A SUMMER TRAINING PROJECT REPORT

ON

Comparitive Analysis Between Axis Bank & HDFC Bank --------

SUBMITTED IN THE PARTIAL FULFILLMENT FOR THE AWARD OF DEGREE OF MASTER IN BUSINESS ADMINISTRATION 2012-14

UNDER THE GUIDANCE OF: Ms. MEGHA GROVER FACULTY, RDIAS

SUBMITTED BY: KANIKA JAIN ROLL NO.11480303912_ BATCH NO. 2012-14

RUKMINI DEVI INSTITUTE OF ADVANCED STUDIES

An ISO 9001:2008 Certified Institute NAAC Accredited Grade A

(Approved by AICTE, HRD Ministry, Govt. of India) Affiliated to Guru Gobind Singh Indraprastha University, Delhi 2A & 2B, Madhuban Chowk, Outer Ring Road, Phase-1, Delhi-110085.

STUDENT DECLARATION

This to certify that I have completed the project titled comparative analysis between Axis bank & HDFC bank under the guidance of Ms. Megha Grover in the partial fulfillment of the requirement for the award of the degree of Master in Business Administration from Rukmini Devi Institute of Advanced Studies, New Delhi. This is an original work and I have not submitted it earlier elsewhere.

NAME Kanika Jain ENROLLMENT NO. - 11480303912

CERTIFICATE (From Guide)

This is to certify that the project titled icomparative analysis between Axis bank & HDFC bank s an academic work done by KANIKA JAIN submitted in the partial fulfillment of the requirement for the award of the degree of Masters in Business Administration from Rukmini Devi Institute of Advanced Studies, New Delhi. under my guidance and direction. To the best of my knowledge and belief the data and information presented by him in the project has not been submitted earlier elsewhere.

Ms MEGHA GROVER (Project Guide) RDIAS

ACKNOWLEDGEMENT (For Guideline only)

I offer my sincere thanks and humble regards to Rukmini Devi Institute Of Advanced Studies, GGSIP University, New Delhi for imparting us very valuable professional training in MBA. I pay my gratitude and sincere regards to Dr./Ms., my project Guide for giving me the cream of his knowledge. I am thankful to him as he has been a constant source of advice, motivation and inspiration. I am also thankful to him for giving his suggestions and encouragement throughout the project work.

I take the opportunity to express my gratitude and thanks to our computer Lab staff and library staff for providing me opportunity to utilize their resources for the completion of the project.

I am also thankful to my family and friends for constantly motivating me to complete the project and providing me an environment which enhanced my knowledge.

EXECUTIVE SUMMARY

Any successful business owner is constantly evaluating the performance of his or her company, comparing it with the company's historical figures, with its industry competitors, and even with successful businesses from other industries. To complete a thorough examination of your company's effectiveness, however, you need to look at more than just easily attainable numbers like sales, profits, and total assets. You must be able to read between the lines of your financial statements and make the seemingly inconsequential numbers accessible and comprehensible. This massive data overload could seem staggering. Luckily, there are many well-tested ratios out there that make the task a bit less daunting. Comparative ratio analysis helps you identify and quantify your company's strengths and weaknesses, evaluate its financial position, and understand the risks you may be taking. As with any other form of analysis, comparative ratio techniques aren't definitive and their results shouldn't be viewed as gospel. Many off-the-balance-sheet factors can play a role in the success or failure of a company. But, when used in concert with various other business evaluation processes, comparative ratios are invaluable. This discussion contains descriptions and examples of the eight major types of ratios used in financial analysis: Income, Profitability, Liquidity, Working Capital, Bankruptcy, Long-Term Analysis, Coverage, and Leverage. Ratio analysis is used as a major tool for financial analysis For a meaningful study of information contained in the financial statements Ascertaining the overall financial position of a Business Organization Ratios are calculated from the past financial statements Ratios could also be worked out based on the projected financial statements of the same firm Easiest way of evaluating the performance of a firm is by comparing past and present ratios Used to judge operational efficiency, financial health, solvency or soundness To find out the liquidity position

 Major categories of ratios Liquidity ratios Leverage or solvency ratios Activity Ratios Profitability Ratios

TABLE OF CONTENTS Student declaration Certificate from Guide Acknowledgement Executive Summary CHAPTER 1: INTRODUCTION 1.1 ABOUT BANKING INDUSTRY 1.2 ABOUT ORGANISATION CHAPTER 2: LITERATURE REVIEW 2.1 LITERATURE REVIEW 2.2 ABOUT THE TOPIC CHAPTER 3: RESEARCH METHODOLOGY 3.1 SCOPE OF WORK 3.2 RESEARCH OBJECTIVE OF THE STUDY 3.3 RESEARCH METHODOLOGY OF THE STUDY 3.3.1 RESEARCH DESIGN 3.3.2 SAMPLE DESIGN 3.3.3 DATA COLLECTION TECHNIQUES & TOOLS 3.3.5 LIMITATION CHAPTER 4: DATA ANALYSIS & INTERPRETATION CHAPTER 5: FINDINGS AND SUGGESSTIONS 5.1 FINDINGS 5.2 SUGGESSTIONS CHAPTER 6 : CONCLUSION BIBLIOGRAPHY QUESIONNAIRE i ii iii iv

CHAPTER 1 COMPANY PROFILE

INRTODUCTION
MEANING AND DEFINITION: Bank i s an i nst it ut ion that deals i n m oney and i ts subst it ut es and provides cruci al financi al servi ces. The principal t ype of baki ng i n themod ern industrial world is commercial banking & central banking. 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 HISTORY OF BANKING 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. The government's regular 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 forgetting 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. Money has become the order of the day. 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 are as 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.To make this write-up more explanatory, I prefix the scenario as Phase I, Phase II andPhase III. 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 Europeans 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. Between1906 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 days 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. Phase II

Government took major steps in this Indian Banking Sector Reform after independence. In 1955, 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 1960on 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 were nationalized. Second phase of nationalization Indian Banking Sector Reform was carried out in1980 with seven more banks. This step brought 80% of the banking segment in India under Government ownership. The following are the steps taken by the Government of India to Regulate Banking Institutions in the Country: 1949: Enactment of Banking Regulation Act. 1955: Nationalization of State Bank of India. 1959 : Nationalization of SBI subsidiaries. 1961: Insurance cover extended to deposits. 1969: Nationalization of 14 major banks. 1971: Creation of credit guarantee corporation. 1975: Creation of regional rural banks. 1980: Nationalization of seven banks with deposits over 200 crore. 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 Narasimham, 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 swift. 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 are 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 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.

BANKING SERVICES IN INDIA:

With years, banks are also adding services to their customers. The Indian banking industry is passing through a phase of customers market. The customers have more choices in choosing their banks. A competition has been established within the banks operating in India. With stiff competition and advancement of technology, the service provided by banks has become more easy and convenient. The past days are witness to an hour wait before withdrawing cash from accounts or a cheque from north of the country being cleared in one month in the south. This section of banking deals with the latest discovery in the banking instruments along with the polished version of their old systems

After preparation of the financial statements, one may be interested in knowing the position of an enterprise from different points of view. This can be done by analyzing the financial statement with the help of different tools of analysis such as ratio analysis, funds flow analysis, cash flow analysis, comparative statement analysis, etc. Here I have done financial analysis by ratios. In this process, a meaningful relationship is established between two or more accounting figures for comparison.

Financial ratios are widely used for modeling purposes both by practitioners and Researchers. The firm involves many interested parties, like the owners, management, personnel, customers, suppliers, competitors, regulatory agencies, and academics, each having their views in applying financial statement analysis in their evaluations. Practitioners use financial ratios, for instance, to forecast the future success of companies, while the researchers' main interest has been to develop models exploiting these ratios.

Many distinct areas of research involving financial ratios can be discerned. Historically one can observe several major themes in the financial analysis literature. There is overlapping in the observable themes, and they do not necessarily coincide with what theoretically might be the best founded areas.

Financial statements are those statements which provide information about profitability and financial position of a business. It includes two statements, i.e., profit & loss a/c or income statement and balance sheet or position statement.

The income statement presents the summary of the income earned and the expenses incurred during a financial year. Position statement presents the financial position of the business at the end of the year.

Before understanding the meaning of analysis of financial statements, it is necessary to understand the meaning of analysis and financial statements.

Analysis means establishing a meaningful relationship between various items of the two financial statements with each other in such a way that a conclusion is drawn. By financial statements, we mean two statements- (1) profit & loss a/c (2) balance sheet. These are prepared at the end of a given period of time. They are indicators of profitability and financial soundness of the business concern.

Thus, analysis of financial statements means establishing meaningful relationship between various items of the two financial statements, i.e., income statement and position statement

Parties interested in analysis of financial statements

Analysis of financial statement has become very significant due to widespread interest of various parties in the financial result of a business unit. The various persons interested in the analysis of financial statements are:-

Short- term creditors

They are interested in knowing whether the amounts owing to them will be paid as and when fall due for payment or not. Long term creditors

They are interested in knowing whether the principal amount and interest thereon will be paid on time or not.

Shareholders

They are interested in profitability, return and capital appreciation.

Management

The management is interested in the financial position and performance of the enterprise as a whole and of its various divisions.

Trade unions

They are interested in financial statements for negotiating the wages or salaries or bonus agreement with management.

Taxation authorities

These authorities are interested in financial statements for determining the tax liability.

Researchers

They are interested in the financial statements in undertaking research in business affairs and practices.

Employees

They are interested as it enables them to justify their demands for bonus and increase in remuneration.

You have seen that different parties are interested in the results reported in the financial statements. These results are reported by analyzing financial statements through the use of ratio analysis.

BANK PROFILE :

AXIS BANK LTD.

Type Traded as -

Private company BSE: 532215 LXC: AXBC NSE: AXIS BANK Banking, Financial Services 1994(as UTI bank)

Industry Founded -

Headquarters - Mumbai, Maharashtra, India Key People Dr Sanjiv Misra (Chairman) Shikha Sharma (MD & CEO)

Axis Bank Limited (BSE: 532215, LSE: AXBC) is an Indian financial services corporation headquartered in Mumbai, Maharashtra. It had begun operations in 1994, after the Government of India allowed new private banks to be established. The Bank was promoted jointly by the Administrator of the Specified Undertaking of the Unit Trust of India (UTI-I), Life Insurance Corporation of India (LIC), General Insurance Corporation Ltd., National Insurance Company Ltd., The New India Assurance Company, The Oriental Insurance Corporation and United India Insurance Company UTI-I holds a special position in the Indian capital markets and has promoted many leading financial institutions in the country. As on the year ended 31st March 2012, Axis Bank had an operating revenue of 13,437 crores and a net profit of 4,242 crores. [18] Axis Bank (erstwhile UTI Bank) opened its registered office in Ahmedabad and corporate office in Mumbai in December 1993. The first branch was inaugurated in April 1994 in Ahmedabad by Dr. Manmohan Singh, then the Honorable Finance Minister. The Bank, as on 31st March 2012, is capitalised to the extent of Rest. 413.2 crores with the public holding (other than promoters and GDRs) at 54.08%. [19].New Zealand born Richard Chandler owns about 9.5% share through Orient Global. On 14th March 2013 an online magazine named Cobrapost.com released video footage from Operation Red Spider showing high ranking officials and some employees of Axis bank willing to turn black money into white which is violation of Money Laundering Control Act. After this The government of India and Reserve Bank of India have ordered an inquiry.

Axis Bank India, the first bank to begin operations as new private banks in 1994 after the Government of India allowed new private banks to be established. Axis Bank was jointly promoted by the Administrator of the specified undertaking of the Unit Trust of India (UTI-I) Life Insurance Corporation of India (LIC) General Insurance Corporation Ltd. Alsowithassociatesviz.National Insurance Company Ltd.,theNewIndia As surance Company, The Ori ent al Insurance C orporat io n and Unit ed Insurance Company Ltd.

BOARD OF DIRECTORS
Name Sanjiv Misra Somnath Sengupta K N Prithviraj S B Mathur R N Bhattacharyya Som Mittal Rohit Bhagat Designation Chairman Executive Director & Head (Corporate Centre) Director Director Director Director Director

Name Shikha Sharma V Srinivasan V R Kaundinya Prasad R Menon Samir K Barua Ireena Vittal

Designation Managing Director & CEO Executive Director & Head (Corporate Banking) Director Director Director Director

HDFC BANK

Type -

Public BSE: 500180 NSE: HDFCBANK NYSE: HDB BSE SENSEX Constituent Banking, Financial services August 1994 Mumbai, Maharashtra, India Worldwide Mr Aditya Puri (MD)

Traded as -

Industry Founded Headquarters Area served Key people -

HDFC Bank Limited (BSE: 500180, NSE: HDFCBANK, NYSE: HDB) is an Indian financial services company based in Mumbai, Maharashtra that was incorporated in August 1994. HDFC Bank is the fifth largest bank in India by assets and the largest bank by market capitalization as of 1 November 2012. The bank was promoted by the Housing Development Finance Corporation, a premier housing finance company (set up in 1977) of India. As on August 2013, HDFC Bank has 3,119 branches and 11,088 ATMs, in 1,891 cities in India, and all branches of the bank are linked on an online real-time basis. [3] As of December 2012 the bank had balance sheet size of Rs. 3837 billion. For the fiscal year 2011-12, the bank has reported net profit of 5167.07 crore (US$790 million), up 31.6% from the previous fiscal.

On 14 March 2013 an online magazine named Cobrapost.com released video footage from Operation Red Spider showing high ranking officials and some employees of HDFC bank willing to turn black money into white which is violation of Money Laundering Control Act. Following this the government of India and RBI have ordered an inquiry.[4][5][6] The enquiry confirmed violation of KYC (Know Your Customer) norms by HDFC Bank. A penalty of Rs 45 million was imposed on the bank by RBI.

HDFC Bank was incorporated in 1994 by Housing Development Finance Corporation Limited (HDFC), India's largest housing finance company. It was among the first companies to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector. The Bank started operations as a scheduled commercial bank in January 1995 under the RBI's liberalisation policies. On 26 February 2000 Times Bank Limited owned by The Times Group (Bennett, Coleman & Co.) was merged with HDFC Bank Ltd. This was the first merger of two private banks in India. Shareholders of Times Bank received 1 share of HDFC Bank for every 5.75 shares of Times Bank. On 23 May 2008 HDFC Bank acquired Centurion Bank of Punjab taking its total branches to more than 1,000. The amalgamated bank emerged with a base of about Rs. 1,22,000 crore and net advances of about Rs.89,000 crore. The balance sheet size of the combined entity is more than Rs. 1,63,000 crore

BOARD OF DIRECTORS
Name C M Vasudev Harish Engineer Renu Karnad Partho Datta A N Roy Vijay Merchant Designation Chairman Executive Director Director Director Director Director

Name Aditya Puri Paresh Sukthankar Pandit Palande Bobby Parikh Keki Mistry

Designation Managing Director Executive Director Director Director Director

PRODUCT & SERVICES: AXIS BANK :

PRODUCTS & SERVICES

1. Accounts:
a. Personal: Saving Account - A deposit account held at a bank or other financial institution that provides principal security and a modest interest rate. Depending on the specific type of savings account, the account holder may not be able to write checks from the account (without incurring extra fees or expenses) and the account is likely to have a limited number of free transfers/transactions. It offers: Easy Access Saving Account Prime Saving account Prime Plus Saving Account Pention Saving Account Future Plus Saving Account Womens Saving Account

Current Account - Holding foreign currency is no longer restricted to the NRIs. For the first time Reserve Bank of India has allowed Resident Indians to maintain foreign currency accounts without any ceiling to it. This step is considered as a continuation of RBIs gradual endevour towards achieving 'Full Capital Convertibility'.

Salary Account - salary account as it is more commonly called, is nothing but a regular bank account but one in which your employer will credit your monthly salary/paycheck every month. If you have a salary account with a bank, banks usually provide you with additional facilities like 0 balance account, credit cards, overdraft facilities etc.

Account Portability - Axis Banks Savings accounts are completely transferable. With over 1750 branches, even if you change your home, or re-locate to another city Axis Bank ensures that all your account details remain the same, wherever you go!

b. NRI : NRE Saving Account - An NRE account can be opened by any person who is residing outside India. NRIs having NRE account in India are permitted to hold and maintain foreign currency earnings in Indian rupees. All the funds, along with the accrued interest, are freely repatriable; moreover the interest earned is not taxable in India.

NRO Saving Account - Any individual residing outside India is permitted to hold a NRO Savings account. It allows the NRIs to put through their bona fide transactions in Rupees on account of funds originating in India.

NRI Prime Savings Account - As you move up the ladder of progress in life, along comes with it a lot of expectations and aspirations. To achieve them requires the able support of a willing partner, ever ready to lend a helping hand in your every quest, willing to walk that extra mile to make sure all your aspirations are turned in to reality. With Axis banks NRI Prime Saving Account you may find the perfect partner in your journey.

Resident Foreign Currency Account - This is a Foreign currency account which can be opened, held and maintained by any person who was a NRI but is now residing in India. It can be opened with any authorised dealer for depositing eligible foreign exchange funds. It Foreign currency account can be held by only those citizens and PIOs who have been non-residents for a continuous period of not less than one year and have become resident in India on or after 18th April, 1992.

2. Deposits:

a. Personal:

Fixed Deposits - Axis Bank offers multitudes of fixed deposit schemes for various durations. It offers simple reinvestment Fixed Deposits (at very competitive interest rates), which can be opened with a minimum investment of Rs 10,000.

Tax Saver Fixed Deposits - In the Finance Bill of 2006, the government had announced Tax benefits to Bank Term Deposits which are of over 5 year tenure u/s 80C of IT Act, 1961 vide Notification Number 203/2006 and SO1220 (E) dated 28/07/2006.

Recurring Deposits - Axis Bank's Recurring Deposit scheme will allow you with an opportunity to build up your savings through regular monthly deposits of fixed sum over a fixed period of time.

Encash 24 - The Encash 24 (Flexi Deposit) gives you the liquidity of a Savings Account coupled with high earnings of a Fixed Deposit. b. NRI : Axis bank offers NRE Ruppee Deposit NRO Recurring Deposit NRE Recurring Deposit FCNR Deposit NRO Ruppee Deposit

3. Loans : Axis Bank offers its valuable customers a variety of loans in India that will suit their needs. At Axis bank you are sure to find a loan product that is just meant for you. We offer loans in various denominations so that you can pursue your dreams of buying a car, a home or to send your child abroad for higher education. You can also avail our loan facilities through the internet by providing few basic details and our representative will promptly respond to your query for getting a loan. It offers: Home Loan Car Loan

Personal Loan Loan Against Property Loan Against Share Loan Against Gold

4. Cards: Credit Card - A credit card is a payment card issued to users as a system of payment. It allows the cardholder to pay for goods and services based on the holder's promise to pay for them.[1] The issuer of the card creates a revolving account and grants a line of credit to the consumer (or the user) from which the user can borrow money for payment to a merchant or as a cash advance to the user. It offers: Infinite Credit Card Wealth Credit Card

My Choice Credit Card My zone Credit Card

Debit Card - A debit card (also known as a bank card or check card) is a plastic payment card that provides the cardholder electronic access to his or her bank account(s) at a financial institution. Some cards have a stored value with which a payment is made, while most relay a message to the cardholder's bank to withdraw funds from a payee's designated bank account. It offers: Priority Platinum Debit Card Gold Plus Debit Card Gold Debit Card

5. Investment - In finance, investment is putting money into an asset with the expectation of capital appreciation, dividends, and/or interest earnings. This may or may not be backed by research and analysis. Most or all forms of investment involve some form of risk, such as investment in equities, property, and even fixed interest securities which are subject, among other things, to inflation risk. Axis bank offers: Gold Mohurs Silver Mohurs Mutual Funds Demat Account 8% Saving Account

6. Insurance - Insurance is the equitable transfer of the risk of a loss, from one entity to another in exchange for payment. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. Axis Bank offers: Life Insurance Health Insurance Home Insurance Motor Insurance Travel Insurance

Other than these products and services axis bank provides internet banking, krishi saving account, krishi current account, loans within your reach like kisan power, powertrac, arthia power etc. .

HDFC BANK

PRODUCTS & SERVICES

1. Accounts & Deposits : Saving Account HDFC Bank offers: Saving Max account Womens saving Account Regular saving account Senior Citizen account Kids Advantage Account

Salary Account HDFC offers: Premium Salary Account Regular Salary Account Defence salary Account Classic Account Reimbursement Account

Current Account HDFC Bank offers: Ultima Current Account Supreme Current account Apex Current Account Maxi Current Account

Deposits: HDFC offers: Regular Fixed Deposit Super Saver Facility

Recurring Deposit

Demat Account - HDFC Bank Demat Services offers you a Safe, Online and Seamless mode to keep track of your investments. Invest in a range of securities from Equity, Derivatives, Currency Derivatives, Mutual Funds, IPOs, ETFs (Gold & Indices), Bonds, NCDs etc. and store them conveniently in your Demat Account, without the risk of loss or damage of physical papers.

NRE Saving Account -NRE Savings Account lets you transfer your earnings to India conveniently with complete security. You can repatriate the funds held in the account along with the interest earned at any point of time and you don't even have to pay tax on the interest amount. With a host of direct banking channels available at your fingertips, you can stay in complete control of your hard-earned income abroad.

2.

Loans & Cards:

Credit Card - Choosing the right Credit Card just got simpler! HDFC Bank brings to you a wide range of cards for which you can apply online with ease. You can pick one from the varied options available depending on your spending requirement. Use our Compare Credit Card tool to choose the best credit card suited to your need, be it travel, dining, entertainment & more. The benefits you get, range from CashBack, discounts, access to airport lounges to earning reward points on spends with your Card. Debit Card HDFC Bank offers: Jetprivilege HDFC Bank World Deposit Card Easy shop Imperia Platinum Chip Debit Card Easy shop Platinum Debit Card Loan HDFC Bank offers: Personal Loan Business Loan Home Loan

Motor Loan Education Loan

3. Investment & Insurance: Investment Products HDFC Bank offers: Mutual Funds Equities & Derivatives Invest In Gold Invest In Silver 8% Saving Bonds

Insurance - Insurance is the equitable transfer of the risk of a loss, from one entity to another in exchange for payment. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. HDFC offers: Life Insurance Motor Insurance Travel Insurance Home Insurance Wealth Services

Other than these product & services HDFC bank offers net banking, online services & tools like credit card eligibility check, recharge your mobile, online tax payment etc. .

CHAPTER 2 LITERATURE REVIEW

2.1 Literature Review

Partho Dutta: He conceptually defines the liquidity ratio as realizable cash on the balance sheet to short term liabilities. In turn, realizable cash is defined as liquid assets plus other assets to which a haircut has been applied. Ration analysis is one of the conventional way that use financial statements to evaluate the company and create standards that have simply interpreted financial sense (George H.Pink, G. Mark Holmes 2005). A sudden stop in an organization is generally defined as a sudden slowdown in emerging market capital (cash) inflows, with an associated shift from large current account deficits into smaller deficits or small surpluses. Sudden stops are dangerous and they may result in bankruptcies, destruction of human capital and local credit channels Calvo, 1998.

A N Roy:

The International Accounting Standards indicate the fact that liquidity refers to the available cash for the near future, after taking into account the financial obligations corresponding to that period. Liquidity risk consist in the probability that the organization should not be able to make its payments to creditors, as a result of the changes in the proportion of long term credits and short term credits and the uncorrelation with the structure of organization's liabilities (Stoica, 2000).

R N Bhattacharya:

The Indian capital market has changed dramatically over the last few years, especially since 1990. Changes have also been taking place in government regulations and technology. The expectations of the investors are also changing. The only inherent feature of the capital market, which has not changed is the 'risk' involved in investing incorporate securities. Managing the risk is emerging a s an importantfunction of both large scale and small-scale investors. Risk management of investing in corporate securities is under active and

extensive discussion among academicians and capital market operators. Surveys and research analyses have been conducted by institutions and academicians on risk management. The mutual fund companies in India have conducted specific studies o n the 'risk element' of investing in corporate securities. Grewal S.S and Navjot Grewall (1984) revealed some basic investment rules a n d rules for selling shares. They warned the investors not to buy unlisted shares, as Stock Exchanges d o not permit trading in unlisted shares. Another rule that they specify is not to buy in active shares, i,e, shares in which transactions take place rarely. The main reason why shares are inactive is because there are no buyers for them. They are mostly shares of companies, which are not doing well. A third rule according to them is not to buy shares in closely-heldcompanies because these shares tend to be less active than those of widely held ones since they have a fewer number of shareholders. They caution not to hold the shares for a long period, expecting a high price, but to sell whenever one earns a reasonable reward. Jack Clark Francis2 (1986) revealed the importance of the rate of return in investments and reviewed the possibility of default and bankruptcy risk. He opined that in an uncertain world, investors cannot predict exactly what rate of return an investment will yield. However he suggested that the investors can formulate a probability distribution of the possible rates of return. He also opined that an investor who purchases corporatesecurities must face the possibility of default and bankruptcy by the issuer. Financial analysts can foresee bankruptcy. He disclosed some easily observable warnings of a firm's failure, which could be noticed by the investors to avoid such a risk. Preethi Singh3(1986) disclosed the basic rules for selecting the company to invest in. She opined that understanding and measuring return m d risk is fundamental to the investment process. According toher, most investors are 'risk averse'. To have a higher return theinvestor has to face greater risks. She conclud es that risk is fundamental to the process of investment. Every investor should have a n understanding of the various pitfalls of investments. The investor should carefully analyse the financial statements with special

reference to solvency, profitability, EPS, and efficiency of the company. David.L.Scott a n d William Edward4 (1990) reviewed the important risks of owning common stocks and the ways to minimisethese risks. They commented that the severity of financial risk depends

About the Topic: Financial Ratio analysis

Financial Ratio analysis refers to an assessment of the viability, stability, and profitability of a business, sub-business, or project. As a manager, you may want to reward employees based on their performance. How do you know how well they have done? How can you determine what departments or divisions have performed well? As a lender, how do decide the borrower will be able to pay back as promised? As a manager of a corporation how do you know when existing capacity will be exceeded and enlarged capacity will be needed? As an investor, how do you predict how well the securities of one company will perform relative to that of another? How can you tell whether one security is riskier than another? We can address all of these questions through financial analysis. Professionals prepare reports from the financial statements, using ratios indicating the performance of the organization. These reports are usually presented to top management as one of their bases in making business decisions. Based on these reports, management may: Continue or discontinue its main operation or part of its business. Make or purchase certain materials in the manufacture of its product. Acquire or rent/lease certain machineries and equipment in the production of its goods or acquire any other business. Predict the corporate bankruptcy and take corrective measures. Other decisions that allow management to make an informed selection on various alternatives in the conduct of its business.

Significance of financial ratio analysis:

Interest of various related groups is affected by the financial performance of a firm. Therefore, these groups analyze the financial performance of the firm. The type of analysis varies according to the specific interest of the party involved.

Ratio analysts often asses the firms on:

Profitability- its ability to earn income and sustain growth in both short-term and long-term. Solvency- its ability to pay its obligation to creditors and other third parties in the long term; Liquidity- its ability to maintain positive cash flow, while satisfying immediate obligations. Stability- the firms ability to remain in business in the long run, without having to sustain significant losses in the conduct of its business. Assessing a companys stability requires the use of the income statement and the balance sheet, as well as other reports like those of competitors.

Methods of financial analysis:

The following technique is being used to analyze and interpret the financial statements:

Ratio Analysis:
It is done to develop meaningful relationship between individual items or group of items usually shown in the periodical financial statements published by the concern. An accounting ratio shows the relationship between the two inter-related accounting figures as gross profit to sales, current assets to current liabilities, loaned capital to owned capital etc. Ratios should not be calculated between the two unrelated figures, as it will not serve any useful purpose. Ratios are used to obtain the overview of some of the firms key operating statistics. By following these measures over time the manager can detect important trends in the performance of the firm. In order to evaluate financial condition and performance of a firm, the financial analyst needs certain tools to be applied on various financial aspects. One of the widely used and powerful tools is ratio or index. Ratios express the numerical relationship between two or more things. This relationship can be expressed as percentages (25% of revenue), fraction (one-fourth of revenue), or proportion of numbers (1:4). Accounting ratios are used to describe significant relationships, which exist between figures shown on a balance sheet, in a profit and loss account, in a budgetary control system or in any other part of the accounting organization. Ratio analysis plays an important role in determining the financial strengths and weaknesses of a company relative to that of other companies in the same industry. The analysis also reveals whether the company's financial position has been improving or deteriorating over time.

Some Ratios which are used in the industry are shown below:

S.NO

RATIOS LIQUIDITY

SUB HEADS CURRENT RATIO QUICK RATIO

METHOD CA/CL (CA-INVENTORY)/CL

1 RATIO

OPERATING PROFIT MARGIN EBIT/SALES RATIO CONTRIBUTION RATIO NET PROFIT MARGIN RATIO RETURN ON ASSET RATIO OR PAT/TA ROTA RETURN ON NET ASSET RATIO RETURN ON INVESTMENT RETURN ON EQUITY RATIO OR 2 RONW P-E RATIO DIVIDEND YIELD EARNING YIELD DIVIDEND PAYOUT RATIO DPS EPS RETURN ON CAPITAL PAT/CAP EMPLOYED EMPLOYED RATIO MPS/EPS DPS/MPS EPS/MPS DPS/EPS DIVIDEND/NO. OF SHARE OUTSTANDING PAT/NO.OF SHARE OUTSTANDING PAT/NW EBIT/NA PAT/NA CONTRIBUTION/SALES PAT/SALES

LEVERAGE 3 RATIO

DEBT RATIO DEBT-EQUITY RATIO

TD/(TD+NW) TD/NW

DEBT-ASSET RATIO NAV INT COVERAGE RATIO

TD/TA NW/ NO. OF EQ.SHARES OUTSTANDING EBDIT/INT EXP

AVERAGE COLLECTION PERIOD INVENTORY COGS/AVG INVENTORY TURNOVER RATIO DAYS OF ACTIVITY OR 4 TURNOVER RATIO HOLDING ASSET TURNOVER RM INVENTORY MATERIAL CONSUMED/ AVR RM INVENTORY TURNOVER WIP INVENTORY COST OF PRODUCTION/ AVG WIP INVENTORY TURNOVER SALES/ASSETS INVENTORY AVG INVENTORY/DAILY COGS DEBTORS/DAILY CR. SALES

MKT PRICE TO NAV VALUATION RATIO MKT CAP BETA SCORE

MP/NAV CLOSING MP * NO.EQ.SHARES OUTSTANDING REGRESSION ANALYSIS

LEVERAGE

DOL

% CHANGE IN EBIT/ % CHANGE IN SALES

RELATIONSHIPS

DFL

% CHANGE IN EPS/ % CHANGE IN EBIT

DCL

DOL*DFL

Financial ratio analysis is the selection, evaluation, and interpretation of financial data, along with other pertinent information, to assist in investment and financial decision-making. Financial analysis may be used internally to evaluate issues such as employee performance, the efficiency of operations, and credit policies, and externally to evaluate potential investments and the credit-worthiness of borrowers, among other things. The analyst draws the financial data needed in financial analysis from many sources. The primary source is the data provided by the company itself in its annual report and required disclosures. The annual report comprises the income statement, the balance sheet, and the statement of cash flows. Certain businesses are required by securities laws to disclose additional information. When comparing ratios from various fiscal periods or companies, inquire about the types of accounting policies used. Different accounting methods can result in a wide variety of reported figures. Determine whether ratios were calculated before or after adjustments were made to the balance sheet or income statement, such as non-recurring items and inventory or pro forma adjustments. In many cases, these adjustments can significantly affect the ratios. Carefully examine any departures from industry norms.

The Purpose of Financial Ratio Analysis:

For most of us, accounting is not the easiest thing in the world to understand, and often the terminology used by accountants is part of the problem. Financial ratio analysis sounds pretty complicated. But to simplify the learning processes think of it as batting averages for business. If you want to compare the ability of two Major cricket players, you are likely to look at their batting averages. If one is hitting .357 and the others average is .244, you immediately know which is doing better, even if you dont know precisely how a batting average is calculated. Financial ratios measure your companys productivity. There are many ratios you can use, but they all measure how good a job your company is doing in using its assets, generating profits from each dollar of sales, turning over inventory, or whatever aspect of your companys operation you are evaluating.

The use of financial ratios is a time-tested method of analyzing a business. Wall Street investment firms, bank loan officers and knowledgeable business owners all use financial ratio analysis to learn more about a companys current financial health as well as its potential. Although it may be somewhat unfamiliar to you, financial ratio analysis is neither sophisticated nor complicated. It is nothing more than simple comparisons between specific pieces of information pulled from your companys balance sheet and income statement. If you are thinking about buying shares of a publicly-traded company, you might look at its price-earnings ratio. If the stock is selling for $60 per share, and the companys earnings are $2 per share, the ratio of price ($60) to earnings ($2) is 30 to 1. In common usage, we would say the P/E ratio is 30. Financial ratio analysis can be used in two different but equally useful ways:1. You can use them to examine the current performance of your company in comparison to past periods of time. Frequently, this can help you identify problems that need fixing. Even better, it can direct your attention to potential problems that can be avoided. 2. You can use these ratios to compare the performance of your company against that of your competitors or other members of your industry. Remember the ratios you will be calculating are intended simply to show broad trends and thus to help you with your decision-making.

Advantages:
1. It simplifies the financial statements. 2. It helps in comparing companies of different size with each other. 3. It helps in trend analysis which involves comparing a single company over a period. 4. It highlights important information in simple form quickly. A user can judge a company by just looking at few numbers instead of reading the whole financial statements.

Limitations of ratio analysis:

All of these ratios are meaningful only in conjunction with a firms past performance or in comparison with other firms in the industry. Also, none of these measures has a correct value, for example, it might seem that a higher current ratio is always better. After all, higher

the ratio less is the risk of default. However, managing a firm to ensure a high current ratio may lead to an inefficient use of resources. For example, the firm might increase its current ratio by holding cash or by increasing its inventory way beyond normal levels. Since these assets by themselves do not generate any return to the firm, an exceedingly high current ratio would signal that management is too cautious, and probably underutilizing the firms assets. When analyzing financial statements, we should always look for window dressing Although ratio analysis is very important tool to judge the company's performance, following are the limitations of it. 1. Ratios are tools of quantitative analysis, which ignore qualitative points of view. 2. Ratios are generally distorted by inflation. 3. Ratios give false result, if they are calculated from incorrect accounting data. 4. Ratios are calculated on the basis of past data. Therefore, they do not provide complete information for future forecasting. 5. Ratios may be misleading, if they are based on false or window-dressed accounting information. 6. Different companies operate in different industries each having different environmental conditions such as regulation, market structure, etc. Such factors are so significant that a comparison of two companies from different industries might be misleading. 7. Financial accounting information is affected by estimates and assumptions. Accounting standards allow different accounting policies, which impairs comparability and hence ratio analysis is less useful in such situations. 8. Ratio analysis explains relationships between past information while users are more concerned about current and future information.

Liquidity assessment: Liquidity refers to the speed and ease with which an asset can be converted to cash. Liquidity has two dimensions: ease of conversion versus loss of value. Remember any asset can be quickly converted to cash if you slash the price. A house property valued at Rs 25 lakhs can

be converted to cash within 24 hours if you slash the price to Rs 5 lakhs! So a liquid asset is really one which can be converted to cash without major loss of value. An illiquid asset is one that cannot be en-cashed without a major slash in price. Current assets are most liquid. Fixed assets are least liquid. Tangible fixed assets like land and building and equipment arent generally converted to cash at all in normal business activity. They are used in the business to generate cash. Intangibles such as trademark have no physical existence and arent normally converted to cash. Liquidity is invaluable. The more liquid a business is, less is the possibility of it facing financial troubles. But too much of liquidity too is not good. Thats because liquidity has a price tag. Liquid assets are less profitable to hold. Therefore there is a tradeoff between the advantages of liquidity and foregone potential profits. Liquidity or Short term solvency ratios provide information about a firms liquidity. The primary concern is the firms ability to pay its bills over the short run without undue stress. Hence these ratios focus on current assets and current liabilities. These ratios are particularly useful to the short term lenders. Liquidity is a measure of the quality and adequacy of current assets to meet current obligations as they come due. In other words, can a firm quickly convert its assets to cashwithout a loss in valuein order to meet its immediate and short-term obligations? For firms such as utilities that can readily and accurately predict their cash inflows, liquidity is not nearly as critical as it is for firms like airlines or manufacturing businesses that can have wide fluctuations in demand and revenue streams. These ratios provide a level of comfort to lenders in case of liquidation.

Current ratio: This ratio is a rough indication of a firms ability to service its current obligations. Generally, higher current ratio, greater is the cushion between current obligations and a firms ability to pay them. While a stronger ratio shows that the numbers for current assets exceed those for current liabilities, the composition and quality of current assets are critical factors in the analysis of an individual firms liquidity.

Quick ratio: Also known as the acid test ratio, this is a stricter, more conservative measure of liquidity than the current ratio. This ratio reflects the degree to which a companys current liabilities are

covered by its most liquid current assets, the kind of assets that can be converted quickly to cash and at amounts close to book value. Inventory and other less liquid current assets are removed from the calculation. Generally, if the ratio produces a value thats less than 1 to 1, it implies a dependency on inventory or other less current assets to liquidate short-term debt.

Cash ratio: The cash ratio is most commonly used as a measure of company liquidity. It can therefore determine if, and how quickly, the company can repay its short-term debt. A strong cash ratio is useful to creditors when deciding how much debt, if any, they would be willing to extend to the asking party. The cash ratio is generally a more conservative look at a company's ability to cover its liabilities than many other liquidity ratios. This is due to the fact that inventory and accounts receivable are left out of the equation. Since these two accounts are a large part of many companies, this ratio should not be used in determining company value, but simply as one factor in determining liquidity.

Gross profit margin ratio: A financial metric used to assess a firm's financial health by revealing the proportion of money left over from revenues after accounting for the cost of goods sold. Gross profit margin serves as the source for paying additional expenses and future savings.

Operating profit margin ratio: A financial metric used to assess a firm's financial health by revealing the proportion of money left over from revenues after accounting for the cost of goods sold. Gross profit margin serves as the source for paying additional expenses and future savings. Operating margin is a measurement of what proportion of a company's revenue is left over after paying for variable costs of production such as wages, raw materials, etc. A healthy operating margin is required for a company to be able to pay for its fixed costs, such as interest on debt it is also known as "net profit margin".

Return on Total Assets(ROTA):

It is a ratio that measures company's earnings before interest and taxes (EBIT) against its total net assets. The ratio is considered an indicator of how effectively a company is using its assets to generate earnings before contractual obligations must be paid. The greater a company's earnings in proportion to its assets (and the greater the coefficient from this calculation), the more effectively that company is said to be using its assets.

Return on equity(ROI): Return on equity (ROE) is the amount of net income returned as a percentage of shareholders equity. It reveals how much profit a company earned in comparison to the total amount of shareholder equity found on the balance sheet. ROE is one of the most important financial ratios and profitability metrics. It is often said to be the ultimate ratio or the mother of all ratios that can be obtained from a companys financial statement. It measures how profitable a company is for the owner of the investment, and how profitably a company employs its equity.

Return on capital employed (ROCE): ROCE is used to prove the value the business gains from its assets and liabilities. A business which owns lots of land will have a smaller ROCE compared to a business which owns little land but makes the same profit. It basically can be used to show how much a business is gaining for its assets, or how much it is losing for its liabilities. The main drawback of ROCE is that it measures return against the book value of assets in the business. As these are depreciated the ROCE will increase even though cash flow has remained the same. Thus, older businesses with depreciated assets will tend to have higher ROCE than newer, possibly better businesses. In addition, while cash flow is affected by inflation, the book value of assets is not. Consequently revenues increase with inflation while capital employed generally does not (as the book value of assets is not affected by inflation).

Debt ratio: It is a ratio that indicates what proportion of debt a company has relative to its assets. The measure gives an idea to the leverage of the company along with the potential risks the company

faces in terms of its debt-load. A debt ratio of greater than 1 indicates that a company has more debt than assets; meanwhile, a debt ratio of less than 1 indicates that a company has more assets than debt. Used in conjunction with other measures of financial health, the debt ratio can help investors determine a company's level of risk.

Debt equity ratio: It is a measure of a company's financial leverage calculated by dividing its total liabilities by stockholders' equity. It indicates what proportion of equity and debt the company is using to finance its assets. A high debt/equity ratio generally means that a company has been aggressive in financing its growth with debt. This can result in volatile earnings as a result of the additional interest expense. If a lot of debt is used to finance increased operations (high debt to equity), the company could potentially generate more earnings than it would have without this outside financing. If this were to increase earnings by a greater amount than the debt cost (interest), then the shareholders benefit as more earnings are being spread among the same amount of shareholders. However, the cost of this debt financing may outweigh the return that the company generates on the debt through investment and business activities and become too much for the company to handle. This can lead to bankruptcy, which would leave shareholders with nothing. The debt/equity ratio also depends on the industry in which the company operates. For example, capital-intensive industries such as auto manufacturing tend to have a debt/equity ratio above 2, while personal computer companies have a debt/equity of under 0.5.

Dividend payout ratio: The payout ratio provides an idea of how well earnings support the dividend payments. More mature companies tend to have a higher payout ratio. In the U.K. there is a similar ratio, which is known as dividend cover. It is calculated as earnings per share divided by dividends per share.

CHAPTER 3 RESEARCH METHODOLOGY

Purpose of the study:

Each research study has its own specific pupose. It is like to discover to question through the application of the scientific procedure. But the main aim of our research is to find out the truth that is hidden and which has not been discovered as yet.

Objectives of the study:

Banking and finance can be called as the nerves of any economic system as they accelerate the process of economic development through canalization of adequat e fi n ace. It i s hard t o anti cipat e develo pment of effi ci ent banki ngservices in the country. No doubt financial institutions play so important in e c o n o m i c development but at the some time economic development det erm ines the growt h and developm ent of banki ng i nstit ut ions t he rol e o f various ki nd of banking insti tuti on. In econom i c developm ent need not b eemphasized. M ain obj ecti ve of the st udy i s the comparat ive anal ysi s between Axis bank & Hdfc bank . Some of the major objectives of the study include the determination of the following: To study the comparative analysis between Axis Bank & HDFC Bank on the basis of assets, liabilities , profit & loss account. To find the advantage of Axis bank over Hdfc bank. Customer satisfaction with the service provided by the bank Draw out with conclusions and suggestion based on the analysis and the interpretation of data.

Research Methodology of the study:

The study is concerned with the banking industry in India. Post-liberalization, privatization

and globalization period has shown transformation in banking industry. Particularly, with the introduction of IT in banking industry a lot of changes have taken place in public sector banks but slowly whereas in new private sector banks and foreign banks working in India, these changes have come at fast pace because these banks are fully computerized by birth. Many public sector banks are managing transformation manually not through IT channels (due to some internal and external constraints) but on the other hand new private sector banks and foreign banks are managing whole process through e-channels. New private sector banks and foreign banks as compared to public sector banks provide many new products and services.

Research Design: the study is confined to Indian Banking Industry. Hence, the universe of the study is banking industry of India. The performance is analyzed on bank, bank group and industry level. Four bank groups and further four banks from each bank group have been selected for the study. The study is descriptive and empirical in nature where secondary and primary data is used to address the objectives. The Indian banking industry was divided into four major bank groups for the purpose of the required analysis: Public Sector Banks (SBI and its Associates-7 and Nationalized Banks - 19) (26 Banks) Old Private Sector banks (15 Banks) New Private Sector banks (7 Banks)

Foreign Banks (32 Banks) IDBI was excluded from Public Sector Banks Group because it do not justify the data requirements as it is included in the group from 2004-05 financial year but the data is taken from 1996-97. It was included for the data at banking industry level. These bank groups were further divided into two groups i.e. partially IT-oriented banks and fully IT-oriented banks (e-banks). Partially IT-oriented banks are those with partially computerization and electronic system while fully IT-oriented banks have complete electronic system to provide customer services. Data Collection Techniques : Within each general research approach, one or many data collection techniques may be used. Typically, a researcher will decide for one (or multiple) data collection techniques while considering its overall appropriateness to the research, along with other practical factors, such as: expected quality of the collected data, estimated costs, predicted nonresponse rates, expected level of measure errors, and length of the data collection period (Lyberg and Kasprzyk, 1991). It is of course possible that a given research question may not be satisfactorily studied because specific data collection techniques do not exist to collect the data needed to answer such a question (Kerlinger, 1986). The most popular data collection techniques include: surveys, secondary data sources or archival data, objective measures or tests, and interviews, some of which are shown in Figure 3.

Figure 3. Type of Research, General Research Approaches, Data Collection Techniques, & Data Analysis Techniques

The term "research instrument" is preferable to "survey" in that it is neutral and does not imply a methodology. A research instrument can be administered as part of an experiment, a mailed survey or questionnaire, a semi-structured interview, or a Web survey or questionnaire. Therefore, the gathering of quantitative data directly from respondents should likely not be called a "survey." We prefer the term "experimental instrument" as a neutral term for capturing data in experiments, for example. "Questionnaire" is acceptable as well, but, like survey, has some connotations of a mailed instrument.

Sample Design: Sample design covers all aspects of how the samples in our surveys are specified and selected. The design of samples is a particularly important aspect of survey methodology, and provides a basis for the sound measurement of economic and social phenomena from surveys of businesses and households. Topics include sample frames, which list the businesses and household addresses we might select for a survey; types of sampling (for example, stratified, clustered - covering how we group businesses and households when sampling), and specification of sample sizes, with implications

for costs and quality.

Finally, there is the selection mechanism used for choosing, randomly, the specific units that will make up any given survey sample.

Types Of Sampling Designs

:

When conducting research, it is almost always impossible to study the entire population that you are interested in. For example, if you were studying political views among college students in the United States, it would be nearly impossible to survey every single college student across the country. If you were to survey the entire population, it would be extremely timely and costly. As a result, researchers use samples as a way to gather data. A sample is a subset of the population being studied. It represents the larger population and is used to draw inferences about that population. It is a research technique widely used in the social sciences as a way to gather information about a population without having to measure the entire population. There are several different types and ways of choosing a sample from a population, from simple to complex. Non-probability Sampling Techniques: Non-probability sampling is a sampling technique where the samples are gathered in a process that does not give all the individuals in the population equal chances of being selected. Reliance On Available Subjects.

Relying on available subjects, such as stopping people on a street corner as they pass by, is one method of sampling, although it is extremely risky and comes with many cautions. This method, sometimes referred to as a convenience sample, does not allow the researcher to have any control over the representativeness of the sample. It is only justified if the researcher wants to study the characteristics of people passing by the street corner at a certain point in time or if other

sampling methods are not possible. The researcher must also take caution to not use results from a convenience sample to generalize to a wider population.

Purposive or Judgmental Sample.

A purposive, or judgmental, sample is one that is selected based on the knowledge of a population and the purpose of the study. For example, if a researcher is studying the nature of school spirit as exhibited at a school pep rally, he or she might interview people who did not appear to be caught up in the emotions of the crowd or students who did not attend the rally at all. In this case, the researcher is using a purposive sample because those being interviewed fit a specific purpose or description.

Snowball Sample:

A snowball sample is appropriate to use in research when the members of a population are difficult to locate, such as homeless individuals, migrant workers, or undocumented immigrants. A snowball sample is one in which the researcher collects data on the few members of the target population he or she can locate, then asks those individuals to provide information needed to locate other members of that population whom they know. For example, if a researcher wishes to interview undocumented immigrants from Mexico, he or she might interview a few undocumented individuals that he or she knows or can locate and would then rely on those subjects to help locate more undocumented individuals. This process continues until the researcher has all the interviews he or she needs or until all contacts have been exhausted.

Quota Sample:

A quota sample is one in which units are selected into a sample on the basis of pre-specified characteristics so that the total sample has the same distribution of characteristics assumed to exist in the population being studied. For example, if you a researcher conducting a national quota sample, you might need to know what proportion of the population is male and what proportion is female as well as what proportions of each gender fall into different age categories,

race or ethnic categories, educational categories, etc. The researcher would then collect a sample with the same proportions as the national population.

Probability Sampling Techniques:

Probability sampling is a sampling technique where the samples are gathered in a process that gives all the individuals in the population equal chances of being selected. Simple Random Sample:

The simple random sample is the basic sampling method assumed in statistical methods and computations. To collect a simple random sample, each unit of the target population is assigned a number. A set of random numbers is then generated and the units having those numbers are included in the sample. For example, lets say you have a population of 1,000 people and you wish to choose a simple random sample of 50 people. First, each person is numbered 1 through 1,000. Then, you generate a list of 50 random numbers (typically with a computer program) and those individuals assigned those numbers are the ones you include in the sample.

Systematic Sample:

In a systematic sample, the elements of the population are put into a list and then every kth element in the list is chosen (systematically) for inclusion in the sample. For example, if the population of study contained 2,000 students at a high school and the researcher wanted a sample of 100 students, the students would be put into list form and then every 20th student would be selected for inclusion in the sample. To ensure against any possible human bias in this method, the researcher should select the first individual at random. This is technically called a systematic sample with a random start.

Stratified Sample:

A stratified sample is a sampling technique in which the researcher divided the entire target population into different subgroups, or strata, and then randomly selects the final subjects proportionally from the different strata. This type of sampling is used when the researcher wants to highlight specific subgroups within the population. For example, to obtain a stratified sample of university students, the researcher would first organize the population by college class and then select appropriate numbers of freshmen, sophomores, juniors, and seniors. This ensures that the researcher has adequate amounts of subjects from each class in the final sample.

Cluster Sample:

Cluster sampling may be used when it is either impossible or impractical to compile an exhaustive list of the elements that make up the target population. Usually, however, the population elements are already grouped into subpopulations and lists of those subpopulations already exist or can be created. For example, lets say the target population in a study was church members in the United States. There is no list of all church members in the country. The researcher could, however, create a list of churches in the United States, choose a sample of churches, and then obtain lists of members from those churches.

Population: Polit and Hungler (1999:37) refer to the population as an aggregate or totality of all the objects, subjects or members that conform to a set of specifications. In this study the population was South African women of all races, age groups, educational status, socio-economic status and residential areas, who requested TOP services in the Gert Sibande District during August and September 2003. Sample size: In order to have confidence that your survey results are representative, it is critically important that you have a large number of randomly-selected participants in each group you survey. So what exactly is "a large number?" For a 95% confidence level (which means that there is only a 5% chance of your sample results differing from the true population average), a good estimate of

the margin of error (or confidence interval) is given by 1/N, where N is the number of participants or sample size Sampling method:

Method of data collection: The process of dat a coll ecti on begi ns after a research probl em has been defined and research design ahs been chalked out. There are two types of data

METHODS OF PRIMARY DATA

OBSERVATION METHOD INTERVIEW METHODS QUESTIONAIRE METHOD

SCHEDULE METHOD

It is first hand data, which is collected by researcher itself. Primary data iscollected by various approaches so as to get a precise, accurate, realistic andrelevant data. The main tool in gathering primary data was investigation and observation. It was achieved by a direct approach and observation from theofficials of the company.

SECONDARY DATAit is the data which is already collected by someone el se. R esearcher has t o anal yz e t he dat a and int erpret s the resul ts. It has always been important for the completion of any report. It provides reliable, suitable, adequate and specific knowledge. I took data comprise annual reports and post records. Bank has provided me annual reports from 2004-05 to 2007-08 by help of which, I prepared my report. The valuable cooperation extended by staff members contributed a lot to ful fil l the requi rem ent s in t he col l ect ion of dat a in order to compl et e t he proj ect . Vari ous st at ist i cal t ools are appli ed depending on the research pro bl em . In t his stud y rat io anal ys i s, comparat ive fi nanci al st at em ent sanal ysi s , comm on siz e st at ements and Trend Analysi s has been used for analyzing and interpreting the result.

CHAPTER 3 ANALYSIS & INTERPRETATION

Comparative ratio analysis between AXIS BANK & HDFC BANK

1. LIQUIDITY RATIOS: Current Ratio

CURRENT RATIO
0.5 Axis Title 0.45 0.4 0.35 0.3 2012 2013 Axis Bank HDFC Bank

Interpretation: The ability of Axis bank to meet its current obligation is better than HDFC bank as the current ratio of Axis is better than HDFC bank and also it had increase in the year 2013 whereas HDFCs ratio had declined because the increase in current liability is more than increase in current assets which reduces the ratio.

 Quick Ratio-

QUICK RATIO
20 15 Axis Title 10 5 0 Axis Bank HDFC Bank 2012 2013

Interpretation: The quick ratio of Axis bank is again better than that of HDFC bank in both the years but in this case quick ratio of both the firms have increased in 2013 as compared to 2012 because (current assets-inventory) of both the firms have increased from previous year.The % change is better in case of Axis bank. Talking about overall liquidity ratios Axis bank is more liquid than HDFC bank and is in a better position to meet its current obligation if in case some emergency or need arises Total Debt/Equity

TOTAL DEBT/ EQUITY

0.08 Axis Title 0.06 0.04 0.02 0 Axis Bank HDFC Bank 2012 2013

Interpretation: The total debt/equity of Axis Bank is more in 2013 in comparison to 2012 whereas HDFC has less total debt/ equity in 2013 as compare to 2012.

2. OPERATIONAL & FINANCIAL RATIOS: Earnings Per Share

EARNINGS PER SHARE

120 100 80 60 40 20 0 110.68 2012 2013 28.27 Axis Bank HDFC Bank

Interpretation: The EPS of Axis have increased almost Rs8 whereas in case of HDFC bank it had increased by Rs6 and the overall earning of Axis per share is far more better than HDFC bank and its a good sign for investors that EPS of both the firms have increased in 2013 as compared to 2012 but most of the investors would prever to invest in Axis than HDFC bank because of its high EPS.

Dividend Per Share-

DIVIDEND PER SHARE

20 15 10 5 0 Axis Bank HDFC Bank 5.5 18 2012 2013

Interpretation: Talking about the dividend declaration DPS of both the firms have increased in 2013 but the payout ratio of HDFC is better than that of Axis bank.Axis bank have only given a dividend of Rs18 from a earning of 110Rs which means that they are retaining most of their earnings and this

could be one of the reasons for their high EPS this is again a good sign for a firm to have high net worth as it could be beneficial for the investors.

3. PROFITABILITY RATIOS: Operating Margin

OPERATING MARGIN
30 25 20 15 10 5 0 Axis Bank HDFC Bank 14.9 11.41 2012 2013

Interpretation: In case of margins HDFC is far ahead than Axis bank because Axis have incur more expenses because of which their operating profit margin is much less than HDFC bank also the area of concern is that operating margins have decresed drastically in the year of both the firms by almost 50% which is not a good sign.

Gross Profit Margin

GROSS PROFIT MARGIN

30 25 20 15 10 5 0

2012 10.82 Axis Bank 13.04 2013

HDFC Bank

Interpretation: In case of margins HDFC is far ahead than Axis bank because Axis have incurred more expenses because of which their net profit margin is much less than HDFC bank also the area of concern is that net profit margins have decreased.Both the firms have not been able to make profits in the same proportion as they have increased their sales because of the operating expenses that they have incurred HDFC is still have better margin than Axis bank. Net Profit Margin-

NET PROFIT MARGIN

16.2 16 15.8 15.6 15.4 15.2 15 Axis Bank HDFC Bank 15.35 16.04 2012 2013

Interpretation: Axis bank have very less margins as compared to HDFC bank as we have earlier also seen the main reason for these less margins is that Axis is incurring much more expenses and not able to generate that much of profit from those sales which is not a good sign for the investors as if a firm is generating more sales than it should also generate more profits and that should be also in the same proportion but Axis bank is not been able to do so because of which all the margins ratios have been suffering very badly and further decrease in the margins in the year 2013 add to their problem.

4. PAYOUT RATIOS: Dividend Payout Ratio

DIVIDEND PAYOUT RATIO

25 20 15 10 5 0 Axis Bank HDFC Bank 19.06 22.76 2012 2013

Interpretation: HDFC bank has been giving out more earnings to their shareholders than Axis bank. Axis bank even after having a EPS of Rs110 in the year is paying jus Rs18 Retaining most of its earning whereas HDFC bank even after having much more less EPS than Axis is giving more percentage of its earning to it shareholders. Axis bank has only given 19.08% of their earning to its shareholders whereas HDFC even after so less EPS is paying 22% of their earnings.

Earning Retention Ratio

EARNING RETENTION RATIO

84 82 80 78 76 74 Axis Bank HDFC Bank 77.24 80.94 2012 2013

Interpretation: Axis have been consistently retaining most of their retaining as in 2012 they have retained 82% of their earning and in 2013 they have retained almost 81% of their earnings. Talking about HDFC bank they have they have retained a constant 77% in both the years. Because of high

retention ratio of Axis bank they have been able to have a very huge amount of net worth in their balance sheet.

Cash Earning Retention Ratios-

CASH EARNING RETENTION RATIO

84 82 80 78 76 Axis B ank HDFC Bank 82.16 79.25

2012 2013

Interpretation: Axis Bank has more cash earning ratio as compare to HDFC Bank. Because of high earning ratio axis bank is able to earn more cash.

5. PERFORORMANCE RATIOS: ROA(%)

ROA
1.85 1.8 1.75 1.7 1.65 1.6 1.55 1.5 1.82 2012 1.65 2013

Axis Bank

HDFC Bank

Interpretation: Axis bank have not been able to utilize its assets efficiently in both the years whereas HDFC bank is utilizing its assets better Axis bank because the amount of sales generated by HDFC is better than Axis bank in both the years.

ROE(%)

ROE
20.5 20 19.5 19 18.5 18 17.5 Axis Bank HDFC Bank 18.53 2012 2013 20.34

Axis Bank has less return on equity as compare to HDFC Bank in 2013. ROCE(%)

ROCE
25 20 15 15.01 10 5 0 Axis Bank HDFC Bank 20.63 2012 2013

CHAPTER 4 FINDINGS & SUGGESTIONS

FINDINGS: The bank has good relation with its customers. The customers are verysatisfied with the relationship manager service provided by Axis Bank. The bank and its customers have a long term relationship. Axis Bank has thetendency to retain its customers at any cost. They believe that the oldcustomer is more profitable instead of a new one thats why they try tomaintain good and long term relations to their customers. Less no. of customer use mobile banking or net banking. The accounts of axis bank (both salary & saving) provide great flexibility interms of offering. The accounts of these three banks dont have much difference in terms of features but when it comes to service providing the Axis Bank gets an edge because of their great customer services. The axis bank has good no. of branches and ATMs thats why it has moreease of access. The customers of Axis Bank are satisfied with their savings and salaryaccounts.

SUGGESTIONS: To work on this project I have find out some of the points where Salary managers should think. And by which they can increase customer base as well as they can give better service to the customers. They are as follows. Local toll free customer care numbers should be there to solve the queries and problems as well as for new inquiry of the customer for corporate salary accounts. Informative advertising should be started because lots of new entrants and traditional business houses are not aware about corporate salary accounts so that they can come to know about it. Mostly service class persons prefer the axis bank in the comparison of business and students and other class persons thus it needs to promoteits product and services that are offered mainly for the business class people and students. Because these two class forms major users of the banking services. Axis bank is normally not using properly for the current account so its popularity ratio is quite down. This bank normally using for the longterm planning like saving and FD. This bank is not investing more into the marketing sector so I willsuggest that some of the part of income it investing in the advertisingand marketing sector. Into the comparison of other bank its performance is quite good but notan effective so this may be doing the rates were down with some other facilities. Ability to solve the query and difficulties of the customer is essential aspect of the business. For this matter sales team should be properly train and all the formalities they must know, otherwise approach to corporate many times is not possible and creates bad impression about the bank. Training programs for sales executive should be conducted every month.

CHAPTER 5 CONCLUSION

CONCLUSION Results / conclusion Current ratio of both the banks is satisfactory. Operating Margin of both the banks are increasing in 2013 which means both the bank incur more expenses. Axis bank have very less margins as compared to HDFC bank as we have earlier also seen the main reason for these less margins is that Axis is incurring much more expenses and not able to generate that much of profit from those sales which is not a good sign for the investors. The performance of payout ratios are not satisfactory in 2013 of both the banks.

BIBLIOGRAPHY
Books Referred: I.M. pandey, Financial management, 2nd ed, New Delhi, 2008 Essentials of Corporate Finance 2nd edition, Irwin /McGraw-Hill. Ross, S.A., R.W. Westerfield and B.D. Jordan. Management accounting, M.Y.Khan, 5th edition, McGraw-Hills

Internet websites: History of AXIS BANK retrieved from http://www.wikipedia.org Executive summary, balance sheet, comparative analysis, profit and loss account retrieved from Www.Google.Com Www.Scribd.Com http://www. AXIS BANK.CO.IN

SEARCH ENGINE
-www.google.co.in

OTHER REFERENCES
-Annual Reports of Axis Bank AND HDFC Bank

QUESTIONNAIRE - 1

Q.1 Which are group do you belong (Age wise) ? Interpretation : After looking this bar graph, it can be said the middle-aged group are the main customer of the banks as they occupied almost 75% of this graph. The bank has a huge potential in terms of the untapped market Young and old age group people. High pay packages to todays employed youth and large saving with the old age people (especially in urban areas) has made them attractive potential customers. Q.2What is your occupation? Interpretation : Most of the service class people prefer to open a Savings Account incomparison to the business class people. This may be possible due to the facility of Anywhere Banking suiting their needs and preferences. Q.3Please specify your annual income? Interpretation: Income does not make any difference as far as opening the account in the AxisBank is concerned, as the bar diagram is vividly revealing that more or less people of every segment of income group have opened and are opening theaccount expert one group i.e. lower income group where emphasis is requiredto penetrate this group so it can be said that the target group of the axis bank,specially for saving account are of every segment of income group since its isdevoted to render best services to its costumer. Q.4what features/attributes, while opening an account do youexpect from a bank? Interpretation: When a customer visits any bank the first and foremost thing he expects is the quickness of service and the promptness in entertaining by the bank employee. Second thing customer wishes

to have is proper information regarding his queries. One this in this bar also really significant is, factor like less formalities of document while opening an account. Varieties of product do not make a big impact on customer behavior for opening an account in any bank if its services are efficient. But on the other hand bank cant ignore working hours. As in this bar customer has erred it. For these services like bank preference should be given to make a prompt and customer friendly service channel. For this focus must be given to make well informed and proactive employee along with work should be executed technologically rather than manually. Q.5What kind of account do you have in Axis Bank ? Interpretation : Saving account is the leading and attractive product for the Axis bank as it occupies a major chunk in this bar. It is clearly implying that this product has the ability to satisfy the customers. On the second had and the positions current accounts and fixed deposits has also been helpful to increase the customer base but still their performances needs to be improved. One thing in this bar which is significant is the business of the bank is relying on only few leading products, reason for this could be, neither it has limited range of products nor rest of the product does not have much ability to penetrate in the stiff market of banking of Jaipur. That is giving an alarming message to the management of the bank to go or analyzing the situation very minutely andmust ascertain where things are going wrong and for that what short of necessary step could be taken. Providing better services in comparison with the competitors is a must for excelling in industry.

QUESTIONNAIRE 2

Name Gender Occupation

Address Age ..

1. Which income group do you belong to? a) Less than 50,000 p.a. b) 50,000 to 1, 00,000 p.a. c) 1, 00,000 to 3, 00,000 p.a. d) 3, 00,000 to 5, 00,000 p.a. e) More than 5, 00, 000 p.a. 2. How you find the salary/saving accounts of Axis Bank? a) very good b)good c) excellent d)poor e) satisfactory 3. Do you have any other product of axis ban other than salary/saving account? a) Yes b) No 4. Are you satisfied with your salary/saving account? a) Yes b) No 5. Which bank has ease of access?

a) Axis bank b) HDFC Bank c) ICICI bank 6. Which bank offers you the flexibility in its products? a) Axis Bank b) HDFC Bank c) ICICI Bank 7. Which is the area of improvement in axis bank? a) Product b) RM c) Services d) Technology e) Updates