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Summer Training Report On Opportunity Of Sales in Corporate Sector Of Paramount Farms International Pvt. Ltd.

Submitted In Partial Fulfillment Of the Requirement Of Master of Business Administration

Training Supervisor: Name: Mr. Subodh Saini Designation: Sales Manager

Submitted By: Name of the student: Praveen Kumar ENRNO. /Batch: 08761203910

Submitted To: Banarsidas Chandiwala Institute of Professional Studies, Dwarka, New Delhi (Affiliated to Guru Gobind Singh Indraprastha University)

ACKNOWLEDGEMENT Perseverance inspiration and motivation have always played a key role in success of any Venture. I hereby express my deep sense of gratitude to all the personalities involved directly and indirectly in my project work. I would to thank God for their blessing and my parents also for their valuable suggestion And support in my project report. With immense pleasure, I would like to express my thanks to Ms. Tanushree (ASSISTANT PROFESSOR), my project guide for giving me the privilege of working under him and completing this study. Last but not the least; I would like to express my sincere gratitude to all the faculty members who have taught me in my entire MBA curriculum and our Director Prof. SATISH TANEJA who has always been a source of guidance, inspiration and Motivation. However, I accept the sole responsibility for any possible errors of omission and would be extremely grateful to the readers of this project report if they bring such mistakes to my notice. Praveen Kumar

DECLARATION:I Praveen Kumar, hereby declare that project entitled Opportunity of Sales in

Corporate Sector of Paramount Farms International Pvt. Ltd. is the outcome of research work. No part of this research has been submitted earlier to any institution or university for the award of any other degree/diploma. The sources of material, data used in this study have been acknowledged.

Date:-01/09/2011 Place: - DELHI


CERTIFICATE This is to certify that project work done on Opportunity of Sales in corporate sector Submitted to Guru Gobind Singh Indraprastha University, Delhi by Praveen Kumar in partial fulfillment of the requirement for the award of degree of Master Of Business Administration. Is a bonafide work carried out by him under my supervision and guidance. The work was carried during 21 june 2011 to 21 aug. 2011 in Paramount Farms International Pvt. Ltd. During the training period his behavior and performance was satisfactory.

Date : Seal/Stamp of the Organisation

Name of the guide Address:

CONTENTS S.No 1 2 3 4 5 6 7 8 9 Executive Summary Intro, objective & theoretical background Company Profile Research Methodology DATA ANALYSIS Findings & Conclusions Suggestions & recommendations Bibliography ANNEXURE Particulars PageNo. 1-2 3-19 20-33 34 35-45 46-48 49 50 51-55


2.1 INTRODUCTION: The Balance Sheet and the Statement of Income are essential, but they are only the starting point for successful financial management. Apply Ratio Analysis to Financial Statements to analyze the success, failure, and progress of your business. Importance of financial statement analysis in an organization In our money-oriented economy, Finance may be defined as provision of money at the time its needed. To everyone responsible for provision of funds, it is problem of securing importance to so adjust his resources as to provide for a regular outflow of expenditure in face of an irregular inflow of income. 1. The profit and loss account (Income Statement). 2. The balance sheet In companies, these are the two statements that have been prescribed and their contents have Been also been laid down by law in most countries including India.

There has been increasing emphasis on (a) Giving information to the shareholder in such a manner as to enable them to grasp it easily.30 (b) Giving much more information e.g. funds flow statement, again with a view to facilitating easy understanding and to place a year results in perspective through comparison with post year results. (c) The directors report being quite comprehensive to cover the factors that have been Operating and are likely to operate in the near future as regards to the various functions of production, marketing, finance, labor, government policies, environment in general. Financial statements are being made use of increasingly by parties like Bank, Governments, Institutions, and Financial Analysis etc. The statement should be sufficiently informative so as to serve as wide a curia as possible. The financial statement is prepared by accounts based on the activities that take place in production and non-production wings in a factory. Ratio Analysis enables the business owner/manager to spot trends in a business and to compare its performance and condition with the average performance of similar businesses in the same industry. To do this compares your ratios with the average of businesses similar to Yours and compare your own ratios for several successive years, watching especially for any Unfavorable trends that may be starting. Ratio analysis may provide the all-important early warning indications that allow you to solve your business problems before your business is destroyed by them.

2.2 OBJECTIVE OF THE STUDY The objective is to evaluate the financial performance of ICICI Bank LTD. over a two year period; 2008-10; with the help of ratio analysis.

2.3 THEORETICAL BACKGROUND The objective of ratio analysis is to judge the earning capacity, financial soundness and operating efficiency of a business organization. The use of ratios in accounting and financial management analysis helps the management to know the profitability, financial position (liquidity and solvency) and operating efficiency of an enterprise. The purpose of ratio analysis is as follows:

To identify aspects of a businesss performance to aid decision making Quantitative process may need to be supplemented by qualitative factors to get a complete picture 5 main areas: Liquidity the ability of the firm to pay its way Investment/shareholders information to enable decisions to be made on the extent of the risk and the earning potential of a business investment Solvency ability of a firm to meet its long term indebtedness. Profitability how effective the firm is at generating profits given sales and or its capital assets Financial the rate at which the company sells its stock and the efficiency with which it uses its assets. 2.3.1 LIQUIDITY RATIOS: CURRENT RATIO: Looks at the ratio between Current Assets and Current Liabilities Current Ratio = Current Assets : Current Liabilities Ideal level? 1.5 : 1 A ratio of 5 : 1 would imply the firm has Rs.5 of assets to cover every Rs.1 in liabilities A ratio of 0.75 : 1 would suggest the firm has only 75 paisa in assets available to cover every Re.1 it owes Too high Might suggest that too much of its assets are tied up in unproductive activities too much stock, for example?

Too low - risk of not being able to pay your way. ACID TEST RATIO Also referred to as the Quick ratio (Current assets stock) : liabilities 1:1 seen as ideal The omission of stock gives an indication of the cash the firm has in relation to its liabilities (what it owes) A ratio of 3:1 therefore would suggest the firm has three times cash as it owes very healthy! A ratio of 0.5:1 would suggest the firm has twice as many liabilities as it has cash to pay for those liabilities. This might put the firm under pressure but is not in itself the end of the world! QUICK RATIO=QUICKASSETS: CURRENT LIABLITIES Where, QUICK ASSETS=CURRENT ASSETS-(STOCK+PREPAID EXPENSES)

2.3.2 INVESTMENT/SHAREHOLDERS RATIOS: Earnings per share profit after tax / number of shares Price earnings ratio market price / earnings per share the higher the better generally. Comparison with other firms helps to identify value placed on the market of the business. Dividend yield ordinary share dividend / market price x 100 higher the better. Relates the return on the investment to the share price. Return on equity net profit after interest and tax / shareholders funds x 100. Judges the efficient utilisation of funds supplied by shareholders. Return on equity shareholders funds net profit after interest, tax and preference dividend / equity shareholders funds x 100. Used in comparing the performance of a companys equity capital with that of alike companies.

Dividend per share - equity dividend/no. of equity shares. The sum of declared dividends for every ordinary share issued. Dividend per share (DPS) is the total dividends paid out over an entire year (including interim dividends but not including special dividends) divided by the number of outstanding ordinary shares issued.

2.3.3 SOLVENCY RATIO: Gearing Ratio Long term loans / Capital employed x 100. The higher the ratio the more the business is exposed to interest rate fluctuations and to having to pay back interest and loans before being able to re-invest earnings Proprietary ratio shareholders funds / total assets higher the better. Shows the extent to which total assets have been financed by the proprietor. Total assets to debt ratio total assets / long term debt measures margin available to suppliers. Measures the extent to which debt is being covered by assets. Debt equity ratio debt / equity lower the better. Judges long term financial position and soundness of long term financial policies of the firm.

2.3.4 PROFITABILITY RATIOS: Profitability measures look at how much profit the firm generates from sales or from its capital assets Different measures of profit gross and net Gross profit effectively total revenue (turnover) variable costs (cost of sales) Net Profit effectively total revenue (turnover) variable costs and fixed costs (overheads) GROSS PROFIT MARGIN: Gross Profit Margin = Gross profit / turnover x 100

The higher the better Enables the firm to assess the impact of its sales and how much it cost to generate (produce) those sales A gross profit margin of 45% means that for every Rs.1 of sales, the firm makes 45p in gross profit NET PROFIT MARGIN: Net Profit Margin = Net Profit / Turnover x 100 Net profit takes into account the fixed costs involved in production the overheads Keeping control over fixed costs is important could be easy to overlook for example the amount of waste - paper, stationery, lighting, heating, water, etc. e.g. leaving a photocopier on overnight uses enough electricity to make 5,300 A4 copies. (1,934,500 per year) 1 ream = 500 copies. 1 ream = Rs.5.00 (on average) Total cost therefore = Rs.19, 345 per year or 1 persons salary. RETURN ON CAPITAL EMPLOYED (ROCE): Return on Capital Employed (ROCE) = Profit / capital employed x 100 The higher the better Shows how effective the firm is in using its capital to generate profit A ROCE of 25% means that it uses every Rs.1 of capital to generate 25p in profit Partly a measure of efficiency in organisation and use of capital OPERATING RATIO: Operating ratio = (cost of goods sold + operating expenses) / net sales x 100.

This ratio is calculated to judge the operational efficiency of the business. A decline in the operating ratio is better because it would leave a higher margin, which means more profit. OPERATING PROFIT RATIO: Operating profit ratio = operating profit / net sales x 100 The objective of computing this ratio is to determine the operational efficiency of management An increase in this ratio is said to be better. This ratio is widely used as an effective measure to judge the profitability of the concern. This ratio measures the relationship between operating profit and net sales. RETURN ON TOTAL ASSETS (ROTA): Return on total assets = net profit after tax / total assets x 100 The ratio is computed to ascertain whether the investments in assets have generated adequate net profit. A high percentage indicates efficient utilisation of assets. The ratio shows the relationship between the net profit and total assets. It also reflects on the efficiency of management. INTEREST COVERAGE RATIO (ICR): ICR = net profit before interest and tax / interest on long term debt

This ratio reflects the number of times that a company interest charges are covered by the profits available for interest. A higher ratio ensures safety of return on the amount of debt and it also ensures availability of surplus for shareholders. This ratio establishes relationship between profit before interest and tax and interest on long term debts.

2.3.5 FINANCIAL RATIOS: ASSET TURNOVER RATIO: Asset Turnover = Sales turnover / assets employed Using assets to generate profit Asset turnover x net profit margin = ROCE STOCK TURNOVER RATIO: Stock turnover = Cost of goods sold / stock expressed as times per year The rate at which a companys stock is turned over

A high stock turnover might mean increased efficiency? But: dependent on the type of business supermarkets might have high stock turnover ratios whereas a shop selling high value musical instruments might have low stock turnover ratio Low stock turnover could mean poor customer satisfaction if people are not buying the goods (Marks and Spencer?) DEBTOR DAYS: Debtor Days = Debtors / sales turnover x 365 Shorter the better Gives a measure of how long it takes the business to recover debts Can be skewed by the degree of credit facility a firm offers DEBTORS TURNOVER RATIO (DTR): DTR = net credit sales / average account receivables This ratio indicates economy and efficiency in the collection of amount due from debtors. Higher the ratio, better it is since it indicates that debts are being collected more quickly. In this ratio meaning of debtors is considered account receivable, i.e., debtors plus bills receivable. CREDITORS TURNOVER RATIO (CTR): CTR = net credit purchases / average payable It indicates the number of times the creditors are turned over in relation to purchases.

A high turnover or shorter payment period shows the availability of less credit or yearly payments. WORKING CAPITAL TURNOVER RATIO (WCTR): WCTR = cost of goods sold / net working capital. This ratio shows the number of times the working capital has been employed in the process of carrying on business. Higher the ratio, better the efficiency of utilising working capital. FIXED ASSETS TURNOVER RATIO (FATR): FATR = net sales / net fixed assets A high ratio indicates efficient utilisation of fixed assets. CURRENT ASSETS TURNOVER RATIO (CATR): CATR = net sales / current assets This ratio examines the efficiency or inefficiency in the investment of current assets. CAPITAL EMPLOYED TURNOVER RATIO (CETR): CETR = net sales / capital employed This ratio is good when the ratio is satisfactory i.e. ratio shouldnt be high nor being low. The objective of computing this ratio is to determine the efficiency in which the capital employed is being used, and this in turn shows the profitability and efficiency of management. EXPENSES RATIOS: Material consumed ratio = material consumed / net sales x 100

Manufacturing expenses ratio = manufacturing expenses / net sales x 100 Administrative expenses ratio = administrative expenses / net sales x 100 Selling and distribution expenses ratio = selling and distribution expenses / net sales x 100 Finance expenses ratio = finance expenses / net sales x 100 Expenses ratios reveal the managerial efficiency and profit earning capacity of the enterprise. On comparing ratios of similar enterprise as well as ratios of same enterprise, the saving or overspending of each item can be ascertained.

2.3.2 ADVANTAGES AND USES OF RATIO ANALYSIS: Useful in analysis of financial statements: Accounting ratios are useful for understanding the financial position of the enterprise. Bankers, investors, etc. all analyse balance sheet and profit and loss account by means of ratios. Useful in simplifying accounting figures: Accounting ratios simplifies, summarises and systemises a long array of accounting figures to make them understandable. Useful in judging the operating efficiency of business: Accounting ratios are essential for understanding the affairs of an enterprise, specially its operating efficiency.

Useful for forecasting: Ratios are helpful in business planning and forecasting. The trend ratios are analysed and used as guide to future planning. Useful in locating the weak spots: Accounting ratios are of great assistance in locating the weak spots in the business even though the overall performance may be quite good. Useful in inter firm and intra firm comparison: A firm would like to compare its performance with that of other firms and industry in general. This is called inter firm comparison. If the performance of different units belonging to the same firm is to be compared, it is called intra firm comparison. Such comparison is almost impossible without accounting ratios. Even the progress of the firm cannot be measured from year to year cannot be measured without the help of accounting ratios.

2.3.3 LIMITATIONS OF RATIO ANALYSIS: False result: Ratios are calculated from the financial statements; so, the reliability of ratio and its analysis is dependent upon the correctness of the financial statements. Different meanings are put on different terms: Elements and sub elements of financial statements are not uniquely defined as the basis are different. Due to this, the ratios that will be worked out will not be comparable. Before comparison, one must see that the ratios have been worked out on the same basis. Not comparable if different firms follow different accounting policies: When results of two enterprises are being compared, it should be kept in mind that enterprise may follow different accounting policies.

Affect of price level changes: Changes in price level affects the comparability of ratios. But no consideration is given to price level changes in the accounting variables from which ratios are computed. Ignores quantitative factors: sometimes ignores quantitative factors due to qualitative factors. May be worked out for insignificant and unrelated factors: The ratios can even be worked out for significantly unrelated factors. Difficult to evolve a standard ratio: The financial and economic scenario is dynamic; therefore, it is difficult to evolve a standard ratio. Window dressing: Ratios may be affected by window dressing. Manipulations of account are a way to conceal vital facts and present that statement better than what it actually is. Personal bias: Personal judgments play an important role in financial statements and, therefore, the accounting ratios are also not free from this limitation.

2.4 EXPRESSION OF RATIO Pure It is expressed as a quotient. For example, current ratio which expresses the relationship between current assets and current liabilities is (say) 2. It may also be expressed as 2: 1. Percentage It is expressed in percentage. For example, gross profit which relates gross profit to net sales is (say) 25%. Times It is measured in number of times a particular figure is compared to another figure. For example, stock turnover ratio which studies relationship between costs of goods sold and average stock is (say) 4 times.

Fraction It is expressed in fraction. For example, ratio of fixed assets to share capital is (say) (0.75). Ratio, sometimes, may be expressed in terms of days also. For example, the average collection period is 73 days.

3 COMPANY PROFILE 3.1 CORPORATE PROFILE ICICI Bank is India's second-largest bank with total assets of Rs. 4,062.34 billion (US$ 91 billion) at March 31, 2011 and profit after tax Rs. 51.51 billion (US$ 1,155 million) for the year ended March 31, 2011. The Bank has a network of 2,532 branches and about 6,301 ATMs in India, and has a presence in 19 countries, including India. ICICI Bank offers a wide range of banking products and financial services to corporate and retail customers through a variety of delivery channels and through its specialized subsidiaries in the areas of investment banking, life and non-life insurance, venture capital and asset management

The Bank currently has subsidiaries in the United Kingdom, Russia and Canada, branches in United States, Singapore, Bahrain, Hong Kong, Sri Lanka, Qatar and Dubai International Finance Centre and representative offices in United Arab Emirates, China, South Africa, Bangladesh, Thailand, Malaysia and Indonesia. Our UK subsidiary has established branches in Belgium and Germany. ICICI Bank's equity shares are listed in India on Bombay Stock Exchange and the National Stock Exchange of India Limited and its American Depositary Receipts (ADRs) are listed on the New York Stock Exchange (NYSE).

3.2 HISTORY ICICI Bank was originally promoted in 1994 by ICICI Limited, an Indian financial institution, and was its wholly-owned subsidiary. ICICI's shareholding in ICICI Bank was reduced to 46% through a public offering of shares in India in fiscal 1998, an equity offering in the form of ADRs listed on the NYSE in fiscal 2000, ICICI Bank's acquisition of Bank of Madura Limited in an all-stock amalgamation in fiscal 2001, and secondary market sales by ICICI to institutional investors in fiscal 2001 and fiscal 2002. ICICI was formed in 1955 at the initiative of the World Bank, the Government of India and representatives of Indian industry. The principal objective was to create a development financial institution for providing medium-term and long-term project financing to Indian businesses.

In the 1990s, ICICI transformed its business from a development financial institution offering only project finance to a diversified financial services group offering a wide variety of products and services, both directly and through a number of subsidiaries and affiliates like ICICI Bank. In 1999, ICICI become the first Indian company and the first bank or financial institution from non-Japan Asia to be listed on the NYSE. After consideration of various corporate structuring alternatives in the context of the emerging competitive scenario in the Indian banking industry, and the move towards universal banking, the managements of ICICI and ICICI Bank formed the view that the merger of ICICI with ICICI Bank would be the optimal strategic alternative for both entities, and would create the optimal legal structure for the ICICI group's universal banking strategy. The merger would enhance value for ICICI shareholders through the merged entity's access to low-cost deposits, greater opportunities for earning fee-based income and the ability to participate in the payments system and provide transaction-banking services. The merger would enhance value for ICICI Bank shareholders through a large capital base and scale of operations, seamless access to ICICI's strong corporate relationships built up over five decades, entry into new business segments, higher market share in various business segments, particularly fee-based services, and access to the vast talent pool of ICICI and its subsidiaries. In October 2001, the Boards of Directors of ICICI and ICICI Bank approved the merger of ICICI and two of its wholly-owned retail finance subsidiaries, ICICI Personal Financial Services Limited and ICICI Capital Services Limited, with ICICI Bank. The merger was approved by shareholders of ICICI and ICICI Bank in January 2002, by the High Court of Gujarat at Ahemdabad in March 2002, and by the High Court of Judicature at Mumbai and the Reserve Bank of India in April 2002. Consequent to the merger, the ICICI group's financing and banking operations, both wholesale and retail, have been integrated in a single entity.


ICICI Bank Limited



Traded as



Banking Financial services


1994 (promoted by ICICI)


Mumbai, Maharashtra, India

Key people

Chanda Kochhar (Chairman) Chanda Kochhar (MD & CEO) N. S.Kannan (ED & CFO) K. Ramkumar (Executive Director) Rajiv Sabharwal (Executive Director) Other Members


Finance and insurance Retail Banking Commercial Banking Mortgages Credit Cards Private Banking Asset Management Investment Banking $3.451 billion (2011)[1]



$1.134 billion (2011)[1] $89.493 billion (2011)[1] $12.136 billion (2011)[1] 74,056 (2010)[1]

Total assets

Total equity



3.4 ICICI Banks global network, today, spans 18countries.



ICICI Lombard General Insurance Company Limited ICICI Prudential Life Insurance Company Limited ICICI Securities Limited ICICI Prudential Asset Management Company Limited ICICI Venture Funds Management Company Limited ICICI Home Finance Company Limited ICICI Direct


ICICI Bank UK PLC ICICI Bank Canada ICICI Bank Eurasia LLC


2005 - Investitsionno-Kreditny Bank (IKB), a Russian bank 2007 - Sangli Bank, Maharashtra State 2010 - Bank of Rajasthan



Ms. Chanda Kochhar, Managing Director & CEO, received the Global Leadership Award for her contribution to the US India commercial relationship

Ms. Chanda Kochhar, Managing Director & CEO, was named as one of the two best Indian CEOs in an annual poll conducted by Finance Asia magazine.

ICICI Bank is the only Indian brand to figure in the Brands Top 100 Most Valuable Global Brands Report 2011, second year in a row.

ICICI Bank ranked 5th in the list of "57 Indian Companies", and 288 the in World Rankings in Forbes Global 2000 list

Ms. Chanda Kochhar Managing Director & CEO, was conferred with the Transformational Business Leader of the Year, by All India Management Association (AIMA)

Ms. Chanda Kochhar, Managing Director & CEO, was ranked 17th in Fortune's 25 Most Powerful CEOs in Asia.

Ms. Chanda Kochhar, Managing Director & CEO, was ranked as the 5th most recognized and respected company leaders by American research firm, Penn Schoen Berland (PSB). The survey was conducted among 600 respondents from US, EU, Asia-Pacific and India in March

Ms. Chanda Kochhar Managing Director & CEO ranks 41 in the "50 Power List 2011", by India Today

Ms. Chanda Kochhar, Managing Director & CEO, awarded the Skoch Challenger Awards 2011, for Banking. The Skoch awards recognizes best practices in people, projects and institutions for inclusive growth

Ms. Chanda Kochhar, Managing Director & CEO, in the list of 25 most powerful professional women of the country, by India Today

ICICI Bank has won the "Banking Technology Awards 2010" at The Indian Banks Association in the following categories:

"Best Financial Inclusion Initiative" (first prize) "Best Online Bank" ( runner up) "Best use of Business Intelligence" ( runner up) "Technology Bank of the year" ( runner up)

ICICI Bank was recognized for its Special Citation of the Fully Electronic Branch Service Channel, first set up at Hiranandani Estate, Thane, at the Financial Insights Innovation Awards held in conjunction with Asian Financial Services Congress

For the second year in a row, ICICI Bank was ranked 70th in the Brandirectory league tables of the worlds most valuable brands by, The Brand Finance Banking 500.

ICICI Bank UK, HiSAVE product range has been awarded the Consumer Money facts Awards 2011 for the 'Best Online Savings Provider'

ICICI Bank ranked second in the financial services sector in Business World's,"Most Respected Company Awards 2011"

ICICI Bank was ranked 1st in the Banking and Finance category and 9th in the "2010 Best Companies To Work For" by Business Today

Ms. Chanda Kochhar, Managing Director & CEO, ICICI Bank conferred with "Padma Bhushan"


Ms Chanda Kochhar, Managing Director & CEO, conferred the Outstanding Woman Business Leader of the Year award by CNBC TV18

ICICI Bank awarded the most Tech-friendly Bank award by Business World Ms Chanda Kochhar featured in Business Today's list of 30 most powerful women leaders for the 8th consecutive year

Ms. Chanda Kochhar, Managing Director & CEO, ranked 92nd in Forbes list of the Most Powerful Women in the world

Ms.Chanda Kochhar, Managing Director & CEO was ranked 10th in the International Fortune list of 50 most powerful women in business

ICICI Bank was voted as the Most Trusted Brand among private sector banks in the 2010 Economic Times - Brand Equity Most Trusted Brands Awards and ranked 7th in the list of Top 50 service brands

ICICI Bank received the 2010 World Finance UK award for: in Remittance Business, Worldwide Excellence in NRI Services,


Worldwide Excellence in Private Banking Business, APAC Region

ICICI Bank UK, HiSAVE has been awarded 'Best Online Savings Account Provider 2010 ' by Your Money, direct consumer awards, UK.

ICICI Bank UK, HiSAVE has been commended for 'Best Internet Account Provider 2010' and 'Best Fixed Rate Account Provider 2010' by Money facts, an independent consumer finance leading aggregator

Ms.Chanda Kochhar, MD & CEO was awarded the Financial Express Best Banker Award

For the sixth time in a row, ICICI Bank has received the Most Preferred Auto Loan Brand in the Financials Services category at the CNBC Consumer Awards

ICICI Bank has won Gold in the Readers Digest Trusted Brands 2010 Consumer award in the Finance category for a) Best Bank and b) Best Credit Card Issuing Bank

ICICI Bank won the Best Trade Finance Bank and Best Foreign Exchange Bank, India at the Finance Asia Country Awards for Achievement, Hong Kong

ICICI Bank won the Best Local Bank by Trade and Forfaiting Review, UK ICICI Bank received the Best Trade Finance Bank in India by The Asset Triple A Award, Hong Kong

ICICI Bank was awarded the Best Trade Finance Bank in South Asia by GTR (Global Trade Review), UK

ICICI Bank amongst the top 3 to receive the FE- EVI Green Business Leaders Award, in the banking industry

ICICI Bank wins the Asian Banker Award for Best Banking Security System ICICI Bank is the first and the only Indian brand to be ranked as the 45th most valuable global brand by Brands Top 100 Global Brands Report.

ICICI Bank has been ranked 1st in the term money category, from a list of 38 leading Banks by the German magazine, Euro. Since commencement of business two years ago in the German market, this is the 5th certification/award including 2 certifications from Stiftung warren test (for Savings and Term Deposits) and three "Best Bank" rankings by Euro magazine.

Forbes' 2000 most powerful listed companies' survey ranked ICICI Bank 4th among the Indian companies and 282nd globally.

ICICI Bank was awarded The Asian Banker Achievement Award 2009 for Cash Management in India.

The Economic Times-Corporate Dossier Annual Survey of India Inc's Most Powerful CEOs featured Ms Chanda Kochhar, MD and CEO, as the most powerful women CEO in India. She was ranked 13th in the overall power list.

ICICI Group Global Private Clients (GPC) has won the coveted 'Euro money Private Banking Award 2010' for Best Bank in the Super-Affluent Category (USD 500,000 to USD 1 million) - India. The other categories in which GPC picked up awards were:




Management Lending/Financing

Solutions Precious


Investment Private Equity Investment Specialized Services - Entrepreneurs FX/Rates Derivatives Supplier

ICICI Bank wins the Asian Banker Award for Excellence in SME Banking 2009 ICICI Bank won the second prize in the Six Sigma Excellence Awards, conducted by Indian Statistical institute, Bangalore for "Improving Sales for TV Banking business"

Mr.N. Vaghul, Former Chairman, ICICI Bank was awarded the "Padma Bhushan"

3.7 CONTROVERSY ICICI Bank has been in focus in recent years because of alleged harassment of customers by its recovery agents. Listed below are some of the related news links:

ICICI Bank was fined 55 lakh for hiring goons (known colloquially as "goondas") to recover a loan. Recovery agents had, allegedly, forcibly dragged out a youth (who was not even the borrower) from the car, beaten him up with iron rods and left him bleeding as they drove away with the vehicle. "We hold ICICI Bank guilty of the grossest kind of deficiency in service and unfair trade practice for breach of terms of contract of hirepurchase/loan agreement by seizing the vehicle illegally, No civilized society governed by the rule of law can brook such kind of conduct" said Justice Kaleem, who was born in Laddhawala, Muzaffarnagar is the president of the consumer commission.

RBI warns ICICI Bank for coercive methods to recover loans. ICICI Bank drives customer to suicide - Four men including an employee of ICICI Bank booked under sections 452, 306, 506 (II) and 34 of IPC for abetting suicide. According to the suicide note they advised him, "If you cannot repay the bank loan, sell off your wife, your kids, yourself, sell everything at your home. Even then if you cannot pay back the due amount, then it's better if you commit suicide." India biggest private bank has compensated the life by money

ICICI Bank on huge car recovery scam in Goa - ICICI Bank invests in car-jackers to recover loans in Goa. A half an hour investigative report on CNN-IBN's 30 Minutes. The under cover report was executed by CNN-IBN's Special Investigations Team from Mumbai, led by Ruksh Chatterji. Family of Y. Yadaiah alleged that he was beaten to death by ICICI Banks recovery agents, for failing to pay the dues. Four persons were arrested in this case.

A father while talking to Times of India alleged that "ICICI Bank recovery agents visited his house and threatened his family. And his son Nikhil consumed poison because of the tension"

Oppressed by ICICI Bank's loan recovery agents, Shakuntala Joshi (38), committed suicide by hanging. The suicide note stated that she was upset with the ill-treatment meted out by ICICI Bank's recovery agents and had thus decided to end her life. In another case of a suicide it is alleged that goondas sent by ICICI Bank abused Himanshu and his wife in front of the entire residential colony before taking away his vehicle. Feeling frustrated and insulted, he reportedly committed suicide.

C.L.N Murthy, a scientist with the Hyderabad-based Indian Institute of Chemical Technology, was allegedly tortured by recovery agents of ICICI Bank after he defaulted on his loan. They humiliated me no end. They ripped my shirt, shaved my moustache, cut my hair and gave electric shocks on my chest and even spat on my face" adds Murthy.

A dozen recovery agents of ICICI Bank, riding on bikes, allegedly forced a prominent lawyer, Someshwari Prasad, to stop his car. They held Prasad at gunpoint and also slapped him to force him. A manager of the ICICI Bank branch, Rakesh Mehta, along with four other employees was arrested.

In a landmark case, Allahabad High Court had ordered registration of an FIR against ICICI Bank's branch manager, President, Chairman and Managing Director on a complaint of 75-year-old widow Prakash Kaur. She had complained that goondas were sent by the bank to harass her and forcibly took away her truck. When the Supreme Court wanted to know about the procedure adopted by the Bank, ICICI Bank counsel said notice would be sent to a defaulter asking him either to pay the installments or hand over the vehicle purchased on loan, failing which the agents would be asked to seize it. When the Bench pointed out that recovery or seizure could be done only legally, ICICI Bank counsel said, "If we have to go through the legal process it would be difficult to recover the installments as there are millions of defaulters".

Taking strong exception to ICICI Bank's use of 'goondas' against a defaulter, the president of Consumer Disputes Redressal Forum said, "The fact leaves us aghast at the manner of functioning and goondaism in which the bank is involved for a petty amount of 1,889... Such attitude is deplorable and sends chills down the spine....The bank had the option to recover dues through legal means. They have no legal right to snatch the vehicle in such a manner which amounts to robbery,". In this case recovery agents pointed a pistol at a defaulter when he tried to resist. ICICI bank argued that they had taken peaceful possession of the vehicle "after due intimation to the complainant as he was irregular in remitting the monthly installments". But the court found out that the records proved otherwise.


ICICI Prudential life insurance company ICICI Prudential AIMC and trust ICICI Securities ICICI Lombard insurance company ICICI Venture


The data is collected from the source and is attached in annexure which includes financial statements & other additional information. 5 DATA ANALYSIS 5.1 RATIO CALCULATION 5.1.1 LIQUIDITY RATIOS CURRENT RATIO (CR) CR= Current assets/Current liabilities Current assets = cash and balance with RBI + bank balance, money at call + advances + investments Current liabilities = borrowings + other liabilities and provision NOTE: The ICICI bank has used contingent liabilities as current liabilities and investments as current assets. Whereas in the quick ratio given below ICICI bank has used current liabilities as other liabilities and provision and quick assets as cash and bank balance, advances and other advances. But, I have calculated it as per my knowledge and not as per ICICI bank. IN 2009 Current assets = 17536.33 + 12430.23 + 218310.85 + 103058.31 = 351335.72 Current liabilities = 67323.69 + 43746.43 = 111070.12 CR = 351335.72/111070.12 = 3.16:1 IN 2010 Current assets = 27514.39 + 11359.40 + 181205.60 + 120892.80 = 340972.09 Current liabilities = 94263.57 + 15501.48 = 109765.05

CR = 340972.09/109765.05 = 3.10:1 QUICK RATIO (QR) QR = quick assets / current liabilities Quick assets = cash and bank balance with RBI + bank balance, money at call + investments IN 2009 Quick assets = 17536.33 + 12430.23 + 103058.31 = 133024.87 QR = 13024.87/111070.12 = 1.19:1 IN 2010 Quick assets = 27514.39 + 11359.40 + 120892.80 = 159766.59 QR = 159766.59/109765.05 = 1.45:1 RATIO IN 2009 CR QR 3.16 1.19 IN 2010 3.1 1.45

3.5 3 2.5 2 CR 1.5 1 0.5 0 IN 2009 IN 2010 QR

5.1.2 INVESTMENT/ SHAREHOLDERS RATIOS DIVIDEND PER SHARE (DPS) DPS = equity dividend/no. of equity shares Equity dividend = equity dividend (% per share) x no. of equity shares x 10/100 IN 2009 1224.58 = 110 x no. of equity shares x 10/100 No. of equity shares = 111.3254(IN CRS.) DPS = 1224.58/111.3254 = 11 RS. Per share IN 2010 1337.95 = 120 x no. of equity shares x 10/100 No. of equity shares = 111.495(IN CRS.) DPS = 1337.95/111.495 = 12 RS. Per share EARNING PER SHARE (EPS) EPS = (net profit after tax preference dividend)/no. of equity shares Preference dividend = 0. So, net profit after tax = net profit after tax preference dividend. IN 2009 EPS = 3758.13/111.3254 = 33.76 RS. Per share IN 2010

EPS = 4024.98/111.495 = 36.10 RS. Per share

PRICE EARNING RATIO (PER) PER = Book value/EPS IN 2009 PER = 444.94/33.76 = 13.18 TIMES IN 2010 PER = 463.01/36.10 = 12.83 TIMES RATIO IN 2009 DPS EPS PER 11 33.76 13.18 IN 2010 12 36.1 12.83

40 35 30 25 20 15 10 5 0 DPS EPS PER IN 2009 IN 2010

5.1.2 PROFITABILITY RATIOS RETURN ON INVESTMENT (ROI) ROI = Profit before int., tax and dividend / capital employed x 100 IN 2009 ROI = 6193.87 / 49883.02 x 100 = 12.41% IN 2010 ROI = 6834.63 / 51618.37 x 100 = 13.24% NET PROFIT MARGIN NET PROFIT MARGIN = NET PROFIT/ TURNOVER X 100 IN 2009 NET PROFIT MARGIN = 6163.87/39210.31 x 100 = 15.79% IN 2010

NET PROFIT MARGIN = 6834.63/32999.36 x 100 = 20.71%


IN 2009

IN 2010


12.41% 13.24% 15.79% 12.71%

18.00% 16.00% 14.00% 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% IN 2009 IN 2010 ROI NPM

5.1.4 FINANCIAL RATIOS: FINANCIAL EXPENSES RATIO Finance expenses ratio = finance expenses / net sales x 100 IN 2009 Finance expenses ratio = 32842.47 / 39210.31 x 100 = 83.75% IN 2010 Finance expenses ratio = 26695.06 / 32999.36 x 100 = 80.89% CAPITAL EMPLOYED TURNOVER RATIO: CETR = net sales / capital employed IN 2009 CETR = 39210.31 / 49883.02 = 0.78 TIMES IN 2010 CETR = 32999.36 / 51618.37 = 0.63 TIMES

FIXED ASSETS TURNOVER RATIO: FATR = net sales / net fixed assets IN 2009 FATR = 39210.31 / 27965.24 = 1.40 IN 2010 FATR = 32999.36 / 22472.62 = 1.46 CURRENT ASSETS TURNOVER RATIO (CATR): CATR = net sales / current assets IN 2009 CATR = 39210.31 / 351335.72 = 0.11 TIMES IN 2010 CATR = 32999.36 / 340972.09 = 0.09 TIMES RATIO IN 2009 CETR FATR CATR FER 0.78 1.4 0.11 83.75 IN 2010 0.63 1.46 0.09 80.89

90 80 70 60 50 40 30 20 10 0 CETR FATR CATR FER IN 2009 IN 2010

5.1.5 SOLVENCY RATIOS: PROPRIETARY RATIO (PR) PR = Shareholders funds / total assets Shareholders funds = equity share capital + preference share capital + reserves fictitious assets Shareholders funds = capital employed (as there are no non operating assets as per given information in annexure) IN 2009 Shareholders funds = 1113.29 + 350 + 48419.73 = RS. 49883.02 (IN CRS.) PR = 49883.02/379300.96 = 0.13:1 IN 2010 Shareholders funds = 1114.89 + 0 + 50503.48 = RS. 51618.37(IN CRS.) PR = 51618.37/36339.71 = 0.14:1

DEBT-EQUITY RATIO (DER) DER= debt/equity IN 2009 DER = 218347.82/49883.02 = 4.38:1 IN 2010 DER = 202016.60/51618.37 = 3.91:1 TOTAL ASSETS TO DEBT RATIO (TADR) TADR = total assets/long term debt IN 2009 TADR = 379300.96/218347.82 = 1.74:1 IN 2010 TADR = 363399.71/202016.60 = 1.80:1 RATIO IN 2009 PR DER TADR 0.13 4.38 1.74 IN 2010 0.14 3.91 1.8

5 4.5 4 3.5 3 2.5 2 1.5 1 0.5 0 PR DER TADR Series1 Series2


14) FER = financial expenses ratio}

6 FINDINGS AND CONCLUSIONS 6.1 FINDINGS Dividend per share In 2009, the DPS was RS.11 per share and it has increased to RS.12 per share in 2010. The increase in dividend is said to be better as it increases the dividend paid to equity shareholders which in turn makes people interested in investing in the business. Earning per share The earning per share has increased from RS. 33.76 In 2009 to RS. 36.10 In 2010. This shows that the firm has increased profit earning capacity. A greater profit earning capacity makes the investors to invest in the business.

Price earning ratio The price earning ratio has fallen down from 13.18 to 12.83. This shows that the firm has lost a little faith from his investors due to the decrease in the market price per share. Proprietary ratio There is an increase in the proprietary ratio which indicates that the lenders and creditors are satisfied as there funds can be financed through the assets of the firm. Total asset to debt ratio The asset debt ratio has improved from 1.74 to 1.80 which shows the firm is efficient to pay of its debts through his assets in emergency situations. Debt equity ratio The debt equity ratio has fallen down from 4.38 to 3.91. This shows that the lenders enjoy a greater degree of protection. So, they will be able to provide the funds at required stages seeing the firms ability to pay debt. Return on investment It judges how efficiently the sources of the business are used. There is an increase in the return on investment from 12.41 to 13.24. This shows that the firm has improved its efficiency and has utilized them well. Current ratio There is a decrease in the current ratio but still the ratio is said to be impure as the ratio is above 2:1 which is said to be pure. Therefore, the funds have started to be utilized but they are not fully utilized. Quick ratio The quick ratio is fairly a stringent method of liquidity. The quick ratio has increased from 1.19 to 1.45. Even though, there is a smaller increase in quick ratio but this shows that in utilizing there current assets, firm hasnt taken care of quick assets. Social responsibility The ICICI Bank needs to take care of its social responsibility as there are many reports shown in controversy section shows that they are hiring up goons, forcing people to suicides or repay loan and many other things. Prestige and Recognition The ICICI Bank employees are working effectively towards the organization for which they are being awarded for the past few years.

2nd largest bank - The ICICI Bank is the second largest bank in the world. It needs to gain the number 1 spot. Net profit margin - it has increased which shows that firm is increasing its profitability during the course of time. Capital employed turnover ratio - it is good as it is nor too high nor too low which is said to be satisfactory Fixed assets turnover ratio it has increased which shows the firms efficiency in utilizing it assets to increase its sales. Current asset turnover ratio it has decreased a little and it shows that firm is inefficient to utilize its current assets. Financial expenses ratio this ratio has decreased which shows that the firm has reduced its expenses and it is said to be a good sign for the business.

6.2 CONCLUSION At the end, I have come to the following conclusion: The firm needs to improve its current assets as well as needs to improve its faith over its customers. This is because the firm has its improper current ratio, quick ratio and price earning ratio. The firm needs to take qualitative as well as quantitative facts because ratios focus only on the basis of financial statements and doesnt show the complete scenario of the whole enterprise. The ICICI Bank needs to take care of its social responsibility towards its customers. There had been many reports on their controversy with the customers. The ICICI Bank is the second -largest bank with total assets of Rs. 4,062.34 billion (US$ 91 billion) at March 31, 2011 and profit after tax Rs. 51.51 billion (US$ 1,155

million) for the year ended March 31, 2011. The Bank has a network of 2,532 branches and about 6,301 ATMs in India, and has a presence in 19 countries, including India. The Bank currently has subsidiaries in the United Kingdom, Russia and Canada, branches in United States, Singapore, Bahrain, Hong Kong, Sri Lanka, Qatar and Dubai International Finance Centre and representative offices in United Arab Emirates, China, South Africa, Bangladesh, Thailand, Malaysia and Indonesia. Their UK subsidiary has established branches in Belgium and Germany.

7 SUGGESTIONS AND RECOMMENDATIONS Some of The suggestions and recommendations are as follows: Both quantitative and qualitative facts need to be considered. None of the facts is to be undermined. To improve profitability, growth and stability, the firm needs to decrease its operating expenses. The attention is required on the areas of growth, profitability, servicelevel and building talent. To increase its liquidity, bank should keep some more cash in its hand instead of giving more and more advances.

Make manager competitive and introduce spirit of market-orientation and culture of working for customer satisfaction. Bank should manage its all risk such as credit, market and operational risk properly and should be managed by a person who is highly skilled and qualified.

8 BIBLIOGRAPHY REFERRED BOOKS: T.S. Grewals, Analysis of Financial Statements, Sultan Chand & sons (p) LTD., Educational publishers, New Delhi 110002, India, 2008 edition, Number of pages referred from 4.1 to 4.5, 4.62 to 4.65, 6.5 to 6.14 INTERNET SITE:, vipul, 8 July 2011., ICICI Bank Ltd. - Research Center, 4th July 2011



report,, ICICI Bank Ltd. Research Center, 4th July 2011


9.1 PROFIT AND LOSS ACCOUNT: The following profit and loss account for the year 2009 and 2010 given below is in Rs.(in crs.) PARTICULARS Intrest earned Other income Total income Interest expended MARCH 2009 31092.55 8117.76 39210.31 22725.93 MARCH 2010 25706.93 7292.43 32999.36 17592.57

Employee cost Selling and administration expenses Depreciation Miscellaneous expenses Operating expenses Provisions and contingencies Total expenses

1971.70 5977.72 678.60 4098.22 10795.14 1931.10 35452.17 MARCH 2009

1925.79 6056.48 619.50 2780.03 10221.99 1159.81 28974.37 MARCH 2010 4024.98 0 2809.65 6834.63

Net profit for the year Extraordinary item Profit brought forward Total

3758.13 -0.58 2436.32 6193.87

9. 2 BALANCE SHEET: The balance sheet of ICICI Bank for 2009 and 2010 given below is in Rs.(in crs.) PARTICULARS CAPITAL Equity share capital Preference share capital Reserves 1113.29 350 48419.73 1114.89 0 50503.48 MARCH 2009 MARCH 2010

Deposits Borrowings Other liabilities and provision Total liabilities

218347.82 67323.69 43746.43

202016.60 94263.57 15501.48

379300.96 MARCH 2009

363399.72 MARCH 2010

ASSETS Cash and balance with RBI Balance with banks, money at call Advances Investments Net block Other assets Total assets 218310.85 103058.31 3801.62 24163.62 379300.96 181205.60 120892.80 3212.69 19214.93 363399.71 17536.33 12430.23 27514.39 11359.40

9. 3 ADDITIONAL IMFORMATION: PARTICULARS Gross block Accumulated depreciation on gross block Contingent liabilities Bills for collection Book value (rs.) 803991.92 36678.71 444.94 694948.84 38597.36 463.01 MARCH 2009 7443.71 3642.09 MARCH 2010 7114.12 3901.43

Preference dividend Equity dividend Corporate dividend tax Earning per share Transfer to statutory reserves Transfer to other reserves Equity dividend (% per share) Proposed dividend

0 1224.58 151.21 33.76 2008.42 0.01 110

0 1337.95 164.04 36.10 1867.22 1.04 120


1501.99 3464.38

Appropriations Balance c/f to 2809.65 balance sheet Face value 10