973766816
-0.026583412
-0.020538699
STD DEV OF DAILY RETURN
0.030261943
STD DEV OF DAILY RETURN(%)
3.026194266
252
DAYS A YEAR
SQRT OF 252
15.87450787
0.480393447
SQRT OF 2N
5.477225575
0.087707442
KANORIA
CHEMICALS
LTD (POST BI)
DATE
DAY
CL.PRICE
PRICE RELATIVE
DAILY RETURN
7-Jan
59.1
8-Jan
56.55
0.956852792
-0.044105722
9-Jan
53.8
0.951370469
-0.049851735
10-Jan
51.8
0.962825279
-0.037883318
11-Jan
49.25
0.950772201
-0.050480782
14-Jan
47.55
0.965482234
-0.035127579
15-Jan
49.65
1.044164038
0.043216601
16-Jan
48.25
0.971802618
-0.028602563
17-Jan
48.55
1.006217617
0.006198367
18-Jan
47.1
0.970133883
-0.030321194
10
44.75
0.950106157
-0.051181556
11
42.55
0.950837989
-0.05041159
23-Jan
12
40.5
0.951821387
-0.049377881
24-Jan
13
39
0.962962963
-0.037740328
25-Jan
14
37.45
0.96025641
-0.040554936
28-Jan
15
37.7
1.006675567
0.006653384
-0.029971389
0.027424681
2.742468092
252
DAYS A YEAR
SQRT OF 252
15.87450787
0.435353313
SQRT OF 2N
5.477225575
0.079484277
ASHIANA
HOUSING
LTD(B.I:29.10.07)
DATE
DAY
CL.PRICE(BSE)
PRICE RELATIVE
DAILY RETURN
29-Oct
138.05
26-Oct
132.26
0.958058674
-0.042846256
25-Oct
122.64
0.927264479
-0.075516448
24-Oct
123.92
1.010437052
0.010382962
23-Oct
105.98
0.85522918
-0.156385799
22-Oct
99.67
0.940460464
-0.061385668
19-Oct
87.24
0.875288452
-0.133201788
18-Oct
89.41
1.024873911
0.024569591
17-Oct
94.01
1.051448384
0.050168627
16-Oct
98.51
1.047867248
0.046756906
15-Oct
10
99.51
1.010151254
0.010100076
11
97.62
0.981006934
-0.019175751
12
99.5
1.019258349
0.019075254
10-Oct
13
85.1
0.855276382
-0.156330609
9-Oct
14
88.88
1.044418331
0.04346011
8-Oct
15
84.64
0.95229523
-0.048880177

STD DEV OF DAILY RET(%)
-0.032613931
0.071970436
7.19704358
252
DAYS A YEAR
SQRT OF 252
15.87450787
1.142495249
SQRT OF 2N
5.477225575
0.20859014
ASHIANA
HOUSING
LTD(POST
B.I)
DATE
DAY
CL.PRICE
PRICE RELATIVE
DAILY RETURN
29-Oct
138.05
30-Oct
146.04
1.057877581
0.056264618
31-Oct
140.68
0.963297727
-0.037392749
1-Nov
132.03
0.938512937
-0.063458638
2-Nov
140.91
1.067257441
0.065092219
5-Nov
139.07
0.98694202
-0.013143985
6-Nov
138.4
0.995182282
-0.00482936
7-Nov
129.37
0.934754335
-0.067471527
8-Nov
131.5
1.016464404
0.016330336
9-Nov
133.03
1.011634981
0.011567815
12-Nov
10
130.8
0.983236864
-0.016905228
13-Nov
11
126.6
0.967889908
-0.032636929
14-Nov
12
125.87
0.994233807
-0.005782881
15-Nov
13
122.56
0.973703027
-0.026648922
16-Nov
14
127.64
1.041449086
0.040613095
19-Nov
15
133.74
1.047790661
0.046683815
-0.002114555
0.041259807
4.125980719
252
DAYS A YEAR
SQRT OF 252
15.87450787
0.654979134
SQRT OF 2N
5.477225575
0.119582282
(5.3)ANALYSIS OF DATA:
In the above data, researcher have collected 15 days closing stock prices
prior the bonus issue & after the bonus issue.
Closing stock prices of few companies are quoted in Bombay stock
exchange & majority of them are quoted in National stock exchange. Rests
of the companies are not quoted in any of the stock exchanges.
Regarding the items mentioned in the table, we have Price relative, Daily
return, Volatility of stock P.A, STD error of estimate etc.
Price relative= 2nd day closing price/1st day closing price
Daily return= LN of Price relative
Volatility of stock per annum= STD dev of Daily return * SQRT of 252
SQRT of 2n= 2*15days
STD error of estimate= Volatility of stock per annum/SQRT of 2n
Mean= Average (closing stock prices)
The table mentioned below shows, the statistics for applying
T-test.
STATISTICS FOR APPLYING TTEST

MEAN VALUE(PRE
BONUS)
-0.011314037
MEAN VALUE(POST
BONUS)
0.005520538
SOFTWARE
-0.002459741
-0.00091684
SAH PETROLEUMS
PETROLEUM
0.006766445
-0.006709568
PARENTERAL
DRUGS
PHARMACEUTICAL
-0.016986894
-0.009665201
USHDEV INTERNAT
TRADING
-0.020669326
0.001336301
NMDC
DEVELOPMENT
-0.013576591
0.003032207
ELECON ENGG
ENGINEERING
-0.006481889
0.018325034
AXON INFOTECH
I.T
-0.008043803
-0.001850235
ASHIANA HOUSING
CONSTRUCTION
-0.032613931
-0.002114555
KANORIA
CHEMICALS
CHLORIDE-ALKALI
-0.020538699
-0.029971389
RAJESH EXPORTS
DIAMOND CUTTING
0.00182221
-0.003740648
WALCHANDNAGAR
INDUSTRIES
ENGINEERING
0.017313255
-0.003543917
PARLE SOFTWARE
COMPUTER SOFTWARE
-0.002903639
-0.001897979
MAHALAXMI
RUBTECH
RUBBER PRODUCTS
-0.013603418
0.005575387
CRANES
SOFTWARE
SOFTWARE
0.003717595
-0.002286906
COMPANY
TATA STEEL
NATURE
MANUFACTURING
SIEMENS
MEAN(PRE BONUS) = X
MEAN(POST BONUS)= Y
CONDUCTING T-TEST FOR TWO INDEPENDENT

SAMPLES:
y
-0.011314037
0.005520538
-0.002459741
-0.00091684
0.006766445
-0.006709568
-0.016986894
-0.009665201
-0.020669326
0.001336301
-0.013576591
0.003032207
-0.006481889
0.018325034
-0.008043803
-0.001850235
-0.032613931
-0.002114555
-0.020538699
-0.029971389
0.00182221
-0.003740648
0.017313255
-0.003543917
-0.002903639
-0.001897979
-0.013603418
0.005575387
0.003717595
-0.002286906
t-Test: Two-Sample Assuming Equal Variances
Variable 1
Mean
Variance
Observations
Pooled Variance
Hypothesized Mean Difference
df
t Stat
Variable 2
-0.007971498
-0.001927185
0.000159241
0.000102391
15
15
0.000130816
0
28
-1.447262696
P(T<=t) one-tail
0.079463795
t Critical one-tail
1.701130259
P(T<=t) two-tail
0.15892759
t Critical two-tail
2.048409442
From the above table,

No of observations came to 15
Through excel application, Pooled variance=Variance1+Variance2/2.
We considered Hypothesis mean difference as 0
Degree of freedom= (n1-1) + (n2-1)
Since our intention, is to find whether there is a change in stock returns
following the bonus issue, we considered as two-tailed test.
Finally t-stat= -1.44726
STATISTICAL EQUATION
T-test= [(sample mean 1-sample mean 2)-(mean of population 1Mean of population 2)]/
Square root [Sp^2(1/n1+1/n2)]
Sp^2= [ (n1-1)S1^2+ (n2-1)S2^2]/[ (n1-1)+(n2-1)]
Since, there are two independent samples with zero mean population &
pooled variance estimate, the above equation is appropriate. The variables
are less than 30 of each independent sample.
With small sample sizes, normally distributed populations, & the assumption
of equal population variances, the t-test is appropriate:
Sp^2 is associated with the pooled variance estimate.
CALCULATION OF T-STAT FROM THE ABOVE STATISTICAL

EQUATION:
From the above data, regarding Mean, Std deviation, pooled variance we
came to know that;
Sample mean 1= -0.007971498
Sample mean 2= -0.001927185
Mean population 1= 0
Mean population 2= 0
S1^2= 0.000159241 & n1=15
S2^2= 0.000102391 & n2=15
Pooled variance estimate= 0.0001308
From the above calculations, we can verify that t-stat= -1.44739.
Therefore, from the above we can conclude that t-stat through excel
application & through manual calculation it came to,
-1.44739
I.e. t= [-0.007971498+ 0.001927185]-(0-0)/

Square root [0.0001308(2/15)]
Sp^2= [14(0.00015924) + 14(0.000102391)]/28

= 0.002229 + 0.001433/28
= 0.0001308
T-stat= -1.44739
RESEARCH FINDINGS
Null hypothesis:
Ho: There is no change in the stock returns following the bonus issue for the
companies like NMDC where there is no change in the stock returns 3 days after the
bonus issue & Walchandnagar Industries 2 days after the bonus issue
Ha: There is a change in the stock returns following the bonus issue for the rest of the
13 companies.
Statistical test:
The t-test is chosen because the samples are independent, normally distributed
populations & the assumption of equal population variances
Significance Level:
Level of significance is at 5% (two-tailed test)
Calculated value:
As, t-stat is equal to -1.44739
Critical test value:

With degrees of freedom is 28, level of significance at 0.05, two-tailed test, the
critical test value came to 2.048
Interpretation:
Since the calculated value is lesser than critical value
I.e -1.44739<2.048, null hypothesis has to be accepted
Where in there is no change in the stock returns following the bonus issue.
CHAPTER 6
SUMMARY & CONCLUSION
(6.1) CONCLUSION FROM THE STUDY
To conclude, the investors should invest in the stock markets considering the various
factors of volatility & beta. If they consider this one they will not loose heavily. There is
no uniformity in the stock prices before the bonus issue & after the bonus issue. This may
be due to the inflation & interest factors. When there is no uniformity, there will be
drastic changes in each & every aspects. If this is the case it will be a confusing state for
the investors whether to invest in particular stock or not.
6.2 Implications
The findings what the researcher has made is, if there is an increase in STD deviation
there is an increase in volatility returns before the bonus issue & after the bonus issue.
This has happened in the companies like TATA STEEL, SIEMENS, SAH
PETROLEUMS, and NMDC etc
6.3
RECOMMENDATIONS
The emphasis is to be given from investors point of view where in before investing there
money, they should consider the volatility factor, the beta factor which has been loaded in
high tech stocks, so that they will not loose their net worth.
Volatility refers, many price swings in the short run, to tackle this volatility, is by
investing on a regular basis through systematic investment plans, means making periodic
investments of the same amount of money in an equity fund, regardless of whether the
stock market is declining or ascending. SIP can protect in a volatile market.
Apart from this, the investors have not considered the other volatility factors & beta
factors which in-turn is more important from the investment point of view.
It is better for the investors to invest in systematic investment plans by considering the
other factors of volatility.
BIBLIOGRAPHY
Barua,S.K., V.Raghunathan, & J.R. Varma, Portfolio management, Tata McGraw

Hill,
Prasanna Chandra, Investment analysis & portfolio management,
V.K. Bhalla , Investment Management
I.M. Pandey, Financial Management
Damodaran, Aswath, Investment valuation
WEB-LINKS
www.moneycontrol.com
www.sharekhan.com
www.capitaline.com
www.bseindia.com
www.nse-india.com
APPENDIX
TATA IRON & STEEL:(MANUFACTURING SECTOR)
They issued bonus shares as on 22-7-04 in the ratio of 1:2. This is subject to the
approval of shareholders.
SIEMENS LTD:(SOFTWARE COMPANY)

They issued bonus shares in the ratio of 1:1 as on 23-11-07. It traded down 4.41%
(BSE) traded at Rs.1,600 in afternoon trade.
SAH PETROLEUMS MUMBAI:(PETROLEUM INDUSTRY)

The bonus shares were Rs.5 each. The AGM also gave its nod to increase the
authorized share capital of the company from Rs.11 cr to Rs.16 cr for issuing bonus
shares.
PARENTERAL DRUGS LTD:(PHARMACEUTICAL CO)

They issued bonus shares as on 4-9-07 in the ratio of 1:1.
USHDEV INTERNATIONAL:(TRADING CO)

NATIONAL MINERAL DEVELOPMENT CORPORATION

LTD:(DEVELOPMENT SECTOR)
ELECON ENGINEERING LTD :( ENGG SECTOR)

AXON INFOTECH LTD(IT SECTOR):

ASHIANA HOUSING(CONSTRUCTION CO):

They issued 5 new shares of A.H. LTD for every 2 shares held as on 29-10-07.
KANORIA CHEMICALS & INDUSTRIES LTD(CHLORIDE

ALKALI):
They issued 1 equity share for every 2 shares held as on 7-1-08. The face value of
equity share got subdivided from Rs.10 to Rs.5.
RAJESH
EXPORTS
LTD(DIAMOND
CUTTING
&
JEWELLERY):
They issued 2 bonus shares for every 1 share held by the shareholders as on 23-10-07.
WALCHANDNAGAR INDUSTRIES LTD(ENGG CO)

They issued bonus shares in the ratio of 1:1 as on 26-11-07
These equity shares are subdivided into the face value of Rs.10 each into 5 equity
shares of Rs.2 each.
PARLE SOFTWARE LTD(COMPUTER SOFTWARE)

They issued bonus shares in the ratio of 3:1 as on 30-11-07(3 equity shares of Rs.10
each fully paid-up for every 1 share held).
MAHALAXMI
RUBTECH
LTD(MANUFACTURE
OF
RUBBER PRODUCTS):
They issued bonus shares in the ratio of 1:4 as on 24-11-06. The company at EGM
raised the borrowing limit of the company up to Rs.50 crores.
CRANES SOFTWARE INTERNATIONAL LTD(S/W CO):

They issued bonus shares in the ratio of 1:1 as on 28-9-05 & issued 12 lakh equity
shares on preferential basis. The AGM decided to split equity shares of Rs.10 each
into 5 shares of Rs.2 each, the company informed the BSE. The AGM also approved
the dividend of Rs.5 per share including regular div of Rs.2 per share & special div of
Rs.3 per share.

Sandeep S

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A PROJECT REPORT ON

IMPACT OF BONUS ISSUE ON STOCK

Under the guidance of

The work has been satisfactory & is recommended for

(Prof. Praveen Bhagwan)

I express my sincere gratitude to Dr.Nagesh Malavalli Principal, MPBIM in getting an

I would express sincere thanks & gratitude to my dissertation guide

As my dissertation is mainly done on applying through testing basis, I am thankful to

ANALYSIS OF DATA & 19-59

Table showing calculation 20-50

Conducting t-test for two

Bonus issue includes an offer of free additional shares to existing shareholders. A

CONCEPTUAL FRAMEWORK ON BONUS ISSUE &

STOCK RETURNS VOLATILITY

STOCK RETURN VOLATILITY:

EFFECTS ON ISSUE OF BONUS SHARES:

i) Share capital is increased according to the bonus issue:

ii) Liquidity in the stock increases:

iii) Effective EPS, B.V per share values stand reduced:

iv) Market Price is adjusted on issue of bonus shares.

v) Accumulated profits are reduced:

2.2) STATEMENT OF THE PROBLEM:

2.3) SIGNIFICANCE OF THE STUDY:

2.4) RESEARCH OBJECTIVES:

iii) To investigate the impact of bonus issue on stock returns volatility

3.1.1) PREVIEW OF THE PREVIOUS STUDIES:

3.2) METHODOLOGY FOLLOWED:

BENEFITS DERIVED IN THE LITERATURE REVIEW:

SIEMENS LTD: (SOFTWARE COMPANY)

SAH PETROLEUMS MUMBAI: (PETROLEUM INDUSTRY)

PARENTERAL DRUGS LTD: (PHARMACEUTICAL CO)

USHDEV INTERNATIONAL: (TRADING CO)

NATIONAL MINERAL DEVELOPMENT CORPORATION

ELECON ENGINEERING LTD :( ENGG SECTOR)

AXON INFOTECH LTD (IT SECTOR):

ASHIANA HOUSING (CONSTRUCTION CO):

KANORIA CHEMICALS & INDUSTRIES LTD (CHLORIDE

WALCHANDNAGAR INDUSTRIES LTD (ENGG CO)

They issued bonus shares in the ratio of 1:1 as on 26-11-07

PARLE SOFTWARE LTD(COMPUTER SOFTWARE)

CRANES SOFTWARE INTERNATIONAL LTD(S/W CO):

NAME OF THE COMPANY:TATA

MEAN OF DAILY RETURN

STD DEVIATION OF DAILY RETURN

STD DEV OF DAILY RET IN %

ASSUME THERE ARE 252 TRADIND

STD ERROR OF THE ESTIMATE

POST BONUS ISSUE (AFTER 22-7-04)

STD DEV OF THE DAILY RETURN

MEAN OF THE DAILY RETURN

STD DEV OF THE DAILY RETURN(%)

ASSUMING THERE ARE 252 TRADING

STD ERROR OF ESTIMATE

MEAN OF THE DAILY RETURN

STD DEV OF THE DAILY RETURN

STD DEV OF DAILY RETURN (%)

ASSUME THAT THERE ARE 252

VOLATILITY OF THE STOCK P.A

STD ERROR OF ESTIMATE

MEAN OF STOCK RETURN

STD DEV OF DAILY STOCK RETURN

STD DEV OF STOCK RETURN(%)

ASSUME THAT THERE ARE 252