Hai Raviram,
Cycle dynamo as conventionally used term. most of the manual by-cycles "Dynamos" are really alternators with permanent magnet working as exciter and rotary output taken through slip rings. Now imagine the alternator with one terminal of the output connected to cycle metal body. the second terminal is brought to the front thro' a wire and connected to the Head light thro an ON/OFF or LOW or High beam switch. then another parallel wire is run from the alternator to a rear tail lamp (red one), and in this case also the return is again the cycle body.