CEAT Limited Research Report

## Summary

Prediction of future movement of stock prices has been a subject matter of many research work. There is a gamut of literature of technical analysis of stock prices where the objective is to identify patterns in stock price movements and derive profit from it. Improving the prediction accuracy remains the single most challenge in this area of research. We propose a hybrid approach for stock price movement prediction using machine learning, deep learning, and natural language processing. We evaluate CEAT Limited prediction models with Modular Neural Network (Speculative Sentiment Analysis) and Stepwise Regression1,2,3,4 and conclude that the NSE CEATLTD stock is predictable in the short/long term. According to price forecasts for (n+16 weeks) period: The dominant strategy among neural network is to Hold NSE CEATLTD stock.

## Key Points

1. Probability Distribution
2. What is the use of Markov decision process?
3. Game Theory

## NSE CEATLTD Target Price Prediction Modeling Methodology

We consider CEAT Limited Stock Decision Process with Modular Neural Network (Speculative Sentiment Analysis) where A is the set of discrete actions of NSE CEATLTD stock holders, F is the set of discrete states, P : S × F × S → R is the transition probability distribution, R : S × F → R is the reaction function, and γ ∈ [0, 1] is a move factor for expectation.1,2,3,4

F(Stepwise Regression)5,6,7= $\begin{array}{cccc}{p}_{a1}& {p}_{a2}& \dots & {p}_{1n}\\ & ⋮\\ {p}_{j1}& {p}_{j2}& \dots & {p}_{jn}\\ & ⋮\\ {p}_{k1}& {p}_{k2}& \dots & {p}_{kn}\\ & ⋮\\ {p}_{n1}& {p}_{n2}& \dots & {p}_{nn}\end{array}$ X R(Modular Neural Network (Speculative Sentiment Analysis)) X S(n):→ (n+16 weeks) $∑ i = 1 n s i$

n:Time series to forecast

p:Price signals of NSE CEATLTD stock

j:Nash equilibria (Neural Network)

k:Dominated move

a:Best response for target price

For further technical information as per how our model work we invite you to visit the article below:

How do AC Investment Research machine learning (predictive) algorithms actually work?

## NSE CEATLTD Stock Forecast (Buy or Sell) for (n+16 weeks)

Sample Set: Neural Network
Stock/Index: NSE CEATLTD CEAT Limited
Time series to forecast n: 20 Nov 2022 for (n+16 weeks)

According to price forecasts for (n+16 weeks) period: The dominant strategy among neural network is to Hold NSE CEATLTD stock.

X axis: *Likelihood% (The higher the percentage value, the more likely the event will occur.)

Y axis: *Potential Impact% (The higher the percentage value, the more likely the price will deviate.)

Z axis (Yellow to Green): *Technical Analysis%

## Adjusted IFRS* Prediction Methods for CEAT Limited

1. An entity shall apply the amendments to IFRS 9 made by IFRS 17 as amended in June 2020 retrospectively in accordance with IAS 8, except as specified in paragraphs 7.2.37–7.2.42.
2. For purchased or originated credit-impaired financial assets, expected credit losses shall be discounted using the credit-adjusted effective interest rate determined at initial recognition.
3. The requirements in paragraphs 6.8.4–6.8.8 may cease to apply at different times. Therefore, in applying paragraph 6.9.1, an entity may be required to amend the formal designation of its hedging relationships at different times, or may be required to amend the formal designation of a hedging relationship more than once. When, and only when, such a change is made to the hedge designation, an entity shall apply paragraphs 6.9.7–6.9.12 as applicable. An entity also shall apply paragraph 6.5.8 (for a fair value hedge) or paragraph 6.5.11 (for a cash flow hedge) to account for any changes in the fair value of the hedged item or the hedging instrument.
4. An entity's estimate of expected credit losses on loan commitments shall be consistent with its expectations of drawdowns on that loan commitment, ie it shall consider the expected portion of the loan commitment that will be drawn down within 12 months of the reporting date when estimating 12-month expected credit losses, and the expected portion of the loan commitment that will be drawn down over the expected life of the loan commitment when estimating lifetime expected credit losses.

*International Financial Reporting Standards (IFRS) are a set of accounting rules for the financial statements of public companies that are intended to make them consistent, transparent, and easily comparable around the world.

## Conclusions

CEAT Limited assigned short-term B2 & long-term Ba2 forecasted stock rating. We evaluate the prediction models Modular Neural Network (Speculative Sentiment Analysis) with Stepwise Regression1,2,3,4 and conclude that the NSE CEATLTD stock is predictable in the short/long term. According to price forecasts for (n+16 weeks) period: The dominant strategy among neural network is to Hold NSE CEATLTD stock.

### Financial State Forecast for NSE CEATLTD CEAT Limited Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*B2Ba2
Operational Risk 8065
Market Risk4975
Technical Analysis3286
Fundamental Analysis8258
Risk Unsystematic4149

### Prediction Confidence Score

Trust metric by Neural Network: 90 out of 100 with 617 signals.

## References

1. E. Collins. Using Markov decision processes to optimize a nonlinear functional of the final distribution, with manufacturing applications. In Stochastic Modelling in Innovative Manufacturing, pages 30–45. Springer, 1997
2. D. Bertsekas. Dynamic programming and optimal control. Athena Scientific, 1995.
3. J. G. Schneider, W. Wong, A. W. Moore, and M. A. Riedmiller. Distributed value functions. In Proceedings of the Sixteenth International Conference on Machine Learning (ICML 1999), Bled, Slovenia, June 27 - 30, 1999, pages 371–378, 1999.
4. Arora S, Li Y, Liang Y, Ma T. 2016. RAND-WALK: a latent variable model approach to word embeddings. Trans. Assoc. Comput. Linguist. 4:385–99
5. R. Sutton and A. Barto. Introduction to reinforcement learning. MIT Press, 1998
6. M. L. Littman. Markov games as a framework for multi-agent reinforcement learning. In Ma- chine Learning, Proceedings of the Eleventh International Conference, Rutgers University, New Brunswick, NJ, USA, July 10-13, 1994, pages 157–163, 1994
7. P. Marbach. Simulated-Based Methods for Markov Decision Processes. PhD thesis, Massachusetts Institute of Technology, 1998
Frequently Asked QuestionsQ: What is the prediction methodology for NSE CEATLTD stock?
A: NSE CEATLTD stock prediction methodology: We evaluate the prediction models Modular Neural Network (Speculative Sentiment Analysis) and Stepwise Regression
Q: Is NSE CEATLTD stock a buy or sell?
A: The dominant strategy among neural network is to Hold NSE CEATLTD Stock.
Q: Is CEAT Limited stock a good investment?
A: The consensus rating for CEAT Limited is Hold and assigned short-term B2 & long-term Ba2 forecasted stock rating.
Q: What is the consensus rating of NSE CEATLTD stock?
A: The consensus rating for NSE CEATLTD is Hold.
Q: What is the prediction period for NSE CEATLTD stock?
A: The prediction period for NSE CEATLTD is (n+16 weeks)