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ASSIGNMENT-1 Banking Sector Analysis [ICICI BANK]
Academic Year: PGP/ 2012-2014 (LR)
NAME OF GROUP MEMBERS: NEETIKA GHAI PG20121258 SARAVPREET SINGH PG20121088 PANKAJ GUPTA PG20121394 YOGI RAJ GOGIA PG2012 RAMNIKA SAHNI PG2012
AND KOTAK MAHINDRA BANK: 2. BALANCE SHEET ANALYSIS : ICICI bank . capitalization. HDFC BANK. ANALYSIS OF ICICI BANK WITH AXIS BANK.BANKING SECTOR ANALYSIS ICICI BANK 1. is a second largest bank in India by assets and third largest by market Products only offered by ICICI bank are :Corporate banking Finance and Insurance Investment banking Mortgage Loan Private Banking Wealth Management .
68 crore.78 crore where as total liabilities of ICICI bank is bit high than other 2 banks that is Rs.09 crore .14 15. ICICI Bank. . HDFC Bank. Total assets of ICICI bank is Rs. 60.29.99 crore (i) Ratio Analysis of all the 4 banks (Axis Bank. 473. Total liabilities of excess bank is very less that is Rs.Based on balance sheet of different banks we can conclude that ICICI bank is performing better than other three banks .627. 551.39 Mahindra • Earning Per share Ratio: This is the earning of investor on each share and the maximum earning per share is of Axis bank. Kotak Mahindra Bank) • Profit Margin Ratio It measure the amount of net profit earned by each rupee of revenue is almost same for all the four banks.25 crore and net worth Rs. which is a very good sign for the company.473.647. Hence it is the most profitable bank for the shareholders to invest in followed by ICICI bank. Ratio Bank Mar-12 Profit Margin Ratio Axis Bank 15. 285. basically ICICI bank is leading ahead of HDFC bank ( in case of net worth of ICICI bank isRs.924.1 that is 3rd highest. Book Value of ICICI bank is 524.93 Kotak Bank 15.01 crore where as book value of Axis bank is very high that is Rs.51 ICICI Bank HDFC Bank 16.402.647.
52 16.67 ICICI Bank HDFC Bank 56.02 Kotak Bank 14. ICICI bank has the highest ratio in the four banks.Ratio Bank Mar-12 Earning Per Share Ratio Axis Bank 102.13 0.65 Mahindra • Capital Adequacy Ratio This ratio is used to protect depositors and promote the stability and efficiency of the financial system around the world.09 22.66 ICICI Bank HDFC Bank 18. Ratio Bank Mar-12 Current Ratio Axis Bank 0.05 Mahindra .52 Kotak Bank 17.52 Mahindra • Current Ratio: The current ratio for all the three firms is low than the ideal ratio that should be 2:1 but ICICI bank is havng the maximum current ratio out of all the banks. Ratio Bank Mar-12 Capital Adequacy Ratio Axis Bank 13.03 ICICI Bank HDFC Bank 0.08 Kotak Bank 0.
2. Few alternatives available 2. 4. RBI rules and regulations .3. Low switching cost: 6. There is a high fixed cost and High exit barriers. 1.Rivalry among the Competing Firms in the industry: Rivalry among competitors is very strong in the Indian banking sector because: 1. BARGAINING POWER OF SUPPLIERS The Reserve Bank of India governs banking industry. Similar services Almost all the banks offer similar services. This has sparked competition. FIVE FORCE MODEL: A. The rules and regulations determined by RBI. 5. 3. High market growth rate India is seen as one of the largest on the market and the growth rate of the banking industry in India is also very high. A large number of banks : There are many banks and financial institutions to get the maximum market share and pull each other’s customers hence there is intense competition. The depositors give their savings in the bank in exchange of the interest which mostly depends on the kind of monetary policies taken by the RBI hence i n b a n k i n g i n d u s t r y suppliers have low bargaining power. Homogeneous product and services The services offered by banks is more homogeneous than it does the company to offer the same service at a lower rate and eat their market share from the competition. The Suppliers of the banks are the depositors. High exit barriers humiliate banks to gain and retain customers by providing world class services B. Each bank tries to copy each other services and technology to increase the level of competition.
increase. There are numerous with negligible portion of offer . so many banks. 2. Similar service Bank provide merely similar service. Suppliers not concentrated Banking industry suppliers sure not concentrated. It reduces the bargaining power of suppliers 3. All these increase preference for customers.Low switching cost. 4. fighting for the same pie. POTENTIAL ENTRY OF NEW COMPETITORS Reserve Bank of India has set some rules regulating stagnation and new entrants in the banking sector. 3. Full information about the market Customers have full information about the market due to globalization and digitalization hence.Banks have to behave in the away that RBI wants them to. There are many nonfinancial institutions. POTENTIAL DEVELOPMENT OF SUBSTITUTE PRODUCTS Every day there is one or the other new product in financial sector The wide range of choices and needs give a sufficient room for new product development and product enhancement I n p r i v a t e b a n k i n g i n d u s t r y f o l l o w i n g a r e t h e substitutes: • • Government Bond Mutual Funds . E.Large no of alternatives Customers have many choices. We expect mergers and acquisitions in the banking sector in the near future and also introduction of many new banks as the RBI has given license to a lot of banks that will again increase the threat for existing banks. BARGAINING POWER OF CONSUMERS Customers have high bargaining power because: 1. They can not be charged for differentiation.so this reduce their bargaining power C. the bargaining power of customers D.
• • Stock Market Other Investment Alternatives .