Eic on Banking Sector (1)

7/31/2019 Eic on Banking Sector (1)

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EIC ANALYSIS ON PSU BANKS

Submitted to Submitted By:

Rohoini Sharma Akash 50018

Bhaskar Prasad 50043

Bhuvnesh Prakash 50045

Ashok Kr Gupta 8177

Deepak 50049


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ECONOMY ANALYSIS

Indian economy is facing challenging times. After enjoying a high growth rates of around 8%for the better past 5 years its GDP growth estimated at 5.3 per cent in real terms for the

quarter ended March 2012. Slowdown in comparison to preceding two years is primarily dueto deceleration in industrial growth. Adding to the economy woes is inflation and interestrates are not expected to come down in near time.

The recovery of Indian economy has been stalled due to host of factors like

The intensification of sovereign debt crisis in the Euro zone, political turmoil in

Middle East injected widespread uncertainty, crude oil prices rose, an earthquake

struck Japan and the overall gloom refused to lift.

A number of scams and scandal(common wealth scam,adarsh society scam,tetra

scam,2G,3G scams etc) have come forward which has not only tannish indias shining

image in the world but also reduce the confidence of retail investors.

Certain policies (like FDI in insurance, retail, etc.) aimed at improving growth

prospect of the economy have been stalled in the parliament like foreign investment in

multichain outlets etc.

Growth below expectation: India's economy grew at an annual rate of 5.3 per cent in

the quarter ended March 2012, much lower than expectations of 6.1 per cent projected

by a poll of 31 economists. Experts see a bleak growth rate looking forward and stress

on policy reforms by government to kickstart the manufacturing sector. The GDP

numbers mean that the countrys growth slowed for eight successive quarters through

the three months ended March 2012. It is also the lowest GDP growth rate in 13quarters; the last time India registered the same rate of growth was in the quarter

ended December 2009, when the global financial system had all but collapsed in the

aftermath of the bankruptcy filing by Lehman Brothers Holdings Inc.

Weakest fiscal performance in 9 years: Indias growth rose 6.5 per cent in the fiscal

year to the end of March 2012. This is the lowest growth rate since 2002-03 when it

fell to 4 per cent in the wake of a global slowdown. It is also a sharp slowdown from

the previous fiscals 8.4 per cent.

Agriculture growth falters: The farm sector, which is the single largest employer in

the country but one of the lowest contributors to absolute GDP, grew at a measly 1.7per cent against 7.5 per cent in the corresponding period last fiscal. This is bad news

as rural consumption drives considerable amount of growth for leading Indian

companies. Poor agriculture growth means rural consumers would have less money to

spend going forward.

Manufacturing and services struggle: A key drag on growth numbers were the

industry and services sectors -- both key drivers of growth -- which came in lower

than expected, at 1.9 and 7.9 per cent against 7 and 10.6 per cent in the year-ago

period. The manufacturing sector contracted (-) 0.3 per cent from 7.3 per cent in the

same period last fiscal.


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Exports hurt: The corporate sector has witnessed its worst slowdown in recent times.

Confidence and demand have been weighed down by higher interest rates, a

challenging export environment, and, perhaps most important, policy mismanagement

and political deadlock, according to Moodys Analytics. A sluggish global economy

has also cut demand for India's goods overseas, despite the falling rupee, which meansexports may also not grow enough to compensate for the domestic weakness.

Expect fewer jobs: The ability of companies to create jobs is hurt during a successive

slowdown in the GDP growth rate. Company could conserve cash and put expansion

on hold as a result of weak growth prospects going forward. Lower investment is also

partially a fallout of a high interest regime to keep inflation in check.

No scope for economic stimulus: The current account deficit is the highest since 1980.

This occurs when a country imports more than it exports. Costly subsidies have

pushed the fiscal deficit to 5.9 per cent from a target of 4.6 per cent of GDP in the

fiscal year that ended in March 2012. This leaves little headroom for any fiscal

stimulus. The surging budget deficit means the government cannot provide for any tax

related incentives to stimulate growth.

RBI cannot stimulate the economy either: A sharp 25 per cent drop in the rupee over

the past 9 months could hurt RBIs ability to cut interest rates because doing so could

increase inflationary pressure. There can be no growth stimulus from RBI through a

lower borrowing cost as it battles stubbornly high inflation.

On the brighter side, the Recent UPA Govts reform initiatives show policy paralysis is over.

If these reforms are implemented in timely manner coupled with directed effort towards

pushing for fiscal consolidation can really help the economy to reach a higher growth rate butalso can help reduce inflation and the current account deficit,

India has always surprised the world with vibrancy and exponential growth in the past and

there is no reason why India cannot repeat the same success story of the past. Looking at the

whole scenario one feels that worst may be over for Indian economy only direction left is

upside.


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INDUSTRY ANALYSIS

For the past three decades India's banking system has several outstanding achievements to its

credit. 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 mainreasons of India's growth process. The government's regularization policy for Indian bank

since 1969 has paid rich dividends with the nationalization of 14 major private banks of

India. Not long ago, an account holder had to wait for hours at the bank counters for getting a

draft or for withdrawing his own money. Today, he has a choice. Gone are days when the

most efficient bank transferred money from one branch to other in two days. Now it is simple

as instant messaging or dial a pizza. Client satisfaction has become the order of the day.

History

Post-Independence

In 1948, the Reserve Bank of India, India's central banking authority, was nationalized, and it

became an institution owned by the Government of India.

In 1949, the Banking Regulation Act was enacted which empowered the Reserve Bank ofIndia (RBI) "to regulate, control, and inspect the banks in India."

The Banking Regulation Act also provided that no new bank or branch of an existing bank

may be opened without a license from the RBI, and no two banks could have common

directors.

Liberalization

The new policy shook the Banking sector in India completely. Bankers, till this time, were

used to the 4-6-4 method (Borrow at 4%; Lend at 6%; Go home at 4) of functioning. In the

early 1990s the then Narsimha Rao government embarked on a policy of liberalization and

gave licenses to a small number of private banks, which came to be known as New

Generation tech-savvy banks, which included banks such as Global Trust Bank (the first of

such new generation banks to be set up) which later amalgamated with Oriental Bank of

Commerce, UTI Bank (now re-named as Axis Bank), ICICI Bank and HDFC Bank


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RECENT DEVELOPMENT IN BANKING SECTOR

A retrospect of the events clearly indicates that the Indian banking sector has come far away

from the days of nationalization. The Narasimhan Committee laid the foundation for the

reformation of the Indian banking sector. Constituted in 1991, the Committee submitted two

reports, in 1992 and 1998, which laid significant thrust on enhancing the efficiency and

viability of the banking sector. As the international standards became prevalent, banks had to

unlearn their traditional operational methods of directed credit, directed investments and

fixed interest rates, all of which led to deterioration in the quality of loan portfolios,

inadequacy of capital and the erosion of profitability.

The recent international consensus on preserving the soundness of the banking system has

veered around certain core themes. These are: effective risk management systems, adequate

capital provision, sound practices of supervision and regulation, transparency of operation,

conducive public policy intervention and maintenance of macroeconomic stability in the

economy.

Until recently, the lack of competitiveness vis--vis global standards, low technological level

in operations, over staffing, high NPAs and low levels of motivation had shackled the

performance of the banking industry. However, the banking sector reforms have provided the

necessary platform for the Indian banks to operate on the basis of operational flexibility and

functional autonomy, thereby enhancing efficiency, productivity and profitability. The

reforms also brought about structural changes in the financial sector and succeeded in easingexternal constraints on its operation, i.e. reduction in CRR and SLR reserves, capital

adequacy norms, restructuring and recapitulating banks and enhancing the competitive

element in the market through the entry of new banks.

The reforms also include increase in the number of banks due to the entry of new private and

foreign banks, increase in the transparency of the banks balance sheets through the

introduction of prudential norms and increase in the role of the market forces due to the

deregulated interest rates. These have significantly affected the operational environment of

the Indian banking sector.

To encourage speedy recovery of Non-performing assets, the Narasimhan committee laid

directions to introduce Special Tribunals and also lead to the creation of an Asset

Reconstruction Fund. For revival of weak banks, the Verma Committee recommendations

have laid the foundation. Lastly, to maintain macroeconomic stability, RBI has introduced the

Asset Liability Management System.

The competitive environment created by financial sector reforms has nonetheless compelled

the banks to gradually adopt modern technology to maintain their market share. Thus, the

declaration of the Voluntary Retirement Scheme accounts for a positive development


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reducing the administrative costs of Public Sector banks. The developments, in general, have

an emphasis on service and technology; for the first time that Indian public sector banks are

being challenged by the foreign banks and private sector banks. Branch size has been reduced

considerably by using technology thus saving manpower.

The deregulation process has resulted in delivery of innovative financial products at

competitive rates; this has been proved by the increasing divergence of banks in retail

banking for their development and survival.

In order to survive and maintain strong presence, mergers and acquisitions has been the most

common development all around the world. In order to ensure healthy competition, giving

customer the best of the services, the banking sector reforms have led to the development of a

diversifying portfolio in retail banking, and insurance, trend of mergers for better stability

and also the concept of virtual banking.

ANALYSIS OF BANKING SECTOR WITH RESPECT TO PORTERS 5

FORCES MODEL

1) RIVALRY AMONG COMPETING FIRMS

Rivalry among competitors is very fierce in Indian Banking Industry. The services banks

offer is more of homogeneous which makes the Company to offer the same service at a lower

rate and eat their competitor markets share. Market Players use all sorts of aggressive selling

strategies and activities from intensive advertisement campaigns to promotional stuff. Evenconsumer switch from one bank to another, if there is a wide spread in the interest. Hence the

intensity of rivalry is very high. The no of factors has contributed to increase rivalry those

are-

Large no of alternatives

Customers have large no of alternatives, there are so many banks, whichfight for same pie.

There are many non financial institutions like icici, hdfc, andifci, etc. which has also

jump into these business .there are foreign banks , privetbanks, co-

operative banks and development banks together with specializedfinancial companies that provides finance to customers .these all increasepreference for customers.

Low switching cost

Cost of switching from one bank to another is low. Banks are alsoproviding zero balance

account and another types of facilities. They are free

toselect any banks service. Switching cost are becoming lower with internetbanking gaining

momentum and a result customers loyalties are harder to retain.

Undifferentiated service


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Bank provide merely similar service there are no much diffracted inservice provides by

different banks so, bargaining power of customers increase.They cannot be charged for

differentiation.

Full information about the market

Customers have full information about the market due to globalization

anddigitalization Consumers have become advance and sophisticated .they areaware with

each market condition so banks have to be more competitive and customer friendly to serve

them. For good creditworthy borrowers bargaining power is high due to the availability of

large number of banks

2) POTENTIAL ENTRY OF NEW COMPETITORS

Reserve Bank of India has laid out a stagnant rules and regulation for new entrant in Banking

Industry. We expect merger and acquisition in the banking industry in near future. Hence, the

industry is less prone of new competitor. Barriers to an entry in banking industry no longer

exist. So lots of private and foreign banks are entering in the market. Competitors can come

from an industry to disintermediate bankproduct differentiation is very difficult for banks

and exit is difficult. So every bank strives to survive in highly competitive

marketso we see intense competitive can mergers and acquisitions. Government policies are

supportive to start new bank. There is less statutory requirement needed to start a newventure? Every bank to tries to achieve economies of scale through use of technology and

selecting and training manpower .There are public sector banks, private sector and foreign

banks along with on banking finance companies competing in similar business segments.

3) POTENTIAL DEVELOPMENT OF SUBSTITUTE PRODUCTS

Every day there is one or the other new product in financial sector.Banks are not limited to

tradition banking which just offers deposit and lending. In addition, today

banks offers loans for all products, derivatives, ForEx,Insurance, Mutual Fund, Demit

account to name a few. The wide range of choices and needs give a sufficient room for new

product development and product enhancement. Substitute products or services are those,

which are different but satisfying the same set of customers

.In banking industry following are the substitutes:

NBFC: Non-banking financial Institutions play an important role in giving financial

assistance. Mobilization of financial resources outside the traditional banking system

has witnessed a tremendous growth in recent years in the India. NBFC is a close

substitute of banking in respect of raising funds.


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Borrower can easily raise funds from NBFC because it requires less formal procedure

for getting funds compare to private banks.

Post Office Products : Post office is also providing some service like fixeddeposit

facility, saving account, recurring account etc. The interest rateof saving account is higher than private banks. It is fully secured by thegovernment so

people who do not want to take risk for them post officesaving is good substitute.

Government Bond: Govt. Bond also attracts savings from the general public. It is

less risky and more secured as compare to savings in public banks.

Mutual Funds: Mutual funds are also now proving as good substitutes for banks.

They assure for providing high return with less time in comparison of banks. The

administrative expenses are also very low as compared to banks.Investment in Mutual

funds is more flexible than investment in banks.

Stock Market: People who are ready to bear risk and wants a high return on their

investment, stock market is a good substitute for them. Day by day investors are

moving towards stock market as interest rate in banks are decreasing. So now stock

market has proved as a big competitor for banking sector.

Debentures: Debentures is also proved as a good substitute of banks fixed deposit as

return on debenture is fixed and high. There are different types of debentures, which

attract various classes of investors.

Other Investment Alternatives: Now common peoples attraction is shiftingfrom

banks to other various alternatives such as gold, precious metals, land,small savings

etc. As we can see the growing trend in these alternatives incomparison of decreasing

interest rates in banks

4) BARGAINING POWER OF CUSTOMERS

Customers of the banks are those who take loans, advances and use services of banks.

Customers have high bargaining power. Following are the reasons for high bargaining power

of customers.

Large no. Of alternatives: Customers have very large no. of alternatives. There are

so many banks, whichfight for same pie. There are many non-financial institutions

like ICICI, HDFC, IFCI etc., which has also jumped into this business. There are

foreign banks, private banks, cooperative banks and development banks together with


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the specialized financial companies that provide finance to customers. These all

increase preferences for customers.

Low switching cost: Cost of switching from one bank to another is low. Banks are

also providing zero balance account and other types of facilities. They are free to

select anybanks service.Switching costs are becoming lower with Internet Banking gaining momentum and as

a result consumers loyalties are harder to retain.

Undifferentiated service Banks provide merely similar services. There is no much

difference in services provided by different banks. So, bargaining power of customers

increases. They cannot be charged for differentiation.

Full information about the market: Customers have full information about the

market due to globalization and digitization consumers have become advance and

sophisticated. They are aware with each market conditions. So, banks have to be more

competitive and customer friendly to serve them.

5) BARGAINING POWER OF SUPPLIERS

Suppliers of banks are depositors. These are those people who have excess money

and prefer regular income and safety. In banking industry Suppliers have low

bargaining power. Following are the reasons for low bargaining power of suppliers.

Nature of suppliers: Suppliers of banks are generally those people who prefer low

risk and those who need regular income and safety as well. Bank is best place for

them to deposit their surplus money. They believe that banks are very safe than other

investment alternatives. So, they do not consider other alternatives very seriously,

which lower their bargaining power

Few alternatives: Suppliers are risk averters and want regular income. So, they have

few alternatives available with them to invest like Treasury bills, government bonds.

So, few alternatives lower their bargaining power.

RBI Rules and Regulations: Banks are subject to RBI rules and regulations. Banks

have to behave in the way that RBI wants. So, RBI takes all decisions relating to

interest rates. This reduces suppliers bargaining power.

Suppliers are not concentrated: Banking industrys suppliers are not concentrated.

There are numerous suppliers with negligible portion to offer. So, this reduces their

bargaining power. If they were concentrated then they can bargain with banks or can

collectively invest in other no-risky projects.

.


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SWOT ANALYSIS OF BANKING SECTOR

STRENGTH

Indian banks have compared favorably on growth, asset quality and profitability with

other regional banks over the last few years. The banking index has grown at a

compounded annual rate of over 51 per cent since April 2001 as compared to a 27 per

cent growth in the market index for the same period.

Policy makers have made some notable changes in policy and regulation to help

strengthen the sector. These changes include strengthening prudential norms,

enhancing the payments system and integrating regulations between commercial and

co-operative banks.

Bank lending has been a significant driver of GDP growth and employment.Extensive reach: the vast networking & growing number of branches & ATMs. Indian

banking system has reached even to the remote corners of the country.

In terms of quality of assets and capital adequacy, Indian banks are considered to have

clean, strong and transparent balance sheets relative to other banks in comparable

economies in its region.

WEAKNESS

Public Sector Banks need to fundamentally strengthen institutional skill levels

especially in sales and marketing, service operations, risk management and the overallorganisational performance ethic & strengthen human capital.

There is an increase in amount of NPAs in the balabce sheets of many PSU bank

whick can be a source of discomfort.

The cost of intermediation remains high and bank penetration is limited to only a few

customer segments and geographies.

Structural weaknesses such as a fragmented industry structure, restrictions on capital

availability and deployment, lack of institutional support infrastructure, restrictive

labor laws, weak corporate governance and ineffective regulations beyond Scheduled

Commercial Banks (SCBs), unless industry utilities and service bureaus. Refusal to dilute stake in PSU banks: The government has refused to dilute its stake in

PSU banks below 51% thus choking the headroom available to these banks for raining

equity capital.

Impediments in sectorial reforms: Opposition from Left and resultant cautious

approach from the North Block in terms of approving merger of PSU banks may

hamper their growth prospects in the medium term.


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OPPORTUNITY

The market is seeing discontinuous growth driven by new products and services that

include opportunities in credit cards, consumer finance and wealth management on

the retail side, and in fee-based income and investment banking on the wholesale

banking side. These require new skills in sales & marketing, credit and operations.

With increased interest in India, competition from foreign banks will only intensify.

Given the demographic shifts resulting from changes in age profile and household

income, consumers will increasingly demand enhanced institutional capabilities and

service levels from banks.

New private banks could reach the next level of their growth in the Indian banking

sector by continuing to innovate and develop differentiated business models to

profitably serve segments like the rural/low income and affluent/HNI segments;

actively adopting acquisitions as a means to grow and reaching the next level of

performance in their service platforms. Attracting, developing and retaining more

leadership capacity

Foreign banks committed to making a play in India will need to adopt alternative

approaches to win the race for the customer and build a value-creating customer

franchise in advance of regulations potentially opening up post 2009.

Reach in rural India for the private sector and foreign banks.

Liberalization of ECB norms: The government also liberalised the ECB norms to

permit financial sector entities engaged in infrastructure funding to raise ECBs. This

enabled banks and financial institutions, which were earlier not permitted to raise

such funds, explore this route for raising cheaper funds in the overseas markets.

Hybrid capital: In an attempt to relieve banks of their capital crunch, the RBI has

allowed them to raise perpetual bonds and other hybrid capital securities to shore up

their capital. If the new instruments find takers, it would help PSU banks, left with

little headroom for raising equity.


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THREATS

Threat of stability of the system: failure of some weak banks has often threatened the

stability of the system.

Rise in inflation figures which would lead to increase in interest rates.

Increase in the number of foreign players would pose a threat to the Public Sector

Bank as well as the private players.

Increase in NPA(non performing assets) of these banks is a major cause ofconcern.

Key players in banking industry

1. State Bank of India (SBI)

2. Punjab National Bank (PNB)

3. Bank of Baroda (BoB)

4. IDBI Bank

5. Syndicate Bank

6. Bank of India (BoI)

7. Canara Bank

8. IDBI Bank

9. Corporation Bank

10. Bank of Maharashtra


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COMPANY ANALYSIS

We have taken the following banks for

our analysis:-

Punjab National Bank

State Bank of India

Yes Bank

Bank of Baroda


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PUNJAB NATIONAL BANK (PNB)

Punjab National Bank (PNB) (BSE: 532461, NSE: PNB) is an Indian financial services

company based in New Delhi, India. PNB is the third largest bank in India by assets. It was

founded in 1894 and is currently the second largest state-owned commercial bank in India

ahead of Bank of Baroda with about 5000 branches across 764 cities. It serves over 37

million customers. The bank has been ranked 248th biggest bank in the world by the Bankers

Almanac, London. The bank's total assets for financial year 2007 were about US$60 billion.

PNB has a banking subsidiary in the UK, as well as branches in Hong Kong, Dubai and

Kabul, and representative offices in Almaty, Dubai, Oslo, and Shanghai.

KEY RATIOS

Mar-12

Mar-11

Mar-10

Operational & Financial Ratios

Earnings Per Share (Rs) 144.00 139.94 123.86

DPS(Rs) 22.00 22.00 22.00

Book NAV/Share(Rs) 777.39 632.48 514.77

Performance Ratios

ROA(%) 1.17 1.31 1.44

ROE(%) 21.05 24.45 26.59

ROCE(%) 7.21 6.47 6.97

Efficiency Ratios

Cost Income Ratio 39.75 41.27 39.39

Core Cost Income Ratio 40.55 42.09 42.20

Operating Costs to Assets 1.53 1.68 1.61

Valuation Parameters

PER(x) 6.43 8.72 8.18

PCE(x) 6.07 8.24 7.74

Price/Book(x) 1.19 1.93 1.97


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ANALYSIS & INTERPRETATION

Current Ratio of PNB has been less than 1 for all the 3 years taken for analysis. As the

standard of current ratio is 1:1 for banking industry. This implies that working capital

of PNB is always negative. This is generally considered an aggressive strategy i.e. to

financing its long term asset by short term sources that increases profitability because

current liabilities are non-interest bearing items. The liquidity ratios have increase

from previous year which shows a good trend.

Debt to equity ratio was between 0.08 to 0.10 for previous 3 year as taken to

comparison Moreover it is showing a upward trend this means that the company has

taken huge amount of loan to finance it business.

Yield(%) 2.38 1.80 2.17

EV/Net Sales(x) 1.89 2.60 2.39

EV/Core EBITDA(x) 6.47 7.76 6.99

EV/EBIT(x) 2.29 3.23 2.72

EV/CE(x) 0.15 0.19 0.17

M Cap / Sales 0.86 1.43 1.49

Growth Ratios

Core Operating IncomeGrowth

13.61 39.27 24.10

Operating Profit Growth 17.21 58.21 11.48

Net Profit Growth 10.17 13.52 26.35

BVPS Growth 22.91 22.87 23.52

Advances Growth 21.34 29.75 20.62

EPS Growth(%) 2.90 12.98 26.35

Liquidity Ratios

Loans/Deposits(x) 0.10 0.10 0.08

Total Debt/Equity(x) 0.05 0.08 0.07

Current Ratio(x) 0.32 0.30 0.31

Quick Ratio(x) 9.82 10.10 7.73


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Analyzing the EPS and DPS, which are profit distributing ability ratios, for PNB we

can see that it has been generating more than 500% times profit for its shareholders

over the years. The EPS increased over the years from Rs.123.86 in year 2010 to Rs.

144 in year 2012. It has been distributing the profit in a constant manner with

maintaining the level of Rs 22. If you multiply EPS & PER of 2012 you get Rs 925.92 and the current market share

of PNB is Rs 824.75(as on 12th oct.2012) this means that the company is undervalued.


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State bank of India (SBI)

State Bank of India (SBI) (NSE: SBIN, BSE: 500112, LSE: SBID) is the largest banking and

financial services company in India by revenue, assets and market capitalisation. It is a state-

owned corporation with its headquarters in Mumbai, Maharashtra. As of March 2011, it hadassets of US$370 billion with over 13,577 outlets including 157 overseas branches and agents

globally. 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 presidencies banksBank of

Calcutta and Bank of Bombayto form the Imperial Bank of India, which in turn became the

State Bank of India. The Government of India nationalized the Imperial Bank of India in

1955, with the Reserve Bank of India 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. SBI is

ranked No. 292 globally in Fortune Global 500 list in 2011.

SBI provides a range of banking products through its vast network of branches in India and

overseas, including products aimed at non-resident Indians (NRIs). The State Bank Group,

with over 18,324 branches, has the largest banking branch network in India. SBI has 14 local

head offices situated at Chandigarh, Delhi, Lucknow, Patna, Kolkata, Guwahati (North East

Circle), Bhubaneswar, Hyderabad, Chennai, Trivandrum, Bangalore, Mumbai, Bhopal &

Ahmedabad and 57 Zonal Offices that are located at important cities throughout the country.

It also has 157 branches overseas.

SBI is a regional banking behemoth and is one of the largest financial institutions in the

world. It has a market share among Indian commercial banks of about 20% in deposits andloans.[3] The State Bank of India is the 29th most reputed company in the world according to

Forbes.[4] Also, SBI is the only bank featured in the coveted "top 10 brands of India" list in

an annual survey conducted by Brand Finance and The Economic Times in 2010.[5]

The State Bank of India is the largest of the Big Four banks of India, along with ICICI Bank,

Punjab National Bank and HDFC Bankits main competitors

Key Ratios

MAR2012

MAR2011

MAR2010



DPS(Rs) 35.00 30.00 30.00

Book NAV/Share(Rs) 1251.05 1023.40 1038.76


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ROA(%) 0.91 0.73 0.91

ROE(%) 15.72 12.62 14.80

ROCE(%) 6.39 5.61 6.07

Efficiency Ratios





PER(x) 12.01 21.27 14.40

PCE(x) 11.06 18.99 13.07

Price/Book(x) 1.67 2.70 2.00

Yield(%) 1.67 1.08 1.44

EV/Net Sales(x) 2.51 3.63 3.31

EV/Core EBITDA(x) 8.48 11.66 12.83

EV/EBIT(x) 3.27 4.63 3.84

EV/CE(x) 0.20 0.24 0.22

M Cap / Sales 1.32 2.16 1.86

Growth Ratio

Core Operating Income

Growth

33.10 37.41 13.41


Net Profit Growth 41.66 -9.84 0.49

EPS Growth(%) 34.05 -9.85 0.49

Liquidity Ratios



Quick Ratio(x) 12.17 12.80 12.81


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Current Ratio of SBI for last 3 year has remained between 0.30 to 0.37 which is

against the standard of 1:1. This should be an area of concern for the bank.

Debt/Equity ratio means the ratio of finance coming from Debts compared to

shareholders. A ratio exceeding 1 may be cause for concern. As it can be seen that the

Debt/Equity ratio is near to 0.05 to 0.10 for the last three year this means that

company operate the business mainly through owner funds.

FACE value of SBI share is Rs10.Analyzing the EPS and DPS, which are profit

distributing ability ratios. The EPS increased over the years from Rs. 144.37 in year

2010 to Rs. 174.46 in year 2012. It has been generous in distributing the profit in form

of dividend with DPS Rs. 30 in year 2010, 2011 and Rs. 35 in year 2012.

Multiplying EPS & PER for 2012 you get Rs 2095.7 and the current market share ofSBI is Rs 2268 (as on 12th October 2012), this means that the company is overvalued.


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YES BANK

Yes Bank (BSE: 532648) is a private bank in India. It was founded by Ashok Kapur

and Rana Kapur with the duo holding a collective financial stake of 27.16%.

YES Bank has received significant national and international recognitions which include Mr.

Rana Kapoor, Founder, MD & CEO being recognized as the Entrepreneurial Banker of the

Decade (2001-2010) by Bombay Management Association, Indias No. 1 New Private Sector

Bank in the Financial Express-E&Y Best Banks Survey 2010, Indias Fastest Growing

Bank of the Year at the Bloomberg UTV Financial Leadership Awards 2011. YES Bank has

become the first Indian Bank, and the third one globally in the banking industry to receive

certification for its 'Complaints Management System (ISO 10002:2004)' by the British

Standard's Institution (BSI) as on August 25, 2010 . The bank was also awarded the ISO

27001:2005 Certification for its 'Information Security Management System' by BSI.

In 2010, the bank announced the roll-out of a strategic blueprint, named Version 2.0 of the

bank, to further accelerate its business growth in the retail banking space, with the objective

to achieve by 2015, a balance sheet size of Rs.1,50,000 crore, deposits of 125,000 crore,

advances of 100,000 crore, a pan India network of 750 branches and a human capital base

12,000 by 2015 .

March 12 March'11 March '10

Investment Valuation Ratios

Face Value 10 10 10

Dividend Per Share 4 2.5 1.5

Operating Profit Per Share (Rs) 43.31 33.96 21.69

Net Operating Profit Per Share

(Rs)

201.81 134.18 84.68

Free Reserves Per Share (Rs) 98.45 82.62 69.33

Bonus in Equity Capital -- -- --

Profitability Ratios

Interest Spread 4.53 3.6 3.21

Adjusted Cash Margin(%) 14.25 16.31 17.35Net Profit Margin 13.66 15.56 16.3

Return on Long Term Fund(%) 131.35 102.46 74.73

Return on Net Worth (%) 20.89 19.16 15.46

Adjusted Return on Net Worth

(%)

20.92 19.17 15.48

Return on Assets Excluding

Revaluations

132.49 109.29 90.96

Return on Assets Including

Revaluations

132.49 109.29 90.96


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Management Efficiency Ratios

Interest Income / Total Funds 10.74 9.77 9.7

Net Interest Income / Total

Funds

3.67 3.91 4.37

Non-Interest Income / Total

Funds

0.04 0.03 0.18

Interest Expended / Total Funds 7.07 5.86 5.34

Operating Expense / Total

Funds

1.36 1.43 1.88

Profit Before Provisions / Total

Funds

2.28 2.43 2.57

Net Profit / Total Funds 1.47 1.52 1.61

Loans Turnover 0.2 0.16 0.17

Total Income / CapitalEmployed(%) 10.78 9.8 9.89

Interest Expended / Capital

Employed(%)

7.07 5.86 5.34

Total Assets Turnover Ratios 0.11 0.1 0.1

Asset Turnover Ratio 0.11 18.25 13.93

Profit And Loss Account Ratios

Interest Expended / Interest

Earned

74.38 69.15 66.75

Other Income / Total Income 0.37 0.31 1.85

Operating Expense / TotalIncome

12.63 14.64 19.02

Selling Distribution Cost

Composition

0.14 0.44 0.37

Balance Sheet Ratios

Capital Adequacy Ratio 17.9 16.5 20.6

Advances / Loans Funds(%) 65.53 81.65 88.94

Debt Coverage Ratios

Credit Deposit Ratio 76.09 77.75 80.52

Investment Deposit Ratio 48.99 39.92 40.33

Cash Deposit Ratio 5.69 6.97 7.62Total Debt to Owners Fund 10.51 12.11 8.67

Financial Charges Coverage

Ratio

0.33 0.43 0.5

Financial Charges Coverage

Ratio Post Tax

1.22 1.27 1.32

Leverage Ratios

Current Ratio 0.08 0.05 0.04

Quick Ratio 7.83 15.34 14.54

Cash Flow Indicator Ratios


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Dividend Payout Ratio Net

Profit

16.79 13.91 12.47

Dividend Payout Ratio Cash

Profit

16.12 13.28 11.73

Earning Retention Ratio 83.23 86.1 87.54

Cash Earning Retention Ratio 83.9 86.73 88.28

Adjusted Cash Flow Times 48.22 60.25 52.69

Mar12 Mar '11 Mar '10

Earnings Per Share 27.68 20.95 14.06


Analyzing the EPS and DPS, which are profit distributing ability ratios. The EPS

increased over the years from Rs. 14.06 in year 2010 to Rs. 27.68 in year 2012. It has

been generous in distributing the profit in form of dividend with DPS Rs. 1.50 in year

2010, 2.50 in 2011 and for the year ending March 2012, Yes Bank has declared an

equity dividend of 40.00% amounting to Rs 4 per share. At the current share price of

Rs 394.20 these results in a dividend yield of 1.01%.

Capital Adequacy Ratio (CAR) is a ratio that regulators in the banking system use to

watch bank's health, specifically bank's capital to its risk. Regulators in the banking

system track a bank's CAR to ensure that it can absorb a reasonable amount of loss.

Here yes banks Capital Adequacy Ratio is falling down as compared to year 2010 but

increasing if we compared it with year 2011 yes banks Capital Adequacy Ratio isfalling normally but not a big issue for the bank.

As we know that higher the quick ratio, the better the position of the company. Here if

we see the yes banks quick ratio we will find that it is continuously falling down

which is not good for banks position in the financial market.

Operating Profit per Share from last two years is keep on increasing by 99.667 from

march 2010 to 2012. This chows that the company is doing well its business.

Based on latest financial disclosure Yes Bank Limited has Return on Equity of

23.07%. This is 1513.29% higher than that of financial sector, and 304.74% higher

than that of Money Center Banks industry, The Return On Equity for all stocks is627.92% lower than the firm.

Price earnings ratio multiplied by EPS gives you the stock price and if we look at it

for the year 2012 it comes out as 394.83 with 13.38 as PER and 29.51 which comes

out to be as EPS and the market price for the same is 394.70. This means that

company is fairly valued.


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Bank of Baroda

Bank of Baroda is an international level banking products and services provider of India. It isranked #1477 in 2008 Forbes Global 2000 list. It is among few Indian banks that has a globalpresence. Bank of Baroda operates in 25 countries. Bank of Baroda aims at being a leading

bank that performs at par with international standards. It also looks to increase value ofstakeholders to maximum possible level. It is the fourth largest lender with a net profitgrowth of 32% and total business growth of 24%. The bank does most of its business in thenon-urban market where the competition is low but the risks are comparatively higher. Bankof Baroda has the second largest resource base in the country after State Bank of India.

BRIEF HISTORY

Bank of Baroda was incorporated in 1908 by Maharaja Sayajirao Gaekwad III with paid upcapital of INR 10 lacs and the third largest commercial public sector bank after state bank ofIndia and Punjab national bank in terms of net profit and total business founded by . Itlaunched its first branch in 1910 in Ahmedabad. In 1953, its first branches in Kampala andMombasa became operational. Its overseas branch in Nairobi was opened in 1954. Nowtoday it has total number of 2956 branches located worldwide as on April 2009, out of which626 were located in Metro cities, 524 in urban areas, 642 in Semi-Urban locations, 1092 inrural areas and 72 were located outside India. The bank has 10 Zonal Offices and 43 RegionalOffices which help it control its operations nationally.

Product & services

Bank of Baroda provides it banking products and services in several categories like personal,international, business, treasury, corporate and rural. In personal banking section Bank ofBaroda offers products like deposits, debit cards, Gen-Next, personal banking services, loans,

lockers and credit cards.

In business banking sector, Bank of Baroda offers products and services such as deposits,business banking services, loans and advances and lockers. In corporate banking section,Bank of Baroda offers products and services like wholesale banking, loans and advances,deposits and corporate banking services.

FINANCIALS

Sales of Bank of Baroda amounted to $2.48 billion and it earned profits worth $0.26 billion.

Assets held by Bank of Baroda were worth $32.80 billion and its market value stood at $4.72billion.


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MAR

2012

MAR

2011

MAR

2010



DPS(Rs) 17 16.5 15

Book NAV/Share(Rs) 664.08 505.68 414.67

ROA(%) 1.24 1.33 1.21

ROE(%) 21.26 24.30 21.86

ROCE(%) 107.77 189.22 0.00

Efficiency Ratios





PER(x) 6.52 8.89 7.61

PCE(x) 6.18 8.41 7.08

Price/Book(x) 1.20 1.90 1.54

Yield (%) 2.14 1.71 2.35


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Analysis & interpretation

The ideal current ratio is 2:1 as expected but for the past 3 financial years it has beensignificantly below 1. There has been increase but it is negligible amount whichindicates that current liabilities are more than its assets and there are serious liquidityproblems in the organization. Moreover there has been overutilization of cash may beinterest payments for investment undertaken from borrowed capital which couldfurther worsens the scenario and also general operations could become stagnant.

EV/Net Sales(x) 1.89 2.74 2.19

EV/Core EBITDA(x) 6.55 8.60 7.42

EV/EBIT(x) 2.21 3.20 2.44

EV/CE(x) 0.13 0.17 0.13

M Cap / Sales 1.10 1.72 1.39

Growth Ratio

Core Operating Income

Growth

17.21 48.20 15.93


Net Profit Growth 18.04 38.69 37.72

EPS Growth (%) 12.42 29.03 37.32

Liquidity Ratios



Quick Ratio(x) 6.12 7.30 5.53


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Debt-equity ratio measures the amount of assets financed though debt and ratio lessthan one indicates less risk. It can be observed from above that the amount debt raisedhas been significantly lower which means assets and other investments have beenfinanced through owners funds. Consequently company is on the safer side.

Bank of Baroda has its Face value as Rs 10. The DPS indicate the proportionate

earnings that an investor is entitled to and higher dividend payout keep his or herconfidence instill in the company. The DPS and EPS ratios are profit distributingability ratios and earnings of shareholders will depend on earnings of company that isEPS. There has been substantial increase in EPS for past three years ranging from83.96 in 2010 to 121.79 in 2012 and consequent increase in DPS in subsequent years.

A companys price earnings ratio is calculated by dividing the previous daysclosing price by the adjusted EPS (earnings per share). Price earnings ratio multipliedby EPS gives you the stock price and if we look at it for the year 2012 it comes out as794.0708 with 6.52 as PER and 121.79 as EPS and the market price for the same is

777.10. This means that company is undervalued.

Quick ratio measure firms ability to discharge of its current liabilities as soon possible

and it can be seen from above table that the quick ratio has been on the higher side

expect for small decline in 2012 it means that there is ample amount of cash available

with the firm to discharge of its current liabilities.

Return on equity measures the amount of profit generated with every rupee investedby shareholders and higher the ROE would lead to higher cash availability internally.It has been the highest for the 2011 that is 24.30 and while for the current year that is

2012 it fell by 12.5% which is surely a matter of concern and also it representsinconsistency if we observe ROE for past 3 years. Moreover it also brings out the factwith respect of inefficient utilization of resources which is causing operating expensesto vary.


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BANK PNB SBI YES BOB

P/E 5.56 12.78 13.36 6.29

P/BV 1 1.74 2.99 1.20

ROE 21.1 15.7 23.07 21.26

ROCE 7.21 6.39 10.78 7

EPS 140.4 170.1 27.68 121.79

Market cap(in crores) 26,437.39 146,149.16 14,144.72 32,155.90

RECOMMENDATION Buy Sell/Hold Hold Buy

As per P/E ratio,PNB and BOB is undervalued and SBI is overvalued meanwhile Yes

bank is fairly valued Yes Bank provides the maximum ROE% and ROCE% among other banks.

SBI has the maximum EPS as well as maintained a constant dps of Rs 30 and above.

We would recommend to buy PNB and BOB at current levels.as both of the sharesare trading below their fair value.and maintain the hold position in SBI and Yes Bank.


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ANNEXTURE

Balance sheets and P&L accounts

Balance Sheet of PNB ------------------- in Rs. Cr. -------------------

Mar '12 Mar '11 Mar '10

12 mths 12 mths 12 mths

Capital and Liabilities:

Total Share Capital 339.18 316.81 315.3

Equity Share Capital 339.18 316.81 315.3

Share Application Money 0 0 0

Preference Share Capital 0 0 0

Reserves 26,028.37 19,720.99 15,915.63

Revaluation Reserves 1,449.53 1,470.76 1,491.99

Net Worth 27,817.08 21,508.56 17,722.92

Deposits 379,588.48 312,898.73 249,329.80

Borrowings 37,264.27 31,589.69 19,262.37

Total Debt 416,852.75 344,488.42 268,592.17

Other Liabilities &Provisions

13,524.18 12,328.27 10,317.69

Total Liabilities 458,194.01 378,325.25 296,632.78

Mar '12 Mar '11 Mar '10


Assets

Cash & Balances with RBI 18,492.90 23,776.90 18,327.58

Balance with Banks, Moneyat Call

10,335.14 5,914.32 5,145.99

Advances 293,774.76 242,106.67 186,601.21


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Investments 122,629.47 95,162.35 77,724.47

Gross Block 5,265.08 4,981.60 4,215.21

Accumulated Depreciation 2,096.22 1,876.01 1,701.74

Net Block 3,168.86 3,105.59 2,513.47

Capital Work In Progress 0 0 0

Other Assets 9,792.88 8,259.42 6,320.07

Total Assets 458,194.01 378,325.25 296,632.79

Contingent Liabilities 173,768.84 101,465.73 68,124.47

Bills for collection 50,981.22 37,449.53 33,215.78

Book Value (Rs) 777.39 632.48 514.77

PROFIT AND LOSS STATEMENT OF PNB

Punjab National Bank Previous Years

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

Mar '12 Mar '11 Mar '10


Income

Interest Earned 36,428.03 26,986.48 21,466.91

Other Income 4,202.60 3,612.58 3,565.31

Total Income 40,630.63 30,599.06 25,032.22

Expenditure

Interest expended 23,013.59 15,179.14 12,944.02

Employee Cost 4,723.48 4,461.10 3,121.14

Selling and Admin Expenses 3,353.59 2,813.45 1,701.46

Depreciation 292.26 255.85 222.83

Miscellaneous Expenses 4,363.51 3,456.02 3,137.42


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Preoperative ExpCapitalised 0.00 0.00 0.00

Operating Expenses 9,405.85 8,367.96 5,761.36

Provisions & Contingencies 3,326.99 2,618.46 2,421.49

Total Expenses 35,746.43 26,165.56 21,126.87

Mar '12 Mar '11 Mar '10


Net Profit for the Year 4,884.20 4,433.50 3,905.36

Extraordionary Items 7.88 0.00 0.00

Profit brought forward 0.00 0.00 7.64

Total 4,892.08 4,433.50 3,913.00

Preference Dividend 0.00 0.00 0.00

Equity Dividend 746.19 696.99 693.67

Corporate Dividend Tax 121.05 113.07 116.43

Per share data (annualised)

Earning Per Share (Rs) 144.00 139.94 123.86

Equity Dividend (%) 220.00 220.00 220.00

Book Value (Rs) 777.39 632.48 514.77

Appropriations

Transfer to Statutory Reserves 1,390.32 1,258.39 1,532.46

Transfer to Other Reserves 2,634.53 2,365.05 1,570.44

Proposed Dividend/Transfer to

Govt

867.24 810.06 810.1

Balance c/f to Balance Sheet 0 0 0

Total 4,892.09 4,433.50 3,913.00


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BALANCE SHEET AND PROFIT AND LOSS ACCOUNT OF SBI

BALANCE SHEET Mar '12 Mar '11 Mar '10



Total Share Capital 671.04 635 634.88


Share Application Money 0.00 0.00 0.00

Preference Share Capital 0.00 0.00 0.00

Reserves 83,280.16 64,351.04 65,314.32

Revaluation Reserves 0.00 0.00 0.00

Net Worth 83,951.20 64,986.04 65,949.20

Deposits 1,043,647.36 933,932.81 804,116.23

Borrowings 127,005.57 119,568.96 103,011.60

Total Debt 1,170,652.93 1,053,501.77 907,127.83

Other Liabilities &

Provisions

80,915.09 105,248.39 80,336.70

Total Liabilities 1,335,519.22 1,223,736.20 1,053,413.73

Mar '12 Mar '11 Mar '10


Assets


Balance with Banks, Moneyat Call 43,087.23 28,478.65 34,892.98

Advances 867,578.89 756,719.45 631,914.15

Investments 312,197.61 295,600.57 285,790.07

Gross Block 14,792.33 13,189.28 11,831.63


Net Block 5,133.87 4,431.95 4,117.73


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Capital Work In Progress 332.68 332.23 295.18

Other Assets 53,113.02 43,777.85 35,112.76

Total Assets 1,335,519.24 1,223,736.20 1,053,413.74



Book Value (Rs) 1,251.05 1,023.40 1,038.76

Profit & Loss account of State

Bank of India

------------------- in Rs. Cr. ----------------

---

Mar '12 Mar '11 Mar '10


Income

Interest Earned 106,521.45 81,394.36 70,993.92

Other Income 14,351.45 14,935.09 14,968.15

Total Income 120,872.90 96,329.45 85,962.07

Expenditure


Employee Cost 16,974.04 14,480.17 12,754.65

Selling and Admin Expenses 15,625.18 12,141.19 7,898.23

Depreciation 1,007.17 990.50 932.66


Preoperative ExpCapitalised 0.00 0.00 0.00


Provisions & Contingencies 8,393.43 8,660.28 4,532.53

Total Expenses 109,186.89 88,959.12 76,796.02

Mar '12 Mar '11 Mar '10


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Extraordionary Items 21.28 0.00 0.00


Total 11,713.34 7,370.69 9,166.39


Equity Dividend 2,348.66 1,905.00 1,904.65


Per share data (annualized)


Equity Dividend (%) 350.00 300.00 300.00

Book Value (Rs) 1,251.05 1,023.40 1,038.76

Appropriations

Transfer to Statutory Reserves 3,531.35 2,488.96 6,495.14

Transfer to Other Reserves 5,536.50 2,729.87 529.50

Proposed Dividend/Transfer toGovt

2,645.15 2,151.52 2,141.41

Balance c/f to Balance Sheet 0.34 0.34 0.34

Total 11,713.34 7,370.69 9,166.39


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P&L STATEMENTS AND BALANCE SHEET OF YES BANK

Profit & Loss account ofYes Bank ------------------- in Rs. Cr. -------------------

March'12

March '11 March '10

Income

Interest Earned 6,307.36 4,041.75 2,369.71

Other Income 857.12 623.27 575.53

Total Income 7,164.48 4,665.02 2,945.24

Expenditure


Employee Cost 475.15 362.34 256.89

Selling and Admin Expenses 203.03 185.25 182.76

Depreciation 40.82 34.84 30.26

Miscellaneous Expenses 776.76 560.64 415.84

Preoperative Exp Capitalised 0.00 0.00 0.00

Operating Expenses 944.10 719.08 587.76

Provisions & Contingencies 551.66 423.99 297.99

Total Expenses 6,187.48 3,937.89 2,467.51

Mar '12 Mar '11 Mar '10


Net Profit for the Year 977.00 727.14 477.74

Extraordinary Items 0.04 -0.04 0.00

Profit brought forward 1,115.06 672.95 405.78


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Total 2,092.10 1,400.05 883.52


Equity Dividend 141.20 86.79 50.95



Earning Per Share (Rs) 27.68 20.95 14.06

Equity Dividend (%) 40.00 25.00 15.00

Book Value (Rs) 132.49 109.29 90.96

Appropriations

Transfer to Statutory Reserves 269.61 183.79 150.95

Transfer to Other Reserves -0.01 0.00 0.00

Proposed Dividend/Transfer to Govt 164.11 101.20 59.61

Balance c/f to Balance Sheet 1,658.39 1,115.06 672.95

Total 2,092.10 1,400.05 883.51

BALANCE SHEET OF

YES BANKMarch '12 March '11 March '10




Share Application Money 0.00 0.00 0.00

Preference Share Capital 0.00 0.00 0.00

Reserves 4,323.65 3,446.93 2,749.88



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Net Worth 4,676.64 3,794.08 3,089.55

Deposits 49,151.71 45,938.93 26,798.57

Borrowings 14,156.49 6,690.91 4,749.08

Total Debt 63,308.20 52,629.84 31,547.65

Other Liabilities & Provisions 5,677.28 2,583.07 1,745.32


Mar '12 Mar '11 Mar '10


Assets


Balance with Banks, Money at Call 1,253.00 419.96 677.94

Advances 37,988.64 34,363.64 22,193.12

Investments 27,757.35 18,828.84 10,209.94

Gross Block 331.05 255.30 206.40

Accumulated Depreciation 161.98 125.78 92.32

Net Block 169.07 129.52 114.08

Capital Work In Progress 8.04 2.91 1.38

Other Assets 4,153.48 2,186.11 1,190.73

Total Assets 73,662.12 59,007.00 36,382.50

Contingent Liabilities150,977.70

128,259.99 101,835.50


Book Value (Rs) 132.49 109.29 90.96


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Balance Sheet of BOB ------------------- In Rs. crore. -------------------

Mar '12 Mar '11 Mar '10





Share Application Money 0 0 0

Preference Share Capital 0 0 0

Reserves 27,064.47 20,600.30 14,740.86


Net Worth 27,476.85 20,993.11 15,106.39

Deposits 384,871.11 305,439.48 241,044.26

Borrowings 27,573.05 22,307.85 13,350.09

Total Debt 408,444.16 327,747.33 254,394.35

Other Liabilities &Provisions

11,400.46 9,656.73 8,815.97


Mar '12 Mar '11 Mar '10


Assets

Cash & Balances with BOB 21,651.46 19,868.18 13,539.97

Balance with Banks, Moneyat Call

42,517.08 30,065.89 21,927.09

Advances 287,377.29 228,676.36 175,035.29

Investments 83,209.40 71,260.63 61,182.38

Gross Block 4,921.59 4,548.16 4,266.60



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Net Block 2,341.50 2,299.72 2,284.76

Capital Work In Progress 0 0 0

Other Assets 10,224.73 6,226.40 4,347.22

Total Assets 447,321.46 358,397.18 278,316.71



Book Value (Rs) 668.34 536.16 414.71

PROFIT AND LOSS STATEMENT OF BOB

BANK OF BARODA Previous Years

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

Mar '12 Mar '11 Mar '10


Income

Interest Earned 29,673.72 21,885.92 16,698.34

Other Income 3,422.33 2,809.19 2,806.36

Total Income 33,096.05 24,695.11 19,504.70

Expenditure


Employee Cost 2,985.58 2,916.78 2,350.88

Selling and AdminExpenses

2,589.44 1,885.00 1,627.56

Depreciation 276.57 243.04 230.86



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Preoperative ExpCapitalised

0.00 0.00 0.00


Provisions & Contingencies 2,004.80 1,699.88 976.28

Total Expenses 28,089.10 20,453.42 16,446.37

Mar '12 Mar '11 Mar '10



Extraordinary Items 0.00 0.00 0.00


Total 5,006.96 4,241.68 3,058.33


Equity Dividend 812.29 753.35 639.26




Equity Dividend (%) 170.00 165.00 150.00

Book Value (Rs) 668.34 536.16 414.71

Appropriations

Transfer to StatutoryReserves

1,740.81 1,387.87 1,162.07

Transfer to Other Reserves 2,453.86 2,100.46 1,257.00

Proposed Dividend/Transferto Govt

812.29 753.53 639.26

Balance c/f to BalanceSheet

0 0 0

Total 5,006.96 4,241.68 3,058.33

Eic on Banking Sector (1)

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