Industry Analysis
12 questions. Each answer is explained.
Question 1 of 10Practice · Series XV — Research Analyst
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Learn these topics
More units in NISM Series XV
- Introduction to Research Analyst Profession2
- Introduction to Securities Market3
- Terminology in Equity and Debt Markets3
- Fundamentals of Research7
- Economic Analysis7
- Company Analysis – Business and Governance9
- Company Analysis – Financial Analysis16
- Corporate Actions7
- Valuation Principles13
- Fundamental analysis of commodities9
- Fundamentals of Risk and Return10
- Qualities of a Good Research Report7
- Legal and Regulatory Environment15
- Technical Analysis22
- Case Study - Valuation8
Exam format
| Questions | 100 · 1 mark each |
|---|---|
| Duration | 120 min · 2 hours |
| Pass mark | 60% · 60 of 100 marks |
| Negative marking | 25% · 0.25 marks off per wrong answer |
| Certificate validity | 3 years · from the date of the examination |
| Marks for this unit | Not published by NISM |
NISM Series XV Research Analyst
Exam rules read on NISM's site on 3 October 2026. Exam pattern revised on 20 January 2026. Check the current rules on NISM's site (opens in a new tab)
What these answers assume, and when it was last checked
Each question uses the rules listed below. We last checked them on 5 September 2026. A Budget or SEBI circular can change a rate, lot size or expiry day. If a rule changes before your exam, treat the linked questions as out of date and check NISM's current workbook.
- NSE uses Tuesday expiry and BSE uses Thursday expiry. This applies from 1 September 2025.
- The January 2026 index lot sizes are NIFTY 65, BANKNIFTY 30, FINNIFTY 60, MIDCPNIFTY 120 and NIFTYNXT50 25.
- The October 2024 SEBI framework sets a minimum index contract value of Rs 15–20 lakh. Each exchange may list one weekly benchmark index.
- Option buyers pay the premium upfront from 1 February 2025. A short index option has an extra 2% Extreme Loss Margin on expiry day from 20 November 2024.
- Equity short-term capital gains are taxed at 20%. Long-term gains are taxed at 12.5% above Rs 1.25 lakh. Both rates apply from 23 July 2024.
- F&O income is non-speculative business income in ITR-3. NSE equity derivatives trade from 9:15 a.m. to 3:40 p.m.
- The final ten-minute session began on 3 August 2026. It aligns with the cash market Closing Auction Session.
- Most Securities Transaction Tax questions test the base and who pays. On an option sale, it is the premium and the seller pays. On a futures sale, it is the traded value and the seller pays.
- On exercise, Securities Transaction Tax uses intrinsic value: settlement price minus strike price. The buyer pays it.
- Two questions test the current rate. From 1 April 2026, option sales carry 0.15% on the premium and futures sales carry 0.05% on traded price. The earlier rates were 0.10% and 0.02% from 1 October 2024.
- This section uses the T+1 rolling settlement cycle. Obligations are fixed on T+1. A short delivery goes to buy-in auction on T+1 and settles on T+2.
- The trade-for-trade surveillance segment uses direct close-out. Funds pay in by 10:30 a.m. and pay out on or after 1:30 p.m. on settlement day.
- Securities pay in to the settlement pool by 10:30 a.m. They pay out directly to the client’s demat account by 3:30 p.m.
- The 3:30 p.m. deadline replaced 1:30 p.m. under SEBI’s 10 October 2024 circular. Direct client credit was required by SEBI’s 5 June 2024 circular.
- The optional T+0 cycle trades until 1:30 p.m. Obligations are fixed by 2:30 p.m. on the trade day. An early pay-in shortage is closed out directly.
- Cash-market Value at Risk margin is six times exponentially weighted moving-average volatility. It has a 9% floor for Group I, a 21.5% floor for Group II, and a fixed 50% or 75% level for Group III.
- Extreme Loss Margin is 3.5% for a share and 2% for a broad-market-index exchange traded fund. Mark-to-market margin is collected before the next day’s trading. The trade-for-trade segment has 100% upfront margin.
- Close-out uses the higher of the highest price from trade day to auction day and 20% above the auction day’s official close.
- A funds shortage costs 0.07% a day. The trading facility is withdrawn at a shortage of Rs 5 lakh or more.
- SCORES allows 21 calendar days, then two 15-day review levels. Online Dispute Resolution moves from conciliation to arbitration after the market participant and SCORES steps.
- At NSE, the Investor Protection Fund limit is Rs 35 lakh per investor for each defaulting or expelled member. This applies to claims arising after 13 August 2024.
- A Basic Services Demat Account has no annual maintenance charge up to Rs 4 lakh of holdings. It costs up to Rs 100 above that, until the Rs 10 lakh eligibility ceiling. These slabs apply from 1 September 2024.
- The rupee pairs are USD-INR, EUR-INR, GBP-INR and JPY-INR. The cross-currency pairs are EUR-USD, GBP-USD and USD-JPY.
- Each contract covers 1,000 units of the foreign currency, except JPY-INR. JPY-INR covers 100,000 yen and is quoted in rupees per 100 yen.
- The tick is 0.25 paise, or Rs 0.0025. It equals Rs 2.50 a contract.
- Rupee pairs trade from 9:00 a.m. to 5:00 p.m. A monthly contract stops trading at 12:30 p.m. two working days before the expiry month’s last business day.
- Final settlement is in cash at the FBIL reference rate on expiry day. FBIL, Financial Benchmarks India, has published this rate in place of the Reserve Bank since 2018. Premium-style European options are quoted in rupees. The buyer pays the premium in cash on T+1.
- Daily settlement is on T+1 and final settlement is on T+2.
- NSE Clearing circular 026/2020 sets SPAN margin plus Extreme Loss Margin. The futures margin is 0.50% for USD-INR, 0.15% for EUR-INR, 0.25% for GBP-INR and 0.35% for JPY-INR. A short option has 0.75%. These figures apply from 1 June 2020.
- A USD-INR client may hold 6% of total open interest or USD 20 million, whichever is higher. A trading member may hold 15% or USD 100 million.
- A resident user has one USD 100 million equivalent limit across all rupee pairs and exchanges. No document is needed below that limit, but a valid underlying contracted exposure must still exist. This clarification applies from 3 May 2024.
- The currency segment has no Securities Transaction Tax.
The exam figures (questions, time, pass mark, negative marking and certificate validity) come from NISM's own pages, read on 3 October 2026. Timed practice uses the same figures. Study with the official workbook as well.
The written-out answers on this page are hidden while your timed set runs.
All 12 questions on Industry Analysis, with answers
Q1An industry once required heavy distribution infrastructure, but digital channels have sharply lowered setup costs and customer access barriers. Other things equal, which Porter force has become more threatening to incumbent profitability?
Option A. Bargaining power of suppliers
Why it is wrong: The scenario concerns entry barriers, not supplier concentration or switching costs.
Option B. Threat from accounting policy changes
Why it is wrong: Accounting policy changes are not a Porter force.
Option C. Bargaining power of employees
Why it is wrong: Employee bargaining power is not one of Porter's Five Forces.
Option D. Threat of new entrants — Correct answer
Answer: D. Lower entry barriers make it easier for new competitors to enter, increasing the threat of new entrants and potentially reducing incumbent profitability. Remember: Identify the economic fact in the scenario and map it to the relevant competitive force.
Hint, shown before you answer in practice mode: Common mistake: Memorising the five labels without recognising how real-world changes affect them.
XV-018mediumconceptual
Q2An industry that previously grew rapidly now faces slowing demand growth, excess capacity and intense price competition. Weaker firms are exiting or being acquired. Which stage best fits this description?
Option A. Shakeout — Correct answer
Option B. Growth
Why it is wrong: Growth is generally characterised by rapid market expansion rather than widespread consolidation caused by slowing demand.
Option C. Introduction
Why it is wrong: Introduction usually involves early adoption and low penetration.
Option D. Embryonic recovery
Why it is wrong: 'Embryonic recovery' is not the relevant standard life-cycle stage here.
Answer: A. The shakeout stage commonly follows rapid growth. Demand growth slows, competition intensifies, excess capacity becomes visible and weaker participants exit or consolidate. Remember: Industry life-cycle analysis connects demand growth, capacity, competition and consolidation.
Hint, shown before you answer in practice mode: Common mistake: Calling every consolidating industry 'mature' without examining whether the shakeout process is still underway.
XV-029mediumconceptual
Q3A manufacturer depends on a specialised input supplied by only one qualified vendor. There is no close substitute, switching would require costly redesign, and the input is critical to production. Which competitive force is strongest in this fact pattern?
Option A. Bargaining power of buyers
Why it is wrong: The scenario does not describe customer concentration or buyer leverage.
Option B. Bargaining power of suppliers — Correct answer
Option C. Threat of new entrants
Why it is wrong: Entry barriers for competitors are not the central issue.
Option D. Threat of substitute products faced by the supplier
Why it is wrong: The question concerns the manufacturer's dependence on its supplier.
Answer: B. Supplier bargaining power is high when suppliers are concentrated, the input is critical, substitutes are limited and switching costs are high. Remember: Assess competitive power from concentration, substitutability, switching costs and importance of the input.
Hint, shown before you answer in practice mode: Common mistake: Focusing only on the number of suppliers and ignoring switching costs and substitutes.
XV-030mediumconceptual
Q4When forecasting a regulated electricity distribution utility, which factor is likely to be especially important to sustainable earnings?
Option A. The colour of the logo used in the company's annual report
Why it is wrong: Branding aesthetics do not drive regulated earnings.
Option B. The daily RSI reading shown on the utility's share price chart
Why it is wrong: RSI is a technical-market indicator, not a driver of operating earnings.
Option C. The regulator's rules on tariffs, returns and the asset base — Correct answer
Option D. The face value of each equity share the company has issued
Why it is wrong: Share face value does not determine regulated operating profitability.
Answer: C. For a regulated utility, earnings often depend heavily on the tariff-setting framework, allowed returns, approved costs and the regulated/recognised asset base. These are industry-specific drivers. Remember: Industry analysis should focus on the KPIs and regulatory/economic variables that actually drive earnings.
Hint, shown before you answer in practice mode: Common mistake: Applying generic consumer-business drivers to heavily regulated industries.
XV-031mediumconceptual
Q5Compared with a consumer-staples producer, a commercial-vehicle manufacturer will generally be expected to have:
Option A. Lower sensitivity to the economic cycle because vehicles are non-discretionary
Why it is wrong: Commercial vehicles are usually more, not less, economically sensitive.
Option B. Identical earnings volatility across the cycle
Why it is wrong: Earnings cyclicality differs materially across industries.
Option C. No exposure to interest rates
Why it is wrong: Vehicle purchases and dealer/customer financing can be rate-sensitive.
Option D. Greater sensitivity to freight activity, financing conditions and the investment cycle — Correct answer
Answer: D. Commercial-vehicle demand is typically more cyclical because fleet replacement, freight economics, financing availability and business investment respond to economic conditions. Consumer staples are generally less cyclical. Remember: Industry cyclicality determines how strongly revenue and margins respond to the economic cycle.
Hint, shown before you answer in practice mode: Common mistake: Comparing sectors only on product familiarity rather than on demand drivers and operating leverage.
XV-032mediumconceptual
Q6An industry sells 5 million units annually at an average realised price of ₹2,400 per unit. Ignoring taxes and channel inventory changes, the approximate annual market value is:
Option A. ₹120 crore
Why it is wrong: It understates the market by a factor of ten.
Option B. ₹1,200 crore — Correct answer
Option C. ₹12,000 crore
Why it is wrong: ₹12,000 crore is ten times too high.
Option D. ₹1,20,000 crore
Why it is wrong: It is one hundred times too high.
Answer: B. Market value ≈ Volume × Average realised price = 5,000,000 × ₹2,400 = ₹12,000,000,000, which is ₹1,200 crore. Remember: Market sizing often starts with units × realised price, but unit conversions must be checked carefully.
Hint, shown before you answer in practice mode: Common mistake: Getting the commercial logic right but making a crore/billion conversion error.
XV-076mediumnumerical
Q7A new technology makes an established manufacturing process significantly cheaper and enables new competitors to enter. In a PESTLE analysis, the initial external change is primarily classified under:
Option A. Political
Why it is wrong: No government or political change is described.
Option B. Economic
Why it is wrong: The consequences are economic, but the initiating factor is technological.
Option C. Technological — Correct answer
Option D. Legal
Why it is wrong: No law or regulation is described.
Answer: C. PESTLE categorises broad external forces. A new production technology is primarily a technological factor, even though it may later create economic and competitive consequences. Remember: PESTLE classifies the source of an external force. Downstream effects can span several categories.
Hint, shown before you answer in practice mode: Common mistake: Classifying the consequence instead of the originating external factor.
XV-077mediumconceptual
Q8In the BCG growth-share matrix, a business with high relative market share in a high-growth market is conventionally classified as a:
Option A. Cash cow
Why it is wrong: A cash cow normally has high relative share in a low-growth market.
Option B. Star — Correct answer
Option C. Question mark
Why it is wrong: A question mark typically has low relative share in a high-growth market.
Option D. Dog
Why it is wrong: A dog typically has low share in a low-growth market.
Answer: B. In the conventional BCG matrix, a 'Star' combines high relative market share with high market growth. Remember: The BCG matrix combines relative market share with market growth.
Hint, shown before you answer in practice mode: Common mistake: Remembering only the labels without linking them to the two matrix dimensions.
XV-105mediumconceptual
Q9Which statement best captures the logic of the Structure-Conduct-Performance (SCP) framework used in industry analysis?
Option A. Company accounting policies determine the country's overall economic growth
Why it is wrong: This is not the logic of SCP.
Option B. Share-price momentum in a sector determines its industry structure
Why it is wrong: Market-price momentum is not the core causal sequence in SCP.
Option C. Management compensation alone determines market concentration
Why it is wrong: Compensation alone does not define market structure.
Option D. Industry structure shapes firm conduct, which in turn shapes performance — Correct answer
Answer: D. The SCP framework studies how structural features such as concentration and entry barriers may influence competitive conduct and, ultimately, outcomes such as pricing, profitability and efficiency. Remember: SCP links market structure to competitive behaviour and economic outcomes.
Hint, shown before you answer in practice mode: Common mistake: Confusing SCP with a company-level accounting or technical-analysis framework.
XV-106hardconceptual
Q10For an airline, passenger load factor most directly measures:
Option A. The share of available seats filled by passengers — Correct answer
Option B. The airline's debt-to-equity ratio on its balance sheet
Why it is wrong: Leverage is a financial ratio, not load factor.
Option C. The average age of the airline's aircraft fleet
Why it is wrong: Fleet age is operationally relevant but is a different metric.
Option D. The percentage change in jet fuel prices over the year
Why it is wrong: Fuel-price changes are an input-cost variable.
Answer: A. Passenger load factor is a capacity-utilisation KPI: passenger traffic relative to available seat capacity. Remember: Industry KPIs should be interpreted in terms of the operating activity they measure.
Hint, shown before you answer in practice mode: Common mistake: Using a generic financial ratio when the question asks for an industry-specific operating KPI.
XV-107mediumconceptual
Q11Over several years, consumers shift spending from physical media to subscription streaming platforms, and the industry's profit pool gradually moves toward the streaming ecosystem. This is best described as:
Option A. Temporary inventory destocking
Why it is wrong: Destocking is a short-term inventory phenomenon.
Option B. A one-day cyclical fluctuation
Why it is wrong: The scenario is structural and multi-year.
Option C. Value migration — Correct answer
Option D. A stock split
Why it is wrong: A stock split is a corporate action.
Answer: C. Value migration occurs when economic value and profit pools shift from one business model, product or part of an industry to another as customer preferences, technology or economics change. Remember: Value migration is a structural shift in where an industry creates and captures economic value.
Hint, shown before you answer in practice mode: Common mistake: Calling a long-term structural shift merely a short-term cycle.
XV-108mediumconceptual
Q12An analyst covers a sector in which tariffs, licences and permitted returns are set or heavily influenced by regulation. What is the most appropriate approach?
Option A. Ignore regulation, because valuation depends only on historical EPS figures
Why it is wrong: Historical EPS alone can miss major forward-looking regulatory effects.
Option B. Model the regulation, since changes can alter revenue, costs and returns — Correct answer
Option C. Use only technical charts, because regulation is too qualitative to model
Why it is wrong: Regulation is relevant to fundamental cash-flow analysis.
Option D. Assume all firms in the sector will be affected identically by any rule change
Why it is wrong: Company exposures and business mixes may differ.
Answer: B. In regulated sectors, changes in tariffs, licences, permitted returns, compliance requirements or market structure can materially affect cash flows and competitive dynamics. Remember: Regulation can be an industry driver, not merely a compliance footnote.
Hint, shown before you answer in practice mode: Common mistake: Treating a regulated sector as if its economics were determined only by market demand.
XV-109mediumconceptual
Industry Analysis: common questions
How many practice questions are there on Industry Analysis?
12 questions, all written out on this page with the correct answer and why each other option is wrong. This unit is one of the 16 practice topics for NISM Series XV, which has 150 questions in total.
Are these real NISM Series XV questions on Industry Analysis?
No. LearnNifty wrote every question from NISM's public syllabus. NISM does not publish its question bank, so nobody can offer you the real paper. Use these questions to check that an idea has gone in. Use the official NISM workbook to see what is examined.
Does negative marking apply to NISM Series XV?
Yes. NISM takes off 25% of a question's marks for a wrong answer. On a 1-mark question that is 0.25 marks off. A blank question earns nothing and loses nothing, so a wrong guess costs marks on this paper. Timed practice here uses the same rule.
Are these practice questions kept up to date?
Each question is written against the rules printed on this page, last checked on 5 September 2026. A Budget or a SEBI circular can change a rate, a lot size or an expiry day. If one of those rules changes before your exam, treat the questions that use it as out of date. Then check NISM's current workbook.
Company Analysis – Business and Governance
9 questions on Company Analysis – Business and Governance. Its quiz opens on that unit.
Open Company Analysis – Business and Governance