A

Project Report On

"FINANCIAL MANAGEMENT OF BANKS"

( A CASE STUDY OF HDFC BANK) Submitted to University of Rajasthan In lieu of Paper VI for the Award of Bachelor of Business Administration Degree

2011-2012 Supervised By: Dr. N.M. Sharma Asst. Professor Department of Business Adm. University Maharani 's College Submitted By : Monika Yadav BBA Part III

MAHARANI COLLEGE
UNIVERSITY OF RAJASTHAN, JAIPUR

DECLARATION
I hereby declare that the Summer Training Report on the topic of "Financial Management of HDFC

Bank Ltd." confined to search the subjective insight

"Service Proliferation and Customer Satisfaction at HDFC Bank Ltd., Jaipur submitted by me to University of Rajasthan, Jaipur is of my own and it is not submitted to any other college or published any time before.

MONIKA YADAV

CERTIFICATE

This is to certify that Ms. Monika Yadav a student of BBA Part 3rd of Maharani College, Jaipur has prepared her project entitled "Financial Management of HDFC Bank Ltd." under my supervision. She has prepared the report on the basis of training received at HDFC Bank Ltd., for a period of 45 days.

Date : Dr. N.M. Sharma

Asst. Professor Deptt. of Business Adm. University Maharani 's College

ACKNOWLEDGEMENT
Any job in this world, however trivial or tough cannot be accomplished without the assistance of other. I would hereby take the opportunity to express my indebtedness to people who have helped me to accomplish this task. With a deep sense of gratitude, I once express my sincere thanks to Dr. N.M. Sharma for their active support and continuous guidance without which it would have been difficult for me to sustain in this world. I would also like to thank Mr. MUKUL CHATURVEDI FINANCE DEVELOPMENT MANAGER, of HDFC Ltd., for providing me with the required data. And I am very much thankful to the whole staff of HDFC Bank for their support and suggestions. At the very outset, I would like to extend my heart filled gratitude to MR. NavinMaheshwari, Branch Manager of HDFC Bank for giving me an opportunity to work on such an interesting topic. His directions and valuable inputs kept me motivated and inspired to keep working toward the objectives of the study.
MONIKA YADAV

PREFACE
The summer training project of management courses plays an important role for a management student to develop into a well groomed professional. It provides the theoretical concepts and practical exposure in the field of application. Summer training project also provides idea of dynamic and versatile professional world as well as an exposure to the details and complexities of the corporate world. During my BBA curriculum I studied many subjects, which if not applied properly are simply waste of time. At HDFC Bank Ltd. I got a chance to apply management theories to the latest competitive and marketing oriented environment. In my project study I tried to know about the real aspects of Financial management. My project study covers the different aspects of finance, introduction of financial, and financial analysis of HDFC BANK LTD. and so on.

Index
Sr. No. Contents 1 Financial Management : An Introduction 2 HDFC Bank : A Profile 3 Financial Management of HDFC Bank Data Analysis Interpretation 4 Working Capital Management 5 SWOT Analysis 6 Conclusions and Suggestions

Appendix

Bibliography &Webliography

FINANCIAL MANAGEMENT Meaning and definition Financial means procuring sources of money supply and allocation of these sources on the basis of forecasting monetary requirements of the business. The word 'Management' refers to planning, organization, co-ordination and control of human activities and physical resources for achieving the objectives of an enterprise. Thus, financial management is that part of business management which is concerned with the planning and controlling of a firm's financial resources i.e. management of finance function. Financial management is the ways and means of managing money. i.e. the determination, acquisition, allocation and utilization of financial resources usually with the aim of achieving some particular goals or objectives. Financial management is a functional area of business management. It is viewed as an integral part of overall management. It relates mainly with the control of current performance, acquisition and profitable use of these funds, planning for future activities and employs economically most suitable methods such as financial accounting, cost accounting, budgeting, statistics and so on. In nutshell, financial management is the planning, organizing, directing and controlling of eh procurement and utilization of funds and safe disposal of profit to the end that individual, organizational and social objectives are accomplished. SIGNIFICANCE OF FINANCIAL MANAGEMENT The main objective of financial management is the maximum utilization of financial resources with maximum profits. Therefore, the study of financial management is important for both profit-earning and non-profit earning institutions. The Financial management, therefore, gained much important over the time. It has now assumed such an important place in the business management that the success

of a business firm largely depends upon the financial policies developed and followed by the financial management. In the words of Ezra soloman "financial management is properly viewed as an integral part of overall management rather than as a staff specially concerned with production, marketing and other functions within an enterprise whether decisions are made about the acquisitions or distribution of assets," The importance of financial management is being discussed under the following heads: 1. Determinant of Business Success: Sound financial management is the index of the success of an enterprise, its existence and growth. An analysis of the causes of many sick units point out that sickness of these units is the result of defective financial management. Sound financial management makes possible the use of available resources in the form of men, materials and machines more effectively. Thus, it helps in preparation of plans for development and expansion and their successful execution. 2. Optimal Utilization of Resources: Sound financial management

emphasizes the optimum utilization of resources of the enterprise. In fact, the failure of a business enterprise is not always the result of inadequate finance but it is the result of defective management of funds. As Collin Broods has observed. "bad production management and bad sales management and bad sales management have slain their hundreds, but faulty finance slains its thousands. "Financial management plays an important role in the maximum exploitation and utilization of the resources of the enterprise. Country like India, where capital is limited, effective utilization of financial is of great significance. It gives maximum returns by increasing the productivity of capital funds. 3. Focal Point of Decision-making :Earlier, financial decisions were based on intuition, but in modern times, the basis of decision-making is scientific

financial analysis. Financial management provides scientific analysis of facts and figures through various financial tools such as, comparative financial statements, budgets, ratio analysis, variance analysis, cost-volume-profit analysis etc. These tools help in evaluating the profitability of the project in the given circumstances, so that a proper decision may be taken to minimize the risk involved in the project. 4. Measurement of Performance : The performance of the firm can be measured by its financial results i.e. by its size of earnings. Risk and profitability are two major factors which jointly determine the value of the firm. financial decisions which increase the profitability will reduce the value of the firm, and on the other hand, financial decisions which increase the profitability will enhance the value of the firm. Therefore, risk and profitability are two essential ingredients of a business concern as Weston and Briham have observed, "financialdecisions affect the size of earnings stream or profitability and the riskness of the firm. Policy decisions affect risk and profitability and these two factors jointly determine the value of the firm.

CHAPTER- 2

HDFC Bank: A Profile

CHAPTER- 3

Financial Management of HDFC Bank Data Analysis Interpretation