Dabu Tranning Report 5th Sem

A TRAINING REPORT
ON
ANALYSIS OF FINANCIAL STATEMENTS OF
KOTAK MAHINDRA BANK
Submitted to:
Satyug Darshan Institute of Engineering and Technology
By:
DEVSMITA MALLICK
Roll No. -
Batch 2016 - 2019
In Partial Fulfillment of
Bachelor of Business Administration
(Industry-Integrated)
(Specialization: Financial Services and Banking)
MAHARSHI DAYANAND UNIVERSITY

ROHTAK (HARYANA)
(NOVEMBER, 2018)
Satyug Darshan Institute of Engineering and Technology

Bhupani Lalpur Road, Village Bhupani
Faridabad - 121002, NCR, Haryana, India
DECLARATION
I, Ms. DevsmitaMallick, student of SatyugDarshan Institute of Engineering & Technology hereby

declare that this training report titled “Analysis of financial statements of Kotak Mahindra Bank.” is the
record of authentic work carried out by me during the period from …….2018 to ……..2018 and has not
been submitted to any other University or Institute for the award of any degree / diploma etc.
(Signature)
DevsmitaMallick
Date:
BONAFIDE CERTIFICATE
This is to certify thatMs. DevsmitaMallick, student of SatyugDarshan Institute of

Engineering and Technologyhas successfully completed the project work titled
“Analysis of financial statements on Kotak Mahindra Bank .” in partial fulfillment of
requirement for the completion ofBachelor in Business Administration (BBA II-FSB)
course as prescribed by the MaharshiDayanand University, Rohtak, (HARYANA).
This project report is the record of authentic work carried out by her during the period
from 8th JANUARY 2018 to 14th APRIL 2018. She has worked under my guidance.
(Signature)
Mrs. Sneha Sharma
Assistant Professor, BBA Department
Project Guide (Internal)
Date:
ACKNOWLEDGEMENT
Perseverance, inspiration and motivation have always played a great role in the success of any venture.
At this level of understanding it is often different to understand the wide spectrum of knowledge without
proper guidance and advice.
I have great pleasure and privilege in expressing my deep sense of gratitude to my Project Guide, Mrs.
Sneha Sharma for his guidance and support in completing this project and giving his valuable insights
and suggestion regarding the same, which has helped my project to shape up the way, it is now. It was
only because of his helpful nature that I was given absolute freedom to explore new directions in this
project.
I would take this opportunity to thank Mr. Subhash Arora.
Finally, I would like to thank all myfriends and family members who have helped me for the completion
of this project.
DevsmitaMallick
PREFACE
Many students may have work on this project in different way/styles. I have also tried to work on this
project in a different way.
It was for the first time I got the opportunity to work in such a prestigious and well-known organization
and things which I have experienced in my training time are going to help me throughout my life time. I
have worked on this project with great enthusiasm and zeal.
DEVSMITA MALLICK
DATE:
TABLE OF CONTENT
S.NO PARTICULARS PAGE NO.
1 Introduction to the study
2 Company Profile
3 Literature review
Research Methodology
 Objectives of the Study
 Research Design
4
 Method of Data Collection
 Limitations of the Study
5 Data Analysis & Interpretation
6 Findings, Conclusion and Suggestions
7 Bibliography
Annexure
CHAPTER – 1
INTRODUCTION
Financial statement
Financial Statements are the reports that provide the detail of entity’s financial information including
assets, liabilities, equity, incomes and expenses, shareholders’ contribution, cash flow and others related
information. These statements normally required annual audit by independence auditors and they are
presented along others information in entity annual report.
Base on IAS 1, there are five types of Financial Statements that entity required to prepare and present if
those statements are prepared by using IFRS, and US GAAP. Most of local GAAP also required the
same thing. Financial Statements are used by entity’s management, shareholders, investors, staffs;
majors’ customers, majors’ suppliers, government authority, stocks exchanges, and others related
stakeholders.
Here are the five types of Financial Statements:
Income Statement
Income statement is one of the financial statements of entity that report three main financial information
of entity for the specific period of time. That information included revenues, expenses, and profit or loss
for the period of times.
Income Statement is sometime called the statement of financial performance because this statement let
the users to assess and measure the financial performance of entity from period to period of the same
entity or with competitors. The detail of these three main information’s is:
Revenues
Revenues refer to sales of goods or services that entity generate during the specific accounting period.
Entity can use cash basis or accrual basis to recognize its revenues. In the revenues section, you could
know how much the entity made net sales for the period they are covering.
Revenues normally reports as the summary in income statement and if you want to check the detail,
probably you need to check with the noted to the revenues that provided.
Expenses
Expenses are operational costs that occur in the company for specific accounting period. They are
ranking from operating expenses like salary expenses, utilities, depreciation, transportation and training
expenses to tax expenses and interest expenses.
Profit or Loss
Profit or loss refers to the bottom line of income statement those results from deducting expenses from
revenues. If the revenues during the period are higher than expenses, then there is profit. However, if the
expenses are higher than revenues, then there will be loss. Profit or loss for the period will forward to
retain profit or loss in balance sheet and statement of change in equity.
Balance Sheet
Balance Sheet is sometime called statement of financial position. It shows the balance of assets,
liabilities and equity at the end of the period of time. Balance sheet is sometime called statement of
financial position since it shows the values of net worth of entity. You can find entity net worth by
removing liabilities from total assets.
Assets
Assets are resources own by entity legally and economically. For example, building, land, cars, and
money are types of assets of entity. Assets are classified into two main categories: Current Assets and
Non-Current Assets.
Current Assets refer to short term assets including cash on hand, petty cash, raw materials, work in
progress, finish goods, prepayments, and similar kind that convert and consume within 12 months from
the reporting date.
Non-current assets including tangible and intangible assets that expected to convert and consume in
more than 12 months from reporting date. Those assets include land, building, machinery, computers
equipment, long term investment and similar kind of.
Liabilities
Liabilities are the obligation that entity owes to others person or entity. For example, credit purchases,
bank loan, interest payable, tax payables, and overdraft. The same like assets, liabilities are classed into
two types: Current Liabilities and Non-current liabilities. The liabilities are the balance sheet items and
they represent the amount at the end of accounting period.
Equity
Equities are the different between assets and liabilities. The items in equity included share capital, retain
earning, common stock, prefer sock, and accumulation of others income. The changed of assets and
liabilities over the period will affect the net value of equity. You can calculate the net value of equity of
an entity by removing liabilities from assets.
Detail of Balance Sheet is here,
Statement of Change in Equity
Statements of change in equity are one of Financial Statements that show the shareholder contribution
and movement in equity. And equity balance at the end of accounting periods. Information that shows is
this statement including Classification of share capital, total share capital, retains earning, dividend
payment, and others related state reserve.
Please note that the statement of change in equity is the result of income statement and balance sheet.
Basically, if the income statement and balance sheet are correctly prepared, the statement of change in
equity would be corrected too.
Statement of Cash Flow

Statement of cash flow is one of the Financial Statement that shows the movement of entity’s cash
during the period. This statement help users how is the cash movement in the entity.
There are three sections in this statement. They are cash flow from operation, cash flow from investing,
and cash flow from financing activities. In general, the information will be shown base on the method of
cash flow that entity prepare. It includes direct and indirect method.
Noted to Financial Statements

Note to Financial Statements is the importance statements that most people forget about. This is the
mandatory requirement by IFRS that entity has to prepare this statement.
Note or sometime call disclosure detail the financial information related to specific account. Example, in
balance sheet you will see the balance of fixed assets. But detail information of those fixed assets is
including not in the statement of financial position. If the users want to learn more about those fixed
assets, they need to go to note to those fixed assets.
Purpose for business entities
"The objective of financial statements is to provide information about the financial position,
performance and changes in financial position of an enterprise that is useful to a wide range of users in
making economic decisions." Financial statements should be understandable, relevant, reliable and
comparable. Reported assets, liabilities, equity, income and expenses are directly related to an
organization's financial position.
Financial statements are intended to be understandable by readers who have "a reasonable knowledge of
business and economic activities and accounting and who are willing to study the information
diligently." Financial statements may be used by users for different purposes:
 Owners and managers require financial statements to make important business decisions that affect
its continued operations. Financial analysis is then performed on these statements to provide
management with a more detailed understanding of the figures. These statements are also used as
part of management's annual report to the stockholders.
 Employees also need these reports in making collective bargaining agreements (CBA) with the
management, in the case of labor unions or for individuals in discussing their compensation,
promotion and rankings.
 Prospective investors make use of financial statements to assess the viability of investing in a
business. Financial analyses are often used by investors and are prepared by professionals (financial
analysts), thus providing them with the basis for making investment decisions.
 Financial institutions (banks and other lending companies) use them to decide whether to grant a
company with fresh working capital or extend debt securities (such as a long-term bank
loan or debentures) to finance expansion and other significant expenditures.
Consolidation
Consolidated financial statements are defined as "Financial statements of a group in which

the assets, liabilities, equity, income, expenses and cash flows of the parent (company) and
its subsidiaries are presented as those of a single economic entity", according to International
Accounting Standard 27 "Consolidated and separate financial statements", and International Financial
Reporting Standard 10 "Consolidated financial statements".
Government
The rules for the recording, measurement and presentation of government financial statements may be
different from those required for business and even for non-profit organizations. They may use either of
two accounting methods: accrual accounting, or cost accounting, or a combination of the two (OCBOA).
A complete set of chart of accounts is also used that is substantially different from the chart of a profit-
oriented business.
Personal
Personal financial statements may be required from persons applying for a personal loan or financial aid.
Typically, a personal financial statement consists of a single form for reporting personally held assets
and liabilities (debts), or personal sources of income and expenses, or both. The form to be filled out is
determined by the organization supplying the loan or aid.
Audit and legal implications
Although laws differ from country to country, an audit of the financial statements of a public company is
usually required for investment, financing, and tax purposes. These are usually performed by
independent accountants or auditing firms. Results of the audit are summarized in an audit report that
either provides an unqualified opinion on the financial statements or qualifications as to its fairness and
accuracy. The audit opinion on the financial statements is usually included in the annual report.
There has been much legal debate over who an auditor is liable to. Since audit reports tend to be
addressed to the current shareholders, it is commonly thought that they owe a legal duty of care to them.
But this may not be the case as determined by common law precedent. In Canada, auditors are liable
only to investors using a prospectus to buy shares in the primary market. In the United Kingdom, they
have been held liable to potential investors when the auditor was aware of the potential investor and how
they would use the information in the financial statements. Nowadays auditors tend to include in their
report liability restricting language, discouraging anyone other than the addressees of their report from
relying on it. Liability is an important issue: in the UK, for example, auditors have unlimited liability.
In the United States, especially in the post-Enron era there has been substantial concern about the
accuracy of financial statements. Corporate officers - the chief executive officer (CEO) and chief
financial officer (CFO) - are personally responsible for fair financial reporting allowing those reading
the report to have a good sense of the organization.
Standards and Regulations
Different countries have developed their own accounting principles over time, making international
comparisons of companies difficult. To ensure uniformity and comparability between financial
statements prepared by different companies, a set of guidelines and rules are used. Commonly referred
to as Generally Accepted Accounting Principles (GAAP), these set of guidelines provide the basis in the
preparation of financial statements, although many companies voluntarily disclose information beyond
the scope of such requirements.
Recently there has been a push towards standardizing accounting rules made by the International
Accounting Standards Board ("IASB"). IASB develops International Financial Reporting Standards that
have been adopted by Australia, Canada and the European Union (for publicly quoted companies only),
are under consideration in South Africa and other countries. The United States Financial Accounting
Standards Board has made a commitment to converge the U.S. GAAP and IFRS over time.
Inclusion in annual report
To entice new investors, public companies assemble their financial statements on fine paper with
pleasing graphics and photos in an annual report to shareholders, attempting to capture the excitement
and culture of the organization in a "marketing brochure" of sorts. Usually the company's chief
executive will write a letter to shareholders, describing management's performance and the company's
financial highlights.
In the United States, prior to the advent of the internet, the annual report was considered the most
effective way for corporations to communicate with individual shareholders. Blue chip companies went
to great expense to produce and mail out attractive annual reports to every shareholder. The annual
report was often prepared in the style of a coffee table book.
Notes
Notes to financial statements (notes) are additional information added to the end of financial statements
that help explain specific items in the statements as well as provide a more comprehensive assessment of
a company's financial condition. Notes to financial statements can include information on debt, going
concern criteria, accounts, contingent liabilities or contextual information explaining the financial
numbers (e.g. to indicate a lawsuit).
The notes clarify individual statement line-items. For example, if a company lists a loss on a fixed
asset impairment line in their income statement, notes could state the reason for the impairment by
describing how the asset became impaired. Notes are also used to explain the accounting methods used
to prepare the statements and they support valuations for how particular accounts have been computed.
In consolidated financial statements, all subsidiaries are listed as well as the amount of ownership
(controlling interest) that the parent company has in the subsidiaries. Any items within the financial
statements that are evaluated by estimation are part of the notes if a substantial difference exists between
the amount of the estimate previously reported and the actual result. Full disclosure of the effects of the
differences between the estimate and actual results should be included.
Management discussion and analysis
Management discussion and analysis or MD&A is an integrated part of a company's annual financial
statements. The purpose of the MD&A is to provide a narrative explanation, through the eyes of
management, of how an entity has performed in the past, its financial condition, and its future prospects.
In so doing, the MD&A attempt to provide investors with complete, fair, and balanced information to
help them decide whether to invest or continue to invest in an entity.
The section contains a description of the year gone by and some of the key factors that influenced the
business of the company in that year, as well as a fair and unbiased overview of the company's past,
present, and future.
MD&A typically describes the corporation's liquidity position, capital resources, results of its
operations, underlying causes of material changes in financial statement items (such as asset impairment
and restructuring charges), events of unusual or infrequent nature (such as mergers and
acquisitions or share buybacks), positive and negative trends, effects of inflation, domestic and
international market risks, and significant uncertainties.
Move to electronic segments

Financial statements have been created on paper for hundreds of years. The growth of the Web has seen
more and more financial statements created in an electronic form which is exchangeable over the Web.
Common forms of electronic financial statements are PDF and HTML. These types of electronic
financial statements have their drawbacks in that it still takes a human to read the information in order to
reuse the information contained in a financial statement.
More recently a market driven global standard, XBRL (Extensible Business Reporting Language),
which can be used for creating financial statements in a structured and computer readable format, has
become more popular as a format for creating financial statements. Many regulators around the world
such as the U.S. Securities and Exchange Commission have mandated XBRL for the submission of
financial information.
The UN/CEFACT created, with respect to Generally Accepted Accounting Principles, (GAAP), internal
or external financial reporting XML messages to be used between enterprises and their partners, such as
private interested parties (e.g. bank) and public collecting bodies (e.g. taxation authorities). Many
regulators use such messages to collect financial and economic information.
CHAPTER -2
COMPANY PROFILE
HISTORY
Established in 1985, the Kotak Mahindra group has been one of India's most reputed financial
conglomerates. In February 2003, Kotak Mahindra Finance Ltd, the group's flagship company was given
the license to carry on banking business by the Reserve Bank of India (RBI). This approval created
banking history since Kotak Mahindra Finance Ltd. is the first non–banking finance company in India to
convert itself in to a bank as Kotak Mahindra Bank Ltd. Today, the bank is one of the fastest growing
bank and among the most admired financial institutions in India.
The bank has over 323 branches and a customer account base of over 2.7 million. Spread all over India,
not just in the metros but in Tier II cities and rural India as well, it is redefining the reach and power of
banking. Presently it is engaged in commercial banking, stock broking, mutual funds, life insurance and
investment banking. It caters to the financial needs of individuals and corporates. The bank has an
international presence through its subsidiaries with offices in London, New York, Dubai, Mauritius, San
Francisco and Singapore that specialize in providing services to overseas investors seeking to invest into
India.
Products and Services

The bank offers complete financial solutions for infinite needs of all individual and non–individual
customers depending on the customer's need – delivered through a state of the art technology platform.
Investment products like Mutual Funds, Life Insurance, retailing of gold coins and bars etc. are also
offered. The bank follows a mix of both open and closed architecture for distribution of the investment
products. All this is backed by strong, in–house research on Mutual Funds.
The bank’s savings account goes beyond the traditional role of savings, and allows us to put aside a lot
more than just money. The worry–free feature of Savings Account provides a range of services from
funds transfer, bill payments, 2–way sweep through our Active Money feature and much more. We can
place standing instructions for investment options that can be booked through Internet or through Phone
banking services. The Savings Account thus provides for attractive returns earned through a
comprehensive suite products and services that offer investment options, all delivered seamlessly to the
customer by well integrated technology platforms.
Apart from Phone banking and Internet banking, the Bank offers convenient banking facility through
Mobile banking, SMS services, Net banking, and Home banking and Bill Pay facility among others.
The Depository services offered by the Bank allows the customers to hold equity shares, government
securities, bonds and other securities in electronic or Demat forms.
The Salary 2 Wealth offering provides comprehensive administrative solutions for Corporates with
features such as easy and automated web based salary upload process thereby eliminating the paper
work involved in the process, a dedicated relationship manager to service the corporate account,
customized promotions and tie – ups and many such unique features. The whole gamut of investment
products and investment advisory services is available to the salary account holders as well.
For the business community, the bank offer comprehensive business solutions that include the Current
Account, Trade Services, Cash Management Service and Credit Facilities. The bank’s wholesale banking
products offer business banking solutions for long–term investments and working capital needs, advice
on mergers and acquisitions and equipment financing. To meet special needs of the rural market, the
bank has dedicated business offerings for agricultural financing and infrastructure. Its Agriculture
Finance division delivers customized products for capital financing and equipment financing needs of
our rural customers.
For financial liquidity the bank offers loans that meet personal requirements with quick approval and
flexible payment options. To complete the personal financial offerings space, the bank now offers Kotak
Credit Card which is a hassle–free, transparent product that also happens to be the first vertical credit
card in the industry.
Kotak Mahindra Bank addresses the entire spectrum of financial needs of Non–Resident Indians. The
bank has tie–up with the Overseas Indian Facilitation Centre (OIFC) as a strategic partner, which gives
them a platform to share their comprehensive range of banking and investment products and services for
Non Resident Indians (NRIs) and Persons of Indian Origin (PIOs). Their Online Account Opening
facility and Live Chat service helps to get in touch at the comfort of homes and at the convenience.
These offerings are specifically designed to suit the overseas Indian's personal financial needs and give
the global Indians a near to home feel.
Awards
ICAI Award – Excellence in Financial Reporting under Category 1 – Banking Sector for the year
ending 31st March, 2010
Asia money – Best Local Cash Management Bank 2010
IDG India – Kotak won the CIO 100 'The Agile 100' award 2010
IDRBT
Banking Technology Excellence Awards Best Bank Award in ITS Framework and Governance among
Other Banks' – 2009
Banking Technology Award for IT Governance and Value Delivery, 2008
IR Global Rankings – Best Corporate Governance Practices – Ranked among the top 5 companies in
Asia Pacific, 2009
Finance Asia – Best Private Bank in India, for Wealth Management business, 2009
Kotak Royal Signature Credit Card – Was chosen 'Product of the Year' in a survey conducted by
Nielsen in 2009
IBA Banking Technology Awards
Best Customer Relationship Achievement – Winner 2008 & 2009
Best overall winner, 2007
Best IT Team of the Year, 4 years in a row from 2006 to 2009
Best IT Security Policies & Practices, 2007
Euro money – Best Private Banking Services (overall), 2009
Emerson Uptime Champion Awards – Technology Senate Emerson Uptime Championship Award in
the BFSI category, 2008
2010
Best Investment Bank in India, 2010
Best Equity House in India, 2010
Best Broker in India, 2010
Best Domestic Equity House, 2010
Best Local Brokerage in the Asia money Brokers Poll ? 2010
Best Investment Bank in India, 2010
Best Bank for Equity Finance in India, 2010
Best Domestic Investment Bank, 2010
Best Investment Bank in India, 2006, 2007, 2008, 2009 & 2010
Best Equity House in India, 2008 & 2010
Best Domestic Equity House, 2008, 2009 & 2010
Kotak Mahindra Bank has launched a credit card called Kotak Trump Card that offers 10% cash back on
dining as well as movie and play spends.
Kotak Mahindra Bank (KMB) has introduced Stock Ace, a new product offering for individual
customers which provides them the power of instant liquidity.
2011
Kotak Mahindra Bank launches interbank mobile payment service
Milestones
1986 – Kotak Mahindra Finance Ltd started the activity of Bill Discounting
1987 – Kotak Mahindra Finance Ltd entered the Lease and Hire Purchase market
2003 – Kotak Mahindra Finance Ltd. converted into a commercial bank – the first Indian company to do
so.
2009 – Kotak Mahindra Bank Ltd. opened a representative office in Dubai. Entered Ahmadabad
Commodity Exchange as anchor investor.
FINANCIAL HIGHLIGHTS
Pursuant to the approval of the Reserve Bank of India to the Scheme of Amalgamation of ING Vysya
Bank Ltd. (IVBL) with Kotak Mahindra Bank Ltd. (the Bank), IVBL merged with the Bank effective
from 1st April 2015. The current year consolidated and standalone figures include operations of the
erstwhile IVBL. Hence, the previous year figures are not comparable.
BONUS ISSUE OF SHARES
During the year, pursuant to approval of the shareholders of the Bank at the Annual General meeting
held on 29th June 2015, your Bank issued 91,28,41,920 Bonus shares in the ratio of 1:1 i.e. one equity
share for every one equity share held on the Record Date, to the Members on 10th July 2015.
DIVIDEND
Your Directors are pleased to recommend a dividend of Rs. 0.50 per equity share entailing a payout of
Rs. 110.53 crore including dividend distribution tax. The dividend would be paid to all the shareholders,
whose names appear on the Register of Members/Beneficial Holders list on the Book Closure date.
CAPITAL
During the year, your Bank has allotted 99,91,715 equity shares (adjusted for bonus) arising out of the
exercise of Employees Stock Options granted to the employees and whole–time directors of your Bank
and its subsidiaries. As per the ESOP Schemes of erstwhile ING Vysya Bank Ltd. (IVBL), the stock
options granted to the employees vested on an accelerated basis upon the merger. Consequently, the
number of stock options on which vesting was accelerated was 1,04,91,900 (on a post swap basis,
adjusted for bonus shares).
Post allotment of equity shares as aforesaid and the bonus allotment, the issued, subscribed and paid–up
share capital of your Bank stands at Rs. 9,17,19,10,790 comprising of 1,83,43,82,158 equity shares of
Rs. 5 each as on 31st March 2016.
Your Bank is well capitalized and has a Capital Adequacy Ratio (CAR) under Basel III as at 31st March
2016 of 16.34% with Tier I being 15.28%.
During the year, your Bank has not issued any capital under Tier II. As on 31st March 2016, outstanding
Unsecured, Redeemable Non–Convertible, Subordinated Debt Bonds were Rs. 969.7 crore and
outstanding Unsecured, Non–Convertible, Redeemable Debt Capital Instruments Upper Tier II stood at
Rs. 806.31 crore.
TERMINATION OF GDS PROGRAM

The Global Depository Shares (GDS) of the Bank were listed on Luxembourg Stock Exchange.
Consequent to the issuance of notice of termination of the GDS program by the Bank to the Custodian
and the Depository, the Depository Agreement entered into between the Bank and the Depository was
terminated. Subsequently, the GDS program has been terminated with effect from 4th September 2015.
OPERATIONS
The merger of ING Vysya Bank (IVBL) with this Bank brought in 577 branches and 657 ATMs from the
erstwhile IVBL.
This Bank consolidated its network presence through a measured expansion of its footprint across the
country and as of 31st March 2016 had 1333 branches and 2032 ATMs, covering 706 locations. Of the
74 new branches commissioned this year, 32 were in rural and semi–urban locations. This Bank added
about 10.96 lac new customers this year across core banking products of savings and checking accounts,
term deposits, overdrafts and non–resident accounts. This Bank rolled out several initiatives aimed at
offering a superior and differentiated customer experience. Some key ones are:
Products and Services

1. Launched its first E–Lobby at Andheri Metro Station, Mumbai. The e–lobby offers a host of self
service capabilities such as ATM, Banking Kiosk, Tablets, Surface Table, etc. which can be used by both
customers and non–customers.
2. Enhanced its suite of products positioned at specific customer segments and launched two new
propositions, MY FAMILY – a savings bank proposition tailored exclusively for the entire family. The
proposition gives the benefit of pooling in balances across family members & also gives them the
benefit of a dedicated relationship manager for the family, and, ALPHA – a savings bank proposition
linked to investments. The customer gets the benefit of a NMC waived savings account when they
choose an RD (or) MF SIP (or) NPS along–with a term insurance premium of Rs. 300 per month (which
offers a cover of Rs.20 lac) linked to their savings account. The proposition also offers Cash Back on
Debit Card spends & is targeted for the age group of 18–55.
3. Tied up with Thomas Cook and Kuoni Travels to offer a Holiday Savings Account linked to a
Recurring Deposit. Customers get benefit of various schemes & offers launched by these travel
companies and the banking linkage enables them to save on a monthly basis to facilitate the holiday
expense.
4. Appointed as Authorized Collection Centre (ACC) by Stock Holding Corporation of India Ltd
(SHCIL) for providing E–stamping facility in the states of Punjab and Rajasthan. Appointed as one of
the collecting Banks for Government of India’s Sovereign Gold Bonds and was actively involved in
raising subscriptions across all three tranches. Launched three new Current Account products – Kotak
Pro Plus, Kotak Elite Plus and Kotak Ace Plus offering more efficient cash management in select
locations.
5. Introduced Kotak Cheque Protect, a calibrated credit oriented program for offering cheque protection
facility to existing customers for honoring cheques in the event of shortfall in the bank account, based on
certain pre–approved parameters.
6. Implemented Foreign Account Tax Compliance Act (FATCA) / Common Reporting Standard (CRS)
which requires the Bank to carry out due diligence of its customers to identify the individuals and
entities which fulfill the indices as prescribed by the regulatory bodies and reporting to the Indian tax
authorities for onward submission of information to foreign authorities as appropriate.
Business Lines
a) Non Resident Indian Business
Some of the key initiatives taken this year are:
Extended CR money transfer to Canada. Your Bank’s NRI clients can now use this medium to transfer
money from Canada to their Kotak Bank account in India.
Further expanded the network of exchange house relationships and the count now stands at 26.
As a platform to reach out to the overseas Indian community, your Bank has participated in various
international business forums organized by the Indian community in various countries.
In order to work closely with the mariner community & shipping companies your Bank has participated
in various mariner events nationally.
b) Priority Banking Business

Privy League program, positioned to cater to the affluent segment, now services 3.4 lac customers. A
new tier–Insignia was launched at select locations to cater to customers with group relationship value of
at least Rs. 1 crore. A Corporate Credit card with exclusive benefits for Privy League Business banking
customers was introduced to increase the segmental focus in the program. To address customers need for
legacy planning, Smart Will, an automated online will writing solution was launched in association with
Kotak Securities.
c) Corporate Salary Business

Salary-Wealth your Bank’s corporate salary business now caters to over 17 lac customers across 13,700
corporates. The Salary2Wealth book grew by 33% Y–o–Y to close the year at Rs. 3,988 crore and
acquired 4.90 lac new customers with more than 1,700 new corporate sign–ups.
d) Consumer Assets
Your Bank has continued to grow the product lines under the Consumer Assets business.
Credit Card: Credit card business has issued 6.34 lac cards by March 2016 and is in its seventh year of
operations. The premium range of our products VISA Signature and VISA Platinum have driven spends
growth in the portfolio and it contributes to 42% of spends. The credit card business has clocked total
spends of Rs. 4,543 crore for the year at 42% growth Y–o–Y with a book size of Rs.942 crore.
Salaried Personal Loan: Salaried personal loan business offers salaried individuals personal loans with
tenure of up to 60 months. This year the business has grown by 70% with outstanding loans of Rs. 1,416
crore as of March 2016. The total customer base stands at 47,500 customers.
Home Finance: Home finance business clocked growth of 19% in disbursements with loan book growth
of 19%. Your Bank has expanded its home finance business further in Tier II cities. Cross Sell through
Bank Branches, Corporate Salary, Privy, and Wealth Teams contributed to around 38% of total volume.
This year also witnessed very low losses on account of effective recovery and collection processes and
policies adopted.
e) Business Banking Assets (BBA)

Your Bank through its BBA division offers secured and unsecured Business loans, Loans against
Property & Working Capital Finance to self-employed professionals / non–professionals and Small &
Medium Enterprises. This has been a landmark year for your Bank’s BBA business with its book
growing by 30%. It continues to maintain its best in class portfolio quality through it effective and
efficient risk management and recovery policies and practices. Capitalizing on the growing retail branch
network, your Bank managed to expand its BBA product offering in over 450 branches.
Wholesale Banking
Your Bank through its consolidated franchise has focused on serving customers requirements across
segments with its wide array of customized financial products and services that are driven through best–
in–class technology platforms. Your Bank is a trusted banking franchise consistently delivering right and
customized solutions to high quality customers through a passionate and entrepreneurial team.
Focused approach on client selection and constant portfolio monitoring has ensured a healthy portfolio
through both volatile economic situation and tough credit environment in the last financial year. In order
to give more focus to our client activities, your Bank created a separate Corporate, Institutional &
Investment Banking vertical which covers selected large Indian corporate houses with a view to provide
a single platform to service both their corporate banking and investment banking needs. Consequent to
the merger of ING Vysya Bank Limited with your Bank, we now have a strong presence in the
multinational segment i.e. as a banker to various multinational companies present in India.
The Integrated Global Transaction Banking with enhanced suite of products and solutions is steered by
innovation, technology & Kona Kona Kotak. The merger has opened up new opportunities to cater to
needs of customer segments such as Insurance, Corresponding Banking and Multinational Companies.
In addition to serving existing customers as well as being bankers Bank on Global Transaction Banking,
your Bank has led from the front in offering services to new age segments viz. E–com and M–com. Your
Bank recognizes the dynamic landscape in Transaction Banking and the evolving Banking space and has
suitably invested in finch initiatives. It is your Bank’s endeavor to continue to provide simple, secure,
reliable solutions leading to superior customer experience.
Your Bank has been in the limelight for its people, products and services. It has been adjudged Best
Cash Management Bank across business categories Small, Medium and Large Corporates. The Global
Custodian magazine has conferred a dual recognition for the Custody Business in the India Domestic
Survey and later in the Survey of Agent Banks in Emerging Markets.
Your Bank has introduced the following key initiatives to serve customers better:
Service Support: To ensure a faster customer response, a Service Solutions vertical was set up during the
year. This vertical is the single point of contact for all service related and documentation issues for
wholesale customers with personnel present across all key major 9 locations across the country.
Secure Internet Banking: Given the growing online frauds, the security of the net banking platform has
been further strengthened by offering secured token for logging in. Customers can use the dynamic
number on the token along with the password to access the account online and transact thereafter. Cash
Pay Offers walk in cash and cheque collection services through branch network thereby enhancing the
reach and convenience for the customer. The product is capable of validating the collection data pre–fed
by customer to ensure only valid requests are processed. The transaction processing is supported by
comprehensive MIS for ease of reconciliation and instant status of collection.
Operation SAHAJ: In order to gain increased efficiencies, your Bank has started Operation SAHAJ.
This focusses on improving existing client facing or back–end process in order to deliver superior
service to the client with a lower turnaround time without compromising on credit / operational risk.
One of our clients facing endeavors has been able to open any account in one day post receiving the
complete documentation. As of today, courtesy Operation SAHAJ, accounts are being opened within the
target of one day. Further, various products are implementing monitoring and control systems to measure
and improve service parameters.
Trade: Tie up with multiple offshore banks for facilitating client transactions like offshore guarantees,
ECA financing, ECB funding, offshore subsidiary funding etc. Your Bank is preferred trade partner for
top banks for Europe and US region for their India centric business. Financial/ Performance Guarantees,
Letter of Credit and remittances of these banks now are handled at your Bank counters.
Commercial Banking
The Commercial Banking business has registered a reasonable growth in FY 2015–16 despite subdued
market sentiments and erratic monsoon.
Commercial Vehicles (CV) and Construction Equipment (CE) sectors, which have been witnessing
slowdown since 2011, showed strong signs of recovery. The CV situation has improved significantly
over the previous year, especially in the case of Medium Commercial Vehicle (MCV) & Heavy
Commercial Vehicle (HCV) sales across segments, which was driven by replacement demand. Your
Bank has increased exposure significantly to this sector in FY 2015–16. Light Commercial Vehicle
(LCV) segment has also grown over the previous year. Further, decrease in energy prices and all round
improvement of load factors have improved viability for transport operations and also reduced levels of
delinquency. Small Commercial Vehicles (SCV) segment is also showing signs of recovery with
marginal growth in the last quarter.
Despite a second back to back dry spell last year, the agro business (including the tractor finance
business) managed to grow last year with the loans outstanding of Rs.17,993 crore. The agro business
increased its focus on financial inclusion activities by directly financing the micro loans segment for
women’s Joint Liability Groups. Close to 56,000 women borrowers were added with loan sizes of
around Rs. 20,000 each to women in the states of UP and Bihar. Your Bank has maintained its market
share in the tractor finance business. While the delinquencies in this segment have increased, it is under
control.
Activities in focus were loans for construction of ware houses & cold storages, warehouse receipt
funding under pledge, micro loans and loans for purchase of pumps etc. These loans qualified for small
and marginal farmer categorizations and direct individual farmer funding. Other Agro loans included
loans for food and Agro processing units.
The agro division (including tractor finance) continued to manage its delinquency though incremental
stress was observed across locations due to monsoon shortfall. The growth of the Emerging Corporate
Group’s (ECG) portfolio has been modest in FY 2015–16. There has been an increase in delinquencies
in this segment, mainly on account of volatile commodity prices and uncertainty in the economy.
Significant transformation opportunity, we are on the journey to leverage digital technology to enable
greater engagement, interaction and flexibility.
Guided by our value system that motivates our attitudes and action, your Bank is focused on forward
looking policies, lean processes and nurturing talent.
Technology
With the announcement of the merger with ING Vysya Bank, your Bank took up the initiative of
merging the technology systems and data of the two banks. The merger provided an opportunity to
leverage the best of breed systems from both banks. As the technology integration progressed across
business verticals, your Bank identified synergies in systems and capabilities to optimize costs across
the technology operations of the two banks. The merged systems will provide a standard customer
experience across all channels to all customers of the merged entities.
Customer data security and risk management need to keep pace with digital offerings. With this in mind,
the Distributed Denial of Service was augmented with an in–premise solution. A fraud management
solution to track customer transactions across channels was implemented. On the regulatory side, a new
Enterprise Risk System was implemented for the Value at Risk calculation of the treasury products.
Digitization
Focus on creating more and more digitally enabled services across channels remained a key priority for
your Bank in this year. Some of the highlights being: Launched a comprehensive microsite for New
Pension System with various calculators and educative content to demystify the concept of pension and
also enable people to get started with opening their pension account online.
Launched a real time customer acquisition platform for personal loan, where a customer PAN, Adhaar &
CIBIL are checked real time & decision about the loan amount and interest rate can be given instantly.
Launched Pre–approved Personal Loan on Net Banking for salaried customers. This enables a pre–
qualified customer to apply for personal loan while logged into the net–banking account and the
disbursed amount is instantly credited to customer’s banking account. Launched tab based account
opening process for Saving Account. This is an end–to–end digitized workflow, from lead capture to
account set up, thereby reducing the processing time and enhancing customer experience. Hashtag
banking was given further fillip by creating capability to order a book or special promotional movies by
just a single tweet.
Launched Kotak Bharat Banking – India’s first internet–free app. This app does not need internet to
transact. Customer can do 25 different transactions including mobile recharge and small value fund
transfer. The app is available in 6 languages (Hindi, Gujarati, Marathi, Tamil, Kannada and English).
Response messages within the app will also be in regional language. Rolled out e–store on Net Banking
after successful roll out of m–store on banking app. This includes travel categories like flight tickets, bus
tickets and hotel booking.
Introduced new features in the iPhone version of mobile app. iPhone customers can now book a
Recurring Deposit (RD), Add a new biller and set Auto Pay amongst various new services introduced.
Turn–around times for lending to commercial customers significantly improved by digitizing the process
by introducing a tablet based lead management system for use by sales people in the field.
Corporate customers got an upgraded FX trading portal.
Digitization for wealth management customers was also strengthened with the launch of a portal
providing a single view of all their investments.
Investment in Airtel M Commerce Services Ltd.

Airtel M Commerce Services Ltd. Company (AMSL), 100% subsidiary of Bharti Airtel Ltd. (BAL), had
been granted in–principle approval for setting up a Payments Bank by the Reserve Bank of India (RBI)
in August 2015. Basic but critical services such as small savings account, remittances etc. will bring a
large number of low income households and small businesses under formal banking network. Your Bank
in February 2016 has signed a Share Subscription and Shareholders Agreement with AMSL and BAL for
acquisition of 19.90% equity stake in AMSL. Subsequently, your Bank has invested in AMSL. AMSL
has received final license from RBI in April 2016.
SUBSIDIARIES & ASSOCIATES

Your Bank’s subsidiaries are established players in the different areas of financial services, viz. car
finance, investment banking, stock broking, asset management and life insurance.
As at 31st March 2016, your Bank has eighteen (18) subsidiaries as listed below:
Domestic Subsidiaries
Kotak Mahindra Prime Limited
Kotak Securities Limited
Kotak Mahindra Capital Company Limited
Kotak Mahindra Old Mutual Life Insurance Limited
Kotak Mahindra Investments Limited
Kotak Mahindra Asset Management Company Limited
Kotak Mahindra Trustee Company Limited
Kotak Investment Advisors Limited
Kotak Mahindra Trusteeship Services Limited
Kotak Forex Brokerage Limited
Kotak Mahindra Pension Fund Limited
Kotak Mahindra General Insurance Company Limited
IVY Product Intermediaries Limited (formerly known as ING Vysya Financial Services Limited)
International Subsidiaries
Kotak Mahindra (International) Limited
Kotak Mahindra (UK) Limited
Kotak Mahindra Inc.
Kotak Mahindra Financial Services Limited
Kotak Mahindra Asset Management (Singapore) Pte. Limited
Kotak Mahindra General Insurance Company Limited, which was incorporated in December 2014 with
principal objective of carrying on business of general insurance, received approval from Insurance
Regulatory and Development Authority of India (IRDAI) to commence the business of general
insurance in November 2015 and subsequently commenced its operations in December 2015.
SECRETARIAL AUDITOR
Pursuant to Section 204 of the Companies Act, 2013, your Bank has appointed Ms. Rupal D. Jhaveri, a
Company Secretary in Practice, as its Secretarial Auditor. The Secretarial Audit Report for the financial
year ended 31st March 2016 is annexed to this Report.
DEPOSITS
Being a banking company, the disclosures required as per Rule 8(5)(v) & (vi) of the Companies
(Accounts) Rules, 2014, read with Section 73 and 74 of the Companies Act, 2013 are not applicable to
your Bank.
AUDITORS
In terms of Section 139 of the Companies Act, 2013, Messrs. S.R. Batliboi & Co. LLP, Chartered
Accountants, were appointed as statutory auditors of your Bank for a period of four years from the
conclusion of the Thirtieth Annual General Meeting until the conclusion of the Thirty fourth Annual
General Meeting of the Bank, subject to the annual approval of RBI and ratification by the members
every year. Accordingly, requisite resolution forms part of the Notice convening the Annual General
Meeting.
INTERNAL FINANCIAL CONTROLS

The Board of Directors confirms that your Bank has laid down set of standards; processes and structure
which enables to implement Internal Financial controls across the organization with reference to
Financial Statements and those control are adequate and are operating effectively. During the year under
review, no material or serious observation has been observed for inefficiency or inadequacy of such
controls.
RISK MANAGEMENT POLICY

Your Bank has in place a comprehensive Enterprise wide Risk Management (ERM) framework
supported by detailed policies and processes for management of Credit Risk, Market Risk, Liquidity
Risk, Operational Risk and various other Risks. Details of identification, assessment, mitigations,
monitoring and the management of these Risks are mentioned in the Management Discussion and
Analysis section appended to this Report.
CHAPTER 3
LITERATURE REVIEW
Yusuf and Hakan, (2011) described the short term creditors of a company like suppliers of goods of
credit and commercial banks providing short-term loans are primarily interested in knowing the
company’s ability to meet its current or short-term obligation as and when these become due. Ross et
al., (2007) implied that the most researchers divide the financial ratios into four groups i.e. profitability,
solvency, liquidity and activity ratios for detailed analysis.
Eugene F Brigham and Michael C Ehrhardt (2010) stated that financial ratios are designed to help in
evaluating financial statements and used as a planning and control tool.
Nadia Zedek (2016) investigated the controlling shareholders affects product diversification
performance of 710 European commercial banks, it was found that when banks have no controlling
shareholder or have only family and state shareholders diversification yields diseconomies, while the
involvement of banking institutions, institutional investors, industrial companies or any other
combination of these shareholder categories, produce diversification economies: they display higher
profitability, lower earnings volatility and lower default risk.
Abe De Jong, et al (2008) analyzed the importance of firm-specific and country-specific factors in the
leverage choice of firms around the world. Data suggested that firm-specific determinants of leverage
differ across countries, and that there is an indirect impact of country-specific factors on the roles of
firm-specific determinants of leverage.
Dimitios Louzius (2012) In his study of Banking sector in Greece found that for all loan categories,
NPLs in the Greek banking system could be explained mainly by macroeconomic variables (GDP,
unemployment, interest rates, public debt) and management quality.
Muhammad Saifuddin Khan, et al (2016) in his research paper examines the relationship between
funding liquidity and bank risk taking in the U.S. bank holding companies from 1986 to 2014, results
showed that bank size and capital buffers usually limit banks from taking more risk when they have
lower funding liquidity risk.
Malcom and Jeffrey Wurgler (2002) found that effects on capital structure are very persistent. Results
suggest that capital structure is the cumulative outcome of past attempts to time the equity market.
Zeitun (2007) investigated the effect which capital structure has had on corporate performance using a
panel data sample representing of 167 Jordanian companies during 1989-2003. Results showed that a
firm’s capital structure had a significantly negative impact on the firm’s performance measures, in both
the accounting and market’s measures.
Bank of China said it appointed Lonnie Dounn, an expert on credit management, as its chief credit
officer. Mr. Dounn is the first foreign financial expert to be appointed to the management of one of
China's four state-owned commercial bank, the bank said on its Web site.
Bank of China said it appointed Lonnie Dounn, an expert on credit management, as its chief credit
officer. Mr. Dounn is the first foreign financial expert to be appointed to the management of one of
China's four state-owned commercial bank, the bank said on its Web site. Mr. Dounn's appointment"
shows bank of China's resolution to push reform vigorously, reinforce corporate governance and raise
the level of risk management," the Web statement said. Mr. Dounn's experience in bank risk
management spans more than 30 years, including stints at HSBC Holdings PLC and Marine Midland
bank, the statement said. Marine.
Mr. Dounn has been chief bank officer at HSBC Hong Kong since May 1998 and has gained a good
understanding of credit management in Asia, the statement said. The rescue of credit Lyonnais, bailed
out by the French government in March 1994 after losing Fr6.9 billion in 1993, has provoked a
heated row over who is responsible for the bank's woes. Shocked French taxpayers want to know why so
much money has been squandered by and on a publicly owned company. Right-wing politicians
complain that credit Lyonnais' main problem was deference toward the French Socialist Party and its
favorites, until the Socialists were voted out of government
In credit general, megalomania, mismanagement, and political meddling are to blame for the problems
of credit Lyonnais, France's largest state-owned bank. The best way to put credit Lyonnais‟troubles
behind it and to protect it from interfering politicians will be to privatize it as soon as possible.
Unfortunately, the French government seems intent on waiting until the bank is back in profit before
attempting a flotation; so the timing will depend upon how long it takes credit Lyonnais' new
management team to turn the ailing bank around. It will probably be 1996 before French taxpayers
finally part company with one of their least-loved assets.There are number of indicators for evaluating
financial performance of banks on the basis of the financial measures. Usually the financial performance
of the institutions has been measured by using a combination ratio analysis, benchmarking, and measure
performance against budget or a mix of these methods (Avkiran 1995).
Deposits are key factor of banks that affects the return of banks. On the one hand deposits are the chief
source of funds by which bank are able to operate their business, enable to lend more and get profit and
on the other hand banks have to pay interest on deposits. Advances and investment are other major
source for earning revenues. The operating efficiency has an effect on the size of the bank.
According to the sufian (2009), Molyneux and Seth (1998) Ramlall (2009) found an affirmative
relation of bank size and examine small banks are less profitable than the larger bank. On the other hand
Koasmidou (2008), Spathis and Doumpous (2002) found empirically a negative relation between bank
size and profitability. Raza, Farhan and Akram (2011) classified the investment banks by using return
on assets, return on owner’s equity and total assets.
The empirical study of Tarawneh (2006) showed that a company having better efficiency does not mean
it will show better effectiveness. Elizabeth and Elliot (2004) explained that all financial measure such
as ROA, Capital Adequacy interest margin is calculated positively with score of customer service
quality. Many researchers have been focusing on liability and assets management in banking sector
Ruth 2001, Caddy 2000, and Richard & James 2003.Tektas and Gunay (2005) argued that
maximizing bank profit, lowering and controlling various risks are obligatory for assets and liability
management.
According to the Rangan N. and Grabowski (1988) use data envelopment analysis to analyze the
efficiency of US banks into pure technical and scale efficiency. Aly H. and Rangan (1990) spread out
the study to contain analysis of allocative efficiency.
Endris (1997) in his study conducted in Kuwait to determine the selection factor used by the Kuwait
business consumers in choosing foreign and domestic banks. The study shows that important factor for
bank selections are size of bank assets, banking experience, reputation and availability of branches.
Mazhar M. Islam (2003) discusses the performance of Arab Countries and showed that local and
foreign banks performed well over the past several years.
Nigmonov (2010) aim to study the bank performance in Uzbekistan for the period of 2004-2006. The
results show that inefficiency is due to the technical efficiency and overall bank average efficiency level
reduced. Basher (2000) examines the performance of Islamic banks of eight Middle East Countries. The
important indicators are return on assets, return on equity, and profit before tax and non interest margin.
Munawar Iqbal (2001 and 2004) compares Islamic and conventional baking in the Nineties and
included 12 banks into his study sample. He calculated the development of Islamic banking industry
during 1990-98. and found that capital assets ratio, liquidity ratio, deployment ratio, cost/income ratio,
profitability ratio, return on asset and return on equity ratio and concluded that both return on assets
(ROA) and return on equity (ROE) for the Islamic banks are substantially higher than the conventional
banks.
Alkassim (2005) in his study of GCC countries banking find that higher capital ratios sustain Islamic
banks profitability. Total Loans for both types of banking have a positive relationship with profitability.
Deposits have a positive relation with profitability for Conventional and a negative relation for Islamic
banking. This indicates that deposits impact Islamic banks profitability negatively whereas it contributes
to Conventional banks profitability.
Cihak and Hesse (2008) analyze in their cross country empirical study that small Islamic banks are
financially stronger than the small conventional banks. Also found that large conventional banks are
financially stronger than the large Islamic banks.
CHAPTER – 4
RESEARCH
METHODOLOGY
Research
Redman and Mory define research as a “systemized effort to gain new knowledge.” Some people
consider research as a movement, a movement from the known to the unknown.
Research is an academic activity and as such the term should be used in a technical sense. According to
Clifford Woody, research comprises defining and redefining problems, formulating hypothesis or
suggested solutions; collecting, organizing and evaluating data; making deductions and reaching
conclusions; and at last carefully testing the conclusions to determine whether they fit the formulating
hypothesis.
Research Methodology
Research methodology is a way to systematically study &solve the research problems. If research wants
to claim his study as a good study. He must clearly state the methodology adopted in conducting the
research so that it may be judged by the reader whether the methodology of work done is so or not.
Research Gap
India is a country where 65% of the population still lives in rural areas and they do not access to the
banking services. In urban areas, finance is easily available and fully utilized whereas in rural areas there
is lack of banking services and low financial services and underutilization of finance is also present in
rural areas. Because of this gap between the urban and rural financial services there is not a fully
attainment of economic growth. So, there is need to reduce this gap by promoting financial services in
rural areas.
OBJECTIVES OF THE STUDY

This project has been made to study about the bank (i.e., Kotak Mahindra Bank), so the purpose of study
includes following objectives-
1. To understand the working of Kotak Mahindra Bank.
2. To compare and analyze the performance of Kotak Mahindra bankof last 3 years.
3. To analyze the profit and loss of the bank.
4. To check the credit worthiness of the company.
5. To examine the present scenario of the bank in India.
So, that the bank can analyze itself and increase its credit rating.
RESEARCH DESIGN
The formidable problem that follows the task of defining the research problem is the preparation of the
design of the research project, popularly known as “Research Design”. Research design is a plan,
structure and strategy of investigation conceived to obtain answers to research questions and to control
variance.
A research design can be defined as “Arrangement of condition for collection and analysis of data in the
manner that aims to combine relevance to the research purpose with economy in procedure.” It consists
of the blue print for the collection measurement and analysis of data. The research used here is
descriptive research.
Research Design
Conclusive Exploratory
Research Design Research Design
Descriptive Casual
Resarch Research
Design Design
Types of research design

 Descriptive Research
 Analytical Research
 Fundamental Research
 Exploratory Research
 Conceptual Research
In this report, Analytical Research design was taken. In analytical Research, I had used information
or facts which is already available and analyzed that to make critical evaluation
About the banking ratio movements of Kotak Mahindra Bank. It involves the in-depth study and
evaluation of available information in an attempt to explain complex phenomenon. It is primary
concerned with testing hypothesis and specifying and interpreting relationship by analyzing the facts or
information already available.
METHODS OF DATA COLLECTION
Data collection is an important aspect of any type of research study. Inaccurate data collection can
impact the results of a study and ultimately lead to invalid results.
Information can be collected through both primary and secondary sources.
Primary Data: In some cases, the researchers may realize the need for collecting the first-hand
information. As in the case of everyday life, if we want to have firsthand information or any happening
or event, we either ask someone who knows about it or we observe it ourselves, we do the both. Thus,
the two methods by which primary data can be collected is observation and questionnaire.
Secondary Data: Any data, which have been gathered earlier for some other purpose, are secondary
data in the hands of researcher. Those data collected first hand, either by the researcher or by someone
else, especially for the purpose of the study is known as primary data.
The data collected for this project has been taken from the Secondary source.
Sources of secondary data are:-
 Internet
 Magazines
 Publications
 Newspapers
 Broachers
Data Analysis Techniques

The statistical techniques which were employed in analyzing the data collected in the study are:
Table:Tables effectively order and summarize the quantitative data they are used to arrange facts and
figures in columns and rows. These facts and figures can be systematically examined. Percentage:
These are used in translating frequency counts into percentage. These percentages are used to show the
distribution of respondents according to their answers.
This data which was tabulated and then converted into percentages was then interpreted using graphical
presentation like pie chart, column chart, bar graphs, etc.
Limitations of the Study
 The study is limited to the analysis of financial position of Kotak Mahindra Bank only.
 The study is based on secondary data available from monthly fact sheets, websites and other
books, as primary data was not accessible.
 As the study was for short span i.e., 3 years and due to lack of time other areas could not be well
focused.
 The study excludes the entry and the exit loads of the Kotak Mahindra.
 This study does not and cannot represent views and ideas of all the banks of the country.
In spite of these limitations, an honest attempt has been made to arrive at fairly objective conclusion.
CHAPTER – 5
DATA ANALYSIS
And
INTERPRETATION
1. NET TURNOVER MARGIN RATIO
YEAR 2018-March 2017-March 2016-March
Net Profit 4,084.30 3,411.50 2,089.79
Net Sales 19,748.50 17,698.90 16,384.20
Net turnover
0.20681571 0.1927521 0.1275491
margin ratio
(Reference of net profit is from Annexure B and net sales from Annexure C)
 For the year 2018
Net profit
Net turnover margin ratio =
Net Sales
4,084.30
=
19,748.50
=0.20681571
Net Profit
Net Sales
3,411.50
=
17,698.90
= 0.1927521

Net profit
Net Sales
2,089.79
=
16,384.20
= 0.1275491
0.25
0.2
0.15
Series1
0.1
0.05
0
1 2 3
Figure no. : 1
INTERPRETATION No. 1: -
Net turnover margin ratio is also called a profit margin ratio. As per my analysis the profit margin ratio
of the Kotak Mahindra bank in 2016 is positive which shows that the company lousier cost and
expansion management is profitable that year, and in both years 2017 and 2018the company achieve a
good position as compare to 2016.
2. NET PROFIT RATIO
Net Profit 4,084.30 3,411.50 2,089.78
Net Sales 19,748.50 17,698.90 16,384.20
Net Profit ratio 20.6815708 19.275209 12.754849
(Reference of net profit is from Annexure B and net sales from Annexure C)
Net Profit
Net profit ratio =
Net Sales
4,084.30
=
19,748.50
=20.6815708
Net profit
Net profit ratio =
Net sales
3,411.50
=
17,698.90
= 19.275209
Net profit
Net profit ratio =
Net saless
2,089.78
=
16,384.20
= 12.754849
25
20
15
Series1
10
0
1 2 3
Figure no. : 2
By comparing the ratios of three we conclude that Kotak Mahindra bank net profit ratio in the year
2016 was 12.7548and in the year 2017 it increases and reached to 19.275. In the year 2018(20.682) the
position of the Kotak Mahindra Bank increased compare to both the years i.e.,2016 and 2017.This
implies that the Kotak Mahindra bank is very efficient, as it has managed to reduce its cost and increases
its profit.
3. EXPENSE RATIO

Total
19,716.40 17,764.59 16,906.65
Expenses
Net Sales 19,748.50 17,698.90 16,384.20
Expense
99.837456 100.37115 103.18874
ratio
(Reference of total expense is from Annexure B and net sales from Annexure C)
Total Expenses
Expense ratio =
Net Sales
19,716.40
=
19,748.50
= 99.837456
Total expenses
Expense ratio =
Net Sales
17,764.59
=
17,698.90
= 100.37115
Total Expenses
Expense Ratio =
Net Sales
16,906.65
=
16,384.20
= 103.18874
104
103
102
101
Series1
100
99
98
1 2 3
Figure no. :3
The expense ratio shows a relationship between the total expenses incurred by the firm to the total
revenue or sales. In the year 2016, the Kotak Mahindra bank’s expense ratio was 103.189 and in the year
2017 the expense ratio decreased and reached 100.371. And the year 2018 the expense ratio decreased to
99.837. This means in the year 2018 the bank’s expenses decreased, which is a good indicator. The
company expenses are more than its sales and therefore it must try to reduce its cost to increase its
profit.
4. RETURN ON EQUITY
Year 2018-March 2017-March 2016-March
Net Profit 4,084.30 3,411.50 2,089.79
Equity Share
952.82 920.45 917.19
Capital
Returns on Equity 4.28653891 3.7063393 2.2784701
(Reference of net profit is from Annexure B and Equity share capital from Annexure A)
Net Profit
Returns on Equity =
Equity Share Capital
4,084.30
=
952.82
= 4.28653891
Net Profit
Returns on Equity =
3,411.50
=
920.45
=3.7063393
Net Profit
Returns on Equity =
2,089.79
=
917.19
= 2.2784701
4.5
3.5
2.5
Series1
2
1.5
0.5
0
1 2 3
Figure no. : 4
Return on equity is a key profitability ratio that investor use to measure the amount of a company’s
income that is returned as shareholders’ equity. As per the analysis the company income is high last in 3
years. The figure no. 4 shows the return on equity of the 2016 and 2017 and 2018. In the year 2016 is
return good those value is 2.278, and the year 2017 increase the returns on equity. In the year 2018 the
company value drive form 4.287. There are high returns on the equity, so we can say the company
generates good returns in last 3 years.
5. Debt-EQUITY RATIO
Total debt 264,933.39 214,589.96 192,259.79
Total
Shareholders’ 37,483.82 27,617.94 23,962.47
Funds
Debt-Equity
7.06794 7.7699481 8.0233711
ratio
(Reference of total debt and total shareholders’ funds both from Annexure A)
Total Debt
Debt-Equity ratio =
Total Shareholders’ Funds
264,933.39
=
37,483.82
= 7.06794
Total Debt
Debt-Equity ratio =
Total Shareholders’ Funds
214,589.96
=
27,617.94
= 7.7699481
Total Debt
Debt-Equity ratio =
Total Shareholders’ Fund
192,259.79
Debt-Equity ratio =
23,962.47
= 8.0233711
8.2
7.8
7.6
7.4
Series1
7.2
6.8
6.6
6.4
1 2 3
Figure no. : 5
It is a leverage ratio, which indicates a relationship between the debt and equity. Lower the ratio lower
the risk, higher the ratio,higher the risk. The ideal ratio is 1:1. In the year 2018, the Kotak bank’s ratio
is7.06794. This means the company relies more on the outsiders and loans. This is not a good indicator,
which means the company was not doing well in the last years. In the year 2017 the ratio was7.7699481,
which means that the bank borrowed a lot of money from the outsiders.
6. CURRENT RATIO
Year 2018 march 2017 march 2016 march
Current assets 213052.33 190708.2

263,406.24
Current liability 225449.24 186972.02 168297.32
Current ratio 1.1683616 1.1394878 1.1331624
(Reference of current assets and current liabilities both from Annexure A)
Current asset
Current Ratio =
Current liability
263,406.24
=
225449.24
= 1.1683616
Current asset
Current Ratio =
Current liabilities
213052.33
=
186972.02
= 1.1394878
Current asset
Current Ratio =
Current liabilities
190708.2
168297.32
= 1.1331624
1.18
1.17
1.16
1.15
Series1
1.14
1.13
1.12
1.11
1 2 3
Figure no. : 6
The ideal current ratio is 2:1. In the year 2016, the ratio was 1.1331624:1. The Kotak Mahindra Bank
financial strength was not good in the year 2016; but in 2018 the ratio is 1.1683616. This year the
company going to earn profit but in case if the bank will not meet its ideal ratio, it will create problem to
meet its short-term obligations.
7. ASSET TURNOVER RATIO
Net Sales 19,748.50 17,698.90 16,384.20
Total Assets 264,933.40 214,589.96 192,259.79
Assets Turnover Ratio 0.07454138 0.08247776 0.08521907
(Reference of net sales is from Annexure C and total assets from Annexure B)

Net Sales
Assets Turnover Ratio =
Total Assets
19,748.50
=
264,933.40
= 0.07454138
Net Sales
Total Assets
17,698.90
=
214,589.96
=214,589.96
Net Assets
Total assets
16,384.20
=
192,259.79
= 0.0852190
0.088
0.086
0.084
0.082
0.08
0.078
Series1
0.076
0.074
0.072
0.07
0.068
1 2 3
Figure no. : 7
This graph shows the assets turnover ratio. This ratio indicates that how efficiently a company can use
its asset to generate sales. As per my analysis I analyzethe asset turnover ratio of Kotak Mahindra bank
is 0.08521907in 2016 and in the year 2017 the value decreased i.e.,0.08247776. In the year 2018 the
ratio also decreased by 0.07454138. There is not good position of the company.
CHAPTER-6
FINDINGS,
RECOMMENDATIONS
AND
CONCLUSION
FINDINGS
By analyzing the three years of the data refers to the financial statement of Kotak Mahindra Bank
from 31th march, 2016 to 31th march, 2018 we can see the following results:
 The Kotak Mahindra bank’s current ratio is increase in the year 2018. It shows the company is
performingwell. If the investor invests the capital in Kotak Mahindra bank it is profitable for
them.
 I found that debt equity ratio of Kotak Mahindra bank is not 1:1 which indicates that the total
liabilities and total asset of bank are notequal. We can see that debt equity ratio in the year 2016
is less from the year 2017 and 2018.The value of debt-equity ratio increases which is a good
indicator forshareholders.
 Asset turnover ratio of Kotak Mahindra Bank shows that the bankuse its assets well but the asset
turnover ratio of Kotak Mahindra bank is quite low in the last year i.e., 2018.
 Return on equity ratio is frequently increases in the last three years this means that bank generate
higher return from its share capital.
 The Kotak Mahindra bank’s total income is high in last three years and the shareholders also
generate a return on their investment.
 After analysing of the net profit ratio we can see that in the third year (i.e., 2018) ratio is
increasing form the previous year (i.e., 2016 and 2017).
RECOMMENDATIONS
After the analysis of Kotak Bank it is clear that the company’s status is good, because the financial
statement of the company shows better performance. Suggestion regarding this would be:
 Consumer should be aware of company’s profile and returns associated with banking sector.
 The investor assumes the entire risk of using this facility and takes full responsibility.
 The Financial advisor should be right enough to serve the consumers. The consumer should also
be aware of the advisor or others who is looking after their investments.
 Company should publish their performance by comparing it with their competitors.
 The Company is utilizing the capital which majorly helps in the growth of the organization.
 The company’s Investments are raised from the inception, it gives the other income i.e., interest
on investments.
 Steps can be taken to decrease the Debt-Equity ratio so as to increase the overall profit.
CONCLUSION
 Kotak Mahindra bank is one of the leading private banks of the country.
 It has made his mark due to its unbeaten reliability.
 The bank has satisfied the people by providing speedy services.
 The company’s current ratio is quite good which shows the ability of the firm to meet its short-
term obligations.
 The bank managed to increase its net profit by 3% in the year.
 This shows the internal financial strength of the company.
 It has benefitted the consumers in many ways by introducing new and innovative products.
 It deals with the people at personal level which gives it an edge over the other banks.
 The calculation of Current and Liquid Ratio will enable the creditors to access the current
financial position of the concern in relation to their debts.
 Preparation of financial statements enables the government to find out whether the organization
is following various rules and regulations or not. These statements provide a base for regulation
of the company.
 It is not only helpful to analyze the present financial position it also enables to study the future
prospects and the expansion plans of the concern.
CHAPTER-7
BIBLIOGRAPHY
Bibliography
Books: -
1. Research Methodology. VK Global publication Pvt.

2. Research Methodology. New Age International publishers
3. Research Methodology. Chaukhambha Orientalia
Journals: -
1. Banking & Finance journals

2. International journal of finance & Banking Studies
3. Journal of Finance And Bank Management
4. International Journal of Bank Management
Website: -
www.google.co.in
http://en:wikipedia.org
www.moneycontrol.com
www.kotakmahindrabank.com
www.amfiindia.com
ANNEXURE
ANNEXURE: A
Balance sheet of Kotak Mahindra bank (Rs. In cr.)

Mar-18 Mar-17 Mar-16 Mar-15 Mar-14
EQUITIES AND
LIABILITIES
SHAREHOLDER'S FUNDS
Equity Share Capital 952.82 920.45 917.19 386.18 385.16
Total Share Capital 952.82 920.45 917.19 386.18 385.16
Reserves and Surplus 36,528.83 26,695.62 23,041.87 13,754.91 11,889.93
Total Reserves and Surplus 36,528.83 26,695.62 23,041.87 13,754.91 11,889.93

Employees Stock Options 2.17 1.87 3.41 3 8.53
Total ShareHolders Funds 37,483.82 27,617.94 23,962.47 14,144.08 12,283.61

Deposits 192,643.27 157,425.86 138,643.02 74,860.31 59,072.33
Borrowings 25,154.15 21,095.48 20,975.34 12,149.71 12,895.58
Other Liabilities and Provisions 9,652.15 8,450.68 8,678.96 4,857.97 3,333.82
Total Capital and Liabilities 264,933.40 214,589.96 192,259.79 106,012.07 87,585.34

ASSETS
Cash and Balances with

8,908.51 7,492.43 6,903.43 3,928.30 2,948.23
Reserve Bank of India
Balances with Banks Money at
10,711.60 15,079.58 3,976.28 2,334.06 3,031.66
Call and Short Notice
Investments 64,562.35 45,074.19 51,260.22 30,421.09 25,484.55
Advances 169,717.92 136,082.13 118,665.30 66,160.71 53,027.63
Fixed Assets 1,527.16 1,537.63 1,551.59 1,206.71 1,106.94
Other Assets 9,505.86 9,324.00 9,902.97 1,961.21 1,986.33
Total Assets 264,933.40 214,589.96 192,259.79 106,012.07 87,585.34
OTHER ADDITIONAL INFORMATION

Number of Branches 1,388.00 1,369.00 1,333.00 684 605
Number of Employees 50,000.00 44,000.00 31,410.00 18,000.00 16,000.00
Capital Adequacy Ratios (%) 18 17 16 17 19

ANNEXURE: B
------------------- in Rs. Cr.

Profit & Loss account of Kotak Mahindra Bank
-------------------
Mar '18 Mar '17 Mar '16 Mar '15 Mar '14
Income
Interest Earned 19,748.50 17,698.93 16,384.18 9,719.87 8,767.12
Other Income 4,052.21 3,477.16 2,612.23 2,028.45 1,399.71
Total Income 23,800.71 21,176.09 18,996.41 11,748.32 10,166.83
Expenditure
Interest expended 10,216.81 9,572.78 9,483.81 5,496.13 5,047.07
Employee Cost 2,950.23 2,768.53 2,816.97 1,466.68 1,172.16
Selling, Admin & Misc
6,246.67 5,132.62 4,318.49 2,726.52 2,279.91
Expenses
Depreciation 302.69 290.66 287.38 193 165.18
Operating Expenses 6,425.72 5,618.50 5,471.53 3,254.72 2,542.62
Provisions &
3,073.87 2,573.31 1,951.31 1,131.48 1,074.63
Contingencies
Total Expenses 19,716.40 17,764.59 16,906.65 9,882.33 8,664.32
Mar '18 Mar '17 Mar '16 Mar '15 Mar '14
Net Profit for the Year 4,084.30 3,411.50 2,089.78 1,865.98 1,502.52
Profit brought forward 10,756.29 8,214.12 6,769.97 4,005.29 3,016.60
Total 14,840.59 11,625.62 8,859.75 5,871.27 4,519.12
Equity Dividend 114.21 0.07 91.84 82.07 63.08
Corporate Dividend Tax 21.7 -0.68 18.7 13.58 8.69
Per share data (annualized)
Earnings Per Share
21.43 18.53 11.39 24.16 19.51
(Rs.)
Equity Dividend (%) 14 12 10 18 16
Book Value (Rs.) 196.69 150.01 130.61 183.09 159.35
Appropriations
Transfer to Statutory
1,100.08 869.94 535.1 587.06 366.93
Reserves
Transfer to Other
0.01 0 -0.01 93.3 75.13
Reserves
Proposed
Dividend/Transfer to 135.91 -0.61 110.54 95.65 71.77
Govt.
Balance c/f to Balance
13,604.60 10,756.29 8,214.12 5,095.26 4,005.29
Sheet
Total 14,840.60 11,625.62 8,859.75 5,871.27 4,519.12
ANNEXURE: C
Income Statement of Kotak Mahindra Bank Ltd.

Year Mar '18 Mar '17 Mar '16 Mar '15 Mar '14
Corporate Tax Rate 0.3432 0.3373 0.331 0.3413 0.3388
Depreciation Expense 302.69 290.66 287.38 193 165.18
Total Dividend 133.56 109.85 91.74 82.1 63.11
EBITDA 16737.7 15011.5 12894.8 8522.03 7484.66
EPS (Earning Per Share) 21.43 18.53 11.39 24.16 19.51
Income Tax 2133.92 1736.57 1033.8 966.92 769.89
Interest 10216.8 9572.78 9483.81 5496.13 5047.07
Net Income 4084.3 3411.5 2089.78 1865.98 1502.52
Outstanding Shares 190.564 184.09 183.438 77.24 77.03
Operating Profit 12685.5 11534.3 10282.5 6493.59 6084.94
Other Income 4052.21 3477.16 2612.23 2028.45 1399.71
Profit Before Tax 6218.22 5148.07 3123.57 2832.9 2272.41
Revenue 19748.5 17698.9 16384.2 9719.87 8767.12
Operating Expense 7062.98 6164.59 6101.65 3226.28 2682.18
Total Income 0 0 0 0 0
Profit Before Depreciation And Tax 23800.7 21176.1 18996.4 11748.3 10166.8
ANNEXURE: D
------------------- in Rs.
Cash Flow
Cr. -------------------
Mar
Mar '18 Mar '17 Mar '16 Mar '14
'15
Net Profit Before Tax 4084.3 3411.5 2089.78 1865.98 1502.52
Net Cash From Operating -
14407.62 6133.72 5121.93 9001.63
Activities 10274.92
Net Cash (used in)/from -
-2515.5 -2971.84 -6363.01 -549.06
Investing Activities 4112.53
Net Cash (used in)/from
9837.22 256.52 -1463.91 -726.93 -6161.84
Financing Activities
Net (decrease)/increase In
-2951.9 11692.29 -1693.19 282.47 2290.73
Cash and Cash Equivalents
Opening Cash & Cash
22572.01 10879.72 12572.91 5979.89 3689.16
Equivalents
Closing Cash & Cash
19620.11 22572.01 10879.72 6262.36 5979.89
Equivalents

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A TRAINING REPORT

MAHARSHI DAYANAND UNIVERSITY

Satyug Darshan Institute of Engineering and Technology

I, Ms. DevsmitaMallick, student of SatyugDarshan Institute of Engineering & Technology hereby

This is to certify thatMs. DevsmitaMallick, student of SatyugDarshan Institute of

I would take this opportunity to thank Mr. Subhash Arora.

S.NO PARTICULARS PAGE NO.

1 Introduction to the study

5 Data Analysis & Interpretation

6 Findings, Conclusion and Suggestions

Here are the five types of Financial Statements:

Statement of Cash Flow

Noted to Financial Statements

Purpose for business entities

Consolidated financial statements are defined as "Financial statements of a group in which

Standards and Regulations

Management discussion and analysis

Move to electronic segments

Products and Services

TERMINATION OF GDS PROGRAM

Products and Services

b) Priority Banking Business

c) Corporate Salary Business

e) Business Banking Assets (BBA)

Investment in Airtel M Commerce Services Ltd.

SUBSIDIARIES & ASSOCIATES

INTERNAL FINANCIAL CONTROLS

RISK MANAGEMENT POLICY

OBJECTIVES OF THE STUDY

Types of research design

Data Analysis Techniques

YEAR 2018-March 2017-March 2016-March

Net Profit 4,084.30 3,411.50 2,089.79

Net Sales 19,748.50 17,698.90 16,384.20

 For the year 2018

 For the year 2017

 For the year 2016

YEAR 2018-March 2017-March 2016-March

Net Profit 4,084.30 3,411.50 2,089.78

Net Sales 19,748.50 17,698.90 16,384.20

Net Profit ratio 20.6815708 19.275209 12.754849

 For the year 2018

 For the year 2017

YEAR 2018-March 2017-March 2016-March

 For the year 2018

 For the year 2017

Year 2018-March 2017-March 2016-March

Net Profit 4,084.30 3,411.50 2,089.79

Returns on Equity 4.28653891 3.7063393 2.2784701

 For the year 2018

 For the year 2017

Year 2018-March 2017-March 2016-March

Total debt 264,933.39 214,589.96 192,259.79

 For the year 2018

 For the year 2017

Year 2018 march 2017 march 2016 march

Current assets 213052.33 190708.2

Current liability 225449.24 186972.02 168297.32

Current ratio 1.1683616 1.1394878 1.1331624