Financial analysis of

Vertical Analysis
Common Size Balance Sheet as of 31 March 2010

Liabilities

Share Capital Reserves and Surplus Secured loans Unsecured Loans

Assets
1% 0% 30% Net Block Capital Work In progress 69% Investments Net current assets

Common size income statement

Particulars Net Sales Personal Expenses Selling Expenses Administrative Expenses Provisions made Total expenditure Operating profit EBITDA Depreciation EBIT Interest EBT Taxes Profit and loss for the year Nonrecurring items PAT Amount In cr. Percent of net sales 1981.90 100.00 163.27 8.2 13.42 0.67 166.84 0.84 12.20 355.72 445.34 1653.31 22.63 1630.68 1193.05 425.43 89.84 335.59 0.44 336.03 0.62 17.9 22.4 83.4 1.1 82.27 60.19 0.21 24.7 16.9 0.02 16.9

Horizontal Analysis
Comparative Balance Sheets as on 31 March 2006-2010

Mar '06 Capital and Liabilities: Total Share Capital Equity Share Capital Reserves Net Worth Deposits Borrowings Total Debt Other Liabilities & Provisions Total Liabilities

Mar '07

Mar '08

Mar '09

Mar '10

100 275.25 300.00 300.06 302.78 100 275.25 300.00 300.06 302.78 100 118.75 133.08 153.84 183.38 100 121.97 136.53 154.90 185.86 100 123.27 165.64 199.31 254.35 100 116.82 167.85 11.78 243.27

100 123.11 165.69 194.59 254.07 100 122.88 141.48 161.12 172.01 100 122.99 161.89 189.40 244.16

Comparative income statement as on 31 March 2006-2010

Ratio Analysis
Ratios Debt equity ratio Gross profit % Net profit % Quick ratio Interest coverage ratio Return on capital employed Return on shareholders fund Current ratio 2010 2009 2008 11.9 11.2 10.6 10.9 9.36 9.77 16.953 14.45 16.31 24.32 20.16 21.1 1.367 1.33 1.4 1.5 20.74 0.83 1.4 17.5 0.75 1.4 17.5 0.65

P/E ratio is 11.8 as on 31 March 2010.

Trend of share price with time

Deposits
The total deposits of the Bank have grown by Rs. 4,170.46 cr from Rs. 15,101.39 cr as on 31st March 2009 to Rs. 19,271.85 cr as on 31st March 2010, registering a growth of 27.62 %.

Investments
The Gross investments of the bank grew by 39.82% to reach Rs.6,649.44 cr as on 31st March 2010 from the level of Rs.4,755.61 cr as at the end of the previous fiscal. Interest income on investments grew by 43.36% to reach Rs. 396.27 cr as against Rs.276.41 cr earned during the last fiscal.

Interpretation of results:
Horizontal analysis shows steady increment in all segments which is a good sign. Even in the time of recession around 2008 it has been able to maintain that trend which may be due to its good management policy, foreign investment policy. Debt Equity ratio is high (11.9) and has been more than 10 for few years which is profitable for shareholders as they will be able to get more dividends though they invest less but it is not quite good for lenders. But banks do have high D/E ratios usually and as compared to its peers it is doing well though not a leader in it. Gross Profit ratio has increased from 9.36 to 10.9 % and Net profit ratio has increased from 14.45 to 16.9 % which is a good point again for all stake holders and lenders. Shareholders will be able to get high dividends and lenders will be paid their instalment .Their increased confidence will make organisation able to amass capital easily when required in future. It will increase the share value. Current ratio has increased but is less than preferred value of 1.33. This increment shows bank s increased ability to invest more in other sectors.

As quick ratio which is 24.32 and which has increased from previous years one will bring confidence in short term lenders as they would be able to get their money as soon as possible. For P/E ratio there is no definite way to conclude whether bigger is better as we want both to be higher. The bank has been able to maintain stable returns even in time of recession which is a good point the view of investors and lenders. Return on the capital employed is less than preferred value means it is not so much profitable to lend to or invest in this company when compared to others. The graph of share price to time shows growth. Though an unsteady one it bears evidence to increasing confidence in the investors about company s prospects. As should have been done, the investments have been increased. This increased the income in the form of interests to investments.