Documente Academic
Documente Profesional
Documente Cultură
ON
SUBMITTED TO
SESSION 2015-16
Supervisor
Submitted By:
Nayana Palsaniya
M.Com.
Semester IV
Roll No. 621
1
PREFACE
This project is an integral part of one academic curriculum. I feel great pleasure
in submitting the peace of work as my project.
This project deals with all the aspects of CAPITAL STRUCTURE OF ICICI
BANK.
The whole study is divided into 5 chapters and cover all the aspects related to
this research. As first chapter : Introduction, 2 nd Chapter : Company Profile and
Research Methodology, Chapter 3rd : Analysis and Interpretation of Data and
Findings, Chapter 4th : Suggestions and Conclusion, Bibliography.
This work is an attempt to present report on account of little practical
knowledge.
Nayana Palsaniya
Semester IV
M.Com.
Roll No. 621
DECLARATION
I Nayana Palsaniya study in M.Com IV Semester in the academic year
2015-16 at department of accountancy and Business Statistics, University of
Rajasthan, Jaipur here by declare that I have completed the dissertation title
CAPITAL STRUCTURE OF ICICI BANK as a compulsory paper of course
requirement of M.Com.
I further declare that information presented in this project report /
dissertation is true and original to the best of my knowledge.
Nayana Palsaniya
Semester IV
M.Com.
Roll No. 621
SUPERVISION CERTIFICATE
It is certified that Ms. Nayana Palsaniya is a student of M.Com IV Semesterhas
completed her Dissertation titled CAPITAL STRUCTURE OF ICICI BANK
under my supervision and guidance.
This is her own work.
Date:
Place: Jaipur
ACKNOWLEDGEMENT
I take this opportunity to express my acknowledgement and deep sense of
gratitude for rendering valuable assistance and guidance to me by Dr. Mayur
Kumar Bardia, Associate Professor, Department of Accountancy and
Business Statistics, University of Rajasthan, Jaipur for successful
completion of my dissertation. I am highly obliged to my supervisor for his
personal encouragement and help provided to me his completion of my
dissertation.
I once again thanks to everyone for all the necessary help to me for
completion of my dissertation.
Nayana Palsaniya
Semester IV
M.Com.
Roll No. 621
INDEX
S.NO.
CHAPTER
1.
CHAPTER-1
2.
INTRODUCTION
CHAPTER-2
PAGE NO.
METHODOLOGY
CHAPTER-3
ANANLYSIS AND INTERPRITATION OF DATA
4.
AND FINDINGS
CHAPTER-4
5.
Chapter-1
St
INTRODUCTION
INTRODUCTION
HISTORY
The history of life insurance in India dates back to 1818 when I was
conceived as a means to provide for English windows. Interestingly in
those days a higher premium was charge for Indian lies than nonIndian lives, as Indian lives were considered more risky for coverage.
WHAT IS INSURANCE?
Insurance is a legal contract that protects people from the financials
costs those results from loses of life, loss of health, lawsuits, or
property damage. Insurance provide a means for individuals & society
to cope up with some of the risks faced in every day life by
everybody.
People purchase contracts of insurance, called a policy, from various
insurance companies.
Life insurance is a contracts for payment of a sum of money to the
person assured on the happening of the event insured against .Usually
the contracts provide for the payment if an amount on the date of
maturity or at unfortunate death . The contracts also provide for
payment of premium periodically to the corporation by the assured.
OVERVIEW OF INSURANCE
Insurance business is divided into four classes:
a) Life insurance
b) Fire
c) Marine
d) Miscellaneous
11
the
risks
between
various
entities,
persons
and
In 2000, the Parent was the first Indian banking company and
the second bank from Asia to list on the New York Stock Exchange
and currently has a financial strength rating of C-from Monday's
Investors Service Lin1ited (Moody's) and a long-term foreign
currency credit rating of Baal froD1 Moody's and BB+ from Standard
13
& Poor's.
ICICI bank has done sales of US $ 9784.5 million with one year
ICICl Bank now has the largest market share among all bank in
retail or consumer financing. ICICl Bank is the largest issuer of credit
card in India [citation needed]. It was the first bank to offer a wide
network of A TM's and had the largest network of A TM's tilf2009
before SBI caught up with it.
Africa.
ICICI Bank now has the largest market value of all banks in
India, and is widely seen as a sophisticated bank able to take on many
global banks in the Indian market.
1999 ICICI becomes the first Indian con1pany and the first bank
or financial institution fron1 non-Japan Asia to list on the NYSE.
17
as provide advisory services to enable entry into India and other Asian
markets. Our services include:
Equity warehousing.
20
member.
Professional group like doctors, lawyers, chartered accountants,
professors, etc.
Documents required for saving Account
Completed AOF (Account Opening Form) With Customer's
Photograph and Signature.
Know Your Customer (KYC) Document
Identity Proof
Address Proof
PAN Card /Form 60/61
Benefits of Saving Account
Unlimited Saving
Attractive Interest Rates on your Funds
Easy Liquidity Option
Annual Interest Certificate
Option of a Joint Account
Demand Drafts & Pay orders
Funds Transfer (Local or Anywhere)
Collection of Cheques/Drafts
22
IMPORTANCE OF INSURACE
If there is some one who would suffer economic hardship if you died,
then the answer is yes.. You need life insurance! Families with
young children have a clear need of life insurance. If both spouses
work, the loss of one income will cause the family immediate
economic hardship and make it harder for them to realize future goals,
such as paying for the childrens educations. But even if one spouse
works inside the home and doesnt bring in a formal income, his or
her death will require the surviving spouses to hire child care,
23
under saving scheme the total accumulated saving alone ,if death
occurs during early.
2. Easy settlement & protection against creditors: The life assured
can name person(s) called Nominee to whom the policy money
would be payable in the events of his death. The proceeds against
the claim of creditors life assured by effecting a valid assignment
of the policy.
3. Ready marketability &suitability for quick borrowing: After an
initial period, if the policyholder finds him unable to continue
payment of premiums, he can surrender the policy for a cash sum.
Alternatives, he can tide over a temporary difficulty by taking loan
on the sole security of the policy without delay.
- 25 -Further,
25
Chapter-2
nd
26
COMPANY PROFILE
ICICI Bank (BSE: ICICI) (formerly Industrial Credit and
Investment Corporation of India) is India's largest private sector bank
by market capitalisation and second largest overall in terms of assets.
Bank has total assets of Rs. 3,793.01 billion (US$ 75 billion) at March
31, 2009 and profit after tax Rs. 37.58 billion for the year ended
March 31, 2009.[1]. The Bank also has a network of 1,449 branches
and about 4,721 ATMs in India and presence in 18 countries, as well
as some 24 million customers (at the end of July 2007). ICICI Bank
offers a wide range of banking products and financial services to
corporate and retail customers through a variety of delivery channels
and specialised subsidiaries and affiliates in the areas of investment
banking, life and non-life insurance, venture capital and asset
management. (These data are dynamic.) ICICI Bank is also the largest
issuer of credit cards in India.[2]. ICICI Bank has got its equity shares
listed on the stock exchanges at Kolkata and Vadodara, Mumbai and
the National Stock Exchange of India Limited, and its ADRs on the
New York Stock Exchange (NYSE). The Bank is expanding in
overseas markets and has the largest international balance sheet
among Indian banks. ICICI Bank now has wholly-owned subsidiaries,
branches and representatives offices in 18 countries, including an
offshore unit in Mumbai. This includes wholly owned subsidiaries in
Canada, Russia and the UK (the subsidiary through which the
HiSAVE savings brand[3] is operated), offshore banking units in
27
approval
from
Insurance
Regulatory
Development
Authority (IRDA).
ICICI Prudentials capital stands at Rs.18.15 billion with ICICI Bank
and Prudential plc holding 74% and 26% stake respectively. For the
period April- December 2006, the company garnered new business
weighted premium of over of Rs.2, 302 crore and wrote over 1.1
million policies. The company has assets held to the tune of over
Rs.13000 crore.
ICICI Prudential is also the only private life insurer in India to receive
a National Insurer Financial strength rating of AAA (Ind) from Fitch
ratings. The AAA (Ind) rating is the highest rating, and is a clear
28
29
ICICI Bank is Indias second largest bank and largest private sector
bank with assets of Rs.2823.72 billion as on September 30, 2006.
ICICI Bank provides a broad spectrum of financial services to
individuals and companies. This includes mortgages, car and personal
loans, credit and debit cards, corporate and agricultural finance. The
bank services a growing customer base through a multi-channel
access network which includes over 635 branches and extension
counters, 2325 ATMs, call centers and internet banking.
PRUDENTIAL Plc
Established in London 1848, Prudential Plc, through its businesses in
the UK and Europe, the US and Asia, provides retail financial services
products and services to more than 21 million customers, policyholder
and unitholders worldwide. Prudential has brought to market an
integrated range of financial services products that now includes life
assurance, pensions, mutual funds, banking, investment management
and general insurance. IN Asia, Prudential is the leading European life
insurance company with a vast network of 23 life and mutual fund
operations in 12 countries- China, Hong Kong, India, Indonesia,
Japan, Korea, Malaysia, The Philippines, Singapore, Taiwan, Thailand
and Vietnam.
30
VISION
To make ICICI Prudential the dominant life and Pensions player built
on trust by world-class people and service.
This can be achieved by:
and conveniently.
Cash Bak
2.
Save n Protect
3.
4.
5.
CHILD PLANS
Education Insurance under Smart kid
32
RETIREMENT SOLUTIONS
1.
Forever Life
2.
3.
4.
Immediate Annuity
HEALTH SOLUTIONS
1.
2.
Cancer Care
3.
Diabetes Care
2.
3.
4.
2.
3.
Income Benefit
4.
Waiver of Premium
33
34
BOARD OF DIRECTORS
Chief Executive Officer - Mr. P Nandagopal
Chief Financial Officer - Mr. Rajesh Bahl
Chief Marketing Officer - Mr. Rohit Gaurav Mull
Chief Operating Officer - Mr. K.V. Srinivasan
Chief Investment Officer - Mr. R Rangarajan
Appointed Actuary - Ms. Pournima Gupte
Head-HR - Ms. Maneesha Thakur
INSURANCE PLANS OF RELIANCE LIFE
36
MISSION
To set the standard in helping our customers manage their financial
future.
MANAGEMENT TEAM
BOARD OF DIRECTORS
Mr. Rajan Raheja : Chairman
Mr. Kshitij Jain :
Director
37
MD & CEO
experience.
company.
38
way.
Prudential.
LITERATURE REVIEW
The literature review includes the academic books, journals, internet
access, magazines etc.
39
Beri G.C.- Marketing Research 3rd edition : This book helped in
understanding the different research designs and analytical tools used
here.
40
RESEARCH METHODOLOGY
The procedure adopted for conducting the research requires a lot of attention as
it has direct bearing on accuracy, reliability and adequacy of results obtained. It
is due to this reason that research methodology, which we used at the time of
conducting the research, needs to be elaborated upon. It may be understood as a
science of studying how research is done scientifically. So, the research
methodology not only talks about the research methods but also considers the
logic behind the method used in the context of the research study. Research
Methodology is a way to systematically study and solve the research problems.
If a researcher wants to claim his study as a good study, he must clearly state the
methodology adapted in conducting the research the research so that it way be
judged by the reader whether the methodology of work done is sound or not.
The Research Methodology here includes: Objective of study
Meaning of Research.
Research Problem.
Research Design.
Data Collection method.
Analysis and interpretation of Data
Limitation of study
41
43
Research Problem
The first step while conducting research is careful definition of Research
Problem. To ERR IS THE HUMAN is a proverb which indicates that no one
is perfect in this world. Every researcher has to face many problemswhich
conducting any research thats why problem statement is defined to know which
type of problems a researcher has to face while conducting any
study. It is said that,
Problem well defined is problem half solved.
Basically, a problem statement refers to some difficulty, which researcher
experiences in the context of either a theoretical or practical situation and
wants to obtain the solution for the same.
The problem statement here is:TO MAKE A FINANCIAL ANALYSIS OF FINANCIAL STATEMENTS
OF ICICI BANK
Research Design
44
45
statements of earlier years and analyse these to make critical evaluation of the
available material. Hence by making the type of the research conducted to be
both Descriptive and Analytical in nature. From the study, the type of data to
be collected and the procedure to be used for this purpose were decided.
Data Collection Method
The process of data collection begins after a research problem has been
defined and research design ahs been chalked out. There are two types of
data
PRIMARY DATA It is first hand data, which is collected by researcher itself. Primary data is
collected by various approaches so as to get a precise, accurate, realistic and
relevant data. The main tool in gathering primary data was investigation and
observation. It was achieved by a direct approach and observation from the
officials of the company.
SECONDARY DATA - it is the data which is already collected by someone
else. Researcher has to analyze the data and interprets the results. It has always
been important for the completion of any report. It provides reliable, suitable,
adequate and specific knowledge.
TYPE OF DATA USED IN THE STUDY
The required data for the study are basically secondary in nature and the data
are collected from
The audited reports of the company.
47
48
the bank.
contained in the published annual reports of ICICI Bank for the study period.
Due to the limited time available at the disposable , the
know about the financial condition of the company and cannot show a through
picture of the activities of the company
.
49
CHAPTER-3rd
ANANLYSIS AND INTERPRITATION OF
DATA AND FINDINGS
50
Percentage(%) figures
Particular
s
2005
2006
2007
2008
2009
Deposits
100
165
231
245
219
Advances
100
160
214
247
239
Net profit
100
127
155
207
187
Interpretation:
There is a continous increase in the deposits till the year ending 2008
followed by a downfall in the year ending 2009 due to repayment od
deposits in this year.
Similarly advances also shows as increasing trend till the year ending
2008 followed by a slight downfall in the year ending 2009.
There has been a substantial increase in net profit till the year year ending
2008.In four years it has been more than double.
51
Year
Current Assets
(Rs. In crores)
Current
Liabilities
Current Ratio
(Rs. In crores)
2005
21632.56
21396.16
1.01
2006
29549.79
25227.88
1.17
2007
53421.59
38228.64
1.39
52
2008
58615.76
42895.38
1.36
2009
54130.18
43746.43
1.23
Interpretation:
An ideal solvency ratio is 2. The ratio of 2 is considered as a safe margin of
solvency due
to the fact that if current assets are reduced to half (i.e.) 1 instead of 2, then also
the
creditors will be able to get their payments in full.
But here the current ratio is less than 2 and more than 1 which shows that the
bank have current assets just equal to the current liabilities which is not
satisfactory as the safety margin is very less or zero. Therefore the bank should
keep more current assets so that it can maintain a satisfactory safety margin.
LIQUID RATIO:
Liquid ratio is also known as Quick or Acid Test Ratio. Liquid assets refer
to
assets which are quickly convertible into cash. Current Assets other stock and
prepaid expenses
are considered as quick assets.
2005
12929.97
21396.16
0.60
2006
17040.22
25227.88
0.67
2007
37121.33
38228.64
0.97
2008
38041.13
42895.38
0.88
2009
29966.56
43746.43
0.68
Interpretation:
A quick ratio of 1:1 is considered favourable because for every rupee of current
liability,there is atleast one rupee of liquid assets. A higher value of ratio is
considered favourable. Here this ratio is less than 1 in 2005,2006 & 2009 but in
2007 & 2008 it is close to 1 which is not satisfactory. This means the bank has
not managed its funds properly in this particular period.Therefore bank should
rationally utilise its funds to maintain an ideal liquid ratio.
54
55
Year
Net Income
Available For
Shareholders
No. Of Equity
Shares
EPS
(Rs. In crores)
(Rs. In crores)
2005
2005.2
73.6716
27.22
2006
2540.07
88.9823
28.55
2007
3110.22
89.9266
34.59
2008
4157.73
111.2687
37.37
2009
3758.13
111.325
33.78
Interpretation:
Earning Per Share is the most commonly used data which reflects the
performance and prospects of the company.It affects the market price of shares.
Here the Earning Per Share is shows a persistent increase till the year 2008 after
that in the year 2009 Earning Per share is followed by a downfall due to decline
in profits.
DIVIDEND PER SHARE :
56
Year
Dividend Paid
(Rs. In crores)
No. Of Equity
Shares
DPS
(Rs. In crores)
2005
632.96
73.6716
8.59
2006
759.33
88.9823
8.53
2007
901.17
89.9266
10.02
2008
1227.7
111.2687
11.03
2009
1224.58
111.325
11
Interpretation:
Here the Dividend Per Share is increasing year after year except a little decline
in 2009.otherwise the dividend per share ratio of the bank is quite satisfactory
which shows the bank has a good dividend paying capacity.
Year
2005
Net Profit
Sales
(Rs. In crores)
(Rs. In crores)
(in %)
2005.2
9409.9
21.3
58
2006
2540.07
13784.49
18.42
2007
3110.22
22994.29
13.52
2008
4157.73
30788.34
13.5
2009
3758.13
31092.55
12.08
Interpretation:
Although both the sales and net profit have increased during the above period
but the Net Profit Ratio of the bank is declining continuously. This is because of
the reason that net profits have not increased in the same proportion as of the
sales.
59
The difference between net profit ratio and net operating profit ratio is that net
operating profit is calculated without considering non-operating expenses and
non-operating incomes. If we deduct this ratio from 100,the result will be
operating ratio. Higher operating profit ratio enable the organization to recoup
non-operating expenses out of operating profits and provide reasonable return.
Year
Operating
Profit
Sales
(Rs. In crores)
(Rs. In crores)
Operating
Profit Ratio (in
%)
2005
2956
9409.9
31.41
2006
4690.67
13784.49
34.02
2007
5874.4
22994.29
25.54
2008
7960.69
30788.34
25.85
2009
8925.23
31092.55
28.7
60
Interpretation:
In the year 2005 & 2006 the operating profit is 31.41% & 34.02% respectively.
After that it has been consistently declined from the year 2007 till 2008 and
again gaining momentum in 2009. This may be due to the reason that operating
expenses have been increased more as compared to sales during the above
period consequently reducing the operating profits.Therefore the bank should
check on unnecessary operating expenses to correct this situation and to provide
a sufficient return.
RETURN ON NET WORTH:
Return On Net Worth = Net Profit After Interest And Tax x 100
Shareholders Funds
61
Year
Shareholder's
Fund
(Rs. In crores)
Return On
Net Worth (in
%)
(Rs. In crores)
2005
2005.2
12899.97
15.54
2006
2540.07
22555.99
11.26
2007
3110.22
24663.26
12.61
2008
4157.73
46820.21
8.88
2009
3758.13
49883.02
7.53
Interpretation:
The net profit after interest and tax have increased slowly till the year 2008
followed by a downfall due to high interest payments,operating expenses and
taxation liability.consequently the networth ratio has declined considerably and
has reduced to more than half in the year 2009 than it was in 2005.
62
It establishes relationship between profit before interest and tax and capital
employed. It indicates the percentage of return on the total capital employed in
the business.This ratio is also known as Return On Investment. It measures
the overall efficiency and profitabilityof the business in relation to investment
made in business. It also shows how efficiently the resources are used in the
business.comparison of one unit with that of the other or performance in one
year with that of the same unit is possible. It is calculated as below:
Year
Capital Employed
Return On Capital
Employed (in %)
(Rs. In crores)
2005
9098.09
146263.25
6.22
2006
12694.05
226161.17
5.61
63
2007
20006.54
306429.48
6.52
2008
28540.34
356899.69
7.99
2009
27842.9
335554.53
8.29
Interpretation:
The above table exhibit the return on capital employed ratio of the bank for last
five years.This ratio measures the earning of the net assets of the business. The
ratio was 6.22% in year 2005. After that it rised to the tune of
5.61%,6.52%,7.99% and 8.29% in year 2006, 2007, 2008 and year 2009
respectively. It lead to the conclusion bank rising but very little proportion of
return on capital employed.
DEBT- EQUITY RATIO:
The Debt-Equity ratio is calculated to find out the long-term financial position
of the firm.This ratio indicates the relationship between long-term debts and
shareholders funds.The soundness of long-term financial policies of a firm can
be determined with the help of this ratio.
It helps to assess the soundness of long-term financial policies of a business.It
also helps to determine the relative stakes of outsiders and shareholders.Longterm creditors can assess the security of their funds in a business.it indicates to
what extent a firm depends upon lenders to meet its long-term financial
requirements.A low Debt-Equity ratio is considered better from the point of
view of creditors.
64
Year
Debt
Equity
(Rs. In crores)
(Rs. In crores)
2005
154759.45
12899.97
11.99
2006
228832.96
22555.99
10.14
2007
319994.86
24663.26
12.97
2008
352974.87
46820.21
7.53
2009
329417.94
49883.02
6.6
Interpretation:
65
The ratio shows the extent to which funds have been provided by long-term
creditors as compared to the funds provided by the owners.Here the DebtEquity ratio for the above period is always high.this shows that the bank is
more relying on outside funds as compared to internal sources of capital,in
its capital structure. From the long-term lenders point of view this ratio is not
satisfactory.
PROPRIETORY RATIO:
It is also called shareholders equity to total equity ratio or net worth to total
assets ratio or equity ratio.It compares the shareholders funds to total assets.It
is calculated by dividing shareholders funds by total assets.
66
Years
Shareholder's
Funds
Total Assets
(Rs. In crores)
Proprietory
Ratio
(Rs. In crores)
2005
12899.97
167659.4
0.07
2006
22555.99
251388.95
0.08
2007
24663.26
344658.11
0.07
2008
46820.21
399795.07
0.12
2009
49883.02
379300.96
0.13
Interpretation:
Above table exhibits the proprietary ratio of the bank for last five years . It was
7% in 2005,After that was 8% in year 2006. Similarly it was once again reduced
to 7 % in the year 2007. After 2007 it registered increase and was 12% and 13%
in the year 2008 and 2009 respectively. Hence it leads to the conclusion owners
have less than 13% stake in the total assets of the bank. It is not a good sign as
far the long term solvency is concerned.
FIXED ASSETS TURNOVER RATIO:
It is also called as Sales to Fixed Assets Ratio.It measures the efficient use of
fixed assets.This ratio is a measure of efficient use of fixed assets.it is calculated
as:
Fixed Assets Turnover Ratio = Cost of goods sold or Sales
Net Fixed Assets
It measures the efficiency and profit earning capacity of the business.Higher the
ratio,greater is the intensive utilization of fixed assets and a lower ratio shows
under utilization of the fixed assets.This ratio has a special importance for
manufacturing concerns where investment in fixed assets,is vey high and the
profitability is significantly dependent on the utilization of these assets.
67
Year
Sales
(Rs. In crores)
2005
9409.9
4038.04
2.33
2006
13784.49
3980.72
3.46
2007
22994.29
3923.42
5.86
2008
30788.34
4108.89
7.49
2009
31092.55
3801.62
8.17
Interpretation:
Here the fixed assets employed in the business shows a decreasing trend except
in the year 2008 where fixed assets have again increased.This may be due to
increase in rate of depreciation in subsequent years. Neverthless,the fixed assets
turnover ratio has been consistently increasing.It indicates that fixed assets have
been effectively used in the business without much additional investment in the
period of study and also the capital is not blocked in fixed assets.
CREDIT-DEPOSIT RATIO:
68
This ratio is very important to assess the credit performance of the bank. The
ratio shows the relationship between the amount of deposit generated by the
bank has well as their deployment towards disbursement of loan and advances.
Higher credit deposit ratio shows overall good efficiency and performance of
any banking institution.
Year
Advances
Deposits
(Rs. In crores)
(Rs. In crores)
(in%)
2005
91405.15
99818.78
91
2006
146163.11
165083.17
88
2007
195865.6
230510.19
84
2008
225616.08
244431.05
92
2009
218310.85
218347.82
99
Interpretation:
Above table exhibits credit deposit ratio of the bank during last 5 years. In
the year 2005 ratio was 91% and it declined to 88% and 84%in the year
2006 and 2007 respectively. In the year 2008 and 2009 ratio was increased to
92% and 99% respectively. it leads to conclusion that credit performance of
the bank is very good.
70
CHAPTER-4th
SUGGESTIONS AND CONCLUSION
71
SUGGESTIONS
AFTER
2015-16
ICICI BANK
THE
HAVE PRODUCED THAT CAN BE QUITE A BIG UNSEEN THREAT FOR THE
SO THE
YEARS BECAUSE OF THE POPULARITY OF THESE COMPANIES CONTINUES THEN ONE DAY
THEY
WILL
BECOME
GOOD
COMPETITORS
OF
THEN
THE
72
CONCLUSION
The balance-sheet along with the income statement is an important tools for
investors and many other parties who are interested in it to gain insight into a
company and its operation. The balance sheet is a snapshot at a single point of
time of the companys accounts- covering its assets, liabilities and shareholders
equity. The purpose of the balance-sheet is to give users an idea of the
companys financial position along with displaying what the company owns and
owes. It is important that all investors know how to use, analyze and read
balance-sheet. P & L account tells the net profit and net loss of a company and
its appropriation.
In the case of ICICI Bank, during fiscal 2008, the bank continued to grow and
diversify its assets base and revenue streams. Bank maintained its leadership in
all main areas such as retail credit, wholesale business, international operation,
insurance, mutual fund, rural banking etc. Continuous increase in the number of
branches, ATM and electronic channels shows the growth take place in bank.
Trend analysis of profit & loss account and balance sheet shows the % change
in items of p & l a/c and balance sheet i.e. % change in 2006 from 2005 and %
change in 2007 from 2006. It shows that all items are increased mostly but
increase in this year is less than as compared to increase in previous year. In p &
l a/c, all items like interest income, non-interest income, interest expenses,
operating expenses, operating profit, profit before tax and after tax is increased
but in mostly cases it is less than from previous year but in some items like
interest income, interest expenses, provision % increase is more. Some items
like tax, depreciation, lease income is decreased. Similarly in balance sheet all
items like advances, cash, liabilities, deposits is increased except borrowings
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which is decreased. % increase in some item is more than previous year and in
some items it is less.
Ratio analysis of financial statement shows that banks current ratio is better
than the quick ratio and fixed/worth ratio. It means bank has invested more in
current assets than the fixed assets and liquid assets. Bank have given more
advances to its customer and they have less cash in their hand. Profitability
ratio of bank is lower than as compared to previous year. Return on equity is
better than the return on assets.
The cash flow statement shows that net increase in cash generated from
operating and financing activities is much more than the previous year but cash
generated from investing activities is negative in both year. There is increase of
159,708,479 thousand RS. in Increase in cash & cash equivalents from previous
year. Therefore analysis of cash flow statement shows that cash inflow is more
than the cash outflow in ICICI Bank.
Thus, the ratio analysis and trend analysis and analysis of cash flow statement
shows that ICICI Banks financial position is good. Banks profitability is
increasing but not at high rate. Banks liquidity position is fair but not good
because bank invest more in current assets than the liquid assets. As we all
know that ICICI Bank is on the first position among all the private sector bank
of India in all areas but it should pay attention on its profitability and liquidity.
Banks position is stable.
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BIBLIOGRAHY
BOOKS REFERED
RAM
SWAMI
AND
HOUSE, PG 250-268
Web Sites
www.icicirulife.com
www.ipruuniverse.com
www.icici.com
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