Fundamental analysis on select cement companies

An investment is a commitment of the funds made in the expectation of some positive rate of return. It is the employment of funds on assets with the aim of earning income or capital appreciation. An investment in knowledge pays the best interest. Fundamental analysis is an approach to identify the under priced and over priced securities in the market. An investor or the speculator while doing the investment he need not to take into consideration of information from technical analysis itself but also he need to evaluate it by using E-I-C analysis also which helps him not to come across losses and also to gain in-depth information about his investment companies and also greater returns. Fundamental analysis tries to predict a stock's intrinsic or ‘fundamental ’value, and looks for opportunities where the current price deviates from the calculated intrinsic price. Efficient investment involves the use of both fundamental analysis and technical analysis. The present study aims at carrying out the Fundamental analyses of two leading companies of Cement sector and estimating their intrinsic value to assist investment decisions. The cement industry is one of the core industries in India and is optimistic of posting good sales in the coming years. So, the investment in the shares and securities of KCP cements and Birla cements companies seems to be profitable. The study is done using secondary data collected from Reserve Bank of India website, BSE website and Company Annual Reports for the period of last five years from year 2010 to 2015. This study develops a decision support system for a fundamental analysis-based stock market forecasting to select optimal stocks from the stock market and predict their future price trends to provide a reference for investor decisions. This paper seeks to clarify the need to make a proper fundamental analysis when investing in various securities in Cement sectors.