UNIVERSITY OF MUMBAI

STERLING COLLEGE OF ARTS, COMMERCE & SCIENCE,

NERUL, NAVI MUMBAI- 400706

PROJECT REPORT ON:

“COMPARATIVE STUDY OF
FINANCIAL REPORTS OF
SBI & ICICI BANKS”

SUBMITTED BY:

SHEETAL TANAJI GAIKWAD

TY.B.A.F. / ACCOUNTING & FINANCE

ROLL NO: 1224

(SEMESTERVI ) 2018-2029

PROJECT GUIDE:

PROF. PRATAP KADAM

ACKNOWLEDGEMENT
I must acknowledge the indebtedness to personalities but for whom, this project
could not have seen the light of the day.

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I am profoundly grateful to PROF. PRATAP KADAM Faculty of management
studies,

B.A.F Who agreed to become my mentor and guide for the project and gave me
the project and gave me the opportunity to work on this project. I am also
grateful, for her support and guidance throughout this project with valuable
information and giving me a better insight of things, without which successful
culmination of this project would not have been possible. Not only did she
inspired me throughout the progress of the project, but, also motivated me to get
into the insight into the field of my work.

I would also like to extend my immense gratitude to respected HOD PROF.

……………….., Faculty of management studies, B.A.F. Who allowed me to
choose the topic for my Dissertation.

NCRD’S STERLING INSTITUTE OF MANAGEMENT STUDIES

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 CERTIFICATE
This is to certify that Ms. SHEETAL TANAJI GAIKWAD, student of B.A.F-
VI semester Roll no. 1224has completed his project on “COMPARATIVE
STUDY OF FINANCIAL REPORTS OF SBI & ICICI BANKS”and
submitted a satisfactory report under the guidance of PROF. PRATAP
KADAMinthe partial fulfilment of B.A.F. Course of University Of Mumbai in
the Academic year 2018-2019

_____________ ______________
_____________

PROJECT GUIDE CO-ORDINATOR

PRINCIPAL

_____________

UNIVERSITY EXAMINER

DECLARATION
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I Ms.SHEETAL TANAJI GAIKWAD student of STERLING COLLEGAE OF
ARTS, COMMERCE & SCIENCE.studying in B.A.F.( Semester VI) Roll no.
1224 hereby declare that I have completed this project on “COMPARATIVE
STUDY OF FINANCIAL REPORTS OF SBI & ICICI BANKS” and not been
submitted to any other university or any institute for the award of any degree,
diploma etc. The information submitted by me is true and original to the best of
my knowledge.

DATE:

PLACE: STUDENT SIGNATURE

INDEX
SR. No. PARTICULARS PAGE
No.

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CHAPTER- INTRODUCTION OF THE
1 STUDY

Introduction

Objective of the study

Scope of the study

Limitation of the study

Research Methodology

 Types of Research

 Method of data collection

CHAPTER- REVIEW OF LITERATURE

2

Introduction

Company Profile

 SBI Bank

 ICICI Bank

History

 SBI BANK

 ICICI Bank

CHAPTER- CONCEPTUAL FRAME

3 WORK

Product & Services

 SBI BANK

 ICICI Bank

Financial Statement

 SBI Balance Sheet

 ICICI Balance

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 Sheet

CHAPTER- DATA ANALYSIS &

4 INTERPRETATION OF DATA

Ratio Analysis

 Interpretation

 Objectives

 Importance

 Advantages

 Limitations

Data Analysis

Comparative study of SBI &

ICICI

 Questionnaire

CHAPTER- Conclusion
5

Bibliography

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Page 7 of 74
 CHAPTER 1
INTRODUCTION OF
THE STUDY

( 1:1 ) INTRODUCTION

Analysis and interpretation of the financial statement has now become an important technique of credit
appraisal. Though the basic technique of appraisal remains the same in all the cases but the approach and the
emphasis in analysis vary. Analysis of financial statement is necessary because it help in depicting

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the financial position on the basis of past and current records. Analysis of financial statement helps in making
the future decision and strategies.  Therefore, it  is  very necessary for every organization whether it is a
financial or manufacturing etc. to make financial statement and to analysis it. Income statement analysis which
is done by using ratio analysis gives the true picture of the company.

In order to understand and analysis Ratio we have used balance sheet of both banks. The analysis
showed various aspect of bank regarding their financial system. Observation also indicated most
widely emphasized goal of the firm is to maximize the value of the firm to its to meet the long term and short
term requirements. Funds are invariably required to carry on the various activities of a business. on the basis of
ratio analysis we have suggested some issues which will helpful to bank regarding their financial systems
analysis of financial statements helped me to know how ratio analysis helps the banker to know the financial
position of the business. Among the various tools for evaluating the financial statements, ratio analysis is the
most widely used tool, as it helps us to measure the financial and operational performance of any business.
Studying the financial performance of SBI & ICICI was a meaningful and knowledgeable.

( 1:2 ) OBJECTIVES OF THE STUDY

1. To Analyse SBI & ICICI Bank Financial Statement.

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2. To understand the importance of financial statement analysis, calculate the ratios, and also analyse
them.

3. Through the net profit ratio and other profitability ratio, understand the profitability position of SBI &
ICICI bank.

4. Evaluating company’s performance relating to Financial Statement Analysis.

5. To know the liquidity position of the company, with the help of Current ratio.

( 1.3 ) SCOPE OF THE STUDY

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1. The research paper covers two important new private sector banks State Bank Of
India (SBI) & Industrial Credit Investment Corporation Of India (ICICI) Bank only.

2. The purpose of the present study is to analyse the various concepts of working capital
and find out the feasibility of the concept of working capital in the light of better
planning & control of working capital.

3. Problems of working capital management involve the problem of determining the

optimum level of investments in each components of current assets i.e. inventory,
receivables, cash, & other short term investment.

4. The basic focus in working capital management should be to optimize the firm’s
investment.

5. An expert in the financial management is of the opinion that problem of working

capital is one of the factors responsible for the low profitability in manufacturing
sector. Better planning & control of working capital, or in other words, proper
utilization of optimum quantity of working capital increases the earning power subject
to the existence of operating margin.

(1.4) LIMITATIONS OF THE STUDY

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 The major limitation of the present study is that the analysis is restricted to one
particular sector such as banking.

 It is confined to only measures the financial performance of selected banks.

 The inherent limitation is secondary data.

 The published data is not uniform & not properly disclosed by the banks. Hence,
this may be taken as another limitation.

 The data used in this study has been taken from published annual reports only.
So, it is reliable up to that extend only.

 For this study, only simple accounting ratios & simple statistical tools like mean
& growth rate have been used.

(1.5) RESEARCH METHODOLOGY

 RESEARCH METHODOLOGY :

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 In this study, an attempt has been made to evaluate & compare the financial
performance of SBI & ICICI and both of these are banks related with the
private sector. The study is based on secondary data & the details are collected
through websites, magazines and journals. Ratio analysis was applied to analyse
the performance of these banks.

 RESEARCH DESIGN :

A research design specifies the methods & procedures for conducting a

particular study. Research design is important primarily because of the
increased complexity in the market as well as marketing approaches available to
the researchers. A research design is a pattern or an outline of a research
project’s working. It is a statement of only the essential elements of a study,
those that provide the basic guidelines for the details of the project.

TYPES OF RESEARCH

A. ANALYTICAL RESEARCH :
In this type of research has to use facts or information already available,
& analyse these to make a critical evaluation of the material. The
researcher depends on existing data for his research work. The analysis
revolves round the material collected or available.
B. METHOD OF SAMPLING :
The new sector banks consists of eight banks. For the present study
covers two important banks (SBI) & (ICICI).
 Sample Extent : VASHI

C. METHODS OF DATA COLLECTION :

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 PRIMARY DATA :

Primary data is more costly to obtain secondary data, which is

obtain through published sources, but it is also more current &
more relevant to the project work.
Primary data has been collected through personal interview by
direct contact method. Personal interview & discussion was made
with manager & other personnel in the organisation for this
purpose.

 SECONDARY DATA :

The data is collected from the internet, journals, annual reports,

websites, magazines, text books.
The study is based on secondary data. The data were collected
from the official directory & data base of Centre for Monitoring
Indian Economy( CMIE ). The published annual reports of the
selected banks taken from their websites, magazines & journals on
finance have also been used a sources of data.

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 CHAPTER 2
REVIEW OF LITERATURE

The literature of behavioral studies on AT focused on adoption and diffusion of technology,

impact of technology adoption from customers, perspective, suppliers, banker.

1. Manish Mittal and ArunnaDhademade (2005):they found that higher profitability is the

only major parameter for evaluating banking sector performance from the shareholders point
of view. It is for the banks to strike a balance between commercial and social objectives.
They found that public sector banks are less profitable than private sector banks. Foreign
banks top thelist in terms of net profitability. Private sector banks earn higher non-interest
income than public sector banks, because these banks offer more and more fee based services
to business houses or corporate sector. Thus there is urgent need for public sector banks to
provide such services to stand in competition with private sector bank

2. I.M. Pandey (2005): An efficient allocation of capital is the most important financial
function in modern times. It involves decision to commit the firm's funds to the long term
assets. The firm’s value will increase if investments are profitable and add to the shareholders
wealth .Financial decisions are important to influence the firm’s growth and to involve
commitment olarge amount of funds. The types of investment decisions are expansion of
existing business, expansion of new business and replacement and modernization. The capital
budgeting decisions of a firm has to decide the way in which the capital project will be
financed. The financing or capital structure decision. The assets of a company can be
financed either by increasing theowners claims on the creditors’ claims. The various means of
financing represent the financial structure of an enterprise.

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3. MedhatTarawneh (2006): financial performance is a dependent variable and measured by
Return on Assets (ROA) and the intent income size. The independent variables are the size of
banks as measured by total assets of banks, assets management measured by asset utilization
ratio (Operating income divided by total assets) operational efficiency measured by the
operating efficiency ratio (total operating expenses divided by net income)

4. Vasantdesai (2007): The Reserve Bank of India plays a very vital role. It is known as the
banker’s bank. The Reserve Bank of India is the head of all banks. All the money
formulationsof commercial banks are done under the Reserve Bank of India. The RBI
performs all the typical functions of a good central bank as it is involved in planning the
economy of the country. The main function is that the RBI should control their credit. It is
mandatory for the Bank to maintain the external value of the rupee. Major function is that it
should also control the currency.

5. K. C. Sharma (2007): Banking has entered the electronic era. This has been due to
reforms introduced under the WTOcompliances. Private sector banks have been permitted to
open their shops in the country. Thesebanks are either foreign or domestic banks with foreign
partnerships. Some of them have beenset up by Development Financial Institutions in order
to embrace concept of universal banking ,as practiced in advanced countries. The private
sector on the other hand have began their hightech operations from the initial stage and made
the elite of the country to taste the best banking practices that happens in the western
countries. They have foreseen the digital world and haveseen the emerging electronic market,
which has encouraged them to have a better customerservice strategy that would be able to
deliver the things as per customer’s requirement.

6. Hr.Machirajn international publishers (2009): Efficiency can be considered from

technical,economical or empirical considerations. Technical efficiency implies increase in
output. In thecase of banks defining inputs and output is difficult and hence certain ratios of
costs to assets or operating revenues are used to measure banks efficiency. In the Indian
context public sector banks accounts for a major portion of banking assets, it is necessary to
evaluate the financial decisions of these banks and compare them with private sector banks to

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know the quality of financial decisions on its impact or performance of banks in terms of
efficiency, profitability, competitiveness and other economic variables.

7.Aditya Pun (2003): '' said, "Technology has enabled banks to target customers ,and
provide customized products and services to match their individual requirements. The
winners will be those banks that make optimum utilization of available technology to
innovate, offer customized products and services, and make the most of the resources at their
disposal"

8.K. Eswar (2003):said, "As our market evolve, so customer requirements change, and hence
the positioning strategy needs to be modified. Positioning is not a one-time effort. It is a
constant pursuit"

9.PramodGuptha(2003):"said, "Both public and private banks are spending large amounts
of money on technology to provide innovative products and services to their customers with
more convenience and satisfaction. Technology is reducing the cost of transaction and
helping to increase customer base and enable wider reach”.

10.AbhimanDas and SaibalGhosh's (2004):study conducted "to know the performance of

bank CEOs in the era of corporate governance, tried to identify the adaptability
characteristics of CEOs in terms of technology. The study also states that CEOs of poorly
performing banks are likely to face higher turnover than CEOs of well performing ones".

11.T.Uma MaheshwariRaoand L Hymavathi {2005): stated the importance of internet

usage for banking worldwide and its relevance in Indian scenario To compete the present
banking business the banks were transforming themselves sand conducting their business
electronically. This transformation leads to normalbanking to electronic banking,
enabledcustomers to transact online, while saving on various factors. Normal Banking
activities still prevails in developing countries like India.

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 (2.1) INTRODUCTION
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 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

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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:-

1. 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.

2. LONG –TERM CREDITORS

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

3. SHAREHOLDERS
They are interested in profitability, return and capital appreciation.

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

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

6. TAXATION AUTHORITIES
These authorities are interested in fin statements for determining the tax liability.

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

8. 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 analysisancial statements for determining the tax liability

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 (2.2) COMPANY PROFILE

SBI (STATE BANK OF INDIA)

The State Bank of India, popularly known as SBI, is one of the leading banks in India. The
bank traces its origin to the first decade of the 19th century. Later on, it was merged with the
Imperial Bank. In the year 1955, the Government of India nationalized the Imperial Bank
along with the Reserve Bank of India. Ever since that time, the bank acquired its present
namethis SBI

The State Bank of India is India's largest commercial bank. SBI provides a range of
banking products through its vast network in India and overseas, including products aimed at
NRIs. With an asset base of $126 billion and its reach, it is a regional banking behemoth.
SBI has laid emphasis on reducing the huge manpower through Golden Handshake
schemes and computerizing its operations. The State Bank Group, with over 16000 branches,
has the largest branch network in India. It has a market share among Indian commercial
banks of about 20% in deposits and advances.

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 MISSION STATEMENT

To retain the Bank’s position as premiere Indian Financial Service Group,

with world-class standards and significant global committed to excellence in customer,
shareholder and employee satisfaction and to play a leading role in expanding and
diversifying financial service sectors while containing emphasis on its development
banking rule

VISION STATEMENT

1. Retain its position in the country as pioneers in Development banking.

2. Maximize the shareholders value through high-sustained earnings per Share.
3. An institution with cultural mutual care and commitment, satisfying and
4. Good work environment and continues learning opportunities

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INDUSTRIAL CREDIT AND INVESTMENT CORPORATION
OF INDIA (ICICI BANK)

ICICI Bank is India's second-largest bank with total assets of Rs. 4,736.47 billion (US$ 93
billion) at March 31, 2012 and profit after tax Rs. 64.65 billion (US$ 1,271 million) for the
year ended March 31, 2012. The Bank has a network of 2,758 branches and 9,363 ATMs in
India, and has a presence in 19 countries, including India. 
ICICI Bank offers a wide range of banking products and financial services to corporate and
retail customers through a variety of delivery channels and through its specialized
subsidiaries in the areas of investment banking, life and non-life insurance, venture capital
and asset management. 
The Bank currently has subsidiaries in the United Kingdom, Russia and Canada, branches in
United States, Singapore, Bahrain, Hong Kong, Sri Lanka, Qatar and Dubai International
Finance Centre and representative offices in United Arab Emirates, China, South Africa,
Bangladesh, Thailand, Malaysia and Indonesia. Our UK subsidiary has established branches
in Belgium and Germany. 
ICICI Bank's equity shares are listed in India on Bombay Stock Exchange and the National
Stock Exchange of India Limited and its American Depositary Receipts (ADRs) are listed on
the New York Stock Exchange (NYSE).

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 VISION STATEMENT

To be the leading provider of financial services in India and m ajor global bank.

MISSION STATEMENT

1. B e t h e b a n k e r o f f i r s t c h o i c e f o r o u r c u s t o m e r s b y d e l i v e r i n g high
quality, world-class products and services.

2. Expand the frontiers of our business globally.

3. Play a proactive role in the full realization of India’s potential.

4. Maintain a healthy financial profile and diversify our earnings across

Businesses and geographies.

5. Maintain high standards of governance and ethics.

6. Contribute positively to the various countries and markets in

which we operate.

7. Create value for our stakeholders

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 HISTORY OF SBI

The origin of the State Bank of India goes back to the first decade of the nineteenth century
with the establishment of the Bank of Calcutta in Calcutta on 2 June 1806. Three years later
the bank received its charter and was re-designed as the Bank of Bengal (2 January 1809). A
unique institution, it was the first joint-stock bank of British India sponsored by the
Government of Bengal. The Bank of Bombay (15 April 1840) and the Bank of Madras (1
July 1843) followed the Bank of Bengal. These three banks remained at the apex of modern
banking in India till their amalgamation as the Imperial Bank of India on 27 January 1921.
The bank has 52 branches, agencies or offices in 32 countries. It has branches of the parent in
Colombo, Dhaka, Frankfurt, Hong Kong, Johannesburg, London and environs, Los Angeles,
Male in the Maldives, Muscat, New York, Osaka, Sydney, and Tokyo. It has offshore
banking units in the Bahamas, Bahrain, and Singapore, and representative offices in Bhutan
and Cape Town.

SBI operates several foreign subsidiaries or affiliates. In 1990 it established an

offshore bank, State Bank of India (Mauritius). It has two subsidiaries in North America,
State Bank of India (California), and State Bank of India (Canada). In 1982, the bank
established its California subsidiary, which now has seven branches. The Canadian
subsidiary was also established in 1982 and also has seven branches, four in the greater
Toronto area, and three in British Columbia. In Nigeria, it operates as INMB Bank. This
bank was established in 1981 as the Indo-Nigerian Merchant Bank and received permission
in 2002 to commence retail banking. It now has five branches in Nigeria. In Nepal SBI owns
50% of Nepal SBI Bank, which has branches throughout the country. In Moscow SBI owns
60% of Commercial Bank of India, with Canara Bank owning the rest. In Indonesia it owns
76% of PT Bank Indo Monex. State Bank of India already has a branch in Shanghai and
plans to open one up in Tianjin.

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 HISTORY OF ICICI BANK:

ICICI Bank was originally promoted in 1994 by ICICI Limited, an Indian financial
institution, and was its wholly-owned subsidiary. ICICI's shareholding in ICICI Bank was
reduced to 46% through a public offering of shares in India in fiscal 1998, an equity offering
in the form of ADRs listed on the NYSE in fiscal 2000, ICICI Bank's acquisition of Bank of
Madura Limited in an all-stock amalgamation in fiscal 2001, and secondary market sales by
ICICI to institutional investors in fiscal 2001 and fiscal 2002. ICICI was formed in 1955 at
the initiative of the World Bank, the Government of India and representatives of Indian
industry. The principal objective was to create a development financial institution for
providing medium-term and long-term project financing to Indian businesses. 
In the 1990s, ICICI transformed its business from a development financial institution
offering only project finance to a diversified financial services group offering a wide variety
of products and services, both directly and through a number of subsidiaries and affiliates like
ICICI Bank. In 1999, ICICI become the first Indian company and the first bank or financial
institution from non-Japan Asia to be listed on the NYSE. 

After consideration of various corporate structuring alternatives in the context of the

emerging competitive scenario in the Indian banking industry, and the move towards
universal banking, the managements of ICICI and ICICI Bank formed the view that the
merger of ICICI with ICICI Bank would be the optimal strategic alternative for both entities,
and would create the optimal legal structure for the ICICI group's universal banking strategy.
The merger would enhance value for ICICI shareholders through the merged entity's access
to low-cost deposits, greater opportunities for earning fee-based income and the ability to
participate in the payments system and provide transaction-banking services.
In October 2001, the Boards of Directors of ICICI and ICICI Bank approved the
merger of ICICI and two of its wholly-owned retail finance subsidiaries, ICICI Personal
Financial Services Limited and ICICI Capital Services Limited, with ICICI Bank. The merger
was approved by shareholders of ICICI and ICICI Bank in January 2002, by the High Court
of Gujarat at Ahmadabad in March 2002, and by the High Court of Judicature at Mumbai and
the Reserve Bank of India in April 2002. Consequent to the merger, the ICICI group's
financing and banking operations, both wholesale and retail, have been integrated in a single
entity. 

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 CHAPTER 3
( 3.1) PRODUCT AND SERVICES

SBI BANK
1. SBI BANKING
a. Personal Banking
b. Agricultural & Rural Banking
c. NRI Services
d. International Banking
e. Corporate Banking
f. Services
g. Govt. Business
h. SME

PERSONAL BANKING

SBI Term Deposits SBI Loan For Pensioners

SBI Recurring Deposits
SBI Housing Loan
SBI Car Loan
SBI Educational Loan
SBI Personal Loan
e-Invest (ASBA) - IPO
Loan Against Mortgage Of Property
Loan Against Shares & Debentures
Rent Plus Scheme
Medi-Plus Scheme
Rates Of Interest

1. AGRICULTURAL
State Bank of India Caters to the needs of agriculturists and landless agricultural laborers’
through a network of 6600 rural and semi-urban branches. There are 972 specialized branches
which have been set up in different parts of the country exclusively for the development of
agriculture through credit deployment .These branches include 427 Agricultural Development
Branches (ADBs) and 547 branches with Development Banking Department (DBDs) which

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cater to agriculturists and 2 Agricultural Business Branches at Chennai and Hyderabad
catering to the needs of hi tech commercial agricultural projects.

Our branches have covered a whole gamut of agricultural activities like crop
production , horticulture ,plantation crops, farm mechanization, land development and
reclamation, digging of wells, tube wells and irrigation projects, forestry, construction of cold
storages and god owns, processing of agri-products, finance to agri-input dealers, allied
activities like dairy , fisheries, poultry, sheep-goat, piggery and rearing of silk worms.

The branch also has farmer's meet in villages to explain to farmers about various
schemes offered by the bank. To give special focus to agriculture lending Bank has set up
agri business unit. Bank has also agri specialists in various disciplines to handle projects/
guide farmers in their agri 25ventures. Advances are given for very small activity covering
poorest of the poor to hi-tech activities involving large fund outlays.

We are the leaders in agri finance in the country with a portfolio of Rs. 18,000 cars in
agri advances to around 50 lac farmers.

2. NRI SERVICES
World Class Services from a Bank you can Trust Indians everywhere should become
enlightened International citizens. Wherever you are, whichever country you live, enrich that
nation, not only in financial terms, but also with your sweat knowledge and dignity since that
is the tradition of the country from where you came. At the same time, remember we have a
common umbilical connectivity to our motherland, India.

3. INTERNATIONAL BANKING
International banking services of State Bank of India are delivered for the benefit of
its Indian customers, non-resident Indians, foreign entities and banks through a network of 84
offices/branches in 32 countries as on 31 March 2008, spread over all time zones. The
network is augmented by a cluster of Overseas and NRI branches within India and
correspondent links with over 522 banks, the world over. Bank's Joint Ventures and
Subsidiaries abroad further underline the Bank's international presence.

The services include corporate lending, loan syndications, merchant banking,

handling Letters of Credit and Guarantees, short-term financing, collection of clean and
documentary creditsand remittances.

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 The Bank has carved a niche for itself in the Euro land with branches located in
Antwerp, Paris and Frankfurt. Indian banks and corporates are able to avail single-window
Euro services from the Bank's Frankfurt branch.

4. CORPORATE BANKING
SBI is a one shop providing financial products / services of a wide range for large,
medium and small customers both domestic and international.

Working Capital Financing

Assistance extended both as Fund based and Non-Fund based facilities to Corporate,
Partnership firms, Proprietary concerns Working Capital finance extended to all segments of
industries and services sector such as IT Term Loans to support capital expenditures for
setting up new ventures as also for expansion, renovation etc. Deferred Payment Guarantees
to support purchase of capital equipments. Corporate Loans For a variety of business related
purposes to corporate. Export Credit to Corporate / Non Corporate Strategic Business Units

(i) Corporate Accounts Group (CAG)

(ii)Project Finance

(iii) Lease Finance

o An exclusive unit providing one s shopping to Corporate

o A dedicated set up specialized in financing of infrastructure and other large projects
o Exclusive set up for handling large ticket leases.
o Pricing
o SBI's Prime Lending Rates (PLR) is among the lowest
o Presently Bank has two PLR's
o SBAR for loans payable on demand and up to one year.

5. SERVICES
Listed on the left are Services, SBI offers to its customers.

 DOMESTIC TREASURY
 SBI VISHWA YATRA FOREIGN TRAVEL CARD
 BROKING SERVICES
Page 29 of 74
 REVISED SERVICE CHARGES
 ATM SERVICES27
 INTERNET BANKING
 E-PAY

 E-RAIL
 RBI EFT
 SAFE DEPOSIT LOCKER
 GIFT CHEQUE

6. GOVERNMENT BUSINESS
State Bank of India's linkage with Government business is widespread. No wonder
that out of 9315 branches in India, about 7000 branches are conducting Government
Business. The large network of our branches provides easy access to the common man to
deposit the following Government dues and pension payments.

7. SME (small scale industries)

State Bank of India has been playing a vital role in the development of small scale
industries since 1956.The Bank has financed over 8 lakhs SSI units in the country. It has 55
specialized SSI branches, 99 branches in industrial estates and more than 400 branches with
SIB divisions. The Bank finances for Small Business activities which are of special
significance to a large number of people as many of these activities can be started with
relatively lower investment and with no special skills on the part of the entrepreneurs.

Page 30 of 74
 PRODUCTS & SERVICES

ICICI BANK
a. Personal Banking
Safety, Flexibility,

Liquidity Returns!

ICICI Bank offers a wide

Variety of Deposit

Products to suit your

Banking requirements.

 Savings Account
 Advantage Deposit
 Fixed Deposits
 Security Deposits
 Recurring Deposits
 Tax-Saver Fixed Deposit
 Special Savings Account
 Life Plus Senior Citizens Savings Account
 Young Stars Savings Account
 Salary Account
 Advantage Woman Savings Account
 EEFC Account
 Resident Foreign Currency (Domestic) Account
 Child Education Plan
 Bank Campus
 Privilege Banking
 Family Banking
 Rural Savings Account

Page 31 of 74
 People’s Savings Account
 Self Help Group Accounts
 Outward Remittance
 Freedom Savings Account
b. Loans
Simplified Documentation, Quick Processing, Hassle Free!

 Home Loans
 Personal Loans
 Two Wheeler Loans
 Car Loans
 Commercial Vehicle Loans
 Pre-approved Loans
 Loan Against Property
 Loans Against Securities
 Loan Against Gold Ornaments

c. Cards
World Class Service and Acceptance!!! A truly world class service as

ICICI Bank cards have both National and international Acceptance.

 Credit Cards
 Debit Cards
 Consumer Cards

 Commercial Cards
 Travel Cards
 Corporate Cards
 Prepaid Cards
 Business Cards
 Purchase Cards
 Distribution Cards
 Merchant Services

Page 32 of 74
d. Investments
Exclusive, Economical,

Expert Advice!!!ICICI Bank's power-packed,

Feature-rich investment Options for meeting all your Investment needs.

 ICICI Bank Tax Saving Bonds

 Mutual Funds
 Senior Citizens Savings Scheme
 Government of India Bonds
 Foreign Exchange Services
 Initial Public Offers (IPO) by Corporate
 ICICI Bank Pure Gold

e. Insurance
Secure, Reliable, Convenient!!! Convenience has always

been synonymous with ICICI Bank and keeping in

line we offer the facility of buying Insurance policies online

 Home Insurance
 Health Insurance
 Health Advantage Plus
 Family Floater
 Student Medical Insurance
 Personal Accident
 Two Wheeler Insurance
 Travel Insurance
 Individual Overseas Travel Insurance
 ICICI Pro Life State RP
 Motor Insurance
 Car Insurance
 Life Insurance
 ICICI Pro Lifetime Gold

Page 33 of 74
f. NRI Banking
NRIs get benefit from the following services:

 Money Transfer
 Bank Accounts
 Investments
 Property Solutions
 Insurance
 Loans Against FD

g. Business banking
 Corporate Net Banking
 Cash Management
 Online Taxes
 Trade Services
 Custodial Services
 FX Online
 SME Service

Page 34 of 74
 ( 3.2 ) FINANCIAL STATEMENT

STATE BANK OF INDIA

BALANCE SHEET

As on 31 March 2017 & 2018

Mar '18 Mar '17

Capital and Liabilities : Amount Amount
Total share Capital 892.46 797.35
Equity share Capital 892.46 797.35
Reserves 1,93,388.12 1,55,903.06
Net Worth 1,94,280.58 1,56,700.41
Deposits 27,06,343.29 20,44,751.39
Borrowings 33,62,142.07 3,17,693.66
Total Debt 30,68,485.36 23,62,445.05
Other Liabilities & Provisions 1,67,138.08 1,55,235.19
Total Liabilities 34,29,904.02 26,74,380.65
12 Months 12 Months
ICICI BANK
Assets
Cash & Balance with RBI 1,50,397.18 1,27,997.62 BALANCE
Balance With Banks, Money at Call 415,01.46 4,39,74.03
Advances 19,34,880.19 15,71,078.38 SHEET
Investments 10,60,986.72 7,65,989.63
Gross Block 39,200.71 42,344.99 AS ON 31
Revaluation Reserve 24,847.99 31,585.65
Net Block
March 2017
14,352.72 10,759.34
Capital Work in Progress 791.54 573.93 &2018
Other Assets 2,26,994.2 154,007.72
Total Assets 3,429,904.01 26,74,380.65
Contigent Liabilities 1,168,579.33 10,40,929.24
Book Value (Rs.) 217.69 196.53
Mar '18 Mar '17
Capital and Liabilities : Amount Amount
Total share Capital 1,285.81 1,165.11
Equity share Capital 1,285.81 1,165.11
Share Application Money 5.57 6.26
Reserves 1,00,864.37 95,737.57
Net Worth 1,02,155.75 96,908.94
Deposits 5,60,975.21 4,90,039.06
Borrowings 1,82,858.62 1,47,556.15
Total Debt 7,43,833.83 6,34,595.21

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Other Liabilities & Provisions 30,196.40 34,245.16
Total Liabilities 8,76,185.98 7,68,749.31

Assets
Cash & Balance with RBI 33102.38 31,702.41
Balance With Banks, Money at Call 51,067.00 44,010.66
Advances 512,395.29 4,64,232.08
Investments 2,02,994.18 1,61,506.55
Gross Block 7,903.51 7,805.21
Revaluation Reserve 3,003.19 3,042.14
Net Block 4,900.32 4,763.07
Other Assets 71,726.80 62,534.55
Total Assets 8,76,185.97 7,68,749.32
Contigent Liabilities 865,409.07 6,06,063.8
Book Value (Rs) 158.91 166.37

CHAPTER 4
DATA ANALYSIS &
INTERPRETATION OF
DATA
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 (4.1) RATIO ANALYSIS

MEANING OF RATIO: -

A ratio is a simple arithmetical expression of the relationship of one number to another.

According to Accountants Handbook by WixonKell and Bedford, a ratio is an expression of
the quantitative relationship between two numbers. In short it can be defined as the indicated
quotient of two mathematical expressions. The ratios can be expressed in 1) Percentages 2)
fraction and 3) Proportion of numbers.

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MEANING OF RATIO ANALYSIS: -

Ratio Analysis is a technique of analysis and interpretation of financial statements. It is

defined as the systematic use of ratios to interpret the financial statements so that the
strengths and weaknesses of a firm as well as its historical performances and current financial
condition can be determined. There are a number of ratios which can be calculated from the
information given in the financial statements, but the analysts has to select the appropriate
date and calculate only a few appropriate ratios from the same keeping in mind the objectives
of analysis.

The following four steps involved in the ratio analysis: -

1. Selection of relevant data from financial statements depending upon financial Analysis.

2. Calculation of appropriate ratios.

3. Comparison of the calculated ratios of the same firm in the past or the ratios Developed
from projected financial statements to the ratios of some other firms or the comparison with
ratios of the industry to which firm belonged.

4. Interpretation of ratios

INTERPRETATION OF RATIOS: -

The interpretation of ratios is an important factor. Though calculation of ratios is also

important but it is only a clerical task whereas interpretation needs skill, intelligence and
foresightedness. The impacts of factors such as price level changes, change in accounting
policies, window dressing etc should be kept in mind when attempting to interpret ratios. The
interpretation of ratios can be made in following ways: -

Here the ratios of one organization may be compared with the ratios of the same
organization for the various years either the previous

Years or the future years.

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 The ratios of one organization may be compared with the ratios of the other
organization in the same industry and such comparison will be meaningful as the various
organizations, in the same industry may be facing similar kinds of financial problems.

The ratios of an organization may be compared with some standards, which May be
supposed to be the thumb-rule for the evaluation of the performance.

OBJECTIVES

Analysis of financial statements is an attempt to assess the efficiency and

performance of an enterprise. For that there are some objectives which are described as
under.

1. EARNING CAPACITY OR PROFITABILITY

The overall objective of a business is to earn a satisfactory return on the funds

invested in it. Financial analysis helps in ascertaining whether adequate profits are being
earned on the capital invested in the business or not. It also helps in knowing the capacity to
pay the interest and dividend.

2. COMPARATIVE POSITION IN RELATION TO OTHER FIRMS

The purpose of financial statements analysis is to help the management to make a

Comparative study of the profitability of various firms engaged in similar business. Such
comparison also helps the management to study the position of their firm in respect of sales
expenses, profitability and using capital.etc.

3. EFFICIENCY OF MANAGEMENT

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 The purpose of financial statement analysis is to know that the financial policies
adopted by the management are efficient or not. Analysis also helps the management in
preparing budgets by forecasting next year’s profit on the basis of past earnings. It also helps
the management to find out shortcomings of the business so that remedial measures can be
taken to remove these shortcomings.

4. FINANCIAL STRENGTH

The purpose of financial analysis is to assess the financial potential of business.

Analysis also helps in taking decisions;

(a) Whether funds required for the purchase of new machinery and equipments are provided
from internal resources of business or not.

(b) How much funds have been raised from external sources.

5. SOLVENCY OF THE FIRM

The different tool of analysis tells us whether the firm has sufficient funds to
meet its short-term and long-term liabilities or not.

IMPORTANCE

Ratio analysis is an important technique of financial analysis. It is a means for judging

the financial health of a business enterprise. It determines and interprets the liquidity,
solvency, profitability, etc. of a business enterprise.

1. It becomes simple to understand various figures in the financial statements through

the use of different ratios. Financial ratios simplify, summaries, and systemize the accounting
figures presented in financial statements.

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2. With the help of ratio analysis, comparison of profitability and financial soundness
can be made between one industry and another. Similarly comparison of current year figures
can also be made with those of previous years with the help of ratio analysis and if some
weak points are located, remedial measures are taken to correct them.

3. If accounting ratios are calculated for a number of years, they will reveal the trend of
costs, sales, profits and other important facts. Such trends are useful for planning.

4. Financial ratios, based on a desired level of activities, can be set as standards for
judging actual performance of a business. For example, if owners of a business aim at earning
profit @ 25% on the capital which is the prevailing rate of return in the industry then this rate
of 25% becomes the standard. The rate of profit of each year is compared with this standard
and the actual performance of the business can be judged easily.

5. Ratio analysis discloses the position of business with different viewpoint. It discloses
the position of business with liquidity viewpoint, solvency view point, profitability
viewpoint, etc. with the help of such a study, we can draw conclusion regarding the financial
health of business enterprise.

ADVANTAGES

Ratio analysis is an important and age-old technique of financial analysis. The

following are some of the advantages of ratio analysis:

a. SIMPLIFIES FINANCIAL STATEMENTS:

It simplifies the comprehension of financial statements. Ratios tell the whole
story of changes in the financial condition of the business.

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b. FACILITATES INTER-FIRM COMPARISON:
It provides data for inter-firm comparison. Ratios highlight the factors
associated with successful and unsuccessful firm. They also reveal strong firms and weak
firms, overvalued and undervalued firms.

c. HELPS IN PLANNING:
It helps in planning and forecasting. Ratios can assist management, in its basic
functions of forecasting. Planning, co-ordination, control and communications.

d. MAKES INTER-FIRM COMPARISON POSSIBLE:

Ratios analysis also makes possible comparison of the performance of
different divisions of the firm. The ratios are helpful in deciding about their efficiency or
otherwise in the past and likely performance in the future.

e. HELP IN INVESTMENT DECISIONS:

It helps in investment decisions in the case of investors and lending decisions
in the case of bankers etc.

LIMITATIONS

The ratios analysis is one of the most powerful tools of financial management.
Though ratios are simple to calculate and easy to understand, they suffer from serious
limitations.

1. LIMITATIONS OF FINANCIAL STATEMENTS:

Ratios are based only on the information which has been recorded in the

Page 42 of 74
financial statements. Financial statements themselves are subject to several limitations. Thus
ratios derived, there from, are also subject to those limitations.

For example, non-financial changes though important for the business are not relevant by the
financial statements. Financial statements are affected to a very great extent by accounting
conventions and concepts. Personal judgment plays a great part in determining the figures for
financial statements.

2. COMPARATIVE STUDY REQUIRED:

Ratios are useful in judging the efficiency of the business only when they are
compared with past results of the business. However, such a comparison only provide
glimpse of the past performance and forecasts for future may not prove correct since several
other factors like market conditions, management policies, etc. may affect the future
operations.

3. PROBLEMS OF PRICE LEVEL CHANGES:

A change in price level can affect the validity of ratios calculated for different time
periods. In such a case the ratio analysis may not clearly indicate the trend in solvency and
profitability of the company. The financial statements, therefore, be adjusted keeping in view
the price level changes if a meaningful comparison is to be made through accounting ratios.

4. LACK OF ADEQUATE STANDARD: No fixed standard can be laid down for

ideal ratios. There are no well accepted standards or rule of thumb for all ratios which can be
accepted as norm. It renders interpretation of the ratios difficult.

5. LIMITED USE OF SINGLE RATIOS:

A single ratio, usually, does not convey much of a sense. To make a better
interpretation, a number of ratios have to be calculated which is likely to confuse the analyst
than help him in making any good decision.

Page 43 of 74
  PERSONAL BIAS:
Ratios are only means of financial analysis and not an end in itself. Ratios have to
interpret and different people may interpret the same ratio in different way.

 INCOMPARABLE:
Not only industries differ in their nature, but also the firms of the similar business
widely differ in their size and accounting procedures etc. It makes comparison of ratios
difficult and misleading

(4.3)DATA ANALYSIS

1. which bank you depend for your regular transaction ?

Choices Counts Percentage %

SBI Bank 18 51.4

ICICI Bank 11 31.4

Other 6 17.2

Page 44 of 74
 This pie chart shows that 51.4% of people depends on SBI bank for regular transaction.
31.4% of people depends on ICICI bank & 17.2% of people depends on other bank.

2. Are you aware of products & services provided by SBI and

ICICI ?

Choices Counts Percentage %

Yes 28 80

No 7 20

Page 45 of 74
 This pie chart shows that 80% of people are aware of product & services of ICICI & SBI
bank. 20% of people are unaware of product & services of ICICI & SBI bank.

3. If yes are you aware of the advance products (INVESTMENT)

of SBI and ICICI ?

Choices Counts Percentage %

Yes 22 62.9
No 13 37.1

This pie chart shows that 62.9% of people are aware of advance product (INVESTMENT) &
37.1% of people are un aware of advance product (INVESTMENT).

4. Which bank you prefer for invest money ?

Choices Counts Percentage %

ICICI Bank 8 22.9
SBI Bank 18 51.4
Other 9 25.7

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This pie chart shows that 22.9% of people prefer ICICI bank for investment. 51.4% of people
prefer SBI bank for investment. 25.7% of people are intrested to invest in other bank.

5. If you prefer SBI or ICICI bank for INVESTMENT than what

will you concern before investment ?

Choices Counts Percentage %

SBI Bank 19 54.3
ICICI Bank 16 45.7

This pie chart shows that 54.3% of people are concerned with SBI for INVESTMENT &
45.7% of people are concerned with ICICI bank

6. Which product of SBI or ICICI have used ?

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 Choices Counts Percentage %
Fixed deposit 7 20
Insurance 12 34.3
Mutual Fund 2 5.7
Equity 4 11.4
Other 10 28.6

This pie chart shows that 20% of people uses fixed deposit. 34.3% people uses
insurance. 5.7% people uses mutual funds. 11.4% people uses equity. 28.6% people
use others.

7. What do you feel about the services providing by SBI or ICICI

in advance product ?

Choices Counts Percentage %

Both Bad 8 22.9
SBI Good & ICICI not 7 20
ICICI Good &SBI not 3 8.6
Both Good 17 48.6

Page 48 of 74
This pie chart shows that 22.9% of people feels that both have bad services. 20% people feels
that SBI have better services then ICICI bank. 8.6% people feels that ICICI have better
services than SBI. 48.6% people feels that both have good services.

8. Which features you like most in investment of SBI &ICICI ?

|Choices Counts Percentage %

Various Product 10 28.6
Attractive ROI 5 14.7
Transparency 9 25.7
Simple & fast process 10 28.6
E banking 1 2.9

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This tabular presentation shows that 10 people likes to invest in Various Product , 5 people
likes to invest in Attractive ROI , 9 people likes to invest in Transparency , 10 people likes to
invest in Simple & fast process & 1 person likes to invest in E-banking.

9. Which bank do you have an account

Choices Counts Percentage %

SBI Bank 13 37.1
ICICI Bank 16 45.7
Other Bank 6 17.2

This diagram shows that 37.1% of people uses ICICI bank , 45.7% of people uses SBI bank
& 17.2% of people uses other bank.

Page 50 of 74
 ( 4.2 )COMPARATIVE STUDY OF SBI AND ICICI

1. PROFITABILITY RATIO
A class of financial metrics that are used to assess a business's ability to generate
earnings as compared to its expenses and other relevant costs incurred during a specific
period of time. For most of these ratios, having a higher value relative to a competitor's ratio
or the same ratio from a previous period is indicative that the company is doing well.
Some examples of profitability ratios are profit margin, return on assets and return on equity.
It is important to note that a little bit of background knowledge is necessary in order to make
relevant comparisons when analysing these ratios.
For instances, some industries experience seasonality in their operations. The retail industry,
FOR EXAMPLE
Typically experiences higher revenues and earnings for the Christmas season. Therefore, it
would not be too useful to compare a retailer's fourth-quarter profit margin with its first-
quarter profit margin. On the other hand, comparing a retailer's fourth-quarter profit margin
with the profit margin from the same period a year before would be far more informative.

2. OPERATING MARGIN
A ratio used to measure a company's pricing strategy and operating efficiency.
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 "operating profit margin."
Calculated as:
OPERATING INCOME

OPERATING MARGIN=----------------------------------

NET SALES

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Operating margin gives analysts an idea of how much a company makes (before interest and
taxes) on each dollar of sales. When looking at operating margin to determine the quality of a
company, it is best to look at the change in operating margin over time and to compare the
company's yearly or quarterly figures to those of its competitors. If a company's margin is
increasing, it is earning more per dollar of sales. The higher the margin, the better.

For example, if a company has an operating margin of 12%, this means that it makes $0.12
(before interest and taxes) for every dollar of sales. Often, nonrecurring cash flows, such as
cash paid out in a lawsuit settlement, are excluded from the operating margin calculation
because they don't represent a company's true operating performance.

RATIO AT 31-MARCH 2018

SR. BANK OF NAME PERCENTAGE

NO.

1 SBI 22.69 %

2 ICICI 14.45 %

BAR-GRAPH

COMPARISION OF RATIO
25.00%

20.00%

15.00%
Series 1

10.00%

5.00%

0.00%
SBI ICICI

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INTERPRETATION
It shows that operating efficiency of SBI is better than ICICI. While operating
Efficiency of ICICI is lower than SBI. So rank of operating efficiency of banks can be given
as SBI, and ICICI.

3. GROSS PROFIT MARGIN

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. It is also
known as "gross margin".
Calculated as:
REVENUE-COGS
GROSS PROFIT MARGIN=-------------------------
REVENUE
For example, suppose that ABC Corp. earned $20 million in revenue from producing widgets
and incurred $10 million in COGS-related expense. ABC's gross profit margin would be
50%. This means that for every dollar that ABC earns on widgets, it really has only $0.50 at
the end of the day. This metric can be used to compare a company with its competitors. More
efficient companies will usually see higher profit margins.
RATIO AT 31-MARCH 2018

SR. NAME OF BANK PERCENTAGE

NO

1 SBI 21.49 %

COMPARISION OF RATIO
25.00%
2 ICICI 12.99 %

BAR- 20.00% GRAPH

15.00%
Series 1

10.00%

5.00%
Page 53 of 74
0.00%
SBI ICICI
INTERPRETATION
This ratio shows financial position of company. Here, financial position of SBI is
better than ICICI. So SBI is at first rank by its financial position than ICICI.

4. NET PROFIT MARGIN

For a business to survive in the long term it must generate profit. Therefore the net
profit margin ratio is one of the key performance indicators for your business. The net profit
margin ratio indicates profit levels of a business after all costs have been taken into account.
It is worth analysing the ratio over time. A variation in the ratio from year to year may be due
to abnormal conditions or expenses. Variations may also indicate cost blowouts which need
to be addressed.
A decline in the ratio over time may indicate a margin squeeze suggesting that productivity
improvements may need to be initiated. In some cases, the costs of such improvements may
lead to a further drop in the ratio or even losses before increased profitability is achieved.
The calculation used to obtain the ratio is:

NET PROFIT MARGIN = NET PROFIT X 100

SALES

RATIO AT 31-MARCH 2018

SR. NAME OF BANK PERCENTAGE

NO.

1 SBI 11.67 %

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 2 ICICI 10.51 %

BAR-GRAPH

COMPARISION OF RATIO
11.80%
11.60%
11.40%
11.20%
11.00%
Series 1
10.80%
10.60%
10.40%
10.20%
10.00%
9.80%
SBI ICICI

INTERPRETATION

This ratio is key performance indicators for business. Key performance means the
profit Level of company; from above graph we can say that performance of SBI is better than
ICICI. So profit level of SBI is at first rank than comes ICICI.

5. LEVERAGE RATIO
Any ratio used to calculate the financial leverage of a company to get an idea
of the Company’s methods of financing or to measure its ability to meet financial
obligations. There are several different ratios, but the main factors looked at include

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debt, equity, assets and interest Expenses. A ratio used to measure a company's mix of
operating costs, giving an idea of how changes In output will affect operating income. Fixed
and variable costs are the two types of operating costs; Depending on the company and the
industry, the mix will differ,
The most well known financial leverage ratio is the debt-to-equity ratio.
For example, if a company has $10M in debt and $20M in equity, it has a debt-to-equity ratio
of 0.5 ($10M/$20M). Companies with high fixed costs, after reaching the breakeven
point, see a greater increase in operating revenue when output is increased compared to
companies with high variable costs.

The reason for this is that the costs have already been incurred, so every sale after
the breakeven transfers to the operating income. On the other hand, a high variable
cost company sees little increase in operating income with additional output, because costs
continue to be imputed into the outputs. The degree of operating leverage is the ratio used to
calculate this mix and its effects on operating income.

6. DEBT-EQUITY RATIO
A measure of a company's financial leverage calculated by dividing its total liabilities
by stockholders' equity sometimes only interest-bearing, long-term debt is used instead
of total liabilities in the calculation. It is also known as the Personal Debt/Equity Ratio, this
ratio can be applied to personal financial statements as well as companies’. 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.

Page 56 of 74
 RATIO AT 31-MARCH 2018

Sr.No Name of Bank Percentage

1 SBI 10.96 %

2 ICICI 7%

BAR-GRAPH

COMPARISION OF RATIO
12.00%

10.00%

8.00%

Series 1
6.00%

4.00%

2.00%

0.00%
SBI ICICI

INTERPRETATION:-
This ratio indicates what proportion of equity and debt the company is using to
finance its assets. From above diagram we can say that has a high debt-equity ratio means it
is aggressive in financing its growth with debt. Than after SBI has a low debt-equity ratio as
comparison with ICICI comes at third rank in debt-equity ratio

7. LIQUIDITY RATIO
A class of financial metrics that is used to determine a company's ability to pay off its
short-terms debts obligations. Generally, the higher the value of the ratio, the larger
the margin of safety that the company possesses to cover short-term debts. Common liquidity
ratios include the current ratio, the quick ratio and the operating cash flow ratio. Different

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analysts consider different assets to be relevant in calculating liquidity. Some analysts will
calculate only the sum of cash and equivalents divided by current liabilities because they feel
that they are the most liquid assets, and would be the most likely to be used to cover short-
term debts in an emergency. A company's ability to turn short-term assets into cash to cover
debts is of the utmost importance when creditors are seeking payment. Bankruptcy analysts
and mortgage originators frequently use the liquidity ratios to determine whether a company
will be able to continue as going concern.

8. CURRENTRATIO
This ratio is a rough indication of a firm's ability to service its current obligations.
Generally, the higher the current ratio, the greater the "cushion" between current obligations
and your Company's ability to pay them. The composition and quality of current assets is a
critical factor in the analysis of your Company's liquidity. It is calculated as Total current
assets divided by total current liabilities.

RATIO AT 31-MARCH 2018

Sr.No Name of Bank Percentage

1 SBI 0.7%

2 ICICI 0.10 %

BAR-GRAPH

COMPARISION OF RATIO
0.12%

0.10%

0.08%

0.06% Series 1

0.04%

0.02%

0.00%
SBI ICICI
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INTERPRETATION:-
Current ratio of ICICI is higher than SBI, means ICICI has a high ability to pay for its
liabilities, and then secondly comes SBI has a low ability to pay for liabilities in comparison
with ICICI.

9. CAPITALGEARING RATIO:-
Gearing means the process of increasing the equity shareholders return through the use of debt.Equity
shareholders earn more when the rate of the return on total capital is more than the rate of interest on debts. This
is also known as leverage or trading on equity. The Capital-gearing ratio shows the relationship between two
types of capital viz: - equity capital & preference capital & long term borrowings. Capital gearing ratio indicates
the proportion of debt & equity in the financing of assets of a concern. If the amount of fixed cost bearing capital
is more than the equity share capital including reserves an undistributed profits), it will be called high capital
gearing and if it is less, it will be called low capital gearing. The high gearing will be beneficial to equity
shareholders when the rate of interest/dividend payable on fixed cost bearing capital is lower than the rate
of return on investment in business. Thus, the main objective of using fixed cost bearing capital is to maximize
the profits available to equity shareholders

FORMULA:

PREFERENCE CAPITAL+ SECURED LOAN

= ------------------------------------------------------------------------

EQUITY CAPITAL +RESERVE & SURPLUS

10. PAYOUT RATIOS

The amount of earnings paid out in dividends to shareholders. Investors can use the
payout ratio to determine what companies are doing with their earnings.
Calculated as:
DIVIDEND PER SHARE
PAYOUT RATIO= ------------------------------------
EARNING PER SHARE

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For example, a very low pay out ratio indicates that a company is primarily focused on
retaining its earnings rather than paying out dividends. The payout ratio also indicates how
well earnings support the dividend payments: the lower the ratio, the more secure the
dividend because smaller dividends are easier to pay out than larger dividends.

11. DIVIDEND PAYOUT RATIO

Dividend payout ratio is the fraction of net income a firm pays to its stockholders in
dividends:

DIVIDEND

= -------------------------------------------------------

NET INCOME FOR THE SAME PERIOD

The part of the earnings not paid to investors is left for investment to provide for future
earnings growth. Investors seeking high current income and limited capital growth prefer
companies with high Dividend payout ratio. However investors seeking capital growth may
prefer lower payout ratio because capital gains are taxed at a lower rate. High growth firms in
early life generally have low or zero payout ratios. Note that dividend payout ratio is a
reciprocate ratio to dividend cover, which is calculated as EPS/DPS.

RATIO AT 31-MARCH 2018

SR. NO NAME OF PERCENTAGE

BANK

1 SBI 22.64 %

2 ICICI 33.12 %
COMPARISION OF RATIO
35.00%
BAR- GRAPH
30.00%
25.00%
20.00% Series 1
15.00%
10.00%
5.00% Page 60 of 74
0.00%
SBI ICICI
INTERPRETATION

ICICI has a high dividend payout ratio, so the Investors who are seeking high current
Income and limited capital growth should be invested in ICICI bank. SBI have a low
Dividend payout ratio, so investors who are seeking capital growth should be invests in SBI
because capital gains are taxed at a lower rate.

12. EARNING PER SHARE

The portion of a company's profit allocated to each outstanding share of
common Stock. Earnings per share serve as an indicator of a company's profitability.

Calculated as:

NET INCOME-DIVIDEND OF PREFFERS

STOCK
= -------------------------------------------------------------
AVERAGE OUTSTANDING SHARES

When calculating, it is more accurate to use a weighted average number of shares

outstanding over the reporting term, because the number of shares outstanding can
change over time. However, data sources sometimes simplify the calculation by using
the number of shares outstanding at the end of the period. Earnings per share are
generally considered to be the single most important variable in determining a share's
price. It is also a major component used to calculate the price-to-earnings valuation
ratio

RATIO AT 31-MARCH 2018

Page 61 of 74
 Sr.No Name of Bank Percentage
1 SBI 117.33 %
2 ICICI 42.56 %

BAR-GRAPH

COMPARISION OF RATIO
140.00%

120.00%

100.00%

80.00%
Series 1

60.00%

40.00%

20.00%

0.00%
SBI ICICI

INTERPRETATION

This ratio is an indicator of a company's profitability. From above graph we can say
that SBI has a high profitability than ICICI. So, ICICI comes at second position in
profitability

13. RETURN ON CAPITAL  EMPLOYED:-

The profitability of the firm can also be analysed from the point of view of the total funds employed in
the firm. The term fund employed or the capital employed refers to the total long-term source of funds. It means
that the capital employed comprises of shareholder funds plus long-term debts. Alternatively it can also be
defined as fixed assets plus net working capital. Capital employed refers to the long-term funds invested by the
creditors and the owners of a firm. It is the sum of long-term liabilities and owner's equity. These ratios

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determine how quickly certain current assets can be converted into cash. They are also called efficiency ratios or
asset utilization ratios as they measure the efficiency of a firm in managing assets.

FORMULA:

NPAT

= ------------------------------------

CAPITAL EMPLOYED * 100

14. RETURN ON NETWORTH

Return on Net worth (RONW) is used in finance as a measure of a company’s
profitability. It reveals how much profit a company generates with the money that the equity
shareholders have Invested. Therefore, it is also called „Return on Equity‟ (ROE).It is
expressed as:-

Net Income

RONW = ------------------------------------------- X 100

Shareholder’s Equity

The numerator is equal to a fiscal year’s net income (after payment of preference share
dividends but before payment of equity share dividends).

RATIO AT 31-MARCH 2018

Sr.No Name of Bank Percentage

1 SBI 13.72 %
COMPARISION OF RATIO

2
16.00% ICICI 8.94 %

14.00%
BAR-GRAPH
12.00%

10.00%
Series 1
8.00%

6.00%

4.00%

2.00%
Page 63 of 74
0.00%
SBI ICICI
INTERPRETATION

This ratio is useful for comparing the profitability of a company to that of other firms
in the same industry. Here, profitability of SBI is more than ICICI. So we can say that SBI is
at first rank by its profitability than comes ICICI.

15. EARNING RETENTION RATIO

The percent of earnings credited to retained earnings. In other words, the proportion
of net income that is not paid out as dividends
Calculated as:
NET INCOME--DIVIDEND
= -----------------------------------------------
NET INCOME
It can also be calculated as one minus the dividend payout ratio.
RATIO AT 31-MARCH 2018

Sr.No. Name of Bank Percentage

1 SBI 77.33 %

2 ICICI 66.35 %

BAR-GRAPH

Page 64 of 74
 COMPARISION OF RATIO
80.00%
78.00%
76.00%
74.00%
72.00%
Series 1
70.00%
68.00%
66.00%
64.00%
62.00%
60.00%
SBI ICICI

INTERPRETATION
Earning retention ratio is the opposite of the dividend payout ratio. SBI have a high
earning retention ratio, so the Investors who are seeking high current income and limited
capital growth should be invest in SBI. ICICI has a low earning retention ratio, so the
investors who are seeking capital growth should be invest in ICICI BANK.

16.QUICK RATIO
It is also known as the "Acid Test" ratio; it is a refinement of the current ratio and is a
more conservative measure of liquidity. The ratio expresses the degree to which your current
Company's current liabilities are covered by the most liquid current assets. Generally, any
value of less than 1 to 1 implies a "dependency" on inventory or other current assets to
liquidate short-term debt. It is calculated as Cash plus trade receivables divided by total
current liabilities.
RATIO AT 31-MARCH 2018

Sr.No Name of Bank Percentage

.
1 SBI 6.15 %
2 ICICI 6.42 %

BAR-GRAPH

Page 65 of 74
 COMPARISION OF RATIO
6.45%

6.40%

6.35%

6.30%

6.25% Series 1
6.20%

6.15%

6.10%

6.05%

6.00%
SBI ICICI

INTERPRETATION
ICICI has a high quick ratio means it has enough current assets to cover its current liabilities,
while SBI have a low quick ratio in comparison with ICICI.

17. GROSS PROFIT RATIO:-

This ratio measures the relationship between gross profit and sales. It is defined as the excess of the net
sales over cost of goods sold or excess of revenue over cost. This ratio shows the profit that remains after the
manufacturing costs have been met. It measures the efficiency of production as well as pricing. This ratio helps
to judge how efficient the concern is I managing its production, purchase, selling & inventory, how good its
control is over the direct cost, how productive the concern , how much amount is left to meet other expenses
&earn net profit.

.FORMULA:

GROSS PROFIT

= ----------------------------x100

NET SALES

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18. FIXED ASSETS TURNOVER RATIO

Measure of the productivity of a firm, it indicates the amount of sales generated by

each dollar spent on fixed assets, and the amount of fixed assets required to generate a
specific level of revenue. Changes in the ratio over time reflect whether or not the firm is
becoming more efficient in the use of its fixed assets.

Formula: SALES REVENUE ÷ AVERAGE FIXED ASSETS.

RATIO AT 31-MARCH 2018

Sr.No. Name of Bank Percentage

1 SBI 6.31 %
2 ICICI 5.61 %

BAR-GRAPH

COMPARISION OF RATIO
6.40%
INTERPRETATION
6.20% This ratio shows
specific level of revenue by the
6.00%
amount of fixed assets. SBI has a
Series 1
high level 5.80% of revenue in
comparison with
5.60%
ICICI. After SBI has a high
level of 5.40% revenue and then
comes ICICI at last.
5.20%
SBI ICICI

19. STOCK WORKING CAPITAL RATIO:-

This ratio shows the relationship between the closing stock & the working capital. It helps to judge the
quantum of inventories in relation to the working capital of the business. The purpose of this ratio is to show the
extent to which working capital is blocked in inventories. The ratio highlights the predominance of stocks in the
current financial position of the company.

Page 67 of 74
FORMULA: STOCK

= ----------------------------------------

WORKING CAPITAL

20. PROPRIETORS RATIOS :

Proprietary ratio is a test of financial & credit strength of the business. It relates shareholders fund to
total assets. This ratio determines the long term or ultimate solvency of the company. In other words,
Proprietary ratio determines as to what extent the owner’s interest & expectations are fulfilled from the total
investment made in the business operation. Proprietary ratio compares the proprietor fund with total liabilities
this ratio should be 33% or more than that. In other words, the proportion of shareholders funds to total funds
should be 33% or more. A higher proprietary ratio is generally treated an indicator of sound financial position
from long-term point of view, because it means that the firm is less dependent on external sources of finance. If
the ratio is low it indicates that long-term loans are less secured and they face the risk of losing their money.

FORMULA: PROPRIETARY FUND 

 =  ------------------------------------

TOTAL FUND

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 QUESTIONNAIRE

 Name- _________________________________

Occupation- ______________________________

Contract Detail- ________________________________

Q. On which bank you depend for your regular transaction ?

a) SBI Bank

b) ICICI Bank

c) Other Bank Specify (___________)

Q. Are you aware of products & services provided by SBI and ICICI ?

a)Yes

b)No

Q. If yes are you aware of the advance products (INVESTMENT) of SBI and ICICI ?

a)Yes

b)No

Page 69 of 74
Q. Which bank you prefer for invest money ?

a)SBI Bank

b)ICICI Bank

c)Other Bank Specify (______________)

Q. If you prefer SBI or ICICI for INVESTMENT then what will you concern before
investment ?

___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________

Q. Which product of SBI or ICICI you have used ?

a)Fixed deposit

b)Insurance

c)Mutual Fund

d)Equity

e)Other, Specify(__________________)

Q. What do you feel about the services providing by SBI or ICICI in advance product ?

a)Both Bad

b)SBI good and ICICI Not

c)ICICI good or SBI Not

d)Both Good

Page 70 of 74
Q. Which features you like most in investment of SBI and ICICI ?

a)Various Product

b)Attractive ROI

c)Transparency

d)Simple & fast processing

e)Strong capital

f)Big bank

h)Any Other feature ,specify(_________________)

Q. Any suggestion you want to give for the betterment of SBI and ICICI and advance
product.

___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
______

Page 71 of 74
 CONCLUSION

1. Ratios make the related information comparable. A single figure by itself has no
meaning, but when expressed in terms of a related figure, it yields significant interferences.
Thus, ratios are relative figures reflecting the relationship between related variables. Their
use as tools of financial analysis involves their comparison as single ratios, like absolute
figures, are not of much use.

2. Ratio analysis has a major significance in analyzing the financial Performance of a

company over a period of time. Decisions affecting product prices, per unit costs, volume or
efficiency have an impact on the profit margin or turnover ratios of a company.

3. Financial ratios are essentially concerned with the identification of Significant

accounting data relationships, which give the decision-maker insights into the financial
performance of a company.

4. The analysis of financial statements is a process of evaluating the relationship

between component parts of financial statements to obtain a better understanding of the
firm’s position and performance.

5. The first task of financial analyst is to select the information relevant to the decision
under consideration from the total information contained in the financial statements. The
second step is to arrange the information in a way to highlight significant relationships. The
final step is interpretation and drawing of inferences and Conclusions. In brief, financial
analysis is the process of selection, relation and evaluation.

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6. Ratio analysis in view of its several limitations should be considered only as a tool for
analysis rather than as an end in itself. The reliability and significance

5.1 )BIBLIOGRAPHY

 Web sites:
1. www.sbi.com
2. www.icici.com
3. www.google.com
4. www.bnet.com

Books referred:

1. “Basic Financial Management” - M Y Khan

- P K Jain

2. “Financial Management” -Prasanna Chandra

3. “Text Books "-Solomon, Michael R., Consumer Behaviour.

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