1)

Robust asset growth: Increase to USD1.5 trillion in FY12 from USD1.3 trillion in FY10

2) 3)

Revenue increases: grew almost four-fold from US$ 11.8 billion to US$ 46.9 billion Growing lending and deposit: Total lending and deposits have increased at CAGR of 22.8 per cent and 21.2 per cent, respectively

4)

Higher ATM penetration: Total number of ATMs in India have increased to 1,04,500 in 2012

5)

Rising rural penetration: Due to Financial Inclusion Plan (FY10-13), the banking connectivity in India increased more than threefold to 211,234 villages in 2013

Reserve Bank of India

Banks
Scheduled Commercial Banks (SCBs) Public sector banks (27) Private sector banks (22) Foreign banks (41) Cooperative credit institutions

Financial Institutions

All-India financial institutions

State-level institutions

Regional Rural Banks (RRB) (62) Urban cooperative banks (1,674)

Rural cooperative credit institutions (96,751)

Other institutions

Source: RBI - Reserve Bank of India, Aranca Research Note: The data on number of banks belongs to FY12

Growth in credit off-take over past few years (USD billion)

Growth in deposits over the past few years (USD billion)

High growth of the Indian Economy

Favourable Demographics
Financial Inclusion(FI) Private Banking and Wealth Management Infrastructure Financing Technology Innovation

Basel III norms Intensifying Competition

Increasing NPA
Licensing Requirement

Political Factors

Economic Factors

- Monetary Policy - Regulatory Framework - Budget & Budget Measures - Changes in interest rates

- More savings - More Capital Formation - Increase in production goods and Services - Banking Channels

of

Social Factors

Technological Factors

- Increase in population - Changes in lifestyle - Easy way of lending money - Exploring banking facilities in rural areas

- Internet Banking - IT Services & Mobile Banking - Credit Cards - Improvement in efficiency

Michael Porter Five Forces

Indian Banking Industry : Not Attractive, unless differentiated

Bargaining Power of Customers

Bargaining Power of Suppliers

Threat of new entrants

Threat of new substitutes

Entry Barriers in the Industry

High Medium Low

Competitive Rivalry

Licensing Requirements are very tough Product differentiation very difficult

NBFCs, Mutu al funds, Govern ment Securities and t-bills increasing rapidly

Large no. of banks Low switching costs High fixed costs High exit barriers

Banks have to meet many regulatory criteria, made by the RBI (fairly complex in India)

Provides homogenous kinds of services, so there is high chance that customers switch their banks

HDFC BANK
HDFC Bank
Established in 1994, HDFC Bank is the second largest private sector bank in India. HDFC was amongst the first to receive an 'in principle' approval from the RBI to set up a bank in the private sector Divisions Retail banking, Wholesale banking and Treasury operations Size Number of branches and extensions: 3,062* Number of ATMs: 10,743* Number of employees: 66,076 as on March 31, 2012 Total assets: USD73.5 billion* Recognition Best Retail Bank in India (Asian Banker:2012) Best Performing Bank Private (CNBC TV18:2011)

Net profit USD (millions)

1,235.8 1,076.5

CAGR: 31.6%
614.3 331.3 237.8

818.0

467.7

FY07

FY08

FY09

FY10

FY11

FY12

FY13

Source: Company Annual Reports, Aranca Research Note: * - As on March 2013 Note: * CAGR - Compound Annual Growth Rate, CAGR*: is calculated in INR terms FY13**: Data till February 2013

AXIS BANK
Axis Bank
Established in 1994, Axis Bank is the third largest private sector bank in India. The bank is capitalised to the extent of USD86.0 million with the public holding at 54.1 per cent as on 31st March, 2012 Divisions Treasury, retail banking, corporate/wholesale banking and other banking business Size Number of branches and extensions: 1,947* Number of ATMs: 11,245* Number of employees : 31,738 as on March 31,2012 Total assets: USD63 billion* Recognition Most Productive Private Sector Bank award (FIBAC:2011) 3rd strongest bank in Asia Pacific region (Asian Banker: 2011)

Net profit USD (Millions)

998.0 936.4 753.0

CAGR: 37.5%
452.7 264.1 485.4

147.6

FY07

FY08

FY09

FY10

FY11

FY12

FY13

Source: Company Annual Reports, Aranca Research Note: FIBAC - FICCI and Indian Banks Association Conference * - As on December 2012

Income break-up (FY13)

Advances and deposits (USD billion)

6% Net Interest income 24 34% 60% Other Income FY07 FY08 FY09 FY10 18 Fee Income 8 12 12 17 22 29

46 39 35 30

46 36

FY11 Deposits

FY12

FY13

Advances

Source: Company Annual Reports, Aranca Research

ICICI BANK
ICICI Bank was founded in 1954 as an Indian multinational bank and financial services company headquartered in Mumbai. Based on 2013 information, it is the second largest bank in India by assets and third largest by market capitalisation. Divisions Treasury, retail banking, , life and nonlife insurance, venture capital and asset management, corporate/wholesale banking and other banking business Size Number of branches and extensions: 3350* & 10486 ATMs & has a presence in 19 countries
Recognition

ICICI Bank Limited has been conferred the Best Remittance Business award Ms. Chanda Kochhar, MD & CEO, was also featured in the Power List 2013 of 25 most powerful women in India by India Today, for the third year in a row