A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

CHAPTER 1
INTRODUCTION

1.1 INTRODUCTION: -
BOMBAY STOCK EXCHANGE:
India's largest and oldest stock exchange, the Bombay Stock Exchange (BSE), often known
simply as the stock exchange in Mumbai, is located on Dalal Street and was established in
1875. With over 6,000 listed companies and a market capitalization of $2.5 trillion, it ranks
among the top 10 exchanges worldwide by total market value. The BSE plays a vital role in
the Indian financial system by providing investors with access to liquidity through the listing
and trading of various assets, including bonds, stocks, and derivatives.

The BSE places a strong emphasis on investor safety while adhering to the fair and transparent
trading standards set by the Securities and Exchange Board of India (SEBI). Recognized
globally for its benchmark index, the SENSEX, the BSE is closely monitored by analysts and
investors as an indicator of economic trends.

Its worldwide recognition is strengthened by several agreements with global exchanges that
facilitate cross-border investment and cooperation. Furthermore, the BSE provides a dedicated
venue for small and medium-sized firms (SMEs) to raise funds and become listed. This
initiative promotes the growth and development of small enterprises by giving them access to
financial markets. Overall, the BSE is an important player in the Indian financial landscape,
providing a stable and dependable venue for trade and investment. Its worldwide recognition
is strengthened by some agreements with global exchanges that facilitate cross-border
investment and cooperation.

In appreciation of its work, technological advancements, and contributions to the financial

industry, the BSE has won various honors and accolades. Its devotion to leadership in the stock
exchange sector and to excellence is demonstrated by these honors. With its substantial
contributions to the expansion and development of India’s capital markets, the Bombay Stock
Exchange continues to play a crucial role in the nation’s financial system.

Department of Studies in Management GMIT. Davanagere. Page |1

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

1.2 HISTORY OF BSE

In 1875, Prem Chand Roy Chand established the Bombay Stock Exchange, now widely
recognized as synonymous with Dalal Street. However, its origins trace back to the 1850s,
when four Gujarati brokers and one Parsi stockholder gathered under a banyan tree in front of
the Bombay (now Mumbai) town hall, where Horniman Circle is located today. A decade later,
they moved beneath the banyan trees at the intersection of Meadows Street and Esplanade
Road, now known as Mahatma Gandhi Road. As the number of brokers rapidly increased, they
had to relocate multiple times until, in 1874, they finally secured a permanent venue.

On March 12, 1993, a vehicle bomb detonated in the basement of the BSE during the Bombay
bombings. In September 2012, the BSE became a Partner Exchange of the United Nations
Sustainable Stock Exchange. On December 30, 2016, it launched India INX, India's first
international exchange. Additionally, in October 2018, the BSE became the first stock
exchange in the country to introduce commodity derivatives contracts for gold and silver. The
exchange was demutualized and corporatized on May 19, 2007, under the BSE
(Corporatisation and Demutualization) Scheme, 2005, as mandated by SEBI, and it was listed
on the NSE on February 3, 2017.

Thus, the BSE remains a vital symbol of India’s financial history, encompassing moments of
scandal, tragedy, and achievement. It stands as an important institution in both India’s and the
global stock exchange landscape.

1.3 ADVANTAGES OF THE BOMBAY STOCK EXCHANGE: -

• The BSE provides a venue for investors to invest in different securities and firms
seeking to raise funds.
• It makes price discovery easier, increases liquidity, and promotes fair and efficient
markets.
• The BSE promotes economic growth by directing capital into firms.
• It promotes good corporate governance standards.
• The exchange offers investor education and risk management resources.
• The BSE has an Investor Protection Fund to compensate investors if the broker defaults.
This fund enhances the confidence of retail investors by providing financial security
against unforeseen events.

Department of Studies in Management GMIT. Davanagere. Page |2

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

1.4 PRODUCT/SERVICES: -

▪ Equities
▪ Debt Instruments
▪ Derivatives
▪ Mutual Funds
▪ Currency Derivatives
▪ Commodity
▪ SLBS (security lending and borrowing scheme)

1.5 COMPETITORS: -

• London Stock Exchange

• Hong Kong Exchange
• National Stock Exchange
• Philippine Stock Exchange
• Jamaica Stock Exchange
• Nigerian Stock Exchange
• New York Stock Exchange

1.6 FUTURE GROWTH AND PROSPECTS: -

➢ The BSE's performance is strongly tied to India's economic growth. As India emerges
as one of the world's leading economies, the BSE is poised to benefit from increased
domestic and international investment.
➢ To enhance its trading infrastructure, the BSE has invested in technology, introducing
new trading platforms, implementing blockchain solutions, and enhancing
cybersecurity measures.
➢ Growing financial literacy and internet access are drawing more retail investors to the
stock market, a trend expected to continue, further strengthening the BSE.
➢ Additionally, the BSE is actively working to attract foreign companies for cross-border
listings.

Department of Studies in Management GMIT. Davanagere. Page |3

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

1.7 BANKING STOCKS UNDER BOMBAY STOCK EXCHANGE: -

INTRODUCTION: -

Banking stocks on the Bombay Stock Exchange (BSE) are primarily represented by the BSE
Bankex index, which monitors the performance of India’s leading banks, both public and
private. This index features some of the country’s largest and most actively traded banks,
including the State Bank of India (SBI), HDFC Bank, ICICI Bank, Axis Bank, and Kotak
Mahindra Bank. These institutions play a crucial role in the Indian economy and have a
significant influence on the financial sector. The BSE encompasses a diverse array of banking
stocks, featuring government-owned banks like SBI, Bank of Baroda, and Punjab National
Bank, alongside private sector banks such as HDFC Bank, ICICI Bank, and Axis Bank, which
are recognized for their robust retail and corporate banking services.

IMPORTANCE OF BANKING STOCKS IN BSE: -

Economic Indicator: The performance of banking equities is frequently regarded as a

barometer for the wider economy because banks are involved in practically every sector of the
economy through lending and financial services their stock performance reflects the overall
economic climate.

High Market Capitalization: Banking stocks are often among the BSE’s most valuable major
banks such as the State Bank of India (SBI), HDFC Bank, and ICICI Bank have significant
weight in key indices like the BSE Sensex. Their changes might have a substantial impact on
the market index.

Dividend Yield: Many Banking companies have good dividend yields, making them desirable
to income-oriented investors. This increases their significance in the BSE, as they contribute
to the overall return on investment for numerous market players.

Sectoral Leadership: The banking sector often plays a leading role in the economy,
influencing other market sectors. Its prominence highlights the significance of banking stocks
in the BSE, as shifts in the banking sector often signal broader market trends.

Regulatory Environment: The banking industry is highly regulated, and regulatory changes
can significantly affect bank stocks. The Reserve Bank of India (RBI) periodically adjusts
monetary policy, which directly influences bank profitability, thereby impacting stock prices
and, in turn, the BSE.

Department of Studies in Management GMIT. Davanagere. Page |4

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

1.8 LIST OF BANKING STOCKS IN BSE: -

Public Sector Banks: Private Sector Banks:

1 State Bank of India 1 HDFC Bank

2 Punjab National Bank (PNB) 2 ICICI Bank

3 Bank of Baroda 3 Kotak Mahindra Bank

4 Canara Bank 4 Axis Bank

5 Union bank of India 5 IndusInd Bank

6 Indian Bank 6 Yes Bank

7 Bank of India 7 Federal Bank

8 Central bank of India 8 RBL Bank

9 UCO Bank 9 IDFC First Bank

10 Bank of Maharashtra 10 City Union Bank

11 Punjab& Sindh Bank 11 South Indian Bank

12 Karur Vyasa Bank

Small Finance Banks:

1 AU Small Finance Bank

2 Ujjivan Small Finance Bank

3 Equites Small Finance Bank

Department of Studies in Management GMIT. Davanagere. Page |5

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

CHAPTER 2

CONCEPTUAL BACKGROUND AND LITERATURE REVIEW

2.1 The Conceptual Background of the study:

2.1.1 Banking Stock:

The term “banking stocks” refers to the equity shares of banks that are publicly traded on stock
markets. These stocks represent a significant segment of the financial industry and are
considered a key indicator of the overall health of the economy. As intermediaries that facilitate
investments and savings, provide credit and loans, and manage payment systems, banks play a
vital role in a nation's economic growth. Consequently, the performance of banking stocks is
influenced by various macroeconomic factors, including GDP growth, inflation, interest rates,
and regulatory changes.

Investors view banking stocks as both growth and value investments, depending on the
economic context and the characteristics of individual banks. During economic expansions,
demand for loans and financial services typically increases, enhancing a bank’s profitability
and, in turn, driving up its stock price. Conversely, banks may face challenges during economic
downturns.

2.1.2 BOMBAY STOCK EXCHANGE:

Based in Mumbai, India, The Bombay Stock Exchange (BSE) was established in 1875, making
it among the oldest stock exchanges globally. It is an integral part of the ecosystem of the
Indian capital market, offering a trading platform for a variety of financial assets such as bonds,
equities, mutual funds, derivatives, and more. Because it makes it easier for businesses to raise
finance for expansion and growth and because it gives investors access to the financial markets,
the BSE is essential to the Indian economy. The BSE operates under the regulatory framework
of the Securities and Exchange Board of India (SEBI), which ensures transparency, investor
protection, and the orderly functioning of the securities market. SEBI’s regulations cover
various aspects of the stock market, including listing requirements, trading rules, disclosure
norms, and corporate governance standards. The BSE adheres to these regulations to maintain
the integrity and efficiency of its trading platform, providing a secure and reliable environment
for market participants.

Department of Studies in Management GMIT. Davanagere. Page |6

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

2.2 LITERATURE REVIEW:

1. Dr. Richa Gupta (2023): This paper investigates the risk and return of banking stocks in
the Indian securities market, focusing on six components from the National Stock Exchange
(NSE) over five years (January 1, 2018, to December 31, 2023). The study analyzes daily
returns using MS Excel tools, such as averages and variance and explores the relationship
between the returns of selected stocks and the NIFTY 50 index.
2. Rahul Chauhan and Bharath Suther (2020): This study details the historical context of
private banking in India, tracing its evolution from the nationalization of 14 major banks in
1969. The research highlights the growth of private-sector banks following regulatory reforms
initiated by the Narasimha Committee, which encouraged broader access to the financial
system.
3. Ayushi Vijayvargiya (2020): This study examines the effects of merger and acquisition
announcements on the stock returns of acquiring banks listed on the NSE. The research utilizes
an event study methodology to analyze abnormal returns over three different event windows
surrounding merger announcements in 2019.
4. E Chuke Nwude (2020): This research focuses on defining and applying the concept of
return on investment (ROI) for entrepreneurs. It emphasizes the importance of ROI as a
measure of profitability and explores various methods for calculating it, highlighting the need
for businesses to reassess their investments based on profitability indicators.
5. Dr. G Praveen Kumar (2016): This study assesses the role of banks in India's economic
development and highlights the importance of risk and return analysis in stock market
investments. It emphasizes that investors seek to balance minimizing risk with maximizing
returns while exploring the interdependence of risk and return.
6. Dr. Promod Kumar Patjoshi (2016): This research examines the relationship between the
SENSEX and BSE 30 banking stocks in terms of risk and return, utilizing secondary data to
compare the risk-return trade-off of various stocks, including HDFC Bank, ICICI Bank, Axis
Bank, and SBI.
7. Dr. Kriti Jaynani and Dr. Rakhi Arora (2018): This paper discusses the volatility of the
Indian stock market and its implications for economic progress. It highlights the significance
of investment decisions in a globalized economy, particularly focusing on the fluctuations in
banking sector equities post-demonetization (2014-2018).

Department of Studies in Management GMIT. Davanagere. Page |7

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

8. Dr. Bhavya Vikas and Kavya Venkatesh (2018): This study examines the
interconnectedness of risk and return in investment decisions, analyzing the performance of
nationalized banks listed on the NSE in terms of return, risk, and beta over the year 2017. It
distinguishes between risk (predictable outcomes) and uncertainty (unpredictable outcomes).
9. Dr. A. Jayanthi (2019): This research evaluates India’s banking system, noting its
regulatory strength and capital adequacy compared to other nations. It assesses the resilience
of Indian banks during global crises and emphasizes the correlation between risk and return in
securities investment, specifically analyzing the top six bank stocks based on their NIFTY
Bank Index weightage.
10. Suresh A S, Sai Prakash L (2018): This paper highlights the importance of risk-return
calculations in individual decision-making. It analyzes the performance of twelve national
banks listed on the NSE from January 1 to December 31, 2016, comparing public and private
sector bank performance based on return, risk, and beta.
11. Dr. M Kandola Rao and Dr. Anand J (2012): This study explores the role of stock
exchanges, particularly the BSE and NSE, in facilitating the trading of various financial
instruments. It discusses the historical significance of these exchanges and their impact on the
growth of the Indian economy.
12. Dr. Pramod Kumar Pandey and Saikumar (2013): This research analyzes the financial
performance of India’s largest commercial and public banks using metrics such as net profit,
assets, and return on equity. It compares financial data from 2015 to 2019, revealing that private
banks generally outperform public banks.
13. Dr. Charumathi B and Suraj (2014): This study proposes a framework for evaluating
bank stocks through various valuation models. It assesses the explanatory power of these
models within the Indian stock market by comparing the performance of 14 banks from the
BSE Bankex between 2000-01 and 2010-11.
14. Dr. Ahmad, R., & Raza, A. (2017): This article evaluates the financial performance of
Indian public sector banks using profitability ratios such as return on assets (ROA) and net
interest margin (NIM). It highlights the decline in profitability due to increasing non-
performing assets (NPAs) and competition from private banks, recommending improvements
in operational efficiency and asset quality for sustainable growth.
15. Rohit U J (2018): This study examines stock market trends and their appeal to investors in
India’s emerging economy, emphasizing the significant risks associated with investing in
banking shares while recognizing the banking sector's essential role in economic stability.

Department of Studies in Management GMIT. Davanagere. Page |8

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

16. George Joseph, Anjali Devi K R (2015): This research focuses on investment decision-
making in complex financial markets, discussing the inherent risks of investing in banking
stocks. It analyzes the performance of five major banking stocks over the previous five years
and highlights the trade-off between risk and return.
17. Pavan Kumar and Sunil Sharma (2021): This study analyzes the performance of
domestic banks from 2015 to 2018, addressing sector-wide challenges and projecting future
performance. It emphasizes the vital role banks play in channeling savings into productive
investments, which is crucial for economic growth.
18. Soumya Lohia (2011): This article examines the performance of Indian banks over the
past decade using the CAMLE framework. It compares the share price performance of Indian
banks with those in Hong Kong, Europe, and the US, finding that private banks generally
outperform public banks.
19. Dr. Shiv Prasad Yadav (2013): This research employs Data Envelopment Analysis (DEA)
to measure the efficiency of public sector banks and private sector banks over a one-year
period. It finds that the State Bank of India and its associates have lower inefficiency levels
compared to other nationalized banks.
20. M Muthu Kamu (2010): This study assesses the growth and resilience of India's banking
sector, examining the performance and volatility of banking equities. It uses the GARCH
family model to analyze daily price behaviour, affirming that Indian banks remain robust
during global economic downturns.

2.3 Research Gap:

The literature on Indian banking stocks highlights several gaps, including limited studies on
the impact of technological advancements like fintech and digital banking. Post-pandemic
effects on banking stocks are underexplored, and there is insufficient focus on ESG factors
influencing stock performance. Comparative analysis with global counterparts is outdated, and
recent regulatory reforms like Basel III and the IBC need more attention. Investor sentiment
and behavioural finance during market volatility remain largely unexplored. Additionally, there
is a need for a deeper analysis of public vs. private bank performance under evolving economic
conditions and market anomalies.

Department of Studies in Management GMIT. Davanagere. Page |9

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

CHAPTER 3
RESEARCH DESIGN

3.1 STATEMENT OF PROBLEM:

“A Study on Performance Evaluation of Selected Banking stocks with reference to Bombay

Stock Exchange”

Evaluating the performance and investment potential of selected Indian banking stocks based
on their returns, risk, and growth prospects in the current market environment. By analyzing
historical price data, volatility, and return metrics the study aims to evaluate how these stocks
perform relative to their risk profiles. Which can help investors make informed decisions on
whether to buy, hold, or sell these banking stocks.

3.2 NEED FOR THE STUDY:

This study equips investors with the tools to make informed decisions, manage risks, and seize
opportunities in the dynamic banking sector. It offers crucial insights for those looking to
optimize their portfolios and confidently navigate the complexities of the Indian stock market.
Understanding the performance of banking stocks is vital for investors, regulators, and
policymakers, as it aids in evaluating the sector's financial health, risk exposure, and market
dynamics. Analyzing the performance of banking stocks is key to anticipating market trends
and maintaining financial stability.

3.3 OBJECTIVES:

➢ To analyze the relationship between BSE BANKEX and Banking stocks

➢ To identify the return and risk of selected Indian banking stocks.
➢ To identify the most attractive banking stock for investment.

3.4 SCOPE OF THE STUDY:

This study focuses on the Indian capital market, specifically the banking sector. It will analyze
the performance of banking stocks over a 5-year period, considering both private and public
sector banks. The findings will offer valuable insights for investors, financial analysts, and
policymakers interested in understanding the performance dynamics of banking stocks. The

Department of Studies in Management GMIT. Davanagere. P a g e | 10

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

research will conform to ethical protocols, guaranteeing impartial evaluation and clear
communication of findings.

3.5 RESEARCH METHODOLOGY:

Research Design:

Research is the framework and plan for the study that guides the collection and analysis of data.
This study was conducted using an Analytical Research Technique. Analytical research
involves analyzing available data and information to provide a critical assessment.

Sample Selection:

In this project, 10 banking stocks have been selected from BSE Bankex for analysis. Here
mainly focused on the Random Sample for determining the evaluation of banking sector
performance in a particular period.

Data Collection:

Secondary data have been used for data analysis. Which is collected from the Bombay Stock
Exchange.
Statistical Measures:

1. Standard Deviation
2. Mean value
3. Correlation

Tools Used for Analysis

1. MS-Excel

3.6 LIMITATIONS OF THE STUDY:

➢ The study assumes that market and economic conditions remain steady throughout the
study period, which may not account for unexpected changes in economic policies,
geopolitical events, or market disruptions.
➢ The study may exclude non-quantifiable elements such as investor sentiment and
political stability, both of which can have a major impact on stock performance.

Department of Studies in Management GMIT. Davanagere. P a g e | 11

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

➢ While historical stock prices and financial data are often available, qualitative data such
as management strategies, internal decision-making processes, and risk profiles may
not be as accessible, making comprehensive evaluation difficult.

3.7 Chapter Scheme:

Chapter 1: Introduction
This chapter includes an introduction to the topic, an industry overview, and a company profile.
It also discusses the product and service offerings, operational areas, infrastructure facilities,
competitor analysis, future growth prospects.
Chapter 2: Conceptual Background and Literature Review
This chapter presents the theoretical foundation of the study along with a literature review that
identifies research gaps, including at least 20 relevant sources.
Chapter 3: Research Design
In this chapter, the statement of the problem, the necessity for the study, objectives, scope,
research methodology, hypotheses, and limitations are outlined. Additionally, the chapter
scheme is provided.
Chapter 4: Analysis and Interpretation
This chapter focuses on the analysis and interpretation of the collected data, featuring relevant
tables and graphs. It includes results obtained through various statistical tools.
Chapter 5: Findings, Conclusion, and Suggestions
This chapter summarizes the findings, draws conclusions, and offers suggestions or
recommendations.
Bibliography: This section lists books and articles according to APA style guidelines.

Department of Studies in Management GMIT. Davanagere. P a g e | 12

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

CHAPTER 4

DATA ANALYSIS AND INTERPRETATION

1 Axis Bank:

Year Return Risk

2019 6.67 14.31

2020 7.49 18.75
2021 4.41 6.23
2022 22.96 9.15
2023 24.97 5.38
Table 4.1: Showing Risk and Returns

AXIS BANK
30
Return and Risk

25
20
15
10
5
0
2018 2019 2020 2021 2022 2023 2024
Year

Return Risk

Graph 4.1 Showing the Returns and Risk of the Axis Bank

INTERPRETATION: The data show Axis stock performance has fluctuated over the last five
years. The stock returned somewhat (6.67% and 7.49%) in 2019 and 2020, with rather high-
risk levels of 14.31% and 18.75%, respectively. However, in 2021, the stock had a 4.41%
reduction in returns, as well as a huge drop in risk to 6.23%. From 2022 onward, performance
improved dramatically, with returns increasing to 22.96% and 24.97% in 2022 and 2023,
respectively, while risk was reduced to 9.15% and 5.38%. This implies a recent trend of
increasing returns while decreasing volatility, indicating improved performance and increased
stability.

Department of Studies in Management GMIT. Davanagere. P a g e | 13

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

Correlation Between Axis Bank and BSE BANKEX:

Year Correlation
2019 0.78
2020 1
2021 0.76
2022 0.8
2023 0.32

Table 4.2: Showing the Correlation

CORRELATION
1.2
1
Correlation

0.8
0.6
0.4
0.2
0
2018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5
Year

Graph 4.2: Showing the Relationship between AXIS and BSE BANKEX

INTERPRETATION: The correlation data shows the fluctuating link between Axis Bank's
shares and the Bankex benchmark over five years. In 2019 and 2020, the correlation was strong,
with values of 0.78 and 1, showing that Axis Bank's stock price closely matched the movements
of the broader banking industry. However, in 2021 and 2022, the correlation dropped somewhat
to 0.76 and 0.8, respectively, indicating that, while Axis Bank continued to move in tandem
with Bankex, there were some variances. The most significant change happened in 2023 when
the correlation fell substantially to 0.32. This shows a large divergence, with Axis Bank's stock
price moving more independently of the sector.

Department of Studies in Management GMIT. Davanagere. P a g e | 14

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

2 SBI Bank:

Year Return Risk

2019 19.36 11.1

2020 1.41 16.43

2021 58.11 16.4

2022 15.04 6.36

2023 17.5 7.27

Table 4.3: Showing the Returns and Risk

SBI BANK
70
60
50
Returns and Risk

40
30
20
10
0
2018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5

Year
Return Risk

Graph 4.3: Showing the Returns and Risk of the SBI Bank
INTERPRETATION: The data demonstrate the performance of SBI stock over five years,
with significant differences in returns and risk. In 2019, SBI delivered a great return of 19.36%
while posing a moderate risk of 11.11%. However, in 2020, returns fell sharply to just 1.41%,
while risk increased to 16.4%, indicating more volatility in the market. SBI performed
exceptionally well in 2021, returning 58.11%, although the risk remained excessive at 16.44%.
In 2022, performance steadied, with returns decreasing to 15.04% and risk falling to 6.36%,
indicating more stable growth. Returns in 2023 increased slightly to 17.5%, with a tolerable
risk of 7.27%, demonstrating consistent and better-balanced performance in previous years.

Department of Studies in Management GMIT. Davanagere. P a g e | 15

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

Correlation Between SBI Bank and BSE BANKEX:

Year Correlation
2019 0.98
2020 0.91
2021 0.87
2022 0.83
2023 0.88
Table 4.4: Showing the Correlation

CORRELATION
1

0.95
Correlation

0.9

0.85

0.8
2018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5
Year

Graph 4.4: Showing the relationship between SBI Bank and BSE BANKEX

INTERPRETATION: The correlation figures between SBI Bank and the Bankex benchmark
show a continuously good association over five years. In 2019, the correlation was
exceptionally strong (0.98), indicating that SBI Bank's stock price moved practically in
lockstep with the broader banking sector. Although the correlation declined marginally over
the next four years (to 0.91 in 2020, 0.87 in 2021, and 0.83 in 2022), SBI's shares remained
closely aligned with the sector. In 2023, the correlation improved slightly to 0.88,
demonstrating that, despite modest variances, SBI's stock performance has broadly tracked the
overall trends in the banking sector over the period.

Department of Studies in Management GMIT. Davanagere. P a g e | 16

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

3 ICICI Bank:

Year Return Risk

2019 41.45 7

2020 16.7 15.75

2021 35.55 7.72

2022 14.5 6.87

2023 18.93 3.9

Table 4.5: Showing the Risk and Returns

ICICI BANK
45
40
Returns and Risk

35
30
25
20
15
10
5
0
2018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5
Yerar

Return Risk

Graph 4.5: Showing Returns and Risk of ICICI Bank

INTERPRETATION: The data reflect the performance of ICICI stock over the last five years,
with excellent returns and different levels of risk. In 2019, ICICI delivered a strong return of
41.45% with a comparatively low risk of 7.0%, indicating a high-performing and stable time.
The return fell to 16.7% in 2020, with a minor decrease in risk to 5.75%, demonstrating
increased stability despite the lower return. The following year, 2021, saw a substantial return
of 35.55%, but risk jumped to 7.72%, indicating greater volatility. In 2022, returns fell to
14.5%, but risk remained relatively high at 6.87%. By 2023, ICICI's performance had
improved, with an 18.93% return and a significant drop in risk to 3.9%.

Department of Studies in Management GMIT. Davanagere. P a g e | 17

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

Correlation Between ICICI Bank and BSE BANKEX:

Year Correlation
2019 0.9
2020 0.97
2021 0.78
2022 0.92
2023 0.77
Table 4.6: Showing the Correlation

CORRELATION
1.2
1
Correlation

0.8
0.6
0.4
0.2
0
2018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5
Year

Graph 4.6: Showing the relationship between ICICI and BSE BANKEX

INTERPRETATION: The correlation data between ICICI Bank and the Bankex benchmark
show a strong yet fluctuating link throughout time. In 2019 and 2020, ICICI Bank's shares had
a high correlation of 0.9 and 0.97, respectively, indicating a close alignment with the broader
banking industry. The correlation then dropped to 0.78 by 2021, indicating a period of relative
divergence from the benchmark. This was followed by a rebound to 0.92 in 2022, indicating
renewed alignment with industry trends. In 2023, the correlation fell again to 0.77, indicating
a reduced but still significant link with the benchmark.

Department of Studies in Management GMIT. Davanagere. P a g e | 18

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

4 KOTAK Bank:

Year Return Risk

2019 32.09 7.14
2020 25.18 12.84
2021 6.63 5.95
2022 0.1 5.64
2023 11.27 5.3

Table 4.7: Showing the Risk and Returns

KOTAK BANK
35

30
Return and Risk

25

20

15

10

0
2018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5

Year
Return Risk

Graph 4.7: Showing the Returns and Risk of Kotak Bank

INTERPRETATION: The statistics represent Kotak Bank's stock performance from 2019 to
2023, taking into account both returns and risk (standard deviation). In 2019, the stock returned
32.09% with a modest risk of 7.14%, showing excellent performance. In 2020, the return fell
to 25.18%, while the risk rose to 12.84%, indicating more volatility that year. By 2021, the
return had declined dramatically to 6.67%, with a reduced risk of 5.95%, indicating greater
stability but slower development. In 2022, the return was nearly flat at 0.1%, with a further risk
reduction of 5.64%. In 2023, the stock recovered some pace, returning 11.27% and posing the
lowest risk of 5.3%, communicating greater performance with lower volatility.

Department of Studies in Management GMIT. Davanagere. P a g e | 19

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

Correlation Between KOTAK Bank and BSE BANKEX:

Year Correlation
2019 0.63
2020 0.92
2021 0.56
2022 0.72
2023 0.68
Table 4.8: Showing the Correlation

CORRELATION
1
0.9
0.8
0.7
Correlation

0.6
0.5
0.4
0.3
0.2
0.1
0
2018 2019 2020 2021 2022 2023 2024
Year

Graph 4.8: Showing the relationship between Kotak Bank and BSE BANKEX

INTERPRETATION: The relationship between Kotak Bank and the BSE Bankex changed
during the five years from 2019 to 2023. In 2019, the correlation was modest (0.63), indicating
a good alignment. This increased to 0.92 in 2020, indicating a substantial link presumably
caused by pandemic-induced market swings. However, it fell dramatically in 2021 to 0.56,
indicating that Kotak's stock traded more autonomously. The correlation increased to 0.72 in
2022, indicating a resumed, modest alignment. By 2023, the correlation had steadied at 0.68.
These variances show that, while Kotak Bank typically tracks the banking industry, it
occasionally deviates, most likely owing to special reasons influencing its stock performance.

Department of Studies in Management GMIT. Davanagere. P a g e | 20

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

5 HDFC Bank:

Year Return Risk

2019 -33.1 14.41
2020 25.26 12.93
2021 8 5.72
2022 10.22 4.6
2023 7.64 4.78

Table 4.9: Showing the Risk and Returns

HDFC BANK
30

20
Return and Risk

10

0
2018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5
-10

-20

-30

-40
Year
Return Risk

Graph 4.9: Showing the Returns and Risk of HDFC Bank

INTERPRETATION: The stock's performance statistics from 2019 to 2023 show a dramatic
shift in both return and risk. In 2019, the stock had a significant negative return of -33.4%,
paired by the greatest risk (14.41), indicating a volatile and underperforming year. In 2020, the
return increased substantially to 25.26%, while the risk fell to 12.93%, indicating a robust
rebound with lower volatility, potentially owing to good market circumstances. In 2021, the
return was moderate at 8%, with a large risk reduction to 5.72, indicating more stable but slower
growth. The trend toward lower risk persisted in 2022 (4.6) and 2023 (4.78), with continuous
positive returns of 10.22% and 7.64%, respectively.

Department of Studies in Management GMIT. Davanagere. P a g e | 21

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

Correlation between HDFC Bank and BSE BANKEX:

Year Correlation
2019 0.05
2020 0.96
2021 0.84
2022 0.8
2023 0.74
Table 4.10: Showing the Correlation

CORRELATION
1.2
1
Correlation

0.8
0.6
0.4
0.2
0
2018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5
Year

Graph 4.10: Showing the Relationship between HDFC Bank and BSE BANKEX

INTERPRETATION: The correlation data between HDFC Bank and BSE Bankex from 2019
to 2023 shows considerable variations in their connection. 2019 the correlation was extremely
low (0.05), showing essentially little congruence between Kotak Bank's shares and the larger
banking index. However, in 2020, the correlation increased to 0.96, indicating an almost perfect
alignment, most likely due to pandemic-related market factors that comparably affected the
banking industry. In 2021, the correlation remained strong at 0.84, indicating continuous
alignment but with significant divergence. This trend of somewhat declining correlation
persisted into 2022 (0.80) and 2023 (0.74), demonstrating that, while Kotak Bank continues to
track the banking industry broadly, its performance has begun to depart moderately from the
Bankex in recent years.

Department of Studies in Management GMIT. Davanagere. P a g e | 22

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

6 FEDERAL BANK:

Year Return Risk

2019 7.1 9.42
2020 -2.95 19.5
2021 17.89 8.69
2022 35.5 7.87

2023 16.13 4.96

Table 4.11: Showing the Risk and Returns

FEDERAL BANK
40
35
Returns and Risk

30
25
20
15
10
5
0
-52018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5
Year
Return Risk

Graph 4.11: Showing the Returns and Risk of FEDERAL BANK

INTERPRETATION: The stock's performance between 2019 and 2023 displays significant
variations in both return and risk. In 2019, it yielded a small 7.1% return with moderate risk
(9.42). In 2020, the return fell to -2.95%, while risk rose to 19.5, suggesting significant
volatility. A big recovery occurred in 2021, with a return of 17.89% and a lower risk (8.69).
The stock did extraordinarily well in 2022, returning 35.5% and reducing risk to 7.87. In 2023,
returns moderated to 16.13% as risk fell considerably to 4.96, indicating increased stability and
steady profits.

Department of Studies in Management GMIT. Davanagere. P a g e | 23

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

Correlation between FEDERAL BANK AND BSE:

Year Correlation
2019 1
2020 -1
2021 0.87
2022 0.72
2023 1

Table 4.12: Showing the Correlation

Correlation
1.5

1
Correlation

0.5

0
2018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5
-0.5

-1

-1.5
Year

Graph 4.12: Showing the Relationship between FEDERAL BANK AND BSE BANKEX

INTERPRETATION: The correlation data between Federal Bank and BSE Bankex from
2019 to 2023 reveals significant swings in alignment. In 2019, the correlation was perfect 1,
meaning that Federal Bank's shares traded in lockstep with the BSE Bankex. However, in 2020,
the correlation switched to -1, indicating an inverse association in which Federal Bank's stock
went in the opposite way as the index, most likely owing to specific variables influencing the
bank during the pandemic. In 2021, the correlation normalized to 0.87, indicating a significant
positive association, but not perfect. This favourable alignment deteriorated significantly in
2022, with a correlation coefficient of 0.72, indicating some divergence from the larger banking
industry.

Department of Studies in Management GMIT. Davanagere. P a g e | 24

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

7 IDFC FIRST BANK:

Year Return Risk

2019 4.29 9.38

2020 9.1 16.66

2021 12 13.53

2022 31.34 13.32

2023 46.81 9.37

Table 4.13: Showing the Risk and Returns

IDFC FIRST BANK

50
45
40
35
Return and Risk

30
25
20
15
10
5
0
2018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5

Year
Return Risk

Graph 4.13: Showing Returns and Risk of IDFC FIRST BANK

INTERPRETATION: The stock's performance from 2019 to 2023 exhibits a significant

rising trend in returns, with changing risk levels. In 2019, it returned 4.29% with a moderate
risk (9.38). In 2020, returns increased to 9.1%, while risk increased to 16.66, indicating
increased volatility. The stock continued to outperform in 2021, with a 12% return and a lower
risk (13.53). This upward trend intensified in 2022, with a 31.34% return and somewhat
reduced risk (13.32). In 2023, the company achieved its greatest return of 46.81% while risk
fell sharply to 9.37, demonstrating a fantastic mix of high returns and low volatility, exhibiting
outstanding performance and consistency.

Department of Studies in Management GMIT. Davanagere. P a g e | 25

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

Correlation between IDFC FIRST BANK AND BSE BANKEX:

Year Correlation
2019 1
2020 0.96
2021 0.65
2022 0.85
2023 0.44

Table 4.14: Showing the Correlation

Correlation
1.2

0.8
Correlation

0.6

0.4

0.2

0
2018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5
Year

Graph 4.14: Showing the Relationship between IDFC Bank and BSE BANKEX

INTERPRETATION: The correlation statistics between IDFC First Bank and the BSE
Bankex from 2019 to 2023 show a deteriorating association with time. In 2019, the correlation
was a perfect 1, meaning that IDFC First Bank's shares moved in lockstep with the overall
banking index. In 2020, the correlation remained extremely high at 0.96, indicating a strong
alignment, most likely due to the pandemic's overall market influence. However, by 2021, the
correlation had declined to 0.65, indicating a considerable deterioration in the connection. This
increased somewhat in 2022 to 0.85, showing restored alignment but still lower than in
previous years. By 2023, the correlation had decreased enormously to 0.44, indicating that
IDFC First Bank's stock began to trade more independently of the BSE Bankex.

Department of Studies in Management GMIT. Davanagere. P a g e | 26

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

8 BANK OF BARODA:

Year Return Risk

2019 -2.02 12.24
2020 -22.3 17.8
2021 27.97 13.15
2022 59.82 10.28
2023 35.98 9.05

Table 4.15: Showing the Risk and Returns

BANK OF BARODA
80

60
Return and Risk

40

20

0
2018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5
-20

-40
Year
Return Risk

Graph 4.15: Showing the Returns and Risk of Bank of Baroda

INTERPRETATION: The stock's performance between 2019 and 2023 highlights a

substantial transition from negative returns to robust growth, with changing risk levels. In 2019,
the stock had a tiny negative return of -2.02% and a moderate risk of 12.24. In 2020, the return
fell drastically to -22.3%, followed by a rise in risk (17.8), suggesting strong volatility and poor
performance during the pandemic. In 2021, the stock rallied substantially, returning 27.97%
while risk fell to 13.15. This increasing trend continued in 2022, with an excellent return of
59.82% and even lower risk (10.28). In 2023, the stock maintained its great performance with
a 35.98% return and even lower risk (9.05), Signalling more stability and continuing high
returns.

Department of Studies in Management GMIT. Davanagere. P a g e | 27

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

Correlation between BANK OF BARODA and BSE BANKEX

Year Correlation
2019 0.94
2020 0.81
2021 0.83
2022 0.8
2023 0.87

Table 4.16: Showing the Correlation

Correlation
0.95

0.9
Correlation

0.85

0.8

0.75
2018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5
Year

Graph 4.16: Showing the Relationship between BANK OF BARODA and BSE
BANKEX

INTERPRETATION: The correlation information between Bank of Baroda and the BSE
Bankex from 2019 to 2023 indicates a steady strong association with little changes. In 2019,
the correlation was strong at 0.94, showing that Bank of Baroda's shares traded in tandem with
the larger banking index. In 2020, the correlation fell to 0.81, showing a somewhat lower
alignment, presumably due to the pandemic's differing influence on various banks. In 2021, the
correlation remained at 0.83, indicating a strong and sustained association. This pattern
persisted until 2022, with a correlation of 0.80 showing a stable, but somewhat weaker,
alignment. By 2023, the correlation had grown to 0.87, indicating that Bank of Baroda's shares
continued to closely track the BSE Bankex.

Department of Studies in Management GMIT. Davanagere. P a g e | 28

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

9 INDUSIND BANK:

Year Return Risk

2019 5.56 10.08

2020 33.72 29.79

2021 12.26 11.48

2022 39.98 11.17

2023 40.56 5.84

Table 4.17: Showing the Risk and Returns

INDUSIND BANK
50
Return and Risk

40

30

20

10

0
2018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5

Year
Return Risk

Graph 4.17: Showing the Returns and Risk of INDUSIND BANK

INTERPRETATION: The stock's performance between 2019 and 2023 demonstrates

substantial returns with varied levels of risk. In 2019, the return was small, at 5.56%, with
moderate risk (10.08). In 2020, the return increased to 33.72%, but this was accompanied by a
considerable rise in risk (29.79), indicating severe volatility during the epidemic. In 2021, the
return moderated to 12.26%, but risk fell dramatically to 11.48, indicating a more consistent
performance. The stock fared incredibly well in 2022, returning 39.98% while maintaining a
comparatively low risk of 11.17. In 2023, the return peaked at 40.56%, with the lowest risk
(5.84) during the previous five years, showing significant returns with increased stability and
lower volatility.

Department of Studies in Management GMIT. Davanagere. P a g e | 29

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

Correlation between INDUSIND BANK and BSE BANKEX:

Year Correlation
2019 0.66
2020 0.77
2021 0.9
2022 0.64
2023 0.69
Table 4.18: Showing the Correlation

Correlation
1

0.8
Correlation

0.6

0.4

0.2

0
2018 2019 2020 2021 2022 2023 2024
Year

Graph 4.18: Showing the Relationship between INDUSIND BANK and BSE BANKEX

INTERPRETATION: The correlation data among IndusInd Bank and the BSE Bankex from
2019 to 2023 reveals a moderate to strong association with changes over time. In 2019, the
correlation coefficient was 0.66, showing a modest association between IndusInd Bank's stock
and the larger banking index. This grew to 0.77 in 2020, indicating a greater alignment, which
was most likely affected by pandemic-related market fluctuations. In 2021, the correlation
peaked at 0.90, indicating a high association as the bank's shares closely tracked the banking
industry. However, by 2022, the correlation had declined considerably to 0.64, indicating some
divergence between IndusInd Bank and the index. In 2023, the correlation increased slightly to
0.69, showing a moderate but improving association.

Department of Studies in Management GMIT. Davanagere. P a g e | 30

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

10 CANARA BANK:

Year Return Risk

2019 -3.3 12.8
2020 -22.3 18.81
2021 48.03 10.86
2022 36.25 13.39
2023 40.55 9.23

Table 4.19: Showing the Risk and Returns

CANARA BANK
60
50
40
Return and Risk

30
20
10
0
-102018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5
-20
-30
Year
Return Risk

Graph 4.19: Showing the Returns and Risk of CANARA BANK

INTERPRETATION: The stock's track from 2019 to 2023 indicates a robust rebound from
early losses to significant gains, but with variable risk levels. In 2019, the stock returned -3.3%
while carrying a moderate risk of 12.8%. In 2020, the return fell drastically to -22.3%, while
the risk increased to 18.81, indicating a challenging year with high volatility. The stock
recovered strongly in 2021, with a return of 48.03% and a decreased risk (10.86). This was
followed by sustained great performance in 2022, with a 36.25% return, although the risk
jumped to 13.39. In 2023, the stock maintained its speed, returning 40.55%, while risk fell
dramatically to 9.23, indicating better stability amid strong gains.

Department of Studies in Management GMIT. Davanagere. P a g e | 31

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

Correlation between CANARA BANK AND BSE BANKEX:

Year Correlation
2019 0.85
2020 0.79
2021 0.81
2022 0.91
2023 0.56
Table 4.20: Showing the Correlation

Correlation
1

0.8
Correlation

0.6

0.4

0.2

0
2018.5 2019 2019.5 2020 2020.5 2021 2021.5 2022 2022.5 2023 2023.5
Year

Graph 4.20: Showing the Relationship between CANARA BANK and BSE BANKEX

INTERPRETATION: The correlation statistics between Canara Bank and the BSE Bankex
from 2019 to 2023 show a typically strong association with minor variation. In 2019, the
correlation was high at 0.85, showing a close relationship between Canara Bank's shares and
the larger banking index. This fell slightly to 0.79 in 2020, revealing a still solid but somewhat
weaker alignment, most likely owing to pandemic-induced market fluctuations. In 2021, the
correlation increased to 0.81, signifying a significant link. This grew to 0.91 in 2022, reflecting
a very close connection that year. However, in 2023, the correlation declined to 0.56, showing
a significant divergence in Canara Bank's shares, which became less aligned with the BSE
Bankex.

Department of Studies in Management GMIT. Davanagere. P a g e | 32

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

CHAPTER 5
FINDINGS, SUGGESTIONS AND CONCLUSION
5.1 FINDINGS:
1. Over 5 years, Axis Bank showed rising returns from 6.67% in 2019 to 24.97% in 2023,
while risk steadily declined from 14.31% to 5.38%. Correlation with BSE Bankex
dropped from 1 (2020) to 0.32 (2023).
2. SBI’s returns fluctuated, peaking at 58.11% in 2021 and stabilizing at 17.5% in 2023,
with risk declining to 7.27%. Its correlation with BSE Bankex remained strong,
averaging 0.89.
3. ICICI's returns ranged from 14.5% to 41.45%, with a significant drop in risk to 3.9% in
2023. Its correlation with BSE Bankex stayed moderate, peaking at 0.97 in 2020.
4. Kotak's performance fell from a high of 32.09% in 2019 to a low of 0.1% in 2022, but
recovered to 11.27% in 2023 with a stable risk of 5.3%. Correlation fluctuated, reaching
0.92 in 2020.
5. HDFC’s returns rose after a -33.1% loss in 2019 to 7.64% in 2023, with risk falling from
14.41% to 4.78%. Correlation with BSE Bankex varied, peaking at 0.96 in 2020.
6. Federal Bank’s returns reached 35.5% in 2022, with risk dropping to 4.96% in 2023. Its
correlation with BSE Bankex fluctuated from -1 in 2020 to 1 in 2023.
7. IDFC's returns surged from 4.29% in 2019 to 46.81% in 2023, with risk declining from
16.66% to 9.37%. Correlation with BSE Bankex fell from 1 in 2019 to 0.44 in 2023.
8. Bank of Baroda’s returns recovered from -22.3% in 2020 to 35.98% in 2023, with risk
falling to 9.05%. Correlation with BSE Bankex remained strong, averaging 0.85.
9. IndusInd’s returns peaked at 40.56% in 2023, with risk decreasing to 5.84%. Correlation
with BSE Bankex remained moderate, fluctuating between 0.64 and 0.90. From 2019 to
2023,
10. Canara Bank's stock exhibited a strong recovery with notable gains, peaking at a
48.03% return in 2021, while experiencing fluctuating risk levels.

Department of Studies in Management GMIT. Davanagere. P a g e | 33

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

5.2 SUGGESTIONS:
1. Investors seeking high returns with lower risk should consider Axis, ICICI, and Federal
Bank due to their improving stability.
2. SBI and Bank of Baroda are attractive for balanced growth with moderate risk.
3. Kotak and HDFC may require cautious investment due to fluctuations and lower
correlations with the broader banking index.
4. IDFC First Bank offers high potential returns, but its weakening correlation suggests
careful monitoring of market dynamics.
5. Short-term investors could look into IndusInd Bank for potential gains from volatility,
though with careful exit strategies.
6. Long-term investors should prioritize ICICI Bank and Axis Bank for stable returns over
time, with lower risks.

5.3 CONCLUSION:

The analysis of key banking stocks including Axis Bank, SBI Bank, ICICI Bank, Kotak Bank,
HDFC Bank, Federal Bank, IDFC First Bank, Bank of Baroda, and IndusInd Bank reveals
varying degrees of performance, risk, and market correlation. Each bank exhibits unique
strengths and challenges that cater to different investor profiles.

Axis Bank and ICICI Bank stand out for their steady performance, offering attractive returns
with moderate risk, making them ideal for both long-term and conservative investors. SBI
Bank, despite its market dependence, shows potential for solid long-term returns, especially
for investors who can tolerate some market volatility.

Federal Bank is emerging as a strong contender with an improving risk-to-return ratio, making
it an attractive option for investors seeking growth in mid-tier banks. Bank of Baroda also
presents an appealing opportunity as a recovery stock with strong returns and declining risk,
ideal for value investors.

IndusInd Bank, while volatile, offers potential short-term gains for those willing to capitalize
on market movements. However, investors should approach this stock with a cautious, well-
timed exit strategy. Kotak Bank has underperformed relative to its peers, but its reduced risk
profile could appeal to risk-averse investors.

HDFC Bank and IDFC First Bank offer opportunities for investors interested in stocks that
may not follow traditional market trends. HDFC’s weakening correlation to the broader market

Department of Studies in Management GMIT. Davanagere. P a g e | 34

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

could indicate future divergence, while IDFC First's strong growth, despite the lower
correlation, suggests it may offer an upside in niche scenarios.

A mix of Axis, ICICI, and Federal Bank for diversified portfolios provides strong growth
potential with risk management. In conclusion, the banking sector continues to offer a wide
range of opportunities across risk appetites, with Axis, ICICI, and Federal Bank presenting the
most balanced prospects for steady growth. In contrast, IndusInd and SBI offer more volatile
but potentially higher short-term returns.

Department of Studies in Management GMIT. Davanagere. P a g e | 35

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

5.4 BIBLIOGRAPHY:

BOOKS:

• Bodie, Z., Kane, A., & Marcus, A. J. (2018). Investments (11th ed.). McGraw-Hill
Education.
• Damodaran, A. (2012). Investment valuation: Tools and techniques for determining the
value of any asset (3rd ed.). John Wiley & Sons.
• Hull, J. C. (2017). Options, futures, and other derivatives (10th ed.). Pearson.
• Koller, T., Goedhart, M., & Wessels, D. (2020). Valuation: Measuring and managing
the value of companies (7th ed.). John Wiley & Sons.
• Mishkin, F. S. (2018). The economics of money, banking, and financial markets (12th
ed.). Pearson.
• Saunders, A., & Cornett, M. M. (2014). Financial markets and institutions (7th ed.).
McGraw-Hill Education.

JOURNAL & ARTICLES:

• Damodaran, A. (2012). "Equity Risk Premiums (ERP): Determinants, Estimation and
Implications." Financial Markets, Institutions & Instruments, 21(2), 69-110.
• Fama, E. F., & French, K. R. (2015). "A Five-Factor Asset Pricing Model." Journal of
Financial Economics, 116(1), 1-22.
• Jensen, M. C. (1968). "The Performance of Mutual Funds in the Period 1945-1964."
Journal of Finance, 23(2), 389-416.
• Roll, R. (1977). "A Critique of the Asset Pricing Theory’s Tests Part I: On Past and
Potential Testability of the Theory." Journal of Financial Economics, 4(2), 129-176.
• Sharpe, W. F. (1966). "Mutual Fund Performance." Journal of Business, 39(1), 119-
138.
• Asness, C. S., Frazzini, A., & Pedersen, L. H. (2019). "Quality Minus Junk." Review of
Accounting Studies, 24(1), 34-112.
• Bekaert, G., Harvey, C. R., & Lundblad, C. (2005). "Does Financial Liberalization
Spur Growth?" Journal of Financial Economics, 77(1), 3-55.
• Kothari, S. P., & Warner, J. B. (2001). "Evaluating Mutual Fund Performance."
Journal of Finance, 56(5), 1985-2010.

Department of Studies in Management GMIT. Davanagere. P a g e | 36

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

• Barber, B. M., & Odean, T. (2000). "Trading Is Hazardous to Your Wealth: The
Common Stock Investment Performance of Individual Investors." Journal of Finance,
55(2), 773-806.
• Merton, R. C. (1973). "Theory of Rational Option Pricing." The Bell Journal of
Economics and Management Science, 4(1), 141-183.

WEBSITES:
➢ Investopedia
[https://www.investopedia.com] (https://www.investopedia.com)
➢ Morningstar
[https://www.morningstar.com] (https://www.morningstar.com)
➢ Yahoo Finance
[https://finance.yahoo.com] (https://finance.yahoo.com)
➢ Seeking Alpha
[https://www.seekingalpha.com] (https://www.seekingalpha.com)
➢ The Motley Fool
[https://www.fool.com] (https://www.fool.com)

Department of Studies in Management GMIT. Davanagere. P a g e | 37

A Study on Performance Evaluation of Selected Banking Stocks with reference to BSE

Department of Studies in Management GMIT. Davanagere. P a g e | 38