A final year project on “Financial Analysis And The Best Investment Opportunities In The Indian Banking Industry” was submitted by Rimjhim Agarwal (from Galgotias University Greater Noida, Uttar Pradesh) to extrudesign.com.
| University: | Galgotias University Greater Noida, Uttar Pradesh. | |
| Project Title: | Financial Analysis And The Best Investment Opportunities In The Indian Banking Industry | |
| Submitted by: | Rimjhim Agarwal | |
| Authors: | Rimjhim Agarwal | |
| Supervised by: | N/A | |
| Department: | Bachelor in Business Administration | |
| Academic Year: | 2021-22 |
ABSTRACT
The banking region is taken into consideration to be a vital supply of financing for maximum businesses. They play a completely vital position withinside the attempt to reap strong prices, excessive stage of employment and sound monetary increase. Banks play a vital position withinside the Economic Development of all of the Nations of the World.
Banking is the lifestyle blood of Modern Commerce. The increase of such banks isn’t always feasible except they witness a few fulfilments withinside the context of patron pleasure or might also additionally or not it’s the internet belongings held with the aid of using these banks, performance in their control or the networks of the general public region financial institution. The following paper covers the monetary overall performance evaluation of the general public region banks. Financial Performance Evaluation of Selected Public Sector Bank (State Bank of India, Punjab National Bank, Bank of Baroda and Bank of India) at some stage in the Periods. The State Bank of India is the most important financial institution in India. Punjab National Bank is 2nd biggest financial institution in India. and Bank of India speedy developing financial institution. This observes primarily based completely on secondary records and gear used for Ratio evaluation decided on public region banks. This observation determined that SBI and PNB are financially sound other than BOI.
INTRODUCTION
Banking has performed a vital function withinside the Economic Development of all the Nations of the world. Banking is the existence blood of Modern Commerce. It might also additionally definitely be stated that Modern Commerce is so established upon banking. The banking region is taken into consideration to be a vital supply of financing for maximum organizations. They play a vital function withinside the attempt to reap solid prices, an excessive degree of employment and sound financial growth. They make finances to be had to fulfil the desires of individuals, organizations and the government. In doing this, they facilitate the waft of products and offerings and the sports of governments. The business Banking gadget presents a huge part of the medium of alternate of a given country and is the number one device via which Monitory coverage is conducted, via their deposit mobilization and lending operations. Commercial banks make the efficient usage of the best finances, hence assisting the society to supply wealth. Commercial Banks are the establishments particularly designed to similarly the capital formation manner via the appeal of deposits and extension of credit.
BANKS PROFILE
STATE BANK OF INDIA
The roots of the State Bank of India lie withinside the first decade of the nineteenth century, while the Bank of Calcutta, later renamed the Bank of Bengal, changed into installed on 2 June 1806. The State Bank of India (SBI) is an Indian multinational, public zone banking and economic offerings statutory frame, Bank of Calcutta, 27 January 1921, Imperial Bank of India and 1 July 1955, State Bank of India. State Bank of India Headquarters in Mumbai, Maharashtra. The state financial institution of India’s chairperson is Smt. Arundhati Bhattacharya and products are Consumer banking, company banking, finance and insurance, investment banking, loan loans, personal banking, personal equity, savings, securities, asset management, wealth management, and credit scorecards. The government of India is proprietor and Members round 286. The State Bank of India (SBI) is an Indian multinational, public zone banking and economic offerings statutory frame. It is an authorized organization statutory frame centred in Mumbai, Maharashtra. SBI is ranked 236th withinside the Fortune Global 500 listing of the world’s largest companies of 2019.
PUNJAB NATIONAL BANK
Punjab National Bank, India’s first Swadeshi Bank, Punjab National Bank (PNB) is a Banking and Financial provider financial institution-owned with the aid of using the Government of India. Its headquarter is in New Delhi, India. The financial institution became based in 1894. As of June 2019, the financial institution has over one hundred fifteen million customers, 7,036 branches and 8,906 ATMs. The most important feature of PNB is to make loans and advances out of the deposits of the public. Direct loans and advances are given to all kinds of individuals specifically to commercial enterprises and investors, in opposition to private security, gold and silver and different movable and immovable assets. Punjab National Bank obtained the New Bank of India in 1993. The simplest different nationalized financial institution merged with another besides for State Bank of India with its accomplice banks—became the merger of Bhartiya Mahila Bank with State Bank of India in 20.
BANK OF INDIA
Bank of India is a Commercial financial institution and Headquarters in Mumbai, Maharashtra, India. Founded on September 7, 1906, it’s been an authority-owned financial institution. Since Nationalization Was in 1969. Bank of India has 4828 branches as of 31 December 2013, such as fifty-six places of work out of doors India, which consist of 5 subsidiaries, 5 consultant places of work and one joint venture. Bank of India is a founder member of SWIFT (society for global Interbank Financial Telecommunications), which enables the provision of value-powerful final processing and communique services. The Chairman of Bank of India is M O Rego (MD & CEO).
ICICI BANK
ICICI changed fashioned in 1955 on the initiative of the World Bank, the Government of India and representatives of Indian industry. The most important goal changed into to create an improvement monetary group for supplying medium-time period and long-time period challenge financing to Indian businesses. Until the past due 1980s, ICICI ordinarily targeted its sports on challenge finance, supplying long-time period price range to loads of business projects. With the liberalization of the monetary area in India withinside the 1990s, ICICI converted its commercial enterprise from an improvement monetary group imparting best challenge finance to a diverse monetary offerings issuer that, in conjunction with its subsidiaries and different institution companies, provided a huge form of services and products. As India’s financial system has become greater market-orientated and included with the arena financial system, ICICI capitalized on the brand-new possibilities to offer a much broader variety of monetary services and products to a broader spectrum of clients. ICICI Bank changed included in 1994 as part of the ICICI institution. In 1999, ICICI have become the primary Indian business enterprise and the primary financial institution or monetary group from non-Japan Asia to be indexed at the New York Stock Exchange.
HDFC BANK
The HDFC Bank became included in August 1994 through the call of ‘HDFC Bank Limited’, with its registered workplace in Mumbai, India. HDFC Bank began operations as a Scheduled Commercial Bank in January 1995. The Housing Development Finance Corporation (HDFC) became among the primary to get hold of ‘in-principle approval from the Reserve Bank of India (RBI) to install a financial institution withinside the personal sector, as a part of the RBI’s liberalization of the Indian Banking Industry in 1994.
HDFC Bank is founded in Mumbai. The Bank at gift has an enviable community of over 1416 branches unfolding over 550 towns throughout India. All branches are related on an internet real-time basis. Customers in over 500 places also are serviced thru Telephone Banking. The Bank additionally has a community of approximately 3382 networked ATMs throughout those towns.
UTI BANK
Axis Bank hooked up in 1993 changed into the primary of the brand-new personal banks to have started operations in 1994 after the Government of India allowed new personal banks to be hooked up. Axis Bank Ltd. has been promoted through the most important and exceptional Financial Institution in the country, UTI. The Bank changed into installation with a capital of Rs. one hundred fifteen crores, with UTI contributing Rs. one hundred crores, LIC – Rs. 7. five crore and GIC and its 4 subsidiaries contributing Rs. 1. five crores each. Axis Bank is one of the first new technology personal zone banks to have started operations in 1994. The Bank changed into promoted in 1993, mutually through Specified Undertaking of Unit Trust of India (SUUTI) (then called Unit Trust of India), Life Insurance Corporation of India (LIC), General Insurance Corporation of India (GIC), National Insurance Company Ltd., The New India Assurance Company Ltd., The Oriental Insurance Company Ltd. and United India Insurance Company Ltd. The shareholding of Unit Trust of India changed into ultimately transferred to SUUTI, an entity hooked up in 2003.
KARNATAKA BANK
Karnataka Bank Limited, a main ‘A-Class Scheduled Commercial Bank in India, changed into included on February 18th, 1924 at Mangalore, a coastal city of Dakshina Kannada district in Karnataka State. The financial institution took form withinside the aftermath of patriotic zeal that engulfed the kingdom at some point in the liberty motion of twentieth Century India. Over the years the Bank grew with the merger of Sringeri Sharada Bank Ltd., Chitra Durga Bank Ltd. and Bank of Karnataka. With over nine a long time of enjoying at the leading edge of offering expert banking offerings and the best consumer provider, we have a countrywide presence with a community of 877 branches unfold throughout 22 states and a pair of Union Territories. Managed through a dedicated & expert control team, we’ve got over 8,220 employees, 1,46,000 shareholders and over 10.21 million customers.
Today, we’ve got emerged as a main economic provider organization in India.
LITERATURE REVIEW
Dr Suresh Patidar (2012) Analysis of NPA in precedence region of lending-Comparative observes of the non-public region and public region financial institution of India. This study tried to observe clients’ belief of first-rate services, each transaction primarily based totally and IT-enabled in phrases of its constituent elements in the public region, non-public region and overseas banks. This step become accompanied to have Intra Bank comparison. The observation suggests that the clients of nationalized banks had been now no longer happy with the worker conduct and infrastructure, even as respondents of personal and overseas banks had been now no longer happy with excessive charges, accessibility and communication
Gauba R., (2012), His goal is to observe the main transformational factor in banking enterprise and contemporary Levels of banking in India. The study is primarily based totally on secondary information gathered from banking reports and RBI Reports. Periods of observation taken from 2009-10 to 2010-eleven and gear used to observe earnings& expenditure tendencies and degree of overall performance. Overall end Indian banking enterprises face a challenge in economic inclusion, control of assets first-rate etc. 102 International Journal of Advanced Research in Commerce, Management & Social Science (IJARCMSS) – July- September 2021
Guruswamy D. (2012), its goals discover profitability and overall performance of SBI and related Bank. Research primarily based totally on number one primarily based totally on secondary information using statistical gear like mean, preferred deviation, variance and compound annual increase fee and Anova via SPSS software. Periods 1996 to 2007. Findings related financial institutions earned maximum income about Net well worth in comparison to SBI
Chaudhary K., Sharma M., (2011) in his observe to examine public and personal region banks’ overall performance and compare tendencies in NPA Level and shows NPA Management. Study primarily based totally on secondary information and to evaluate statistical gear for projection of fraud. Study durations from 2009- to 2010. Finding observe want for enhance green control records machine in banks and proper choice of a challenge to reading the economic statements
Malviya M., (2012), in his intention to observe the profitability, threat and increase of public region banks for the economic yr 2010-2011. Data was gathered from precis of earnings statements and Balance Sheets of six predominant Banks. The technique is used for ratio evaluation and to examine public and personal region banks’ profitability. Finding in studies paintings for public region banks better degree of profitability and personal region banks generated greater sales for every invested in assets. Public region banks’ green finance increase techniques and personal region banks are critical components of increase strategy.
Sharma, R., Goswami, A., & Kumar, P. (2014). The authors have assessed the overall performance of Indian privatization. Since liberalization, the banking machine in India has below long past numerous reforms. Current new privatization has first-class technology, manpower and efficiency. It is managed via way of means of professionals. Due to the brand-new generation of banking machines, it has attracted clients and advertised the economic products
OBJECTIVE OF THE STUDY
- To analyze the Banking Industry using internationally accepted norms of investment analysis.
- To identify good investment opportunities among the listed companies in the Indian stock market.
RESEARCH METHODOLOGY
Stage 1: Setting up the project objectives and guidelines.
Stage 2: The data about the Economic and industry factors sensitive to the Indian banking Industry was studied.
Stage 3: Selection of the companies followed by company analysis:
Stage 4: Proper documentation and submission of the report to the M/s. Anand Rathi Investments.
Anand Rathi is a full-service securities firm that offers a broad range of financial services. Mr Anand Rathi launched the firm in 1994, and it now has operations across India as well as overseas locations in Dubai and Bangkok. Anand Rathi provides a breadth of financial and advisory services including wealth management, investment banking, corporate advisory, brokerage & Distribution of stocks, commodities, mutual funds, and insurance, all of which are backed up by strong research teams.
The firm’s concept is completely client-centric, with a clear focus on providing long-term value to clients while upholding the highest levels of excellence, integrity, and professionalism. Individuals, Private Clients, Corporates, and Institutions are the four distinct client categories that the firm serves.
ANALYSIS
India is set to become the fourth-largest economy in the world by 2025 after The United States, Japan and China. The GDP growth rate will remain stable at 7-8% if key enabling factors are implemented. The Indian economy is projected to account for about 60 per cent of the size of the US economy by 2025. By
2035, India’s transition to a three-polar economy will be complete, with a slightly smaller but larger economy than the United States. Of Western Europe. India is projected to be the strongest growth engine of the six major EU countries by 2035, although its impact will be less than half that of the United States. India, currently the fourth-largest economy in the world in terms of purchasing power, is set to become the third-largest economy in the world in ten years, surpassing Japan. The banking sector, which can adequately and efficiently cater to the needs of the growing economy, is one of the proponents of strong economic growth. As India prepares to become an economic superpower, it must accelerate socio-economic reforms and take steps to address the institutional and infrastructural limitations inherent in the system. The availability of physical and social infrastructure is key to sustainable economic development. Since independence, the Indian economy has worked hard to accelerate growth. Cities in India, in particular, have seen tremendous up-grading of infrastructure over the years, but the situation is not the same in most rural areas of India. Similarly, India’s performance in health and education and other human development indicators is not satisfactory, with urban areas benefiting the most from a wide range of regional disparities. Appropriate steps need to be taken to achieve the status that some countries in the world have and to provide a more equal society for the growing population. The problems currently facing the Indian economy are: To gain the status of certain countries in the world at present and to provide a more egalitarian society to the growing population, appropriate steps must be taken. The Indian economy is currently facing these challenges: appropriate steps need to be taken to achieve the status of certain countries in the world and to provide a more egalitarian society for the growing population. The Indian economy is currently facing these challenges: To sustain the growth pace and achieve an average annual growth rate of 7-8% over the next five years. By simplifying policies and reducing barriers to entry into economic activity; Limiting population growth; India is the second-most populous country in the world after China. However, India surpasses China in terms of density, as India’s territory covers almost half of China’s total territory. GDP per capita is low due to rapid population growth. In 2006 it was only $ 2880. (World Bank statistics). Improving agricultural development through diversification and agro-processing development. Not only is there surplus labour in agriculture, but the industry is rapidly expanding to allow an unprecedented number of women and adolescents to join the labour force for at least 10 years. Developing world-class infrastructure to sustain growth in all sectors of the economy. Permission for foreign investment in more sectors Influencing financial consolidation through revenue growth and expenditure management and eliminating the revenue deficit. Enhancing population empowerment through universal education and health care. India’s HDI ranking, which is 127, is much lower than many other developing countries. The administration is committed to sustainable economic reforms and the construction of infrastructure, improving the lives of the rural poor and enhancing economic performance. In many areas, the government has eased restrictions on foreign trade and investment and can expect further simplification in civil aviation, telecommunications and insurance in the future.
The Indian economy is based on a constantly growing growth curve. With positive indicators such as a steady 8 per cent annual growth and an increase in foreign exchange reserves to close to the US $ 166 billion, the leading “Sensex” index topped the capital market with a whopping 14,000 mark, allowing government inflows of US $ FDI. Estimated. With $ 12 billion this fiscal year, and exports growing by more than 22 per cent, it is easy to understand why India is a major destination for foreign investment. Gross domestic product (GDP) in 2007-08 showed a growth trajectory, with overall growth at an estimated cost of 8.4 per cent and the average growth trajectory of the Indian economy over the last three years.
In the first half of the current year (2006-07) (April-September) GDP growth continued at 9.4 per cent and for the first time on a year-over-year basis, a slight increase in growth reached 8.9 per cent. This is an increase of 9.2 per cent compared to the second quarter. In the first half of the financial year (Q2), agriculture grew by 2.6 (1.7) per cent, industry by 10.0 (10.3) per cent and services by 10.7 (10.9) per cent.
FINDINGS
India has more billionaires than China. This year there were 15 billionaires in China but last year in India, there were 20 billionaires, according to Forbes magazine.
- India has emerged as the world’s fastest-growing wealth creator, thanks to a buoyant stock market and higher earnings.
- Several Indian companies surpassed last year’s net profit in just six months of the current fiscal, reflecting an accelerated growth in corporate earnings.
- Forty-four per cent of Top 100 Fortune 500 companies are present in India.
With its manufacturing and services sector on a searing growth path, India’s economy may soon touch the coveted 10 per cent growth figure.
CONCLUSION
One of the problems faced during the duration of the project was the recent change in the environmental factors like inflation, interest rate hike and the recent slump in the market etc. It was really difficult to incorporate these changes into the project. But the long-term views on the scrips remain as projected. Projections are based on the long term outlook of the banking industry. In the short term, the forecasts may not hold. It may be due to some economic cycles or government policies. This report has been made assuming that the prevalent economic conditions remain the same.
REFERENCES
Books
- Bhalla V.K., Investment management security analysis and portfolio management, 8th Ed., New Delhi, S. Chand and Company Ltd., Ramnagar.
- Fisher E. Donald, Jordan J. Ronald, security analysis and portfolio management, 6th Ed., New Delhi, Prentice-Hall of India Pvt. Ltd.
- Kothari, C.R., Research Methodology, 2nd Ed., New Delhi, Vishwa Prakashan, A Division of New Age, International Private Limited.
- Pandian Punithaveathy, security analysis and portfolio management, 1st Ed., New Delhi, Vikas Publishing House Pvt. Ltd.
- Singh Preeti, Investment Management, Security and portfolio management, 9th revised Ed., Mumbai, Himalaya Publishing House.
Magazines / Newspaper
- Business World
- Business Today
- Global Market Scenario
- The Times of India
- Hindustan Times
- Economics Times
Credit: This final year project on “Financial Analysis And The Best Investment Opportunities In The Indian Banking Industry” was submitted by Rimjhim Agarwal from Galgotias University Greater Noida, Uttar Pradesh.
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