PROJECT WORK

Project Title: A COMPARATIVE STUDY OF FINANCIAL STATEMENT ANALYSIS

OF STATE BANK OF INDIA AND AXIS BANK.

A project submitted in partial fulfilment ofthe requirements for the

Degree of

B. Com (Hons.) 2018-2021

By

SOURAV MANDAL

College Roll No. BCFIN18304

Registration No. KU1838459

University Roll No.191605472215

Under the Supervision of

Dr. /Prof. Dr. G. Vijayalakshmi

Faculty of Commerce

Karim City College, Jamshedpur-831001

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 KARIM CITY COLLEGE
Faculty of Commerce, Jamshedpur

CERTIFICATE OF APPROVAL

This Project entitled "A COMPARATIVE STUDY OF FINANCIAL

STATEMENT ANALYSIS OF STATE BANK OF INDIA AND AXIS BANK "
is hereby approved as a creditable commerce study
carried out and presented in a satisfactory manner to
narrate its acceptance as prerequisite to the Degree for
Bachelor of Commerce (B.Com. Hons.) Which is being
submitted.

PROJECT SUPERVISOR EXTERNAL EXAMINER

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 ACKNOWLEDGEMENT

Working on this project entitled "A COMPARATIVE STUDY OF FINANCIAL STATEMENT

ANALYSIS OF STATE BANK OF INDIA AND AXIS BANK "

was a source of immense knowledge to me. I would like to expressmy sincere gratitude
to my project supervisor Dr. G. Vijayalakshmi,
for his guidance and valuable support, inspiring discussions andconstant supervision
throughout the course of this work.

I am also thankful to my Honourable Principal Dr. Mohammad Riyaz for his inspiration. I am
also thankful to our H.O.D. Dr. Aftab Alam Ansari for his help during my project work.

I acknowledge with a deep sense of gratitude, the encouragement and interpretations received
from our faculty members and colleagues. I would also like to thank my parents for their love
and support.

Name: SOURAV MANDAL

College Roll No. BCFIN18304
Registration No. KU1838459
University Roll No.191605472215

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 CONTENTS

TABLE OF CONTENT

List Of Table (i)

List of Graphs (ii)

CHAPTER 1: PAGE NO
1.i Introduction of Banking………………………………………... 9
1.ii History of Banking in India………………………………….….9
1.iii Banks in India……………………………….………………….11
1.iv Indian Banking Industry ……………………………………….12
1.v Objective of Study …………………………………...………...12
1.vi Limitation of Study ……………………………………….……13
1vii Data Collection ………………………………………......…….13

CHAPTER 2.
2. Review of Literature…………………………………………….15

CHAPTER 3.
3.i State Bank of India………………………………………………18
3.ii History of State Bank of India………….….…………………….18
3.iii Milestone of State Bank of India……………...…………………19
3.iv Balance Sheet of State Bank of India…………...…….….……….21
3.v Income Statement of State Bank of India. …..…………..…..……23
3.vi Liquidity Ratio in SBI……………………………………………..24
3.vi Profitability ratio in SBI………………………………….……….25
3.vii Test of significant of profitability ratio……………………………26
3.viii Turnover ratio in SBI………………………………………..……26
3.ix Swot Analysis…………………………………………………….28
3.x Axis Bank…………..…………………………….………………29
3.xi Industry profile…….. ……………………………………………29
3.xii Overview………………………………………………………….29

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3.xiii Awards ……………………..…………..…...…………..….……32
3.xiv Swot analysis…………………………….………………….……33
3.xv Balance Sheet of Axis Bank ………..………..……………….….34
3.xvi Profit and Loss of Axis Bank……………………..……………...36
3.xvii Analysis and interpretation………………………………………38

CHAPTER 4.
4 Data Analysis………………………………………………..……...44
4.i Net Profit Ratio……………………………………………..………44
4.ii Operating Profit Ratio………………………………………………44
4.iii Return on Shareholders’ Investment or net worth ratio…….………44
4.iv Earnings Per Share…………………………………………………..45
4.v Total Assets Turnover Ratio…………………………….…………..45
4.vi Dividend Payout Ratio…………………………………...………….46
4.vii Debt-Equity Ratio…………………………………………………..46
4.viii Interest Expended to Interest Earned Ratio…………………………46
4.viii Result…………….…………………………………….……………47
4.ix SBI AND AXIS BANK…………………………………………….49

CHAPTER 5.
5.i Summary……………………………….……………………………50
5.ii Suggestion……………………………….…..…………….………...50
5.iii Conclusion………………………………...……….………………..50

CHAPTER 6.
6 References…………………………..……………………………….52

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 (i) LIST OF TABLES

SL.NO NAME OF THE TITLE PAGE

NO
3.1 Balance Sheet of SBI 21
3.2 Income Statement of SBI 23
3.3 Current Ratio of SBI 24
3.4 Result of regression analysis 24
3.5 Profitability Ratio in SBI 25
3.6 ANOVA- Profitability Ratio 26
3.7 Turnover Ratio in SBI 26
3.8 Market Based Ratio in SBI 27
3.9 ANOVA- Market Based Ratio 27
3.10 Balance sheet of AXIS Bank 34
3.11 Profit and Loss of AXIS Bank 36
3.12 Current Ratio 38
3.13 Quick liquid/ Acid Test Ratio 38
3.14 Debt-Equity Ratio 39
3.15 Fixed Assets to Long-Term 40
Funds ratio
3.16 Interest Cover 40
3.17 Debt Service Coverage Ratio 41
3.18 Inventory turnover ratio 41
3.19 Gross profit margin 42
3.20 Return on capital Employed 42
3.21 Fixed assets turnover ratio 43
4.0 Net profit ratio 44
4.1 Operating Profit Ratio 44
4.2 Return on Shareholder’s 45
Investment or Net Worth Ratio
4.3 Earnings Per Share 45
4.4 Total Assets Turnover Ratio 45
4.5 Dividend Pay-Out Ratio 46
4.6 Debt-Equity Ratio 46
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4.7 Interest expended to Interest 47
Earned Ratio
4.8 Result 47

4.9 Consolidated Values of Mean

and Standard Deviation of SBI 47
for 2018-2019
4.10 Consolidated Values of Mean 49
and Standard Deviation of Axis
Bank for 2018-2019

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 (ii) LIST OF GRAPHS

SL.NO NAME OF THE TITLE PAGE

NO
3.A Current Ratio 38
3.I Quick Liquid/Acid Test ratio 39
3.J Debt Equity Ratio 39
3.K Fixed Assets to Long-Term Funds 40
ratio
3.L Interest Covered 41
3.M Debt Service Coverage Ratio 41
3.N Inventory Turnover Ratio 42
3.O Gross Profit Margin 42
3.P ROCE 43
3.Q Fixed Assets Turnover Ratio 43
4.A Risk and return of SBI 2018 48
4.B Risk and return of SBI 2019 48
4.C Risk and Return of AXIS Bank 49
2018
4.D Risk and Return of AXIS Bank 49
2019

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 INTRODUCTION OF BANKING

DEFINITION OF BANK
Banking Means "Accepting Deposits for the purpose of lending or Investment of deposits of money from the
public, repayable on demand or otherwise and withdraw by cheque, draft or otherwise."
- Banking Companies (Regulation) Act,1949

ORIGIN OF THE WORD “BANK”: -

The origin of the word bank is shrouded in mystery. According to one view point the Italian business house
carrying on crude from of banking were called banchi/ bancheri" According to another viewpoint banking is
derived from German word "Branck" which mean heap or mound. In England, the issue of paper money by the
government was referred to as a raising a bank.

ORIGIN OF BANKING:
Its origin in the simplest form can be traced to the origin of authentic history. After recognizing the benefit of
money as a medium of exchange, the importance of banking was developed as it provides the safer place to store
the money. This safe place ultimately evolved in to financial institutions that accepts deposits and make loans
i.e., modern commercial banks.

Banking system in India

Without a sound and effective banking system in India it cannot have a healthy economy. The banking system of
India should not only be hassle free but it should be able to meet new challenges posed by the technology and
any other external and internal factors.
For the past three decades India's banking system has several outstanding achievements to its credit. The most
striking is its extensive reach. It is no longer confined to only metropolitans or cosmopolitans in India. In fact,
Indian banking system has reached even to the remote corners of the country. This is one of the main reasons of
India's growth process.

HISTORY OF BANKING IN INDIA

Banking in India has its origin as early or Vedic period. It is believed that the transitions from many lending to
banking must have occurred even before Manu, the great Hindu furriest, who has devoted a section of his work to
deposit and advances and laid down rules relating to the rate of interest. During the mogul period, the indigenous
banker played a very important role in lending money and financing foreign trade and commerce.
During the days of the East India Company it was the turn of agency house to carry on the banking business. The
General Bank of India was the first joint stock bank to be established in the year 1786. The other which followed
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 was the Bank of Hindustan and Bengal Bank. The Bank of Hindustan is reported to have continued till 1906.
While other two failed in the meantime. In the first half of the 19th century the East India Company established
their banks, The bank of Bengal in 1809, the Bank of Bombay in 1840 and the Bank of Bombay in1843. These
three banks also known as the Presidency banks were the independent units and functioned well. These three
banks were amalgamated in 1920 and new bank, the Imperial Bank of India was established on 27th January,
1921.
With the passing of the State Bank of India Act in 1955 the undertaking of the Imperial Bank of India was taken
over by the newly constituted SBI. The Reserve Bank of India (RBI) which is the Central bank was established in
April, 1935 by passing Reserve bank of India act 1935. The Central office of RBI is in Mumbai and it controls all
the other banks in the country.
In the wake of Swadeshi Movement, number of banks with the Indian management were established in the
country namely, Punjab National Bank Ltd., Bank of India Ltd., Bank of Baroda Ltd., Canara Bank. Ltd. on 19th
July 1969, 14 major banks of the country were nationalized and on 15th April 1980, 6 more commercial private
sector banks were taken over by the government.
The first bank in India, though conservative, was established in 1786. From 1786 till today, the journey of Indian
Banking System can be segregated into three distinct phases. They areas mentioned below:
❖ Early phase from 1786 to 1969 of Indian Banks
❖ Nationalization of Indian Banks and up to 1991 prior to Indian banking sector Reforms.
❖ New phase of Indian Banking System with the advent of Indian Financial & Banking Sector Reforms
after 1991.

➢ Phase I
The General Bank of India was set up in the year 1786. Next came Bank of Hindustan and Bengal Bank. The
East India Company established Bank of Bengal (1809), Bank of Bombay (1840) and Bank of Madras (1843) as
independent units and called it Presidency Banks.
These three banks were amalgamated in 1920 and Imperial Bank of India was established which started as
private shareholders banks, mostly European’s shareholders.
In 1865 Allahabad Bank was established and first time exclusively by Indians, Punjab National Bank Ltd. was set
up in 1894 with headquarters at Lahore. Between 1906 and 1913, Bank of India, Central Bank of India, Bank of
Baroda, Canara Bank, Indian Bank, and Bank of Mysore were set up. Reserve Bank of India came in 1935.
During the first phase the growth was very slow and banks also experienced periodic failures between 1913 and
1948. There were approximately 1100 banks, mostly small. To streamline the functioning and activities of
commercial banks, the Government of India came up with The Banking Companies Act, 1949 which was later
changed to Banking Regulation Act 1949 as per amending Act of 1965 (Act No. 23 of 1965). Reserve Bank of
India was vested with extensive powers for the supervision of banking in India as the Central Banking Authority.
During those day’s public has lesser confidence in the banks. As an aftermath deposit mobilization was slow.
Abreast of it the savings bank facility provided by the Postal department was comparatively safer. Moreover,
funds were largely given to traders.

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 Phase II
Government took major steps in this Indian Banking Sector Reform after independence. In1955, it nationalized
Imperial Bank of India with extensive banking facilities on a large scale especially in rural and semi-urban areas.
It formed State Bank of India to act as the principal agent of RBI and to handle banking transactions of the Union
and State Governments all over the country.
Seven banks forming subsidiary of State Bank of India was nationalized in 1960 on 19th July,1969, major
process of nationalization was carried out. It was the effort of the then Prime Minister of India, Mrs. Indira
Gandhi. 14 major commercial banks in the country was nationalized.
Second phase of nationalization Indian Banking Sector Reform was carried out in 1980 with seven more banks.
This step brought 80% of the banking segment in India under Government ownership.
After the nationalization of banks, the branches of the public sector bank India rose to approximately 800% in
deposits and advances took a huge jump by 11,000%.
Banking in the sunshine of Government ownership gave the public implicit faith and immense confidence about
the sustainability of these institutions.

Phase III
This phase has introduced many more products and facilities in the banking sector in its reforms measure. In
1991, under the chairmanship of M Narasimha, a committee was set up by his name which worked for the
liberalization of banking practices. The country is flooded with foreign banks and their ATM stations. Efforts are
being put to give a satisfactory service to customers. Phone banking and net banking is introduced. The entire
system became more convenient and swifter. Time is given more importance than money. The financial system
of India has shown a great deal of resilience. It is sheltered from any crisis triggered by any external
macroeconomics shock as other East Asian Countries suffered. This is all due to a flexible exchange rate regime,
the foreign reserves are high, the capital account is not yet fully convertible, and banks and their customers have
limited foreign exchange exposure
.

BANKS IN INDIA
In India the banks are being segregated in different groups. Each group has their own benefits and limitations in
operating in India. Each has their own dedicated target market. Few of them only work in rural sector while
others in both rural as well as urban. Many even are only catering in cities. Some are of Indian origin and some
are foreign players.
All these details and many more is discussed over here. The banks and its relation with the customers, their mode
of operation, the names of banks under different groups and other such useful information’s are talked about.
One more section has been taken note of is the upcoming foreign banks in India. The RBI has shown certain
interest to involve more of foreign banks than the existing one recently. This step has paved a way for few more
foreign banks to start business in India.

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 INDIAN BANKING INDUSTRY
The Indian banking market is growing at an astonishing rate, with Assets expected to reach US$1 trillion by
2010. An expanding economy, middleclass, and technological innovations are all contributing to this growth.
The country’s middle-class accounts for over 320 million People. In correlation with the growth of the economy,
rising income levels, increased standard of living, and affordability of banking products are promising factors for
continued expansion.
The Indian banking Industry is in the middle of an IT revolution, Focusing on the expansion of retail and rural
banking. Players are becoming increasingly customer -centric in their approach, which has resulted in innovative
methods of offering new banking products and services. Banks are now realizing the importance of being a big
playerand are beginning to focus their attention on mergers and acquisitions to take advantage of economies of
scale and/or comply with Basel II regulation. “Indian banking industry assets are expected to reach US$1 trillion
by 2010 and are poised to receive a greater infusion of foreign capital,” says Prathima Rajan, analyst in Celent's
banking group and author of the report. “The banking industry should focus on having a small number of large
players that can compete globally rather than having a large number of fragmented players.

Objectives
• To compare the financial performance of SBI and Axis Bank.
• To compare the profitability position and managerial efficiency of SBI and Axis Bank.

Statement of the problem

The financial execution of SBI and AXIS banks are the major elements of the country’s financial
progress. The basic objective of Banking industry is to upgrade the performance and profitability.
Moreover, today managers of bank are striving to develop their performance based on financial views
which evaluate overall performance of organization and presenting an effective feedback. The
performances of bank have two be measured through two aspects, financial and human. The financial
performance and their efficiency of banks act as a parameter that assists customers, mangers, regulators
and supervisors in decision making. For the analysis of data, the following ratios are considered viz.,
Profitability ratio, Solvency ratio,and Management efficiency ratios of SBI and AXIS Bank.

OBJECTIVE OF THE STUDY: -

1. To know the strength and weakness of State Bank of India and Axis Bank through Ratio analysis.
2. To evaluate the performance of the companies.
3. To understand the liquidity, profitability and efficiency positions of the companies.
4. To make comparison between the ratios during different periods.
5. To understand the analysis of risk and return of selected banks (SBI and AXIS).
6. To provide adequate information to investors to judge their investment decisions on the basis of Beta.
7. To impart knowledge to the investors with conceptual clarity of equities for investment.
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 LIMITATIONS OF THE STUDY

However I tried my level best in collecting the relevant information for my research report, yet
there are always some problems faced by the researcher. The prime difficulties I faced in
collection of information are discussed below:

• Analysis of the study was depended only on the information available in theinternet.
• Study was restricted to the period of 5 years.
• Detail study was not possible because of time constraints.
• Study process was restricted to the company’s rules and regulations.

Data collection
To analyze the performance of both SBI and AXIS Bank the data was collected through annual report
from sources of secondary data such as Internet, Magazines, Websites, Books, and Journals.

ARTICLES AND LITERATURE REVIEWS FROM PREVIOUS STUDY:

Reviewing an article that is already existing is known as ‘Literature Review’. Literature reviews and review of
various articles give a brief knowledge about any particular idea or topic to bring it into actual existence. It is
the starting step in order to initiate the study.

EQUITY ANALYSIS:
From the review of literatures, the topic ‘Equity Analysis’ is chosen to carry out the study. Equity Analysis is
the process of analyzing the equity shares of different organizations listed on the stock market, and suggesting the
investors to invest in the equities that give high returns.

EQUITY ANALYSIS OF SBI AND AXIS BANK:

Basing on the topic ‘Equity Analysis’, the study is carried out considering the data of SBI and AXIS Bank from
the websites of NSE and various journals, pertaining to a time period of 2 years. The objectives of the study are:

1. To understand the analysis of risk and return of selected banks (SBI and AXIS Bank).
2. To provide adequate information to investors to judge their investment decisions basing on Beta values.

ANALYSIS OF DATA AND INTERPRETATIONS:

The data is analyzed using various statistical tools such as:

• Mean
• Standard Deviation
• Variance
• Covariance
• Correlation
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 • Beta
The interpretations are as follows:
1. The Standard Deviation which indicates the risk is more in the month of October with a value of 6.44. The
Mean which indicates the return, is also high in the month of October with a value of 1.1. The existence of
the risk is much higher than the returns on the whole for SBI in 2018.

2. The Returns are high in the month of February with a value of 0.46. The Standard Deviation is high in the
month of October, which is 3.26 for AXIS bank in 2018.

3. The present study is based on secondary data. The analysis is based on liquidity, profitability, turnover ratio
which are calculated with the help of data from financial statements of the State Bank of India. All the
related to State Bank of India Auditors reports, Internet, Books, Journals, Magazines and the like.
Research Design
This study adopted descriptive Research to find the facts.
Sampling Design
Judgmental sampling technique was used in this study. This technique involved a judgmentalselection
based on the purpose of the sample
Selection of the Sample Units
Banking sector is one of the fast-growing financial institution. Using this Judgmental sample technique
State Bank of India and Axis Bank were selected as a sample unit for this study. These sample units are
selected based on their better performance in banking sector.

Tools Applied

The major tools applied for the analysis of the data are Percentages, Ratios, and T-
Test

SOURCES OF DATA
Data is the fact, figures and other relevant materials, past and present, serving as basis for the study and
analysis. The design of the data collecting method is the backbone of research design. The sources of
data are varied. It depends upon the nature of the study. Data can be distinguished as:
a) Primary Data: Primary data is the data collected for the first time exclusively for the purpose of
achieving the objects of the project work. In this case the feedback received from the respondent
officers through issue of structured questionnaire to the chosen sample is the primary data which is
been collected.
b) Secondary Data: Secondary data is the data which is already collected. In this case the sources are
collected through websites, catalogues of bank, newspapers, magazines etc.

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 CH-2 REVIEW OF LITERATURE

1. Sathya Swaroop Debasish (2006) analyzed efficiency performance in Indian banking sector. This
study measure the relative efficiency of banks segmented on the basis of bank size, ownership
structure and new economy/old economy banks. The current study does not include a few of the
important banking efficiency parameters like non-performing asset, capital adequacy figures,
customer satisfaction index and other service quality variables.

2. Fadzlan Sufian, Muzafar Shah Habibullah (2009) measures macroeconomic attributes of bank
profitability of Chinese banking industry in the post-reform period of 2000–2005. This study results
focuses on the relationship in bank profitability and its explanatory variables.

3. Fadzlan Sufian and Mohamad Akbar Noor Mohamad Noor (2012) the study determines the
Bank Performance in a Developing Economy and focuses on relationship between bank
profitability and Explanatory variables. The study identified that impact of Indian bank’s
profitability on the development of economy is negative.

4. Jaynal Ud-din Ahmed (2015) the study focused on evaluating the performance of Regional Rural
Banks. The study analyzes the development on every sector and deployment of credit ofRRBs over
the years. This study found that RRBs are not in a position to deploy credit for socio-economic
development unlike Indian Commercial Banks.

5. Poonam Singh and Kanhaiya Singh (2015) analyzed the Parameters to determine the efficiency
of Indian Public Sector Banks. The study observed efficiency of rural variable among all the
operational performance variables.

6. Hannes Koster and Matthias Pelster (2017) conducted a study. The study focused on financial
penalties and its impact on profitability and stock performances of bank. The study focuses on
profits of banks deposits and loans.

7. Manish Mittal and Arunna Dhademade (2005) they found that higher profitability is
the only major parameter for evaluating banking sector performancefrom the shareholders
point of view. It is for the banks to strike a balance between commercial and social
objectives. They found that public sector banks are less profitable than private sector
banks. Foreign banks top the list in terms of net profitability. Private sector banks earn
higher non-interest income than publicsector banks, because these banks offer more and
more fee-based services to business houses or corporate sector. Thus there is urgent need
for public sector banks to provide such services to stand in competition with private sector
banks.

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8. Manish Mittal and Arunna Dhademade (2005) they found that higher profitability is
the only major parameter for evaluating banking sector performance from the shareholders
point of view. It is for the banks to strike a balance between commercial and social
objectives. They found that public sector banks are less profitable than private sector
banks. Foreign banks top the list in terms of net profitability. Private sector banks earn
higher non-interest income than public sector banks, because these banks offer more and
more fee based services to business houses or corporate sector. Thus there is urgent need
for public sector banks to provide such services to stand in competition with private sector
banks.

9. I.M. Pandey (2005): An efficient allocation of capital is the most important financial
function in modern times. It involves decision to commit the firm's funds to the long term
assets. The firm’s value will increase if investments are profitable and add to the
shareholders wealth. Financial decisions are important to influence the firm’s growth and
to involve commitment of large amount of funds. The types of investment decisions are
expansion of existing business, expansion of new business and replacement and
modernization. The capital budgeting decisions of a firm has to decide the way in which
the capital project will be financed. The financing or capital structure decision. The assets
of a company can be financed either by increasing the owners claims on the creditors’
claims. The various means of financing represent the financial structure of an enterprise.

10. Medhat Tarawneh (2006) financial performance is a dependent variable and measured
by Return on Assets (ROA) and the intent income size. The independent variables are the
size of banks as measured by total assets of banks, assets management measured by asset
utilization ratio (Operating income divided by total assets) operational efficiency
measured by the operating efficiency ratio (total operating expenses divided by net
income.

11. Fernando Ferreng (2012) it is generally agreed that recent economic crisis intensified

worldwide competition among financial institution. This competition has direct impact
on how bank deal with their customer and achieve its objectives performance evaluation
of banks is the key function for improving banks performance. Banks profitability and
success to a large extent depends on bank branch financial performance

12. Ramchandan Azhagasahi and Sandanvn Gejalakshmi (2012): In their study found the
impact of assets management operational efficiency and bank size on the financial
performance of the public sector and private sector bank. The research revealed that bank
with higher total capital deposits and total assets do not always mean that they have better

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 financial performance. The overall banking sector is strongly influenced by assets
utilization, Operational efficiency and interest income.

13. NutanTroke and P K Pachorkar (2012): The study related that the private sector bank
the percentage of other income in the total income is higher than public sector bank. Public
sector bank depend on intent income for their efficiency and performance. The operational
efficiency of private sector banks is better than public sector banks. Private sector bank
use their assets quality better than public sector banks.

14. Pawankumar Avdhanam and Sriniwas Kolluru, Ramkrishne Fonnd, (2013) in their
study that state bank group other than SBI home finance has performed better throughout the
period of study. Though there was a decline in PAT for the year 2000-01 but then there was
continuous rise in PAT. Most public sector banks have performed better over year.

15. S. Subalakshmi1 , S. Grahalakshmi and M. Manikandan (2018) SBI is the India’s largest
commercial bank in terms of assets, deposits and employees. SBI is the preferred banker for
most of public sector corporations. It occupies a unique place in the Indian money market as it
commands more than one third of India’s bank resources.

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 CH-3 STATE BANK OF INDIA

STATE BANK OF INDIA PROFILE

State Bank of India is an Indian multinational, Public Sector banking and financial services company. It is a
government-owned corporation with its headquarters in Mumbai, Maharashtra. As of December 2013, it had
assets of US$388 billion and 17,000 branches, including 190 foreign offices, making it the largest banking and
financial services company in India by assets.
State Bank of India is one of the Big Four banks of India, along with Bank of Baroda, Punjab National Bank and
Bank of India.
The bank traces its ancestry to British India, through the Imperial Bank of India, to the founding, in 1806, of the
Bank of Calcutta, making it the oldest commercial bank in the Indian Subcontinent. Bank of Madras merged into
the other two "presidency banks" in British India, Bank of Calcutta and Bank of Bombay, to form the Imperial
Bank of India, which in turn became the State Bank of India. Government of India owned the Imperial Bank of
India in 1955, with Reserve Bank of India (India's Central Bank) taking a 60% stake, and renamed it the State
Bank of India. In 2008, the government took over the stake held by the Reserve Bank of India.
State Bank of India is a regional banking behemoth and has 20% market share in deposits and loans among
Indian commercial banks.

History of state bank of India:

The roots of the State Bank of India lie in the first decade of the 19th century, when the Bank of Calcutta, later
renamed the Bank of Bengal, was established on 2 June 1806. The Bank of Bengal was one of three Presidency
banks, the other two being the Bank of Bombay (incorporated on 15 April 1840) and the Bank of Madras
(incorporated on 1 July 1843). All three Presidency banks were incorporated as joint stock companies and were
the result of royal charters. These three banks received the exclusive right to issue paper currency till 1861 when,
with the Paper Currency Act, the right was taken over by the Government of India. The Presidency banks
amalgamated on 27 January 1921, and the re-organised banking entity took as its name Imperial Bank of India.
The Imperial Bank of India remained a joint stock company but without Government participation. Pursuant to
the provisions of the State Bank of India Act of 1955, the Reserve Bank of India, which is India's central bank,
acquired a controlling interest in the Imperial Bank of India. On 1 July 1955, the Imperial Bank of India became
the State Bank of India. In 2008, the government of India acquired the Reserve Bank of India's stake in SBI so as
to remove any conflict of interest because the RBI is the country's banking regulatory authority.
In 1959, the government passed the State Bank of India (Subsidiary Banks) Act. This made SBI subsidiaries of
eight that had belonged to princely states prior to their nationalization and operational take-over between
September 1959 and October 1960, which made eight state banks associates of SBI. This acquisition was in tune
with the first Five Year Plan, which prioritised the development of rural India. The government integrated these
banks into the State Bank of India system to expand its rural outreach. In 1963 SBI merged State Bank of Jaipur
(est. 1943) and State Bank of Bikaner (est.1944).

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SBI has acquired local banks in rescues. The first was the Bank of Bihar (est. 1911), which SBI acquired in 1969,
together with its 28 branches. The next year SBI acquired National Bank of Lahore (est. 1942), which had 24
branches. Five years later, in 1975, SBI acquired Krishnaram Baldeo Bank, which had been established in 1916
in Gwalior State, under the patronage of Maharaja Madho Rao Scindia. The bank had been the Dukan Pichadi, a
small moneylender, owned by the Maharaja. The new bank's first manager was Jall N. Broacha, a Parsi. In 1985,
SBI acquired the Bank of Cochin in Kerala, which had 120 branches. SBI was the acquirer as its affiliate, the
State Bank of Travancore, already had an extensive network in Kerala. There has been a proposal to merge all the
associate banks into SBI to create a "mega bank" and streamline the group's operations. The first step towards
unification occurred on 13 August 2008 when State Bank of Saurashtra merged with SBI, reducing the number of
associate state banks from seven to six. Then on 19 June 2009 the SBI board approved the absorption of State
Bank of Indore. SBI holds 98.3% in State Bank of Indore. (Individuals who held the shares prior to its takeover
by the government hold the balance of 1.7%.) The acquisition of State Bank of Indore added 470 branches to
SBI's existing network of branches. Also, following the acquisition, SBI's total assets will inch very close to the
10 trillion mark (10 billion long scale). The total assets of SBI and the State Bank of Indore stood at 9,981,190
million as of March 2009. The process of merging of State Bank of Indore was completed by April 2010, and the
SBI Indore branches started functioning as SBI branches on 26 August 2010. On October 7, 2013, Arundhati
Bhattacharya became the first woman to be appointed Chairperson of the bank.

MILESTONE OF STATE BANK OF INDIA

• 1806: The Bank of Calcutta is established as the first Western-type bank.

• 1809: The bank receives a charter from the imperial government and changes its name
to Bank of Bengal.
• 1840: A sister bank, Bank of Bombay, is formed.
• 1843: Another sister bank is formed: Bank of Madras, which, together with Bank of Bengal
and Bank of Bombay become known as the presidency banks, which had the right to issue
currency in their regions.
• 1861: The Presidency Banks Act takes away currency issuing privileges but offers
incentives to begin rapid expansion, and the three banks open nearly 50 branches among
them by the mid-1870s.
• 1876: The creation of Central Treasuries ends the expansion phase of the presidency
banks.
• 1921: The presidency banks are merged to form a single entity, Imperial Bank of India.
• 1955: The nationalization of Imperial Bank of India results in the formation of the State
Bank of India, which then becomes a primary factor behind the country's industrial,
agricultural, and rural development.

P a g e 19 | 53
• 1969: The Indian government establishes a monopoly over the banking sector.
• 1972: SBI begins offering merchant banking services.
• 1986: SBI Capital Markets is created.
• 1995: SBI Commercial and International Bank Ltd. are launched as part of SBI's stepped-
up international banking operations.
• 1998: SBI launches credit cards in partnership with GE Capital.
• 2002: SBI networks 3,000 branches in a massive technology implementation.
• 2004: A networking effort reaches 4,000 branches.

• 2005: Raj Travels joins hands with SBI for travel loans. SBI opens branch at Vadakara. SBI
enters into agreement for bilateral sharing of ATMs with PNB on May 10, 2005.

• 2006: State Bank of India (SBI) has informed that Shri. Yogesh Agarwal has been
appointed as Managing Director on the Board of the Bank with effect from October 10,
2006 to the June 30, 2010

• 2007: The State Bank of India (SBI) has become the first foreign bank to set up a branch
in the Israel's diamond exchange. Besides diamonds, they also see huge potential in
telecommunications, hi-tech, chemicals, textiles, agriculture and water management,
food processing, pharma and health care.

• 2008: State Bank of India (SBI) has informed that the Central Government, in
consultation with the Reserve Bank of India and in pursuance of clause (d) of Section
19 of the State Bank of India Act, 1955 (23 of 1955), has nominated Dr. (Mrs.) Vasantha
Bharucha as a part-time non-official Director on the Central Board of State Bank of India
for a period of three years with effect from February 25, 2008, vice Shri Piyush Goel.

• 2009: State Bank of India, entered into an agreement with the government of Gujarat to
create a fund of Rs 5,000 crore for investing in equity of infrastructure projects.

• 2010: State Bank of India, with a debit card base of over 70 million, comprising SBI
Cash Plus, SBI Gold Debit Card and SBI Yuva Card, has added chip and PIN-based
Platinum Debit Card to its bouquet on March 26.

• 2011: SBI - Acquisition of SBICI Bank. P Choudhary has been appointed as the new
chairman of State Bank of India after getting clearance from the government.
• 2012: SBI launched virtual debit cards to check online fraud and promote Ecommerce
• 2013: India's leading Public Sector lender the State Bank of India (SBI) is stepping up
efforts to expand its presence in the world's second biggest economy with the lender
set to launch its second branch in China.
• 2014: SBI announces 150% interim dividend
P a g e 20 | 53
 • 2015: State Bank of India has launched a RuPay Platinum debit card in Association with
National Payment Corporation of India (NPCI). SBI builds foundation for group CSR
activities.

• 2016: SBI opens first branch in South Korea. Govt asks SBI to merge five associate banks.

• 2017: SBI Acquired State Bank of Travancore, State Bank of Patiala , State Bank of
Hyderabad, State Bank of Bikaner & Jaipur , State Bank of Mysore. Bhartiya Mahila Bank
(BMB).

• 2018: Launch of Doctor’s SBI Card and Apollo SBI Card.

• 2019: Launch of SME Business Card, OLA Money SBI Credit Card, Etihad Guest SBI Card
and Allahabad Bank SBI Card.

• 2019: SBI Card enters the ‘9 million Cards’ club.

• 2020: In February 2020, SBI card offered the biggest Initial public offering of 2020.

Domestic presence

SBI has 18,354 branches in India. In the financial year 2012–13, its revenue was ₹2.005 trillion
(US$28 billion), out of which domestic operations contributed to 95.35% of revenue. Similarly,
domestic operations contributed to 88.37% of total profits for the same financial year

Under the Pradhan Mantri Jan Dhan Yojana of financial inclusion launched by Government in
August 2014, SBI held 11,300 camps and opened over 3 million accounts by September, which
included 2.1 million accounts in rural areas and 1.57 million accounts in urban areas.

TABLE 3.1 BALANCE SHEET FOR THE YEAR ENDING ON MARCH 2015-2020
Equities 2015-16 Trend 2016-17 Tren 2017-18 Trend 2018-19 Trend 2019-20 Tren
Anal d Anal Analys d
& is
Liabilities: y sis Anal ys is Anal
ys is ys is
Shar 776.28 100 797.35 102.7 892.46 114.97 892.46 114.97 892.46 114.9
e 1 7
Capit
al
Reserves 143,498.16 100 187,488.7 130.6 218,236.10 152.08 220,021.3 153.33 231,114. 161.0
1 6 6 97 6
& Surplus

P a g e 21 | 53
 Deposits 1,730,722.4 100 2,044,751 118.1 2,706,343. 156.37 2,911,386 168.22 3,241,62 187.
4 . 4 29 . 0.73 3
39 01
Borrowings 323,344.59 100 317,693.6 98.2 362,142.07 111.99 403,017.1 124.64 314,655. 97.3
6 5 2 65 1
Liabilities 159,276.08 100 155,235.1 97.4 167,138.08 104.94 145,597.3 91.41 163,110. 102.4
& 9 6 0 10 1
Provisions

Total 2,357,617.5 100 2,705,966 114.7 3,454,752. 146.53 3,680,914 156.13 3,951,39 167.
Liabiliti 4 . 8 00 . 3.92 6
es
30 25
Assets:

Fixed 10,389.28 100 42,918.92 413. 39,992.25 384.94 39,197.57 377.29 38,439.2 369.9
Assets 1 8 9
Loans 1,463,700.4 100 1,571,078 107.3 1,934,880. 132.19 2,185,876 149.34 2,325,28 158.8
2 . 4 19 . 9.56 6
& 38 92
Advances
Investments 575,651.78 100 765,989.6 133.0 1,060,986. 184.31 967,021.9 167.99 1,046,95 181.8
3 6 72 5 4.52 7
Other 307,876.07 100 325,979.3 105.8 418,892.84 136.06 488,817.8 158.77 540,710. 175.6
Assets 7 8 1 56 3
Total Assets 2,357,617.5 100 2,705,966 114.7 3,454,752. 146.53 3,680,914 156.13 3,951,39 167.6
4 . 8 00 . 3.92
30 25
Other Info:

Capital 13 100 13 100 13 100 13 100 13 100

Adequacy
Ratios (%)
Gross NPA 7 100 7 100 11 157.14 8 114.29 6 85.71
(%)
Net NPA 4 100 4 100 6 150 3 75 2.23 55.75
(%)
Contingent 971,956.01 100 1,046,440 107.6 1,162,020. 119.55 1,116,081 114.83 1,214,99 125.0
Liabilities . 6 69 . 4.61 1
93 46
Inference:

From the above balance sheet, it can be determined that, the company’s share capital is constant in
the year 2017-18, 2018-19 and 2019-20. Reserves and surplus and deposits are increasing year to
year. During 5 years the borrowings are highest in the year 2019. Deposits are more than the loans
and advances. Borrowings are highest in the year 2019.

P a g e 22 | 53
 TABLE 3.2 INCOME STATEMENT OF STATE BANK OF INDIA

(Base year 2015-16)

Annual 2015- 2016-17 2017-18 2018-19 2019-20 T. T.A T.A T T
16 A 2016- 2017- .A .A
2015- 17 18 2018- 2019-
16 19 20
Inter 163,9 175,518. 220,499. 242,868. 257,323. 100.00 107.02 134.45 148.09 156.91
est 98 24 32 65 59
Earn .30
ed
Othe 27,845.3 35,460.9 44,600.6 36,774.8 45,221.4 100.00 127.35 160.17 132.07 162.40
r 7 3 9 9 8
Inco
me
Tota 191,843. 210,979. 265,100. 279,643. 302,545. 100.00 109.97 138.19 145.77 157.70
l 67 17 01 54 08
Inco
me
Total 148,585. 160,131. 205,589. 224,207. 234,412. 100.00 107.77 138.36 150.89 157.76
Expendit 85 27 05 52 46
ure
Operating 43,257.8 50,847.9 59,510.9 55,436.0 68,132.6 100.00 117.55 137.57 128.15 157.50
Profit 2 0 6 2 2
Provision 29,483.7 35,992.7 75,039.2 53,828.5 43,330.3 100.00 122.08 254.51 182.57 146.96
s& 5 2 0 5 7
Contigen
cies
PBT 13,774.0 14,855.1 - 1,607.47 24,802.2 100.00 107.85 - 11.67 180.06
7 8 15,528.2 5 112.74
4
Tax 3,823.40 4,371.07 - 745.25 10,314.1 100.00 114.32 - 19.49 269.76
8,980.79 3 234.89
Net Profit 9,950.67 10,484.1 - 862.22 14,488.1 100.00 105.36 -65.80 8.66 145.60
1 6,547.45 2
NPA
Gross 98,172.8 112,342. 223,427. 172,753. 149,091. 100.00 114.43 227.59 175.97 151.87
NPA 0 99 46 60 85
Gross 7 7 11 8 6 100 100 157.14 114.29 85.714
NPA 3
(%)
Net NPA 55,807.0 58,277.3 110,854. 658,947. 51,871.3 100.00 104.43 198.64 114.29 92.95
2 8 70 40 0
Net 4 4 6 3 2.23 100 100 150 75 55.75
NPA
(%)

P a g e 23 | 53
Inference:
From the above Income Statement, it can be analyzed that the Interest Earned is increased by 7%
in the year 2015-16 and increased up to 56% in the year 2019-20 during 5 years. During 5 years
the total income is less than the total expenditure. Operating profit is increased by 57% in the year
2019-20. Provisions and contingencies are highest in the year 2017-18 i.e. 254.52 and it was
gradually decreased to 146.96. Profit before tax is lesser in the year 2017-18. Tax is highest in the
year 2019-20. Net profit is increased by 45% in the year 2019-20 and it is lowest in the year 2017-
18 during the study period.
LIQUIDITY RATIO IN SBI
The following table -1 current ratio in state bank of India.

TABLE-3.3 CURRENT RATIO

(Rs.in Crore)
Year Current Assets Current Liabilities Ratio (in times)

2013 – 14 1740686.54 96412.96

18.05

2014 – 15 1969915.09 137698.05

14.30

2015 – 16 2108265.36 159875.57

13.18
2016 – 17 2509039.66 155235.19 16.16
2017 – 18 3187765.55 167138.08 19.07
Mean 2303134.44 143271.97 16.152
S.D 567962.5635 28351.47604 2.468799

C.V
24.66041728 19.78857137 15.28479
Regression equation of Y on X1 and
X2
Required equation model is 17.847 + 6.446E-6 X1 +0.00 X2

Where Y= Current Ratio; X1: Current Asset; X2: Current Liability

TABLE 3.4 Result of regression analysis

Result of regression analysis

Standard Adjusted
Variable Coefficients T Stat P-Value R Square
Error R Square

Constant
17.847 .769 23.200 .002

P a g e 24 | 53
 X1
6.446E-6 .000 16.090 .004
.993 0.985
X2
.000 .000 -14.386 .005

Table 1 shows that current ratio of State Bank of India Ltd. The mean value was 16.15 times, the
standard deviation was 2.46, and the co-efficient of variation was 15.28 times.
Regression equation model is depicted in table 1 from the equation model, it is taken increase in current
assets would increase in current ratio of State Bank of India was 6.466E6 times, when current liabilities
remain constant. Similarly decrease in current liabilities would increase in current ratio was 0.00 times,
when current asset remain constant. It is found that both liquidity position and growth in terms of the
company have been good during the period of the study. The results of regression analysis show that the
current ratio contributes significantly to the increase in the liquidity position of a company. The
coefficient for current is highly significant at the 5 per cent level.

PROFITABILITY RATIO IN SBI

Profitability means the ability of a company to earn profit. In analyzing profitability, the
profit-making ability of an organization is measured in terms of the size of the investment therein
or its sales volume. Profitability ratios measure the overall performance and effectiveness of a
company. The following Table -2 shows that the profitability ratio in state bank of India.

TABLE -3.5 PROFITABILITY RATIO IN STATE

BANK OF INDIA
Year/ Gross Net Operating Return on Return on Return on
Ratio Profit profit Profit Ratio Total Shareholders’ Investment
Ratio ratio Assets Fund

2013 – 14 151.14 10.62 63.98 0.61 9.207781 2.73

2014 – 15 155.74 11.66 63.58 0.65 10.20068 2.64

2015 – 16 165.86 8.60 60.88 0.44 6.897029 2.08

2016 – 17 176.53 8.77 58.29 0.39 5.568176 1.36

2017 – 18 187.53 -4.63 58.09 -0.19 -2.98795 -0.65

Mean 167.36 7.004 60.964 0.38 5.777143 1.632

S.D 14.92716 6.628909 2.799862 0.337046 5.231195 1.387793

CV 8.919193 94.64461 4.592649 88.69631 90.54987 85.03635

From the above table the mean value of gross profit ratio (167.36) followed by the operating profit
(60.964), net profit (7.004), Return on Shareholders’ Fund ratio (5.77), Return on Investment (1.632)
and return on Total Assets (0.38). The best performance of Gross profit in profitability ratio of state
bank of India.
P a g e 25 | 53
 TEST OF SIGNIFICANT OF PROFITABILITY RATIO
Table 2.1 gives the relevant details whether the profitability ratio of the State Bank of India
different for the five years. Two ways ANOVA was used.
Table 3.6 ANOVA- Profitability Ratio

(Rs.in Crore)
Source of Sum of Degree of Mean
Variation Square freedom Square F-ratio P-value F crit
Rows
20.66789 4 5.166973 0.086451 0.985652 2.866081
Columns
109801.1 5 21960.23 367.4247 5.87E-19 2.71089
Error
1195.359 20 59.76796
Total
111017.2 29

From the above table that the F-value is less than the F-critical value for the alpha level selected
(0.05). Therefore, we have evidence to accept the null hypothesis and say that at least one of the
three samples have significantly different means and thus belong to an entirely different
population.

TURNOVER RATIO IN SBI

There are few ratios that help measures turnover position. The turnover ratios are also known as
activity of efficiency ratios. They indicate the efficiency with which the capital employed is
routed at the business. The overall Profitability of the business depends on capital employed and
the turnover, i.e. the speed at which the capital employed in the business totals higher or rate of
ratios. The following Table -2 shows that the turnover ratio in state bank of India.

TABLE -3.7 TURNOVER RATIO IN STATE BANK

OF INDIA
Year/ Ratio Fixed Assets Total Assets Working Capital Sales to Capital

Turnover Ratio Turnover Ratio Turnover Ratio Employed Ratio

2013 – 14 12.80705 0.057182

0.062328
0.060433
2014 – 15 12.04223 0.054853
0.061316
0.058807
2015 – 16 11.13321 0.051201
0.059365
0.0551
2016 – 17 2.784553 0.044165
0.050773
0.046853
2017 – 18 3.534764 0.040918
0.046799
0.042999
Mean
8.460361 0.049664 0.056116 0.052838

P a g e 26 | 53
 S.D
4.88221 0.006938 0.00692 0.0076
CV
57.70688 13.96981 12.33135 14.38397

From the above table the mean value of Fixed Assets Turnover Ratio (8.46) followed by the Working
Capital Turnover Ratio (0.056), Sales to Capital Employed Ratio (0.052), Total Assets Turnover Ratio
(0.049).

3.8 MARKET BASED RATIO IN SBI

Year/ EPS Cash Dividend Dividend Book Price (P/BV
Ratio Earnings Payout Yield Value Earnings
Per Ratio Ratio Ratio)
Share

2013 – 14 0.0920 0.103355 14.28751 0.076438 0.066981

14.136 0.066
2014 – 15 0.1020 0.1107 145.714 14.86445 0.00901 0.074644 0.007

2015 – 16 0.0689 0.080755 155.4946 10.85994 0.00565 0.070878 0.004

2016 – 17 0.0556 0.067862 157.0037 8.929279 0.00631 0.099032 0.0056

-
2017 – 18
0.0298 -0.01656 0 0 0.004684 -0.13168 0.004

Mean 0.0577
4 0.069222 94.49996 9.757934 0.020418 0.035971 0.01732
S.D 0.0522
62 0.050938 80.02222 5.965784 0.031357 0.094551 0.027242
CV 90.511
84 73.58664 84.67963 61.13778 153.5728 262.8523 157.2848

TEST OF SIGNIFICANCE-MARKET BASED

Table 4 .1 gives the relevant details whether the market-based ratio – different for the five
years. Two ways ANOVA was used
Table 3.9 ANOVA- Market Based Ratio

(Rs.in Crore)
Source of Sum of Degree of Mean
Variation Square freedom Square F P-value F crit
3390.436 3 1130.145 1.185493 0.348593 3.287382
Rows
42651.75 5 8530.349 8.948116 0.000421 2.901295
Columns

P a g e 27 | 53
 14299.68 15 953.3123
Error
60341.87 23
Total

From the above table that the F-value is less than the F-critical value for the alpha level selected
(0.05). Therefore, we have evidence to accept the null hypothesis and say that at least one of the
three samples have significantly different means and thus belong to an entirely different
population.

SWOT Analysis

1. The biggest bank in the country

2. Has a separate act for itself. Thus, a special privilege.

Strength
3. Biggest branch network in the country
4. First public sector to move to CBS

1. Huge amount of staff

Weakness 2. Expected to experience high level of attrition due to retirement of
its top management
3. Still carries the image of the old Govt. sector bank

1. Pool in talent to replace the going top management to serve the

next generation
Opportunity
2. Make better use of its CRM
3. Expansion into rural areas

1. Consolidation among private banks

Threats 2. New bank licenses by RBI
3. Foreign banks that have sophisticated products

P a g e 28 | 53
 AXIS BANK

INDUSTRY PROFILE

Axis Bank Limited provides a suite of corporate and retail banking products. The Bank operates through four
segments: Treasury, Retail Banking, Corporate/Wholesale Banking and Other Banking Business. Its Treasury
operations include investments in sovereign and corporate debt, equity and mutual funds, trading operations,
derivative trading and foreign exchange operations on the proprietary account and for customers. Its Retail Banking
constitutes lending to individuals/small businesses and activities include liability products, card services, Internet
banking, mobile banking and financial advisory services among others. Its Corporate/Wholesale Banking includes
corporate relationships not included under Retail Banking, corporate advisory services, placements and
syndication, project appraisals, capital market related services and cash management services. Its Other Banking
Business includes Para banking activities, such as third-party product distribution and other banking transactions.

Axis Bank is the third largest private sector bank in India. The Bank offers the entire spectrum of financial
services to customer segments covering Large and Mid-Corporate, MSME, Agriculture and Retail Businesses.
The Bank has a large footprint of 2589 domestic branches (including extension counters) and 12,355 ATMs
spread across the country as on 31st March 2015. The overseas operations of the Bank are spread over nine
international offices with branches at Singapore, Hong Kong, Dubai (at the DIFC), Colombo and Shanghai;
representative offices at Dhaka, Dubai, Abu Dhabi and an overseas subsidiary at London, UK. The international
offices focus on corporate lending, trade finance, syndication, and investment banking and liability businesses.
Axis Bank is one of the first new generation private sector banks to have begun operations in 1994. The Bank
was promoted in 1993, jointly by Specified Undertaking of Unit Trust of India (SUUTI) (then known as Unit
Trust of India), Life Insurance Corporation of India (LIC), General Insurance Corporation of India (GIC),
National Insurance Bank Ltd., The New India Assurance Bank Ltd., The Oriental Insurance Bank Ltd. and
United India Insurance Bank Ltd. The shareholding of Unit Trust of India was subsequently transferred to
SUUTI, an entity established in 2003.
With a balance sheet size of Rs. 4, 61,932crores as on 31st March 2015, Axis Bank has achieved consistent
growth and stable asset quality with a 5-year CAGR (2010-11 to 2014-15) of 21% in Total Assets, 18% in Total
Deposits, 22% in Total Advances and 24% in Net Profit.

Overview

Retail banking

The Bank pursues an effective customer segmentation strategy, the success of which is reflected in the fact that
Savings Bank deposits grew at a Compounded Annual Growth Rate (CAGR) of 26.13% over the last five years.
During the year, Savings Bank deposits grew 23.44% to Rs. 63,778 cores from Rs. 51,668 cores last year. On a
daily average basis, Savings Bank deposits grew 20.26% to Rs. 52,243 crores. The Bank has also maintained its
P a g e 29 | 53
approach in increasing the proportion of Retail Term Deposits. On the 31st March 2013, retail term deposits grew
24.37% year-on-year to Rs. 59,531 crores, constituting 42.37% of total term deposits, compared to 37.20% last
year. Likewise, the Bank continued to focus on increasing its share of retail loans in total advances. The retail
loans of the Bank grew 43.62% to Rs. 53,960 crores as on 31st March 2013 from Rs. 37,570 crores last year.
Retail loans constituted 27.40% of the Bank’s total advances as on 31st March 2013, compared to 22.13% last
year of which secured loans accounted for 87%. The distribution of specific portfolios within the Retail loan
segment as on 31st March 2013 was as follows: home loans - 65%, loans against property - 7%, auto loans -
14%, personal loans and credit cards -9%.

Business banking:

Business Banking offers transactional banking services, leveraging upon the Bank’s network and technology. Its
initiatives focus on procurement of low-cost funds by offering a range of current account products and cash
management solutions across all business segments covering corporates, institutions, central and state
government ministries and undertakings as well as small and retail business customers. Product offerings of this
business segment aim at providing customised transactional banking solutions to fulfill customer’s business
requirement. Cross-sell of transactional banking products, product innovation and a customer-centric approach
have succeeded in growing current account balances and realisation of transaction banking fees. As on 31st
March 2013, balances in current accounts increased by 21.55% and stood at Rs. 48,322 crores compared to Rs.
39,754 crores last year. On a daily average basis, current accounts balances grew by 4.73% to Rs. 28,698 crores
compared to Rs. 27,403 crores last year.
In the cash management services (CMS) business, the Bank focuses on offering customised service to its
customer to cater to specific corporate requirements and improve the existing product line to offer enhanced
features to customers. The Bank is also focusing on host-to-host integration for both collections and payments,
such as IT integration between corporates and the Bank for seamless transactions and information flow. The
Bank provides comprehensive structured MIS reports on a periodic basis, for better accounting and reporting.
CMS continued to constitute an important source of fee income and contributed significantly to generate low cost
funds. The Bank is one of the top CMS providers in the country with the number of locations covered under
CMS increased to 890 from 801 last year. The number of CMS clients has grown to 15,818 from 11,548 last
year.

Corporate credit:

In the backdrop of a subdued macro-economic environment, capital expenditure by corporates remained

lacklustre during the year. Loans for working capital and the drawdown on committed sanctions in existing
projects under implementation contributed to the growth in corporate credit during the year. The corporate
credit portfolio of the bank comprising advances to large and mid-corporates including infrastructure grew
7.89% to Rs. 98,239 crores from Rs. 91,053 crores last year. This includes advances at overseas branches
amounting to Rs. 29,972 crores (equivalent to USD 5.52 billion) comprising mainly the portfolio of Indian
corporates and their subsidiaries as also trade finance. The advances at overseas branches accounted for
15.22% of total advances. The bank’s infrastructure business includes project and bid advisory services, project
lending, debt syndication, project structuring and due diligence, securitisation and structured finance.

P a g e 30 | 53
 International Banking
The international operations of the Bank have generally catered to Indian corporates who have expanded their
business overseas. The overseas network of the Bank currently spans the major financial hubs in Asia. The Bank
now has a foreign network of four branches at Singapore, Hong Kong, DIFC-Dubai and Colombo (Sri Lanka),
and three representative offices at Shanghai, Dubai and Abu Dhabi, besides strategic alliances with banks and
exchange houses in the Gulf Co-operation Council (GCC) countries. While branches at Singapore, Hong Kong,
DIFC-Dubai and Colombo enable the Bank to partner with Indian corporates doing business globally and
primarily offer corporate banking, trade finance, treasury and risk management solutions, the Bank also offers
retail liability products from its branches at Hong Kong and Colombo. The representative offices and strategic
alliances with banks and exchange houses in the GCC countries cater to the large Indian diaspora and promote
the Bank’s NRI products. With management of liquidity being a major challenge in the present global markets,
the Bank consciously restrained its asset growth at the overseas centres to report an asset size of USD 6.84 billion
as at 31st March 2013 vis-à-vis USD 6.35 billion as at 31st March 2012. Further, interactions are also in progress
with China Banking Regulatory Commission (CBRC) for upgrade of the Shanghai Representative Office into a
branch.

INFORMATION TECHNOLOGY

Technology is one of the key enablers for business and for delivering customised financial solutions. The Bank
continued to focus on introducing innovative banking services through investments in scalable, robust and function-
rich technology platforms to enable delivery of efficient and seamless services across multiple channels for
customer convenience and cost reduction. The Bank has also focused on improving the governance process in IT.
During the year, the Bank has received certification of ISO 27001:2005 by BSI (ANAB accredited) for complying
with the standards of Information Security Management System for its data centres located in Navi Mumbai and
Bengaluru. The Bank has also successfully completed migration of its data centre to a co-hosted location during

the year. The new premises offer a category IV data center that complies with the highest benchmarking standards
applicable to data centres promising built-in redundancy of infrastructure. A robust Project Management
framework is used to ensure that investments in IT are based on good gate-keeping principles and result in
appropriate payback in value terms.

xAxis Bank has set up a Trust – the Axis Bank Foundation (ABF) to channel its philanthropic initiatives. The
Foundation has committed itself to participate in various socially relevant endeavours with a special focus on
poverty alleviation, providing sustainable livelihoods, education of the underprivileged, healthcare, sanitation etc.
The Bank contributes up to one per cent of its net profit annually to the Foundation under its CSR initiatives.
The Foundation aims to provide one million sustainable livelihoods to the underprivileged in some of the most
backward regions of the country in the next five years, with 60% of the beneficiaries being women.
The Foundation nurtures / supports NGOs working in the areas of education health and development of
underprivileged and special children. The Foundation also supports various projects to impart vocational training
to the underprivileged youth.

P a g e 31 | 53
The Foundation supports the Lifeline Foundation for providing high level trauma care and rural medical relief in
the states of Maharashtra, Kerala, Gujarat and Rajasthan. The Foundation also supports projects in skill
development, water harvesting and low-cost agricultural practices to enhance farm yield.
Axis Bank is the third largest private sector bank in India. The Bank offers the entire spectrum of financial
services to customer segments covering Large and Mid-Corporates, MSME, Agriculture and Retail Businesses.
The Bank has a large footprint of 4,594 domestic branches (including extension counters) with 11,333 ATMs &
5,710 cash recyclers spread across the country as on 31st March, 2021. The Bank has 6 Virtual Centres and has
over 1500 Virtual Relationship Managers as on 31st March 2021.The Overseas operations of the Bank are spread
over eight international offices with branches at Singapore, Dubai (at DIFC) and Gift City-IBU; representative
offices at Dhaka, Dubai, Abu Dhabi, Sharjah and an Overseas subsidiary at London, UK. The international
offices focus on Corporate Lending, Trade Finance, Syndication, Investment Banking and Liability Businesses.
Axis Bank is one of the first new generation private sector banks to have begun operations in 1994. The Bank
was promoted in 1993, jointly by Specified Undertaking of Unit Trust of India (SUUTI) (then known as Unit
Trust of India), Life Insurance Corporation of India (LIC), General Insurance Corporation of India (GIC),
National
Insurance Company Ltd., The New India Assurance Company Ltd., The Oriental Insurance Company Ltd. and
United India Insurance Company Ltd. The share holding of Unit Trust of India was subsequently transferred to
SUUTI, an entity established in 2003.
With a balance sheet size of Rs. 9,96,118 crores as on 31st March 2021, Axis Bank has achieved consistent
growth and with a 5 year CAGR (2015-16 to 2020-21) of 13% each in Total Assets & Advances and 15% in
Deposits.

Awards
2010

• Best Debt House in India – Euromoney

• Best Domestic Debt House in India – Asiamoney
• Overall Winner & Consistent Performer – (Large Banks Category) – Business Today Best Bank
Awards 201
2011

• Bank of the Year – India –The Banker Awards 2011

2012

• Bank of the Year – Money Today FPCIL Awards 2012–13

• Best Private Sector Bank – CNBC-TV18 India's Best Bank and Financial Institution Awards 2012
2013

• Ranked No 1 in the IT Biz Award – large enterprises category by Express IT Awards

• Joint winner under the ‘Most Innovative Broad Based Product Offering’ category - IBA Innovations
Award.

P a g e 32 | 53
 2014

• Best Domestic Bank in India- Asiamoney Best Banks 2014

• Best Bank Award among Large Banks for IT for Business Innovation - IDRBT Banking Technology
Excellence Awards 2014
• Best Bank for Rural Reach in the Private Sector and Best Retail Growth Performance in the Private
Sector category – Dun & Bradstreet - Polaris Financial Technology Banking Awards 2014
2015

• Axis Bank has been adjudged winner in the Best Bank Category, Outlook Money Awards 2015
• Axis Bank awarded for the Best Security among Private Sector Banks in India by Data Security
Council of India (DSCI).
• Best Domestic Bank in India – Asiamoney Best Banks 2015
• Axis Bank has been featured in Limca Book of Records 2015 for creating a National Record for its
campaign – 'Plant a Sapling'
• No. 1 Promising Banking Brand of 2015, Economic Times Awards 2015.

SWOT ANALYSIS:

Strengths
• Axis bank has been given the rating as one of top three positions in terms of fastest growth in private
sector banks
• Financial express has given number two position and BT-KPMG has rated AXIS bank as the best bank
with some 26 parameters
• The bank has a network of 1,493 domestic branches and 8,324 ATMs
• The bank has its presence in 971 cities and towns
• The banks financial positions grows at a rate of 20% every year which is a major positive sign for any
bank
• The bank’s net profit is Q3FY12 is 1,102.27 which has a increase of 25.19% growth compared to 2011

Weaknesses
• Gaps – Majorly they concentrated in corporate, wholesale banking, treasury services, retail banking
• Foreign branches constitute only 8% of total assets
• Very recently the bank started focusing its attention towards personal banking and rural areas
• The share rates of AXIS bank is constantly fluctuating in higher margins which makes investors in an
uncomfortable position most of the time
• There are lot of financial product gaps in terms of performance as well as reaching out to the customer
• There are many fraudulent activities involved in credit cards as the banks process credit card approval
even without verification of original documents
• Their financial consultants are not wise enough to guide the customers towards right investments

P a g e 33 | 53
 • Customer service has to improve a lot in order to be in race with other major players

Opportunities
• Acquisitions to fill gap
• In 2009, Alliance with MotilalOswal for online trading for 10 million customers
• In 2010, acquired Enam Securities Pvt Ltd – broking and investment banking
• In Sep 2009, SEBI approved Axis Asset Management Co. for mutual fund business
• No. of e-transactions increased from 0.7 million to around 2 million
• Geographical expansion to rural market – 80% of them have no access to formal lending
• 46% use informal lending channels
• 24% unregulated money lenders
• Now number of branches increased to 1493 from 339.
• Last quarter there were 48 new branches opened across the Nation
• Since it’s a new age banking there are lot of opportunities to have the advance technicalities in banking
solutions compared to existing major players.
• The assets in their international operations are growing at a very faster pace with a growth rate of 9%.
• The concept of ETM (Everywhere teller machine) by AXIS Bank had a good response in terms of
attracting new customers in personal banking segment

Threats
• Since 2009, RBI has increased CRR by 100 basis points
• Increased repo rate reverse repo rate by 50 points – 11 times of late
• Increasing popularity of QIPs due to ease in fund raising
• RBI allowed foreign banks to invest up to 74% in Indian banking
• Government schemes are most often serviced only by govern banks like SBI ,Indian Banks, Punjab
National Bank etc
• ICICI and HDFC are imposing strong threats in terms of their expansion in customer base by their
aggressive marketing strategies.

TABLE 3.10 BALANCE SHEET OF AXIS BANK

Standalone Yearly Results ------------------- in Rs. Cr. -------------------

Mar '21 Mar '20 Mar '19 Mar '18 Mar '17

Interest Earned

(a) Int. /Disc. on Adv/Bills 47,918.86 48,302.97 41,322.02 34,137.47 33,124.96

P a g e 34 | 53
(b) Income on Investment 12,558.21 11,246.03 11,349.07 9,983.30 9,622.82

(c) Int. on balances with RBI 1,037.88 1,095.26 693.35 387.83 503.84

(d) Others 2,130.34 1,990.90 1,621.33 1,271.71 1,290.54

Other Income 14,838.20 15,536.56 13,130.34 10,967.09 11,691.31

EXPENDITURE

Interest Expended 34,406.17 37,428.96 33,277.60 27,162.58 26,449.04

Employees Cost 6,164.01 5,321.00 4,747.32 4,312.96 3,891.86

Other Expenses 12,211.14 11,983.62 11,086.08 9,677.38 8,308.05

Depreciation -- -- -- -- --

Operating Profit before Provisions and contingencies 25,702.17 23,438.14 19,005.11 15,594.48 17,584.52

Provisions And Contingencies 16,896.33 18,533.91 12,031.02 15,472.91 12,116.96

Exceptional Items -- -- -- -- --

P/L Before Tax 8,805.84 4,904.23 6,974.09 121.57 5,467.56

Tax 2,217.34 3,277.01 2,297.48 -154.11 1,788.28

P/L After Tax from Ordinary Activities 6,588.50 1,627.22 4,676.61 275.68 3,679.28

Prior Year Adjustments -- -- -- -- --

Extra Ordinary Items -- -- -- -- --

Net Profit/(Loss) For the Period 6,588.50 1,627.22 4,676.61 275.68 3,679.28

Equity Share Capital 612.75 564.34 514.33 513.31 479.01

Reserves Excluding Revaluation Reserves 100,990.26 84,383.51 66,161.97 62,931.95 55,283.53

Equity Dividend Rate (%) -- -- 50.00 -- 250.00

ANALYTICAL RATIOS

a) % of Share by Govt. -- -- -- -- --

b) Capital Adequacy Ratio - Basel -I -- -- -- -- --

c) Capital Adequacy Ratio - Basel -II -- -- -- -- --

EPS Before Extra-Ordinary

Basic EPS 22.15 5.99 18.20 1.13 15.40

Diluted EPS 22.09 5.97 18.09 1.12 15.34

EPS After Extra Ordinary

Basic EPS 22.15 5.99 18.20 1.13 15.40

P a g e 35 | 53
Diluted EPS 22.09 5.97 18.09 1.12 15.34

NPA Ratios:

I) Gross NPA 25,314.84 30,233.82 29,789.44 34,248.64 21,280.48

ii) Net NPA 6,993.52 9,360.41 11,275.60 16,591.71 8,626.55

i) % of Gross NPA 3.70 4.86 5.26 6.77 5.04

ii) % of Net NPA 1.05 1.56 2.06 3.40 2.11

Return on Assets % 1.11 0.20 0.63 0.04 0.65

Public Share Holding

No Of Shares (Crores) -- -- -- -- --

Share Holding (%) -- -- -- -- --

Promoters and Promoter Group Shareholding

a) Pledged/Encumbered

- Number of shares (Crores) -- -- -- -- --

- Per. of shares (as a % of the total sh. of prom. and

-- -- -- -- --
promoter group)

- Per. of shares (as a % of the total Share Cap. of the

-- -- -- -- --
company)

b) Non-encumbered

- Number of shares (Crores) -- -- -- -- --

- Per. of shares (as a % of the total sh. of prom. and

-- -- -- -- --
promoter group)

- Per. of shares (as a % of the total Share Cap. of the

-- -- -- -- --
company)

Notes |202103 |202003 |201903 |201803 |201703

TABLE 3.11 PROFIT AND LOSS OF AXIS BANK

Standalone Profit & Loss account ------------------- in Rs. Cr. -------------------

Mar '20 Mar '19 Mar '18 Mar '17 Mar '16

12 mths 12 mths 12 mths 12 mths 12 mths

P a g e 36 | 53
Income

Interest Earned 62,635.16 54,985.77 45,780.31 44,542.16 40,988.04

Other Income 15,536.56 13,130.34 10,967.09 11,691.31 9,371.46

Total Income 78,171.72 68,116.11 56,747.40 56,233.47 50,359.50

Expenditure

Interest expended 37,428.95 33,277.60 27,162.58 26,449.04 24,155.07

Employee Cost 5,321.00 4,747.32 4,312.96 3,891.86 3,376.01

Selling, Admin & Misc Expenses 51,555.51 36,735.87 23,984.69 21,780.65 17,870.76

Depreciation 772.95 709.72 568.10 508.80 443.91

Operating Expenses 35,838.54 27,864.41 13,546.95 12,276.07 13,810.73

Provisions & Contingencies 21,810.92 14,328.50 15,318.80 13,905.24 7,879.95

Total Expenses 95,078.41 75,470.51 56,028.33 52,630.35 45,845.75

Mar '20 Mar '19 Mar '18 Mar '17 Mar '16

12 mths 12 mths 12 mths 12 mths 12 mths

-
Net Profit for the Year -7,354.41 719.08 3,603.12 4,513.75
16,906.70

Profit brought forward 24,323.00 23,043.05 24,448.33 23,766.46 17,623.49

Total 7,416.30 15,688.64 25,167.41 27,369.58 22,137.24

Preference Dividend 288.86 0.00 0.00 0.00 0.00

Equity Dividend 0.00 0.00 1,405.28 1,407.43 1,191.42

Corporate Dividend Tax 0.00 0.00 0.00 0.00 213.19

Per share data (annualised)

Earning Per Share (Rs) -60.94 -28.60 2.80 15.04 18.94

Equity Dividend (%) 0.00 50.00 0.00 250.00 250.00

Book Value (Rs) 301.05 259.27 247.20 232.83 223.12

Appropriations

Transfer to Statutory Reserves 1,076.18 1,791.38 275.68 1,589.98 2,077.89

P a g e 37 | 53
Proposed Dividend/Transfer to Govt 288.86 0.00 1,405.28 1,407.43 1,404.61

Balance c/f to Balance Sheet 24,585.17 25,928.28 23,043.05 24,448.33 22,364.65

Total 25,950.21 27,719.66 24,724.01 27,445.74 25,847.15

ANALYSIS AND INTERPRETATION

TABLE 3.12 Current Ratio

2010-11 2011-12 2012-13 2013-14 2014-15

Particulars
(Rs in Lakhs) (Rs in Lakhs) (Rs in Lakhs) (Rs in Lakhs) (Rs in Lakhs)

CA&Loans and
advances 5699.28 9587.39 8711.54 7604.87 8138.7

CL& provisions 4973.51 4370.12 7811.18 12255.16 5674.04

Current Ratio 1.15 2.19 1.12 0.62 1.43

Interpretation

From above table the current ratio of a bank has a standard position only in the year of 2012 to 2013,
because as per rule, the current ratio of 2:1 (or) more indicates highly solvent position of firm.

3.a

TABLE 3.13 Quick Liquid/Acid Test Ratio

2010-11 2011-12 2012-13 2013-14 2014-15

Particulars
(Rs in Lakhs) (Rs in Lakhs) (Rs in Lakhs) (Rs in Lakhs) (Rs in Lakhs)

CA & loans and

advances minus
inventories 3727.56 7757.65 7100.4 5925.21 6618.12

P a g e 38 | 53
 CL & Provisions
minus Bank OD 4382.64 2735.56 7640.17 9214.9 5674.04

QL/ Acid Test Ratio 0.85 2.84 0.93 0.64 1.17

Interpretation

From the above table the bank is having good liquidity position i.e.1.17 in the year of 2014 to 2015. The
quick ratio of 1:1 indicates satisfactory position of the firm.

3.b

TABLE 3.14 Debt-Equity Ratio

2010-11 2011-12 2012-13 2013-14 2014-15

Particulars
(Rs in Lakhs) (Rs in Lakhs) (Rs in Lakhs) (Rs in Lakhs) (Rs in Lakhs)

Long time debt 166.9 500 166.9 289.83 1733.74

Share holders fund 3707.84 2832.68 2849.88 2338.69 3184.15

Debt-Equity Ratio 0.045 0.177 0.059 0.124 0.544

Interpretation
If the debt-equity ratio is greater than 1, then the bank assets are financed through debt or if the ratio is less
than 1, its assets are primarily financed through equity.
From the above table bank ratio is less than 1, from the year of 2011 to 2015. Hence the bank assets are financed
through equity.

3.c
P a g e 39 | 53
 TABLE 3.15 Fixed Asset to Long- Term Funds Ratio

2010-11 2011-12 2012-13 2013-14 2014-15

Particulars
(Rs in Lakhs) (Rs in Lakhs) (Rs in Lakhs) (Rs in Lakhs) (Rs in Lakhs)

Fixed asset 5546.86 7999.88 4705.11 4652.63 3577.92

Long-term funds 166.9 500 166.9 289.83 1733.74

FA to LT funds
33.23 16.00 28.19 16.05 2.06
ratio

Interpretation

Comparing this fixed-assets-to long term funds ratio against industry, high ratios can be interpreted as
liquidity problems, because it means the bank does not have immediate access to cash.

From the above table the bank can have an easy access to cash to meet financial obligations in the year
20014-15, when compared to remaining years (2010-11,2011-12,2012-13,2013-14).

3.d

TABLE 3.16 Interest Cover

2010-11 2011-12 2012-13 2013-14 2014-15
Particulars (Rs in (Rs in (Rs in (Rs in (Rs in
Lakhs) Lakhs) Lakhs) Lakhs) Lakhs)

PBIT 1772.58 334.09 1487.56 594.85 2516.04

Interest 286.9 428.1 704.44 734.97 637.54

Interest cover 6.18 0.78 2.11 0.81 3.95

Interpretation

In the years of 2010-11,2012-13,2014-15 the interest expenses has incurred by bank is greater than the
earnings that bank have had to pay, but compare to remaining years. However the bank is easily able to meet the
interest obligation from profits.

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 3.e

TABLE 3.17 Debt Service Coverage Ratio

2010-11 2011-12 2012-13
2013-14 2014-15
Particulars (Rs in (Rs in (Rs in
(Rs in Lakhs) (Rs in Lakhs)
Lakhs) Lakhs) Lakhs)
PAT plus Dep plus interest
on loan 1461.08 2017.11 2188.78 1688.94 2220.09

Interest on loan plus loan

repayment in a year 357.05 7612.22 7082.81 4617.53 4333.54
DSCR 4.09 0.26 0.31 0.37 0.51

Interpretation
The debt service coverage ratio, as per rule 2 is a satisfactory, but if it is below 1 indicates a negative cash flow.
From above table the bank is negative cash flow except in the year 2010-11, when compared to remaining
years (i.e., 2011-12, 2013-14, 2014-15) because it is less than 1.

3.f

TABLE 3.18 Inventory Turnover Ratio

2007-08 2008-09 2009-10 2010-11 2011-12
Particulars (Rs in (Rs in (Rs in (Rs in (Rs in
Lakhs) Lakhs) Lakhs) Lakhs) Lakhs)

Cost of goods sold 13693.65 15012.49 16426.22 19097.99 23281.47

Average Inventory 563.905 501.96 417.845 322.025 365.68

Inventory turnover
24.28 29.91 39.31 59.31 63.67
ratio

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Interpretation
From the above table the inventory turnover ratio of the bank is satisfactory because the ratio is going on
increasing year by year from 2010-2011 to 2014-2015.

3.g

TABLE 3.19 Gross Profit Margin

2011-12 2012-13 2013-14 2014-15
2010-11
Particulars (Rs in (Rs in (Rs in (Rs in
(Rs in Lakhs)
Lakhs) Lakhs) Lakhs) Lakhs)

Sales minus Cost

of Goods sold 5411.22 4612.69 5930.13 4998.28 7382.71

Sales 19104.87 19625.18 22356.35 24078.27 30664.18

GPM 28.32 23.50 26.53 20.76 24.08

Interpretation
From the above table the gross profit was high in the year 2010-11, when compared to remaining years
(i.e., 2011-12, 2012-13, 2013-14, 2014-15). A high gross profit margin indicates that the bank can make a
reasonable profit, as long as it keeps the overhead cost in control. A low margin indicates that the business is
unable to control its production cost.

3.h

TABLE 3.20 Return on Capital Employed (ROCE)

2010-11 2011-12 2012-13 2013-14 2014-15

Particulars
(Rs in Lakhs) (Rs in Lakhs) (Rs in Lakhs) (Rs in Lakhs) (Rs in Lakhs)

PBIT 1239.65 362.83 604.04 163.19 2081.66

P a g e 42 | 53
 Average Networth plus
Loan Funds 6139.16 13470.29 8263.55 8483.255 8044.025

ROCE 20.19 2.69 7.31 1.92 25.88

Interpretation
The return on capital employed is greater or higher in the year of 2014-15, when compared to previous
years. Hence ROCE can indicate that a bank can reinvest a greater portion of its profits back into its operations, to
the benefit of shareholders. The re-invested capital is, in turn, employed ata higher rate of return, which help
sgenerate higher earnings growth.

3.i

TABLE 3.21 Fixed Asset Turnover Ratio

2010-11 2011-12 2012-13 2013-14 2014-15
Particulars (Rs in (Rs in (Rs in (Rs in (Rs in
Lakhs) Lakhs) Lakhs) Lakhs) Lakhs)

Sales 19104.87 19625.18 22356.35 24078.27 30664.18

Fixed Asset 4963.475 6773.37 6352.495 4678.87 4115.275

FA turnover
3.85 2.90 3.52 5.15 7.45
ratio

Interpretation
From above table the fixed asset turnover is too high in the year 2014-15, when compared to remaining
years (i.e., 2010-11, 2011-12,2012-13, 2013-14). So, its shows that firm is likely operating over capacity and needs
to either increase its asset base (plant, property, equipment) to support its sales or reduce its capacity.

3H
P a g e 43 | 53
 CH-4 DATA ANALYSIS

1. Net Profit Ratio

Table 1 illustrates that the period of study, Net profit ratio of both SBI and AXIS Banks are fluctuated.
The highest Net Profit Ratio of SBI was 8.59% in 2014-15 and for AXIS bank it was 20.74% in 2014-
15. However, the lowest Net Profit Ratio of SBI was -2.97% in 2017-18 and 0.60% for AXIS bank in
2017-18.
Table 4: Net Profit Ratio
SBI (Rs in crores) AXIS (Rs in crores)
Year Net Profit
Net Profit Net sales Net Profit Ratio Net Profit Net sales
Ratio
2013 - 2014 10,891.17 136350.8 7.9876099 6,217.67 30641.16 20.29188843
2014 - 2015 13,101.57 152397.07 8.596995992 7,357.82 35478.6 20.73875519
2015 - 2016 9,950.65 163685.31 6.079134407 8,223.66 40988.04 20.06356
2016 - 2017 10,484.10 175518.24 5.973225347 3,679.28 44542.16 8.260219082
2017 - 2018 -6547.45 220499.32 -2.969374237 275.68 45,780.31 0.602180282

2. Operating Profit Ratio

Table 2 illustrates that the period of study, Operating ratio of both SBI and AXIS Banks are fluctuated.
The highest Operating Profit Ratio of SBI was 11.45% in 2014-15 and for AXIS bank it was 17.50%
in 2015-16. However, the lowest Operating Profit Ratio of SBI was8.08% in 2017-18 and 11.34%
for AXIS bank in 2017-18.
Table 4.1: Operating Profit Ratio
SBI (Rs in crores) AXIS (Rs in crores)
Year Operating Operating Profit Operating Operating Profit
Net sales Net sales
Profit Ratio Profit Ratio
2013 – 2014 14890.26 136350.8 10.92055199 4414.79 30641.16 14.40803808
2014 – 2015 17454.1 152397.07 11.45304172 5426.06 35478.6 15.29389548
2015 – 2016 16799.75 163685.31 10.26344392 7176.06 40988.04 17.50769249
2016 – 2017 17680.28 175518.24 10.0731867 6402.01 44542.16 14.37292219
2017 – 2018 17829.74 220499.32 8.086074823 5195.49 45,780.31 11.3487436

3. Return on Shareholder’s Investment or Net Worth Ratio

Table 3 illustrates that the period of study, Net Worth Ratio of both SBI and AXIS Banks are fluctuated.
The highest Net Worth Ratio of SBI was 10.20% in 2014-15 and for AXIS bank it was 16.46% in 2014-
15. However, the lowest Net Worth Ratio of SBI was -2.98% in 2017-18and 0.43% for AXIS bank in
2017-18. The table says that the Net Worth Ratio of SBI is went to negative values the return of
shareholders investment went on losses.
Table 4.2: Return on Shareholder’s Investment or Net Worth Ratio

P a g e 44 | 53
 SBI (Rs in crores) AXIS (Rs in crores)
Year Return on
Share Holders Return on net Share
Net Profit Net Profit net worth
Fund worth Ratio Holders Fund
Ratio
2013 - 2014 10,891.17 1,18,282.25 9.20778055 6,217.67 38,220.49 16.26789714
2014 - 2015 13,101.57 1,28,438.23 10.2006778 7,357.82 44,676.52 16.46909831
2015 - 2016 9,950.65 1,44,274.44 6.8970291 8,223.66 53,164.91 15.46821014
2016 - 2017 10,484.10 1,88,286.06 5.5681765 3,679.28 55,762.54 6.598121248
2017 - 2018 -6547.45 2,19,128.56 -2.9879491 275.68 63,445.26 0.434516306

4. Earnings per Share [EPS]

Table 4 illustrates that the period of study, EPS of both SBI and AXIS Banks are fluctuated.The
highest EPS of SBI was 17.54% in 2014-15 and for AXIS bank it was 17.25% in 2015-
16. However, the lowest EPS of SBI was -7.33% in 2017-18 and 0.53% for AXIS bank in2017-
18. The table says that the EPS of SBI is gone to negative value.

Table 4.3: Earnings Per Share [EPS]

SBI (Rs in crores) AXIS (Rs in crores)
Year No. of
Earnings per No. of Equity Earnings per
Net Profit Equity Net Profit
shares Shares shares
Shares
2013 - 2014 10,891.17 746.57 14.58827705 6,217.67 469.84 13.23359016
2014 - 2015 13,101.57 746.57 17.54901751 7,357.82 474.1 15.51955284
2015 - 2016 9,950.65 776.28 12.81837739 8,223.66 476.57 17.25593302
2016 - 2017 10,484.10 797.35 13.14868 3,679.28 479.01 7.681008747
2017 - 2018 -6547.45 892.46 -7.336407234 275.68 513.31 0.537063373

5. Total Assets Turnover Ratio

Table 7.5 illustrates that the period of study, Total Assets Turnover Ratio of both SBI and AXIS Banks
are fluctuated. The highest Total Assets Turnover Ratio of SBI was 7.60% in 2013-14 and for AXIS
bank it was 7.99% in 2013-14. However, the lowest Total Assets Turnover Ratio of SBI was 6.42% in
2017-18 and 6.62% for AXIS bank in 2017-18.
Table 4.4: Total Assets Turnover Ratio
SBI (Rs in crores) AXIS (Rs in crores)
Year Total Assets Total Assets
Net sales Total Assets Turnover Net sales Total Assets Turnover
Ratio Ratio
2013 - 2014 136350.8 1,792,234.60 7.607865622 30641.16 383,244.89 7.995190751
2014 - 2015 152397.07 2,048,079.80 7.440973247 35478.6 461,932.39 7.680474625
2015 - 2016 163685.31 2,259,063.05 7.245716759 40988.04 525,467.61 7.8002981
2016 - 2017 175518.24 2,674,380.65 6.56294907 44542.16 601,467.66 7.405578548
2017 - 2018 220499.32 3,429,904.01 6.428731514 45,780.31 691,329.57 6.622067388

P a g e 45 | 53
 6.Dividend Pay-Out Ratio
Table 6 illustrates that the period of study, Dividend Pay-Out Ratio of both SBI and AXIS Banks are
fluctuated. The highest Dividend Pay-Out Ratio of SBI was 2.05% in 2013-14 and for AXIS bank it
was 1.62% in 2012-13. However, the lowest Dividend Pay-Out Ratio of SBIwas 0% in 2017-18 and
0% for AXIS bank in 2017-18. Compare to SMI and AXIS the Dividend Pay-Out Ratio of SBI is in
negative.
Table 4.5: Dividend Pay-Out Ratio
SBI (Rs in crores) AXIS (Rs in crores)
Year Dividend Per Earnings per Dividend Dividend Per Earnings per Dividend
share shares pay-out ratio share shares pay-out ratio
2012 - 2013 41.5 20.62 2.012568965 18 11.07 1.626260032
2013 - 2014 30 14.59 2.056445726 20 13.23 1.511305682
2014 - 2015 3.5 17.55 0.199441365 4.6 15.52 0.296400292
2015 - 2016 2.6 12.82 0.202833785 5 17.26 0.289755413
2016 - 2017 2.6 13.15 0.19773848 5 7.68 0.650956165
2017 - 2018 -7.34 0 1.48 0

7.Debt-Equity Ratio
Table 7 illustrates that the period of study, Debt-Equity Ratio of both SBI and AXIS Banks are
fluctuated. The highest Debt-Equity Ratio of SBI was 16.34% in 2015-16 and for AXIS bank it was
10.89% in 2017-18. However, the lowest Debt-Equity Ratio of SBI was 14.2% in 2016-17 and 9.88%
for AXIS bank in 2015-16.
Table 4.6: Debt-Equity Ratio
SBI (Rs in crores) AXIS (Rs in crores)
Year Share Share
Total Debt Equity Total Debt Equity
Holders Holders
Liabilitie Ratio Liabilitie Ratio
Fund Fund
s s
2013 - 2014 1,792,748.28 1,18,282.25 15.15 383244.89 38,220.49 10.02
2014 - 2015 2,048,079.80 1,28,438.23 15.94 461932.39 44,676.52 10.33
2015 - 2016 2,357,617.55 1,44,274.44 16.34 525,467.62 53,164.91 9.88
2016 - 2017 2,674,380.65 1,88,286.06 14.2 601467.67 55,762.54 10.78

8.Interest Expended to Interest Earned Ratio

Table 8 illustrates that the period of study, Interest Expended to Interest Earned Ratio of both SBI and
AXIS Banks are fluctuated. The highest Interest Expended to Interest Earned Ratioof SBI was 66.05%
in 2017-18 and for AXIS bank it was 60.99% in 2013-14. However, the least Interest Expended to
Interest Earned Ratio of SBI was 63.86% in 2013-14 and 58.93% for AXIS bank in 2015-16.
Table 4.7: Interest Expended to Interest Earned Ratio

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 SBI AXIS
Year Interest Expended / Interest Earned Interest Expended / Interest
Earned
2013 - 2014 63.86 60.99
2014 - 2015 63.9 59.91
2015 - 2016 65.12 58.93
2016 - 2017 64.76 59.38
2017 - 2018 66.05 59.33

RESULTS

Table 4.8
VARIABLES MEAN1 MEAN2 SD SE C. V
Deposits 1890603.774 365871.114 2.41 1.077817531 3.35
Advances 1495902.82 332528.632 1.86 0.831842576 2.59
Investments 656637.29 130113.382 1.14 0.509838998 1.58
Net Profit 7576.008 5150.822 1212.59 542.30322 1.60
Total Assets 2440732.422 532688.424 3.016 1.348837209 4.20
Table value = 2.236
Table 9 demonstrates the Performance of SBI and AXIS Bank in terms of Deposits,Advances,
Investments, Net Profit, and Total Assets by applying the t- test

The calculated value of Deposits 3.35 is greater than the table value 2.236. Therefore, H01is rejected.

The calculated value of Advances 2.59 is greater than the table value 2.236. Therefore,H02 is rejected.

The calculated value of Investments 1.58 is less than the table value 2.236. Therefore,H03 is rejected.

The calculated value of Net Profit 1.58 is less than the table value 2.236. Therefore, H04is rejected.

The calculated value of Total Assets 4.2 is greater than the table value 2.236. Therefore,H05 is rejected.

Table4.9: Consolidated Values of Mean and Standard Deviation of SBI for 2018:
SBI 2018
Mont January Februar Marc Apri Ma June July Augus Septembe October Novembe Decembe
h y h l y t r r r
Mean 0.19 0.18 0.4 - 0 -0.24 0.6 -0.54 -0.42 1.1 0.23 -0.15
0.06 4
SD 1.94 1.17 1.26 1.3 1.76 1.07 1.2 1.71 0.99 6.44 2.4 1.31
2
Graph 4.a: Graph Showing Risk and Return of SBI 2018

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Interpretation: The graph depicts that, the Standard Deviation which indicates the risk is more in the month of
October with a value of 6.44. The Mean which indicates the return, is also high in the month of October with a
value of 1.1. The existence of the risk is much higher than the returns on the whole.
Table 4.9: Consolidated Values of Mean and Standard Deviation of SBI for 2019:
SBI 2019
Month Januar Februar March Apri Ma June July Augus Septembe Octobe Novembe Decembe
y y l y t r r r r
Mean 0.06 -0.8 -0.34 - 0.42 -0.17 0.5 0.27 -0.83 0.32 0.06 0.2
0.05 8
SD 2.02 1.84 2.39 1.86 1.87 1.58 1.9 1.98 1.73 3.29 1.6 1.28
1

Graph 4.b: Graph Showing Risk and Return of SBI 2019

Risk and Return Equity Analysis of SBI - 2019

4

Interpretation: The graph depicts that, Mean is more in the month of July, which is 0.58. The Standard
Deviation is high in the month of October, which is 3.29. On the whole, for the year 2018, the existence of risk is
higher than the returns.
Table 4.10: Consolidated Values of Mean and Standard Deviation of AXIS for 2018:
AXIS 2018
Mont Januar Februar Marc Apri Ma Jun July Augus Septembe Octobe Novembe December
h y y h l y e t r r r
Mean 0.19 0.46 -0.13 0.22 0.05 0.04 0.0 -0.18 0.09 0.19 0.12 0.27
3
SD 2.1 1.98 1.42 1.58 1.6 1.35 1.4 1.09 1.43 3.26 1.52 1.05
9

Graph 4.c: Graph Showing Risk and Return of AXIS Bank 2018

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 Risk and Return Equity Analysis of AXIS Bank
- 2018
4
3
2
1
Interpretation: The graph depicts that, the returns are high in the month of February with a value of 0.46. The
Standard Deviation is high in the month of October, which is 3.26. Though the risk is considerably high
throughout the year, there are more number of positive returns, than negative returns

Table 4.11: Consolidated Values of Mean and Standard Deviation of

AXIS for 2019:
AXIS 2019
Mont Januar Februar Marc Apri Ma Jun July Augus Septembe Octobe Novembe December
h y y h l y e t r r r
Mean 0.24 -0.59 -0.17 0.1 0.25 -0.3 0.3 0.8 -0.3 -0.2 0.37 -0.03
5
SD 1.48 1.86 1.68 2.98 1.41 1.19 1.7 1.82 1.71 2.87 1.7 1.59
8

Graph 4.d: Graph Showing Risk and Return of AXIS Bank 2019

Risk and Return Equity Analysis of AXIS bank -

2019
4

Interpretation: The graph depicts that, returns are high in the month of July with a value of 0.35. The risk is
high in the month of October, which is 2.87. On the whole, the risk is prevailing more than the returns.
SBI
SBI bank in the country with an asset size of over Rs 13 trillion. Although the bank's loan book is largely skewed
towards corporate (large, mid and small) loans (50% of total advances in FY12), the retail side is also fast
catching up. SBI has a network of almost 14,270 branches and over 22,141 ATMs across the country.

AXIS BANK
Axis Bank is one of the most aggressive players in the private sector banking industry having more than tripled
its share in non-food credit over the last 9 years from 1% in FY02 to 3.6% in FY12. Axis Bank has set up a
network of 9,925 ATMs, the third largest in the country. During the period FY07 to FY12, Axis Bank has grown
its advances at a compounded annual rate of 47%, against the industry average of 27%. The bank acquired
Enam's investment banking business by issue of shares in 1QFY13
As of 12 August 2016, the bank had a network of 4,096 branches and extension counters and 12,922 ATMs.
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 CH-5 Summary and Conclusions

The study provides key findings according to the data analysis and arrives on someconclusions
based on the findings.
• The average Net Profit Ratio of SBI is 5.13% and AXIS bank is 13.99%, which implies that
the Net Profit Ratio of AXIS bank is 8.85%, which is more than that of the SBI.
• The average Operating profit ratio of SBI is 10.15% and AXIS bank is 14.58% it means AXIS
bank Operating profit ratio is 4.42% more than SBI.
• The average Net Worth Ratio of SBI is 5.77% and AXIS bank is 11.04% it means AXIS bank
Net Worth Ratio is 5.27% more than SBI.
• The average EPS of SBI is 10.15% and AXIS bank is 10.84% it means AXIS bank EPS is
0.69% more than SBI.
• The average Total Assets Turnover Ratio of SBI is 7.05% and AXIS bank is 7.50% it means
AXIS bank Total Assets Turnover Ratio is 0.44% more than SBI.
• The average Dividend Pay-Out Ratio of SBI is 4.66% and AXIS bank is 4.34% it means SBI
bank Dividend Pay-Out Ratio is 0.44% more than AXIS.
• The average Debt-Equity Ratio of SBI is 15.45% and AXIS bank is 10.33% it means SBI
bank Debt-Equity Ratio is 5.07% more than AXIS.

➢ SUGGESTIONS
• An Earnings per Share (EPS) of SBI Bank is very low when compared to AXIS. Where in 2017-
18 the value gone to negative it implies profitability of SBI is not equal to AXIS Bank.
Therefore, the SBI Bank may take some measures to increase income over expenditure for
increasing Earning per Share.
• Debt-equity Ratio of SBI is higher when compared to AXIS Bank. As a result, SBI should have
a control on their debts. Axis Bank have to maintain the standards to manage their debts.

➢ CONCLUSION
According to the analysis both SBI and AXIS banks are maintaining their standards and requirements. Both
the banks are running with profitability. But their performance indicate the significant difference between
both the banks of SBI and AXIS in terms of Deposits, Advances, Investments, Net Profit, and Total Assets.
It is suggested to the investors to prefer investment in equities having returns, with low or moderate risk.
Equities generating high returns, with high risk are also considered better, to the extent of interest of investors.
The Beta is the indicator of volatility of stocks. It measures the fluctuations in securities. From this study, it is
observed that, the equities of SBI are much volatile and riskier, than that of AXIS bank equities. The Return on
Equity from SBI is much lower, compared to AXIS. The fluctuation of the stocks clearly indicate that, SBI
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 equities are bearing more risk. AXIS generates good amount of returns, though there is existence of risk in a
considerable amount. Hence, it is suggested to the investors to invest in AXIS Bank equities.
Every investor’s objective is to obtain greater returns, with minimum risk. Equity Analysis is one such analysis,
which acts as a supporting tool to the investors before they make up their mind to invest in any of the
organization’s equities. It gives the information required by the investors to put forward their investment options
and to make a wise investment decision. Based on the data used and analysis carried out for this study, the

performance of AXIS Bank is considered superior to SBI. The performance of each and every organization’s
stocks keep on changing based on the market conditions and many other factors such as political, economical,
social factors which impacts the stock market. Hence, the investors must analyze all the crucial factors which
may have a direct bearing on the market and it is hoped that, this study fulfills the investor requirements.

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http://en.wikipedia.org/wiki/State_Bank_of_India
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