CKPIM Business Review

07

Authors: Dr. Jaydip Chaudhari and V. R. Ilango

Oil and gas is a major part of the energy sector, which, in turn, is essential for the growth of the manufacturing, utilities, infrastructure and commercial services industries. India is also rising as a potential refining hub because the capital costs are lowered by 25% –50% compared to other Asian countries. The present study identified that profitability and financial strength of Oil and Gas industry of India by taking private and Public Sector Company. The samples were taken from the both sector and company selected like, ONGC, BPCL, HPCL, IOCL, RIL, EOL and OIL. The data period was financial year 2006 to 2010, the ratio calculated from the balance sheet, ratios like, gross profit margin, net profit margin, total asset turnover ratio, return on total assets ratio and return on capital employed. From the study it can be said that ONGC and RIL are the most profitable and have better financial strength as compared to other company, these two companies’ have consistent performance as the profitability and return on capital employed.

11

Authors: V. R. Ilango

This paper examines the effect of oil prices movements on the stock price of Oil and Gas companies in National Stock Exchange. Using daily data; the dynamic interaction between Oil and Gas sector price and CNX nifty is investigated. The results suggest that there exists significant relationship between oil price and stock exchange indeed with high level of volatility. Through the unit root analysis researcher can suggested that series is stationary at 2nd difference so it can be identified that the trend predicted after two working days.

21

Authors: Dr. Keyur M Nayak

The study aimed to analyze the comparison between cash market and derivatives. The study also attempts to provide the insight on the hedging tools in the hands of Indian investors. The cash market is a commodities or securities market in which goods are sold for cash and delivered immediately. Contracts bought and sold on these markets are immediately effective. Cash markets can operate wherever the infrastructure exists to conduct the transaction. The spot market for most securities exists primarily on the Internet. Derivatives are the most dynamic, complex and multifaceted products in the modern financial management. They offer risk transfer facility for hedgers, give leverage to do more turnover for speculators, help the market players to cash the arbitrage opportunities between cash and Future and Options, among future and options segment. It is a product whose value is derived from the value of one or more basic variables, called bases (underlying asset, index, or reference rate), in a contractual manner. The underlying asset can be equity, forex, commodity or any other asset. The price of this derivative is driven by the spot price of the “underlying”. The research methodology to be followed is the Descriptive study and Exploratory Study. The data used in this is both primary and secondary type. The method of primary data collection is with the help of a Structured Questionnaire.