306 Yaashi Ahuja

A COMPARATIVE ANALYSIS BETWEEN SHOPPERS STOP LTD.
AND TRENT
LTD. ON THE BASIS OF THEIR FINANCIAL PERFORMANCES.
Research Project Submitted in Partial Fulfilment of the Requirement for the Degreeof
B.COM Honors
DEPARTMENT OF COMMERCE
BHOPAL SCHOOL OF SOCIAL SCIENCES
April 2021
Submitted by: Guided by:
Ms. Yaashi Ahuja Dr. Geetanjali Shrivastava
B.Com Honors Assistant Professor

Department of Commerce
1
CERTIFICATE
It is to certify that the work contained in the project report titled as A Comparative Analysis
Between Shoppers Stop Ltd. and Trent Ltd. on the Basis of their Financial Performance, by
Ms. Yaashi Ahuja from B.Com Hons, final year, has been carried out under my supervision
and that this work has not been submitted elsewhere for adegree.
Signature of Supervisor: .................
Name : Dr. Geetanjali Shrivastava
Department : Commerce
Bhopal School of Social Sciences

April 2021
2
DECLARATION
I hereby declare that this project report entitled A Comparative Analysis Between Shoppers
Stop Ltd. and Trent Ltd. on the Basis of their Financial Performance wascarried out by me
for the degree of B.Com Honors under the guidance and supervision of Dr. Geetanjali
Shrivastava, Assistant Professor of the Department ofCommerce, BSSS College. The
interpretations put forth are based on my reading and understanding of the original texts
and they are not published anywhere in anyform. The other books, articles, and websites,
which I have made use of are acknowledged at the respective place in the text. This
research report is not submitted for any other degree or diploma in any other University.
Place: Bhopal
Name of the Student: Yaashi Ahuja
3
ACKNOWLEDGEMENT
I would like to appreciate and thank our Principal Dr. Fr. John P.J. and Vice Principal Dr. Sr. Sonia
Kurien for their immense support and blessings. I also thank our HOD Dr. Amit KumarNag for his
support, valuable suggestions, and useful comments throughout this research work. I would like to
extend my deep sense of gratitude and appreciation to Dr. Geetanjali Shrivastava of the Department
of Commerce for her invaluable guidance, patience, and encouragement throughout the development
of this research project on the topic A Comparative Analysis Between Shoppers Stop Ltd. and Trent
Ltd. on the Basis of their Financial Performance. It would have been challenging for me to have
reached this state of completion of my research project without her assistance. I would also like to
express my gratitude to my parents and friends, who assisted me significantly as without their kind
devotion this project would have been a sheer dream.
I wish to sincerely acknowledge everyone who has directly or indirectly helped me with
information, advice, and other assistance during my research period.
Yaashi Ahuja
4
ABSTRACT
The Indian retail market has undergone numerous changes and challenges however it has continued to
grow steadily. This development, in a way, reflects the country’s changing lifestyle preferences. The
fashion industry has become a promising segment with the capability of engaging a broader customer
base, expanding into more geographically accessible markets, and increasing competition among
retailers. Many initiatives have been launched in the retail arena with long-term, aspiring plans to
expand across various verticals,regions, and forms. But to sustain in this competitive and challenging
environment and to step out as one of the best, is the greater task for any organization. And, therefore
having a healthy financial status is also important.
This research project aims to perform a comparative study on the financial stability of two companies
in the Indian retail sector. Financial analysis is primarily used to compare an industry’s or a
company’s growth, efficiency, and financial stability by reviewing the details presented in the
financial statements. This kind of analysis is used to evaluate the financialhealth by creating a proper
relationship between the balance sheet and profit and loss account.
This project would focus solely on the two popular fashion brands of the Indian retail industry,
namely, Shoppers Stop and Trent Ltd, i.e., Westside. Both these firms have beenexisting in the
Indian market for more than two decades now. They have won and gained astrong reputation and
image in the country’s fashion market despite many obstacles in the industry.
The research paper will measure and evaluate the financial and accounting performance ofboth the
companies for the last three years. For this purpose, the financial statements of Shoppers Stop Ltd
and Trent Ltd will be drawn out to summarize and compute some financial ratios to find out their
capabilities to manage their funds and monetary operations.After comparing the ratios, the project
includes the calculation of certain statistical tools which will help us to assess the growth of the
firms in respect of the evaluated metrics.
Besides this, the report also portrays graphical representation to compare the above-statedstatistical
measures.
Lastly, the research paper would analyze the overall financial performance of both the firmsand their
financial positions in the market, against each other.
5
Chapter Number Chapter Title Page Number
1 Introduction of the Topic 7-11
1.1 Rationale of the Study 8
1.2 Indian Retail Industry 9
1.3 Introduction to Shoppers Stop Ltd. and
Trent Ltd. 9-11
1.4 Justification of the Study 11
2 Review of Literature 12-17
2.1 International Reviews 13-15
2.2 National Reviews 15-17
3 Research Methodology 18-20
3.1 Objectives of the Study 19
3.2 Research Hypothesis 19
3.3 Scope of the Study 19
3.4 Source of Data 19
3.5 Limitations of the Study 19-20
4 Data Analysis 21-54
4.1 Data Representation and Interpretation 20-50
4.2 Hypothesis Testing 51-54
5 Results & Discussions 55-57
5.1 Major Findings 56
5.2 Discussions & Suggestions 56-57

57
5.3 Conclusion
References 58-63
Annexure 64-69
6
CHAPTER 1
Introduction of the Topic
1.1 Rationale of the Study
1.2 Indian Retail Industry
1.3 Introduction to Shoppers Stop Ltd. and Trent Ltd.
1.4 Justification of the Study
7
INTRODUCTION OF THE TOPIC
After ruminating numbers and displaying them in financial statements, the predominant purpose of
financial management is to create wealth. The best way to create wealth is to maximize a firm's
value over time by making the best use of its resources. In other words, it is the continuous and
viable accumulation of more assets (growth) as time passes by.
Putting these into context, wealth creation is the result of a series of rational business decisions
taken one after the other, all of which are based on a formal or empirical basis. Since risks impede
a company from achieving its goals, developing formal and empirical decision-making bases
decreases the probability of the latter risks. Now, these structured bases on which the firm
decisions are anchored in financial management is the financial statement analysis.
When we talk about financial analysis of any company it defines the method of evaluating a
company's performance output in relation to its market and economic climate in order to make a
decision or a recommendation. The ability of a business to obtain a return on its capital that is at
least equivalent to the amount of that capital, to lucratively expand its operations, and to produce
sufficient cash to cover obligations and seek opportunities, is a primary concern of financial
analysis.
By reviewing financial statements with different tools and assessing the relations between different
elements of financial statements, it aids in a deeper comprehension of a company's financial status,
growth, and performance. Financial statements for a corporation are similar to a report card that
shows how well the company is doing.
A comparative financial study acts as a key performance indicator that investors and lenders will want
to preview before investing or lending money to the business. A company should work with its
controller services to monitor and enhance its financial statements, as these indicators are later
scrutinized by shareholders.
Indian retail sector is recognized as one of the major sectors contributing to the economic
development of the nation. Various companies are reaching heights and giving inspiration to others to
join the industry. There are various techniques and procedures used by companies to maximize their
growth. Governing and comparing these techniques helps investors to decide their investments.
8
1.2 Indian Retail Industry
Retailing is one of the mainstays of the Indian economy and is the biggest among the other
industries, as it represents more than 10% of the nation’s GDP and around 8% of the employment.
The Retail Industry in India has approached the most unique and rapidly growing enterprises with
several individuals entering its marketplace.
Retailing in India is crawling its steps in the direction towards becoming the subsequent booming
industry. The entire idea of buying has modified regarding customer purchasing conduct, which
guides a transformation in shopping in India. The Indian retailing sector is at a point where the
development of both standardized retailing and the Indian population will take a higher growth
curve. The Indian populace is perceiving a big amendment in its demographics.
One more sincere factor of this sector is the growth in the young operating population. The main
reasons behind this growth are nuclear households in city areas, increasing working women
population, valuable payrolls and compensations, and rising opportunities within the services sector.
Therefore, there is a new boast of retailing nearly in every one of the inclinations of life - Appliances,
Electronics, Cosmetics and Toiletries, Home & Workplace Merchandise, Travel and Leisure, and
plenty others. With this, the retail sector in India is noticing restoration as conventional markets clear
a path for new arrangements like divisional stores, hypermarkets, and grocery stores.
1.3.1 Shoppers Stop Ltd.
Shoppers Stop Limited is an Indian department store chain laid by the K Raheja Corporation Group,
in 1991 with its first store in Andheri, Mumbai. Today, there are 293 multi-format stores throughout
44 towns in India. The organization operates with apparel, shoes, purses, accessories, jewelry, books,
cosmetics, home decor, and health and beauty products. The different retail outlets under the Group
are Crossword, HomeStop, Estee Lauder, M.A.C, Clinique, Bobbi Brown, and more.
Crossword is India’s biggest bookstore chain present across 13 urban cities with around 41 shops
sharing the widest range of books, toys, movies, magazines, and stationery products. And as a
complete home arrangement store, HomeStop offers high-quality products needed to home with a
more profound item combination. As of July 2020, there are about 11 HomeStop Brand outlets.
Shoppers Stop has also introduced a luxury beauty store known as Arcellia along with collaborating
with various renowned beauty brands and stores, stated above. The company has also succeeded in the
cosmetics and make-up business by operating 132 specialty beauty stores.
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Being among India’s one of the largest hospitality and real estate players, the firm crossed yet one
more milestone with its lifestyle venture,i.e., Shoppers Stop. It has developed from being a solitary
brand shop to turning into a Fashion and Lifestyle store for the family. With a good amount of
proficiency and validity, Shoppers Stop is currently owning 89 department stores with over 500+
perceived and trusted brands across a variety of products and has made its way to becoming the
greatest benchmark for the Indian retail industry. Shoppers Stop is a commonly recognized name,
known for its superior quality merchandise, services and especially, for imparting a complete buying
experience.
Shoppers Stop Ltd. has sped up its transformation to turn from a physical brand, into an advanced
Omni-channel organization, adapting to a new normal that collectively serves the goal of delivering
customer delight. In India, Shoppers Stop is the only member of IGDS (Intercontinental Group of
Departmental stores) alongside 29 different experienced retailersfrom all around the world.
1.3.2 Trent Ltd.
Under the Tata Group, Trent Ltd was set up in Mumbai, in 1998 by the brand name, Westside. Trent
is one of the leading organizations in the modern retail industry in India. The company has different
outlets operating in various products like clothes, cosmetics, footwear, fragrances, handbags,
household furniture, lingerie, and accessories. Trent is primarily operating 5 retailing chains.
First is Zudio, a mass marketplace with a separate fashion and style destination. The Zudio shops
have numerous divisions to satisfy the various buying wishes of customers. These encompass
clothing throughout men, women, and kids. Tata Trent Ltd opened its first Zudio store in Bangalore,
2016, and now there are 20 outlets across 12 cities.
Star Bazaar, India’s most pioneering modern distributor for fresh food and groceries. It offers an
extensive variety of daily necessities, staple foods, beverages, recent produce, dairy products, and a
number of exceptional TATA manufacturers at a good value. Currently, there are 39 Supermarket
stores and 10 Hypermarket stores under the Star Bazaar Brand.
Trent also operates a family entertainment outlet known as Landmark, which was started as an
independent bookstore, but now is transformed into a corporate retailer. It provides a wide range of
books movies music PC games, video games, gaming accessories, toys, magazines, phones, laptops,
cameras, sports merchandise, gift items, stationery, and domestic products. At present, Tata Group
owns 5 independent stores of Landmark.
10
The most recent and latest Trent concept is Utsa, a new Indian fashion and lifestyle destination which
offers ethnic attire, beauty products, and materials. This brand comprises a range of Westside Indian
apparel with extra selective styles. Backend activities are incorporated with Trent’s other ideas and
plans to acknowledge collaborations. This new concept is primarily operated in 2 stores situated in
Pune and Vadodara.
And the last is their leading fashion brand, Westside. With around 165 retail stores in 87 major cities
in India, Westside has become one of the fastest developing retail chains. It offers a variety of its
personal branded clothes and is the backbone of the retailing business of the company. Westside plans
to deliver 22 different brands which are original, credible for trend, provide affordable products, and
aim to promote it in such an environment where a customer can gain an overall shopping experience.
1.4 Justification of the Study
This research project aims to analyze the financial performances of Shoppers Stop Ltd. and Trent Ltd.
of the most recent three years. Understanding this course would allow businesses to take appropriate
measures on a variety of issues, ensuring their long-term viability in the sector. The project will assist
investors of the companies in making investment decisions as it reveals financial status.
11
CHAPTER 2
Review of Literature
2.1 International Reviews
2.2 National Reviews
12
REVIEW OF LITERATURE
1. Ika, Siti Rochmah & Nursiningsih, Fami & Sarnowo, Henry & Sahadi, (2021).
Financial Performance of Retail Industry Before and After E-Commerce Booming in
Indonesia: A Study of Altman Z-Score Model. In recent years, many modern retail
outlets are reported closing down their operation due to a financial downturn. Changes
in a shopping behavior pattern that consumers prefer shopping online were blamed for
the closure of the store. This article aims to examine whether there is any difference in
the performance of the retail industry before and after the e-commerce booming This
paper may provide knowledge on the impact of the retail shop’s financial performance
on the growth of internet shopping.
2. Wei, Wei & Zhu, Wuxiang & Lin, Guiping. (2020). Symbiont-Based Financial
Analysis: In the Case of the Retail Industry. This study involves implementing
financial indicators to assess and compare enterprises, where the researchers, used the
industry-based DuPont analysis and ratio analysis techniques. Suggestions for the
future operation of businesses are also focused on the assessment of these factors.
3. Demirgüneş, Kartal. (2016). The Effect of Liquidity on Financial Performance:

Evidence from Turkish Retail Industry. International Journal of Economics and
Finance. The purpose of this study was to examine the impact of liquidity on financial
performance using time series data from the Turkish retail industry in 1998. The unit
root test is used to assess the rationality of series and the co- integration relationship
between them.
4. Savio, Riccardo. (2021). Organizational behavior and firm performance: A study of

Italian retail industry. Risk Governance and Control: Financial Markets and
Institutions. The study provides evidence on the effects on firm performance. They
studied the role of extended shopping hours on the performance of retail firms. To that
end, they gathered data from a large sample of limited liability companies in Italy,
where reform was implemented in 2012 to stimulate the economy, along with the
liberalization of shop opening hours.
5. Nguyen, Phi & Tsai, Jung-Fa. (2020). A Decision Support Model for Financial
Performance Evaluation of Listed Companies in The Vietnamese Retailing Industry.
13
Journal of Asian Finance Economics and Business. The aim of this paper is to propose
a Comprehensive Decision Support Model for evaluating the financial performance of
retail companies listed on the Vietnam Stock Exchange Market. Valuation ratios,
profitability ratios, growth rates, liquidity ratios, efficiency ratios, and leverage ratios
have also been used to assess financial performance.
6. Chen, Yao & Motiwalla, Luvai & Khan, Muhammad. (2004). Using Super- Efficiency
DEA To Evaluate Financial Performance Of E-Business Initiative In The Retail
Industry. International Journal of Information Technology and Decision Making. This
paper shows that infeasibility does not always imply the best performance when super-
efficiency is identified as input savings or output surplus obtained by a particular
efficient DMU. A recent methodology is used to correctly define and rate the output of
a number of Electronic Business (EB) and non-EB businesses, in the retail sector.
7. Lee, Jeong & Kim, Sang-Su & Kang, Yun-Sik. (2018). Corporate Social Responsibility
and Financial Performance in Korean Retail Firms. Journal of Distribution Science.
The study investigates the relationship between a Korean retail firm's social
responsibility and its financial performance. From 2011 to 2016, publicly traded retail
companies were reviewed. The conventional view of corporate theory is generally
supported in this paper, especially in terms of Return on Equity (ROE) and Return on
Asset (ROA).
8. Hawaldar, Iqbal & Lokesha, & Sison, Sheila. (2016). An Empirical Analysis of
Financial Performance of Retail and Wholesale Islamic Banks in Bahrain. American
Scientific Research Journal for Engineering, Technology, and Sciences. This paper
investigates the financial stability of retail and wholesale Islamic banks in the
Kingdom of Bahrain. Six retail Islamic banks and seven wholesale Islamic banks
were chosen for the empirical investigation.
9. Dube, Cinderella & Gumbo, Victor. (2017). A Model for Financial Inclusion: The case
of the Retail Industry in Zimbabwe. Business and Management Studies. The aim of this
study is to investigate the current level of financial inclusion and to create a financial
inclusion model for Zimbabwe's retail industry. A total of 16 bank executives and 4
supermarket executives were interviewed. The findings showed that, although the retail
industry had embraced some financial inclusion programmes, others were still being
rejected.
14
10. Alami, H. & Hajaji, A. & Hilal, K. & Mokhlis, K. (2021). Social and Financial
Performance in Moroccan Companies. The regression econometric method was used
in the study to test the relationship between the Corporate Social Performance (CSP)
and Corporate Financial Performance (CFP) of Moroccan firms, using a sample of the
top 15 most profitable Moroccan companies listed on stock exchanges from 2010 to
2017, which are included in the Casablancastock exchange
1. Chellasamy, P. & Nagaling, Ponsabariraj. (2013). Profitability and trend analysis of

select retail companies in India. Retailing entails direct interaction with customers as
well as the alignment of business activities from start to finish. Annual net profit,
operational efficiency, changes in lifestyle, and demographic trends are driving the
Indian retail industry. This paper aims to examine the profitability position, overall
operating indicators, and trend analysis of identified Indian retailing companies from
2002-03 to 2011-12.
2. Roy, Satyajit. (2011). An Overview of Retail Industry in India: Its Growth,

Challenges, and Opportunities. Providing detailed information about the growth in the
Indian Retailing industry this research paper focuses on urban and semi urban retail markets. It
also talks about the brand consciousness among people from various socioeconomic classes.
This paper concludes with a discussion of the potential impact of global players entering the
Indian retailing industry. It also emphasizes the difficulties that the industry will face in the
coming years.
3. Athanassopoulos, Antreas. (1995). Performance improvement decision aid systems

(PIDAS) in retailing organizations using data envelopment analysis. Journal of
Productivity Analysis. This paper explores the utility of Data Envelopment Analysis
(DEA) models in multi-level retail organizations for strategic thinking. The article
suggests three components of market efficacy that relate to different tiers of
management in a multi-level setting.
4. Pandey, Pallavi & Singh, Saumya & Pathak, Pramod. (2019). Factors affecting
turnover intentions in the Indian retail industry. International Journal of Human
Resources Development and Management. This research is one of the first to look at
15
the turnover intentions of front-line workers in the Indian retail industry. Its aim is to
see how organisational factors such as job satisfaction, organizational engagement,
work stress, work climate, and practical job knowledge affect the intentions to quit.
5. Kumar, Nilesh. (2021). An Overview of Emerging Technologies in the Indian Retail

Industry. Many retailers in India are embracing and implementing the internet of
things, cognitive technologies, and RFID to improve client expertise. Secondary data
has been studied and reviewed in this chapter. The objective of this article is to
examine how technological innovations are transforming the business structure and
thereby developing potential benefits in the retail industry.
6. Zaid, Dheya A. & Ahmad, Irfan. (2020). Impact of firms specific on the financial
performance of Indian firms. The main goal of this article is to investigate the impact
of company specifics on an Indian firm’s financial performance. The research is
focused on 1069 companies that were listed on the Bombay Stock Exchange between
2011 to 2017. The data is analysed using descriptive statistics, correlation matrices,
and regression models.
7. Dash, Sakti & Swain, Rabindra. (2020). DETERMINANTS OF CORPORATE

FINANCIAL PERFORMANCE (An Indian Perspective). Financial success is the ideal
yardstick by which sustainability can be calculated in order to sustain itself in the long
run. It is a significant phenomenon that reflects a company’s financial health. This
research is focused on an empirical analysis of non- financial companies in the Nifty
500 to assess the determinants of the financial performance of the company.
8. Banu, Meraj & Vepa, Sudha. (2021). A Financial Performance of Indian Banks Using
CAMELS Rating System. Journal of Contemporary Issues in Business and
Government. The study’s aim is to examine the Indian banking sector’s financial and
operational efficiency. Capital Adequacy Ratios, Ratios of Asset Quality, Ratios of
Management Capability, Ratios of Earnings to Quality Sensitivity to market risk, and
liquidity ratios are the ratios that are used for the analysis based on the CAMELS
acronym. The time frame in consideration is 2010–2019. The findings of the study are
analysed using descriptive statistics. To check the hypothesis, correlation and the t-test are
used.
9. Bhanawat, Hemant. (2018). Financial Performance of Indian Cement Industry: Study
16
of Selected Units. The aim of this research paper is to look into the production and
sales trends of a few different cement companies. It will assess the sample companies’
short- and long-term financial viability, as well as define the factors that affect their
profitability.
10. Kumar, Amit (2017). Financial Performance - Comparative Analysis between Infosys
and TCS. The researcher here measured the overall finance of business by
consolidating historical data related to finance. It involved a comparison of past
performances and trends of the company. Also, in order to stabilize the taxation
system, the study provided a thorough analysis of the financial assistance backed by
the government organizations.
17
CHAPTER 3
Research Methodology
3.1 Objectives of the Study
3.2 Research Hypothesis
3.3 Scope of the Study
3.4 Source of Data
3.5 Limitations of the Study
18
RESEARCH METHODOLOGY
3.1 Objectives of the Study
 To analyze the short-term solvency of Shoppers Stop and Trent Ltd.
 To determine the long-term solvency position of the companies.
 To analyze the overall efficiency of both companies.
 To examine the profitability of Shoppers Stop and Trent Ltd.
1. There is no significant difference in the short-term solvency position ofShoppers Stop and
Trent Ltd.
2. There is no significant difference in the long-term solvency position of Shoppers Stop and
Trent Ltd.
3. There is no significant difference in the overall efficiency of Shoppers Stop andTrent Ltd.
4. There is no significant difference in the profitability of Shoppers Stop and Trent Ltd.
3.3 Scope of the Study
The study uses secondary data to compare and analyze the financial performance of Shoppers Stop
and Trent Ltd. It tries to ascertain which company has been better in its financial management in the
last three years. It studies various financial ratios through themeans of some statistical tools.
3.4 Source of Data
The research is mainly focused on secondary data acquired from the annual report and evaluation of
other financial statements from the previous three years of both companies. It contains data from
sources such as the internet, where publications, essays, blogs, documents, and academic papers on
the subject are studied.
3.5 Limitations of the Study
The research analysis is likely to have some drawbacks, which are stated below to
comprehend the study’s results in their proper sense:
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 The research is restricted to secondary data sources to analyze the financial
performances of the chosen companies, which may have an effect on the original
findings.
 The secondary data displays the facts and figures drawn out of the annual reports of
the companies. It’s possible that the information provided in annual reports is just
window dressing and does not accurately reflect the company’sfinancial situation.
 The analysis focuses on just two companies namely Shoppers Stop Ltd. and Trent
Ltd. A more comprehensive analysis can be conducted in the future by including
more corporations.
20
CHAPTER 4
Data Analysis
4.1 Data Representation and Interpretation
4.2 Hypotheses Testing
21
DATA ANALYSIS
Comparing the financial performance of Shoppers Stop and Trent Ltd. is the main objective of this
study and in order to accomplish that, it is decided to draw out the financial statements and annual
reports of the companies from the past three years. The analysis would be done by deriving various
financial ratios, determining efficiency, profitability, and solvency position, which are calculated by
referring to the balance sheets of both companies.
Further, the analysis of this research involves the calculation of some statistical measures in order to
study the data deviated, fluctuation, growth, and annual growth of both firms.
Therefore, the analysis is done on the basis of the following statistical avenues: -
1. MEAN:
Mean (or average) is the most prevalent measure of central tendency. It is determined by dividing the sum
̅.
total of values in the data set by the number of values into the data set. Mean is denoted by 𝑋
Formula:
x1+x2+⋯+x3
̅) =
Mean (𝑋
n
OR
∑𝑥
Mean (𝑋̅) =
𝑛
The mean is basically a representation of your data collection. It is the value that is most
common. The mean is not necessarily one of the actual values that are identified in any data
collection. One of its valuable properties, however, is that it minimizes error in predicting
any single element in a certain data set. That is, it is the value that causes the least amount
of error, as compared to all other values.
2. STANDARD DEVIATION:
The Standard Deviation(𝜎) of a data set is a calculation of the magnitude of differences between the values
of the observations found in the data set from a statistical point of view. But from a financial perspective,
the standard deviation will help investors measure how risky an investment is and assess their minimum
necessary return on investment.
Formula:
∑(𝑋−𝑋 2 )
Standard Deviation (𝜎) = √
𝑛−1
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Standard deviation is a valuable method in investment and trading strategies because it helps forecast
performance trends as well as measure market and security volatility. The standard deviation rises high, as
prices shift up or down, indicating thatvolatility is high. If there is a narrow gap between trading ranges, the
standard deviation is low, suggesting that volatility is low.
3. COEFFICIENT OF VARIATION:
The Coefficient of Variation (CV) is a measure of the dispersion of data points around the mean in a data
sequence. The coefficient of variance is a useful metric for measuring the degree of variation between two
data sets, even though the means aresignificantly different. It describes the ratio of the standard deviation to
the mean.
Formula:
𝑆𝑡𝑎𝑛𝑑𝑎𝑟𝑑 𝐷𝑒𝑣𝑖𝑎𝑡𝑖𝑜𝑛
Coefficient of Variable =
𝑀𝑒𝑎𝑛
OR
𝜎
CV = ̅
𝑋
An individual can define the risk-to-reward ratio for every security and make an investment decision by
evaluating the coefficient of variation of multiple securities. In general, an investor looks for a security
with a lower CV since it offers the optimal risk- to-reward ratio, with low uncertainty and high returns.
Nevertheless, when the averageexpected return is less than zero, the low coefficient is unfavorable.
23
4.1 Data Representation and Interpretation
STUDY NO. 1-
TO ANALYZE THE SHORT-TERM SOLVENCY OF SHOPPERS STOP AND TRENT
LTD.
In order to interpret the short-term solvency position of any company, an individual is

required to determine the Liquidity Ratio. These ratios are used to indicate a company’s
potential to sustain its day-to-day expenditures or fulfil its short-term obligations, which
usually last up to a year. It assesses a company’s ability to pay offits debts when they become
due, using its profits or resources at the disposal.
To analyze whether Shoppers Stop or Trent is better at meeting its short-term

obligations, three different types of liquidity ratios are calculated, namely, Current ratio,
Quick Ratio, and Cash Ratio.
 Current Ratio
Definition:
The Current Ratio is also known as Working Capital Ratio evaluates a company’s ability to
meet its short-term debts that are due within a year. The weight of total current assets over
total current liabilities is taken into account in this ratio. It shows a company’s financial
position and informs investors and analysts about how it can make the most of its existing
assets to settle debts and interest payable. When measured repeatedly over time, it also
provides further insight.
Formula:
Current Assets
Current Ratio =
Current Liablities
Indications:
The commonly acceptable current ratio is 2:1, which is a good financial condition for most
businesses. The greater the ratio, the more liquid the company, as it indicates that the firm is
more likely to meet its obligations due, in the coming year.
Nonetheless, if the ratio is extremely high (greater than 2), the organization may not be
adequately utilizing its current assets or short-term lending facilities. This may also be a
sign of an issue with the management of working capital.
24
A low current ratio (less than 1) suggests that a corporation will have trouble covering its
current obligations. However, in order to get a better understanding of acompany’s liquidity,
an investor should look at its operating cash flow, as a low current ratio can be sustained by
a stable operating cash flow.
Comparison:
CURRENT RATIO
Table 1
YEAR SHOPPERS STOP LTD. TRENT
LTD.
2017-18 1.00 1.13
2018-19 1.04 1.61
2019-20 0.48 0.44
The data shown in Table 1, compares the current ratio, showing that before, in 2018 and
2019, both the companies had an acceptable ratio but later in 2020 they had a low current
ratio which clearly represents that they were not able to cover their current liabilities in a
short term.
Calculations:
CURRENT RATIO
Table 2
SHOPPERS STOP LTD. TRENT LTD.
Mean 0.84 1.06
Standard Deviation 0.31 0.59
Coefficient of Variation 37.19 55.48
(%)
Growth (%) -52 -61.06
Annual Growth (%) -17.33 -20.35
25
 Quick Ratio
Definition:
Quick ratio is also known as the Acid-test Ratio assesses a company’s ability to meet
existing obligations without selling inventory or seeking additional funding. The quick ratio
is a more conservative metric than the current ratio, as it excludes current assets such as
inventory and prepaid expenses, which cannot be converted into cash quickly.
Formula:
Current Assets−Inventories−Prepaids
Quick Ratio =
Current Liabilities
OR
(Cash+Cash Equivalents+Marketable Securities+Accounts Receivables)

Quick Ratio =
Current Liabilities
Indications:
The ideal Quick Ratio is considered to be 1:1. It means the company has precisely enough
money to pay off its existing liabilities in a moment.
If the quick ratio is less than one, the firm will not be able to pay off any of its current
liabilities in the short term. If the ratio is greater than one, it indicates that the firm keeps
enough liquid assets to pay off its current liabilities right away.
The higher the ratio, the greater a company’s liquidity and financial health; the lower the
ratio, the more likely it is that it will have trouble covering its debts.
26
Comparison:
QUICK RATIO
Table 3
LTD.
2017-18 0.57 1.09
2018-19 0.31 0.87
2019-20 0.12 0.17
After observing Table 3, it can be said that Trent Ltd. comparatively had a better acid-test
ratio than Shoppers Stop throughout the 3 years, but still is low as required. For both the
companies, the ratios went consequently down, indicating their difficulty in paying off their
short-term liabilities.
Calculations:
QUICK RATIO
Table 4
Mean 0.33 0.71
Coefficient of Variation
67.77 67.66
(%)
Growth (%) -78.94 -84.40
Annual Growth (%) -26.31 -28.13
27
INTERPRETATION OF STUDY NO. 1-
Graph 1
Liquidity Ratios
1.2
1.06
1
0.84
0.8 0.71
0.6
0.4 0.33
0.2
0
Shoppers Stop Trent
current ratio quick ratio
The Graph above represents the mean of the Liquidity Ratios of both companies from
past three years:
Current Ratio: Shoppers Stop with a lower current ratio, is not capable of turning its products
into cash or to fund its obligations over the next 12 months. Whereas, TrentLtd. has a
relatively stable financial status, suggesting a strong operating period.
Quick Ratio: Trent Ltd is more capable than Shoppers Stop of retaining sufficient liquid
assets to pay off current liabilities immediately without the need for additionalfunds.
28
STUDY NO. 2-
TO DETERMINE THE LONG-TERM SOLVENCY POSITION OF THE COMPANIES.
The long term solvency position is derived out by interpreting the Solvency Ratio, also
referred to as the Financial Leverage Ratios. It defines a company’s capacity to fulfill long-
term liabilities. The ratio shows a company’s ability to repay long-term obligations on a
regular basis, including fixed interest payments and principal.
In order to achieve our objective of determining a better long-term solvency position

between the two companies, three solvency ratios are derived out with the help of the
financial statements of both companies.
 Debt to Equity Ratio
Definition:
The Debt to Equity (D/E) ratio compares a company’s total liabilities to its shareholder
equity and is used to calculate how much leverage it has. In corporate finance, this ratio is a
significant measure. It’s an indicator of how much a corporation relies on debt to finance its
projects rather than wholly owned funds. In the event of a tough economy, it represents the
willingness of shareholder equity topay all unpaid debts.
Formula:
Total Liabilities
Debt to Equity Ratio =
Total Shareholder′ sFund
Indications:
The optimal D/E ratio varies between different service industries, but in general, a debt-to-
equity ratio of less than 1.0 is termed comparatively safer, whereas ratios of
2.0 or higher are considered risky.
A D/E ratio of 2 means that the corporation borrows twice as much money as it owns, with
debt accounting for two-thirds of capital and shareholder equity accounting for one-third. In
order to operate without fear of deferring on its bonds or loans, a company’s management
will strive for a debt load that is consistent with a desirable D/E ratio.
29
Comparison:
DEBT TO EQUITY RATIO
Table 5
LTD.
2017-18 0.05 0.24
2018-19 0.00 0.23
2019-20 0.91 0.12
Comparing the Debt to equity ratio, it shows that once Trent Ltd had a higher ratio which
in this case is not safe but later in 2020 it managed to keep it low. Whereas Shoppers Stop,
always had a ratio of less than one suggesting that the corporation uses equity to fuel
growth twice as much as it does debt.
Calculations:
DEBT TO EQUITY RATIO
Table 6
Mean 0.32 0.2
159.86 33.86
(%)
Growth (%) 1720 -50
Annual Growth (%) 573.33 -16.67
 Interest Coverage Ratio
Definition:
The interest coverage ratio is a debt to profitability ratio that defines how easily a business
can pay interest on its debt. The ratio is calculated by dividing a company’s earnings before
interest and taxes (EBIT) by its interest expense during a given period of time. This equation
is commonly used by lenders, investors, and creditors to monitor a company’s risk-bearing
30
ability in relation to its existing debt or potential borrowing.
Formula:
Earnings Before Interest and Tax(EBIT)

Interest Coverage Ratio =
Interest Expenses
here, EBIT = Operating Income
Indications:
An adequate interest coverage ratio differs not only by sector but also by the company
within the same sector. For an organization with strong, consistent sales, an interest
coverage ratio of at least two is usually considered the minimum appropriate number.
A coverage ratio of three or higher is preferred by financialexperts.
The lower the percentage, the more debt-cost burdened the corporation is. A company’s
ability to meet interest costs can be doubted if the interest coverage ratiois just 1.5 or lower.
Comparison:
INTEREST COVERAGE RATIO
Table 7
LTD.
2017-18 3.20 6.62
2018-19 10.94 6.16
2019-20 0.74 2.03
Here, Trent Ltd had a high and consistent ratio for 2 years later it turned down in 2020 but it
was acceptable as it was more than two defining its ability to cover up the interest on its debt.
On the other hand, Shoppers Stop a had high ratio in 2018 and 2019, providing its investors a
better and preferable environment but in the last year, the company was not able to meet its
interest cost payments as it was lower than one.
31
Calculations:
INTEREST COVERAGE RATIO
Table 8
Mean 4.96 4.94
107.32 51.2
(%)
Growth (%) -76.87 -69.33
Annual Growth (%) -25.62 -23.11
 Debt Ratio
Definition:
The Debt Ratio, also known as the Debt to Asset Ratio, is a leverage measure that
calculates how much of a value of the asset is funded by debt.
Creditors also use this ratio to assess the amount of debt owed by a company, the ability to
pay back the debt, and whether or not new loans would be available to thecompany.
Formula:
Total Liabilities
Debt Ratio =
Total Assets
Indications:
A Debt Ratio higher than one implies that assets are used to finance a large proportion of
debt. In other words, the company’s liabilities outnumber its assets. A high ratio also means
that if interest rates increase unexpectedly, a business can beat risk of defaulting on its loans.
If the ratio is less than one, it means that a major percentage of a company’s assets is
financed by equity.
Investors hardly ever choose to buy shares in a business with a very low debt ratio. A debt
ratio of zero suggests that the company does not borrow to fund increased expenses,
32
limiting the overall return that can be earned and carried on to shareholders.
Comparison:
DEBT RATIO
Table 9
LTD.
2017-18 0.46 0.30
2018-19 0.60 0.34
2019-20 0.97 0.54
In the past three years, both the companies had good debt ratios as a ratio less than one
implies that the firm does not finance its assets from debt. But if compared Trent ltd had a
better ratio than Shopper Stop throughout the three years.
Calculations:
DEBT RATIO
Table 10
Mean 0.68 0.39
38.94 32.69
(%)
Growth (%) 110.87 80.00
Annual Growth (%) 36.96 26.67
33
Graph 2
Solvency Ratios
4.96 4.94
5
1 0.68
0.32 0.2 0.39
0
Shoppers Stop Trent
debt to equity ratio interest coverage ratio debt ratio
Graph 2, represents the average of the Solvency Ratios of both companies from past three
years:
Debt to Equity Ratio: A high debt-to-equity ratio mean that a business is not reaping the
benefits of increased profits that financial leverage may provide. It may lead a company to
have a dangerous trend of being financed by its creditors rather than its own financial
resources. Therefore, Trent has a better stand on its finances than Shoppers Stop by having a
lower debt/equity ratio.
Interest Coverage Ratio: Trent and Shoppers Stop both have a higher interest coverage ratio
than is preferred by investors, implying that they are in better financial health and are capable
of covering their lenders' interest expenses.
Debt Ratio: Trent’s high debt/asset ratio compared to Shoppers Stop demonstrates that the
organization has been aggressive in using its debt to fund its assets. The radical financing
can put future borrowing at risk.
34
STUDY NO. 3-
TO ANALYZE THE OVERALL EFFICIENCY OF BOTH COMPANIES.
Activity Ratio is another term for Efficiency ratios. These proportions measure a company’s
efficiency by using its liabilities and assets to increase revenue and maximize profits. The
efficiency ratio is widely used to determine how well a business handles its assets and
liabilities on a regular basis. The turnover of receivables, the redemption of liabilities, the
amount and utilization of equity, and the general use of stock and equipment can all be
calculated using an efficiency ratio.
This section of the research paper displays the comparison between Shoppers Stop Ltd. and
Trent Ltd. on the basis of their efficiency. Asset Turnover, Inventory Turnover, Debtors
Turnover, and Investments Turnover Ratios are measured to evaluate the objective.
 Asset Turnover Ratio
Definition:
The Asset Turnover ratio determines the value of a company’s sales or incomes to the value
of its assets. The ratio is a metric that measures how effectively a corporation uses its assets
to generate revenue. It is used by investors to compare firms in the same industry or group.
Significant asset sales, as well as purchases in a particular year, can have an impact on a
company’s asset turnover ratio.
Formula:
Net Sales
Asset Turnover Ratio =
Average Total Sales
Indications:
This ratio is usually computed once a year. The higher the asset turnover ratio of a company,
the more effective it is at obtaining profits from assets. In other words, it shows that the
business is profitable and produces minimal waste, as well as that your assets are still valued
and don’t need replacement. A lower ratio implies that the corporation is not very good at
generating revenue from its assets.
It’s important to keep in mind that these ratios vary a lot between sectors. Retail
companies, for example, have small asset reserves but much bigger sales units so their asset
35
turnover ratio is likely to be much higher. Therefore, the ratio of 2.5 or higher in the retail
sector is considered the ideal asset turnover ratio.
Comparison:
ASSET TURNOVER RATIO
Table 11
LTD.
2017-18 3.30 1.08
2018-19 3.52 1.25
2019-20 5.46 1.30
From the table above, it can be interpreted that Shoppers Stop is better at utilizing its assets to
generate revenue and has even been improving over time. Whereas, Trent Ltd has a low asset
turnover ratio in all three years.
Calculations:
ASSET TURNOVER RATIO
Table 12
Mean 4.09 1.21
29.04 9.53
(%)
Growth (%) 65.45 20.37
 Inventory Turnover Ratio
Definition:
Inventory Turnover is a financial ratio that shows how often a company’s inventory has been
sold and replaced during a given time span. The days it takes to sell the inventory on hand
can then be calculated by dividing the number of days in the period by the inventory
36
turnover formula. The companies can make better pricing, production, marketing, and
inventory procurement decisions by calculating this ratio.
Formula:
Cost of Goods Sold

Inventory Turnover Ratio =
Average Inventory
Indications:
Inventory turnover is a metric that analysts use to compare how rapidly a business sells
inventory to market averages.
For most industries, a healthy inventory turnover ratio is around 5 and 10 times, implying
that you sell and restock your supply, every 1-2 months. A high ratio means that there is
either strong sales or a lack of inventory in a company.
Low turnover indicates sluggish sales and, likely, surplus inventory also known as
overstocking. It may be the result of a poor promotion or a problem with the products being
listed for trade. A low inventory turnover rate may be advantageous, like when prices are
expected to increase or when shortages are anticipated.
Comparison:
INVENTORY TURNOVER RATIO
Table 13
LTD.
2017-18 12.21 6.63
2018-19 3.30 5.17
2019-20 2.76 5.87
In the financial year 2017-18, both the companies had a good inventory turnover ratio but
later Shoppers Stop either had surplus inventory or a decrease in sales cause it fell lower
than five. On the other hand, Trent continued to maintain a goodratio.
37
Calculations:
Table 14
Mean 6.09 5.89
87.14 12.4
(%)
Growth (%) -77.39 -11.46
Annual Growth (%) -25.79 -3.82
 Debtors Turnover Ratio
Definition:
The Debtors Turnover Ratio is an accounting metric that determining the efficiency with
which a business collects on its accounts receivable, or credit owed by its buyers or clients.
This ratio assesses how well a business handles and utilizes the credit it provides to
consumers, as well as how easily the debt is acquired or paid.
Formula:
Net Credit Sales

Debtors Turnover Ratio =
Average Account Receivables
Indications:
A high receivables turnover ratio can suggest that a corporation’s accounts receivable
management is effective and that the company has a big proportion of high-quality
customers who pay their debts on time. A high ratio might imply that a business is cash-
based. A high ratio may also indicate that a business is cautious about extending credit to
its customers.
A low receivables turnover ratio may be the result of a poor collection process, poor credit
practices, or consumers that are not financially feasible or creditworthy. A lowturnover ratio
usually indicates that the company’s credit policies need to be reviewed in order to ensure
38
timely recovery of receivables.
Comparison:
DEBTORS TURNOVER RATIO
Table 15
YEAR SHOPPERS STOP LTD. TRENT LTD.
2017-18 90.38 255.73
2018-19 79.00 186.22
2019-20 85.06 231.44
Comparatively, Trent Ltd has better management of accounts receivables and credits
and has a trustworthy customer base. But to look at it normally, both the companies had
a high debtors turnover ratio in all three years, indicating their prudent behavior against
their consumers regarding their credit policies.
Calculations:
DEBTORS TURNOVER RATIO
Table 16
Mean 84.81 224.46
6.71 15.72
(%)
Growth (%) -5.89 -9.49
Annual Growth (%) -1.96 -3.16
 Investments Turnover Ratio
Definition:
The investment turnover ratio is a financial metric that determines how efficiently a business
generates revenue using its debts and equity. Investors may use this ratio to see how
efficiently a business uses its resources to produce revenue. To put it another way, the
39
investment turnover ratio calculates how many times a business will turn over the money it
has invested in the company. Analysts comparing companies using this measure should make
sure that the figures are of companies inthe same sector.
Formula:
Net Sales
Investments Turnover Ratio =
Shareholder′ s equity+Outstanding Debt
Indications:
The company’s high investment turnover ratio suggests that it is actively turning over
shareholder’s invested shares in order to maximize its value. It denotes that the organization
makes good use of its capital and resources. As a consequence, the value of the shareholder’s
investment increases.
A low ratio, on the other hand, suggests that the company is inefficient, as it fails to raise
revenue from its debts and equity. A lower investment turnover ratio indicates that the
company’s activities are inefficient, implying that the stakeholder’s investment is not being
maximized.
Comparison:
INVESTMENT TURNOVER RATIO
Table 17
LTD.
2017-18 12.21 6.63
2018-19 3.56 5.17
2019-20 13.02 1.14
Shoppers Stop decreased by 8 times in the year 2019 in respect of the investment turnover
ratio, but later also increased by 10 times in 2020, implying a good utilization of its
resources. But Trent ltd. fails to obtain profits from its debts and equity, indicating
inefficient activities and a decrease in shareholder’s investments.
40
Calculations:
INVESTMENT TURNOVER RATIO
Table 18
Mean 9.6 4.31
54.64 65.92
(%)
Growth (%) 6.63 -82.80
Annual Growth (%) 2.21 -27.60

Graph 3
Efficiency Ratios
250
224.46
200
150
100 84.81
50
6.09
4.09 9.6 1.215.89 4.31
0
Shoppers Stop Trent
Asset Turnover Ratio Inventory Turnover Ratio Debtors Turnover Ratio
Investment Turnover Ratio
Mean of Efficiency Ratios of both companies from past three years are presented in the
graph above:
Asset Turnover Ratio: Trent’s efficiency at obtaining profits from its assets could be a source
of concern. Since, the asset turnover ratio is only 1.21, Trent is not utilizing its resources
properly. Shoppers Stop, on the other hand, is effective at using its assetsto produce sales.
41
Inventory Turnover Ratio: Shoppers stop’s high ratio implies that it can more efficiently
sell the inventory it buys. Furthermore, it may show that Shopper Stop is not overspending
on inventory purchases and does not incur high storage and holding costs compared to
Trent.
Debtors Turnover Ratio: With a high ratio, Trent follows a conservative credit strategy and
it’s collection of accounts receivable is more frequent and reliable as compared to Shoppers
Stop. It also reflects a greater chance to recover from debts since the business will benefit
from a high-quality customer base.
Investment Turnover Ratio: Shoppers Stop is efficient in utilizing its resources and in turning
over stakeholders invested shares in order to increase its value. Meanwhile, Trent's lower
investment turnover ratio suggests that the company is inefficient in its operations, which
means that the shareholders' investment is not being maximized.
42
STUDY NO. 4-
TO EXAMINE THE PROFITABILITY OF SHOPPERS STOP AND TRENT LTD.
Profitability ratios show how well a company is able to produce sales and income from its
activities. The ratio denotes, whether or not a business is profitable. It examines whether the
company is able to fulfil the expectations of its shareholders in terms of return on investment.
From the past three years of financial statements of Shoppers Stop Ltd. and Trent Ltd., some
of the profitability ratios are calculated in order to compare their performance in relation to the
profit they earned in those years. The ratios assessed are Gross Profit Margin, Net Profit
Margin, Operating Profit Margin, and Return on Assets Ratio.
 Gross Profit Margin
Definition:
Gross profit margin is a financial indicator that shows how effectively a company’s
operations are managed. It’s a ratio that measures a company’s sales output based on the
efficiency of its manufacturing process. It is an important financial indicator for both,
company managers and investors because it shows how efficiently a company can
manufacture and sell one or more goods before subtracting extraneous costs.
Gross profit margin, often referred to as the gross margin ratio, is commonly
expressed as a percentage of revenue.
Formula:
Gross Profit
Gross Profit Margin =
Total Revenue
here, Gross Profit = Total Revenue - Cost of Goods Sold
Indications:
A healthy Gross profit margin is considered to be 65%.
A poor gross profit margin indicates that the ratio percentage is below industry norms and
possibly lower than the company’s previous periods. In other words, your sales rates are not
high enough in relation to the cost of goods sold, or COGS, which are the costs of making or
acquiring products.
43
A higher gross profit margin suggests that there is more cash available to fund indirect and
other costs such as interest and one-time expenditures. As a result, it’s a vital ratio for
entrepreneurs and financial experts to use when evaluating a company’s financial health.
Comparison:
GROSS PROFIT MARGIN (%)
Table 19
LTD.
2017-18 2.77 7.72
2018-19 3.39 7.50
2019-20 3.26 10.45
Both the companies have a low gross profit margin indicating limited cash available to
finance indirect costs. But if measured, Trent ltd has better management of its sales rate and
cost of goods sold, since it not only has a higher ratio than Shoppers Stop, but also a higher
ratio as compared to the years before, as seen in Table 19.
Calculations:
GROSS PROFIT MARGIN (%)
Table 20
Mean 3.14 8.56
10.41 19.21
(%)
Growth (%) 17.69 35.36
44
 Net Profit Margin
Definition:
The net profit margin is a profitability ratio that measures a company’s profit as a percentage
of income or net sales. It takes into account all of a company’s costs and not just the cost of
goods sold. It’s a measure that compares a company’s earnings to its overall revenue. This
ratio is used by analysts to determine the financial stability of a company.
Formula:
Net Profit
Net Profit Margin =
Total Revenue
here, Net Profit = Total Revenue - Total Expenses

Indications:
A high net profit margin indicates that a business can efficiently manage costs and/or sell
products or services at a price that is substantially higher than its costs. As a result, a high
ratio may indicate effective management, low costs (expenses), or active pricing methods
A low margin indicates that a firm’s cost structure and pricing policies are inefficient. As a
consequence, a low ratio may be caused by ineffective management, high expenses, or poor
pricing strategies.
Comparison:
NET PROFIT MARGIN (%)
Table 21
LTD.
2017-18 0.32 5.64
2018-19 2.26 5.03
2019-20 -4.16 4.86
45
The table above interprets that Shoppers stop had a low net profit margin, later which
became negative in 2020 implying its inefficient pricing policies. Trent Ltd had an
acceptable net profit margin in all three years as the higher the ratio, the better the
organization is at managing its costs pricing methods.
Calculations:
NET PROFIT MARGIN (%)
Table 22
Mean -0.53 5.18
-625.19 7.92
(%)
Growth (%) -1400.00 -13.83
Annual Growth (%) -466.67 -4.61
 Operating Profit Margin Ratio
Definition:
The Operating Profit Margin is a profitability ratio that represents the percentage of profit
generated by a company’s activities before taxes and interest charges are deducted. It’s
determined by dividing the operating profit by total sales.
Formula:
Operating Profit
Operating Profit Margin Ratio =
Total Revenue
here, Operating Profit = Total Revenue - Cost of Goods Sold - Operating Expenses -
Depreciation and Amortization
Indications:
This ratio helps to measure a firm’s operational quality. A trend analysis is typically
performed between two separate accounting periods to determine progress or deterioration
in operational capability.
46
A high ratio can mean better resource management, i.e., increased operational
efficiency, which leads to increased operating income in the business.
A low ratio may imply administrative failures and inadequate resource management; it also
means that the profit produced from operations is insufficient in comparison to overall
revenue derived from the sale.
Comparison:
OPERATING PROFIT MARGIN (%)
Table 23
LTD.
2017-18 5.89 9.74
2018-19 7.27 9.34
2019-20 16.25 17.72
In 2020, both the companies had a great rise in generating their operating profits
increased their operational efficiency and capabilities. But still, Trent Ltd beats Shoppers
Stop by having a bigger margin all through the three years.
Calculations:
OPERATING PROFIT MARGIN (%)
Table 24
Mean 9.80 12.27
57.38 38.53
(%)
Growth (%) 175.89 81.93
47
 Return on Assets Ratio
Definition:
Return on assets (ROA) is a measure of a firm’s profitability in relation to its total assets.
The return on assets tells a manager, investor, or analyst how effectively a firm’s
administration is using its assets to produce profits. ROA is displayed as a percentage.
Formula:
Net Income
Return on Asset Ratio =
Average Total Assets
Indications:
A low ROA is not a positive sign for a company’s growth because it means that the
organization is unable to make the best use of its resources in an attempt to maximize
profits.
It is often preferable to have a higher ratio. Since it means that the organization is
successfully using its assets in order to increase net profits. A high return on assets suggests
that the company is doing well in terms of financing and operations.
ROAs of over 5% is considered good, and those of over 20% is considered outstanding.
However, ROAs should always be compared among companies in thesame industry.
Comparison:
RETURN ON ASSETS (%)
Table 25
LTD.
2017-18 0.65 5.04
2018-19 3.18 4.97
2019-20 -3.46 2.86
Shoppers Stop tried and increased its ratio by 3% in 2019 but again failed to maximize
profits by utilizing its assets as it declined to -3.46% in 2020. On the other hand, Trent also
48
had a good ROA in 2017-18 but later it also decreased in the consecutive years implying
that the company is not good at managing its finance operations. Comparatively, Shoppers
Stop had a poor return on assets percentage.
Calculations:
RETURN ON ASSETS (%)
Table 26
Mean 0.12 4.29
2717.18 28.88
(%)
Growth (%) -632.31 -43.25
Annual Growth (%) -210.77 -14.42
INTERPRETATION OF STUDY NO. 4 -
Graph 4
Profitability Ratios
14
12.27
12
9.8
10
8.56
8
6 5.18
4.29
4 3.14
2
0.12
0
-0.53
shoppers stop trent
-2
Gross Profit Net Profit Operating Profit Return On Assets
Graph 4 represents the average of Profitability Ratios of Shoppers Stop and Trent Ltd.
from past three years:
49
Gross Profit Margin: Trent Ltd has a decent gross profit margin than Shoppers Stop,
implying that it has enough cash to cover indirect and other expenses.
Net Profit Margin: Trent is in a better position than Shoppers Stop, as it can sell goods or
services at a price that is far greater than its prices, with its high margin.
Operating Profit Margin: Shoppers Stop has a poor operating margin, meaning that it
generates inadequate income from operations in relation to overall revenue derived from the
sale. Whereas, Trent Ltd. relatively have increased operating income in the business.
Return on Assets: Trent ltd is outperforming Shoppers Stop in terms of funding and
activities, as it earns more revenue with less investment. The low percentage of return on
assets suggests that Shoppers Stop might have a strategic management issue or make
inefficient use of its facilities.
50
4.2 Hypothesis Testing
In this research, there are four hypotheses that are studied and tested. For this purpose, we
have employed T-test on excel and the results are listed below.
1. Our first hypothesis is that there is no significant difference in the short-term

solvency position of Shoppers Stop and Trent Ltd.
In other words,
Ho: Liquidity Position of Shoppers Stop Ltd. = Liquidity Position of Trent Ltd.
Table 27
t-Test: Two-Sample Assuming
Unequal Variances
Shoppers Stop Trent
Mean 0.585 0.885
Variance 0.13005 0.06125
Observations 2 2
Hypothesized Mean Difference 0

df 1
t Stat -0.970015709
P(T<=t) one-tail 0.2548444058
t Critical one-tail 6.313751515
P(T<=t) two-tail 0.5096888117
t Critical two-tail 12.70620474
 At 5% Significance level.
From Table 27, it is computed that the t-value is -0.97002 and the p-value is
.217182. Hence from these two parameters, it can be said that the result is not
significant at p < 0.05.
To put it differently, the null hypothesis (Ho) is not rejected. Hence, we can conclude that
there is no significant difference between the short-term solvency position of Shoppers Stop
Ltd. and Trent Ltd.
51
2. The next hypothesis of our study is that there is no significant difference in the long-
term solvency position of Shoppers Stop and Trent Ltd.
In other words,
Ho: Solvency Position of Shoppers Stop Ltd. = Solvency Position of TrentLtd.

Table 28

Unequal Variances
Shoppers Stop Trent
Mean 1.986666667 1.843333333
Variance 6.662933333 7.201033333
Observations 3 3

df 3
t Stat 0.06667516137
P(T<=t) one-tail 0.475517552
P(T<=t) two-tail 0.951035104
From Table 28, it is computed that the t-value is 0.06668 and the p-value is
0.47502. Therefore, from these two parameters, it can be said that the result is
not significant at p < 0.05.
In other words, the null hypothesis (Ho) is accepted. As a result, we can suspect that
there is no significant difference between the long term solvency positions of
Shoppers Stop Ltd. and Trent Ltd.
3. The third hypothesis of this study is that there is no significant difference in the
overall efficiency of Shoppers Stop and Trent Ltd.
In other words,
52
Ho: Overall Efficiency of Shoppers Stop Ltd. = Overall Efficiency of Trent Ltd.
Table 29

Unequal Variances
Shoppers Stop Trent
Mean 26.1475 58.9675
Variance 1534.648425 12176.11989
Observations 4 4
df 3
t Stat -0.5605800994
P(T<=t) one-tail 0.3071123183
P(T<=t) two-tail 0.6142246366

From the above table the computed t-value is -0.56058 and the p-value
is 0.30712. Thus, from these two parameters, it can be said that the result is not
significant at p < 0.05.
In other words, the null hypothesis (Ho) is accepted. Hence, we can suspect that
there is no significant difference between the overall efficiency of Shoppers Stop
Ltd. and Trent Ltd.
4. The last hypothesis of our study is that there is no significant difference in the
profitability of Shoppers Stop and Trent Ltd.
In other words,
Ho: Profitability of Shoppers Stop Ltd. = Profitability of Trent Ltd.
53
Table 30

Unequal Variances
Shoppers Stop Trent
Mean 3.1325 7.575
Variance 22.31489167 13.18016667
Observations 4 4

df 5
t Stat -1.491329075
P(T<=t) one-tail 0.09803734804
P(T<=t) two-tail 0.1960746961
The computed t value, from the above table is -1.49133 and 0.09804 is the p- value.
Hence from these two parameters, it can be said that the result
is not significant at p < 0.05.
In other words, the null hypothesis (Ho) is not rejected. As a result, we can
conclude that there is no significant difference between the profitability of
Shoppers Stop Ltd. and Trent Ltd.
54
CHAPTER 5:
RESULTS AND DISCUSSION
5.1 Major Findings

5.2 Discussions & Suggestions
5.3 Conclusion
55
RESULTS AND DISCUSSION
5.1 Major Findings
Following are the conclusions that can be drawn out from the representation of data shown above:
STUDY NO.1-
The first study examined in this research project, involved the comparison of the two companies on
the basis of their liquidity positions. Although, in the hypothesis testing it is configured that there has
been no such difference in their liquidity positions in the past three years, Shoppers Stop has a better
handle on its short term obligations and has retained its status.
STUDY NO.2-
In the last three years, the firms' long-term solvency positions have been determined to be equivalent
or similar. Both businesses had good debt management, suggesting that their cash flow statements
were adequate to cover their long-term liabilities and thus having a good financial health.
STUDY NO.3-
Under the third objective of this research, Shoppers Stop and Trent Ltd. were compared to provide a
detailed evaluation of their overall operational efficiency. After the analysis, it is known that both of
them were successful in utilizing their assets and manage their liabilities effectively in the current
period. Trent Ltd., in particular, had an excellent control over its credit policies with a solid customer
base.
STUDY NO.4-
The last objective or study included the assessment of both the firm’s profitability. When a
company's performance is examined, the bottom line for its management and return on equity for its
investors are decided. According to the T test review, there was no substantial difference in the
profitability of Shoppers Stop Ltd. and Trent Ltd.
5.2 Discussions and Suggestions
Investors who invest and have put money into the company’s shares are interested in its earnings and
potential profitability.
With its outstanding financial management, Trent Ltd. has attracted a high-quality customer base as well as
investors. And Shoppers Stop has outperformed its competitors on a consistent basis, although at a slower
56
rate of development.
5.3 Conclusion
Analyzing a company’s financial statement is one of the most important aspects of making a good investment
decision. Financial statement preparation and analysis is essential not only to adhere with business laws and
regulations, but also to accommodate the needs of a variety of stakeholders’ groups and parties.
The current paper examines the financial performance of Shoppers Stop Ltd. and Trent Ltd. from 2018 to
2020. For this purpose various ratios and statistical tools are used in the data analysis part.
With a higher liquidity rate, Shoppers Stop has better position than Trent in term of covering short term debts.
In terms of solvency and efficiency, both the companies were proved to be equally effective and have greater
efficiency in utilizing its own properties and assets. In respect of the profitability, Trent has performed well
and is ahead of Shoppers Stop in this field.
After evaluating all of the data analysis variables, it has been determined that Shoppers Stop’s output is
acceptable and satisfactory, but Trent Ltd maintains a good market position. As a result, stakeholders would be
willing to take a risk with their investments. Their investments will be worthwhile with good returns, keeping
them secure and stable.
57
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63
ANNEXURE
Balance Sheet of Shoppers Stop Ltd.
BALANCE SHEET OF SHOPPERS STOP (in Rs. Cr.) MAR 20 MAR 19 MAR 18
12 months 12 months 12 months
EQUITIES AND LIABILITIES
SHAREHOLDER'S FUNDS
Equity Share Capital 44.00 44.00 43.98
TOTAL SHARE CAPITAL 44.00 44.00 43.98
Reserves and Surplus 21.88 870.50 860.46
TOTAL RESERVES AND SURPLUS 21.88 870.50 860.46
TOTAL SHAREHOLDERS FUNDS 66.64 914.70 904.44
Minority Interest 0.00 0.00 0.00
NON-CURRENT LIABILITIES
Long Term Borrowings 0.22 2.02 44.00
Deferred Tax Liabilities [Net] 0.00 0.00 0.00
Other Long Term Liabilities 2,077.81 0.61 0.61
Long Term Provisions 0.00 0.10 0.00
TOTAL NON-CURRENT LIABILITIES 2,078.03 2.73 44.61
CURRENT LIABILITIES
Short Term Borrowings 155.26 30.22 38.35
Trade Payables 1,521.87 1,277.10 519.07
Other Current Liabilities 247.97 241.19 272.93
64
Short Term Provisions 11.08 9.65 8.22
TOTAL CURRENT LIABILITIES 1,936.18 1,558.16 838.56
TOTAL CAPITAL AND LIABILITIES 4,080.85 2,475.59 1,787.62
ASSETS
NON-CURRENT ASSETS
Tangible Assets 1,848.66 544.53 599.82
Intangible Assets 52.06 60.52 63.17
Capital Work-In-Progress 10.19 30.56 15.34
FIXED ASSETS 1,945.14 640.13 681.14
Non-Current Investments 36.47 215.90 262.43
Deferred Tax Assets [Net] 264.08 32.00 19.78
Long Term Loans And Advances 0.00 0.00 0.00
Other Non-Current Assets 160.76 169.22 216.35
TOTAL NON-CURRENT ASSETS 2,406.45 1,066.91 1,189.35
CURRENT ASSETS
Current Investments 154.04 42.45 20.04
Inventories 1,239.20 1,071.93 356.32
Trade Receivables 34.07 47.24 47.72
Cash And Cash Equivalents 4.35 17.44 6.04
Short Term Loans And Advances 0.00 0.00 0.00
Other Current Assets 242.74 229.61 168.17
TOTAL CURRENT ASSETS 1,674.40 1,408.68 598.27
TOTAL ASSETS 4,080.85 2,475.59 1,787.62
65
OTHER ADDITIONAL INFORMATION
CONTINGENT LIABILITIES, COMMITMENTS
Contingent Liabilities 247.55 211.34 62.21
BONUS DETAILS
Bonus Equity Share Capital 0.00 0.00 0.00
NON-CURRENT INVESTMENTS
Non-Current Investments Quoted Market Value 0.00 0.00 0.00
Non-Current Investments Unquoted Book Value 0.01 0.02 20.05
CURRENT INVESTMENTS
Current Investments Quoted Market Value 0.00 0.00 0.00
Current Investments Unquoted Book Value 111.04 42.47 0.00
Source : Money Control
66
Balance Sheet of Trent Ltd.
BALANCE SHEET OF TRENT (in Rs. Cr.) MAR 21 MAR 20 MAR 19
12 months 12 months 12 months
EQUITIES AND LIABILITIES
SHAREHOLDER'S FUNDS
Equity Share Capital 35.55 35.55 33.23
TOTAL SHARE CAPITAL 35.55 35.55 33.23
Reserves and Surplus 2,277.48 2,352.49 1,613.28
TOTAL RESERVES AND SURPLUS 2,277.48 2,352.49 1,613.28
TOTAL SHAREHOLDERS FUNDS 2,313.03 2,388.04 1,646.51
Minority Interest 44.49 80.26 -2.90
NON-CURRENT LIABILITIES
Long Term Borrowings 0.00 299.74 299.56
Deferred Tax Liabilities [Net] 0.00 0.00 25.48
Other Long Term Liabilities 2,600.80 2,233.16 0.44
Long Term Provisions 13.98 18.21 15.64
TOTAL NON-CURRENT LIABILITIES 2,614.78 2,551.11 341.12
CURRENT LIABILITIES
Short Term Borrowings 0.00 0.00 94.62
Trade Payables 274.56 297.65 244.97
Other Current Liabilities 470.42 182.39 228.86
Short Term Provisions 6.45 7.23 5.58
67
TOTAL CURRENT LIABILITIES 751.44 487.27 574.03
TOTAL CAPITAL AND LIABILITIES 5,723.73 5,506.68 2,558.76
ASSETS
NON-CURRENT ASSETS
Tangible Assets 3,134.62 2,668.97 593.97
Intangible Assets 0.00 42.27 42.06
Capital Work-In-Progress 0.00 23.32 87.18
FIXED ASSETS 3,134.62 2,734.56 723.21
Non-Current Investments 816.63 735.91 804.13
Deferred Tax Assets [Net] 114.52 110.40 0.00
Long Term Loans And Advances 2.35 2.34 2.27
Other Non-Current Assets 225.07 192.82 124.67
TOTAL NON-CURRENT ASSETS 4,320.38 3,803.22 1,680.43
CURRENT ASSETS
Current Investments 670.66 778.87 78.70
Inventories 428.39 607.81 497.01
Trade Receivables 20.76 17.12 16.54
Cash And Cash Equivalents 81.47 61.41 54.23
Short Term Loans And Advances 26.04 85.98 30.33
Other Current Assets 176.02 152.27 201.52
TOTAL CURRENT ASSETS 1,403.35 1,703.46 878.33
TOTAL ASSETS 5,723.73 5,506.68 2,558.76
OTHER ADDITIONAL INFORMATION
68
CONTINGENT LIABILITIES, COMMITMENTS
Contingent Liabilities 0.00 149.09 158.92
BONUS DETAILS
Bonus Equity Share Capital 0.00 10.88 10.88
NON-CURRENT INVESTMENTS
Non-Current Investments Quoted Market Value 0.00 0.00 0.00
Non-Current Investments Unquoted Book Value 0.00 671.60 728.69
CURRENT INVESTMENTS
Current Investments Quoted Market Value 0.00 0.00 0.00
Current Investments Unquoted Book Value 0.00 768.39 50.00
Source : Money Control
69
END
70
IMPACT OF E-BANKING ON CUSTOMER PREFERENCES IN
PRIVATE AND PUBLIC BANKS. A COMPARISON BETWEEN SBI
AND HDFC
Research Project Submitted in Partial Fulfilment of the Requirements
For the Degree of
BCOM Honours
By
Yash Kumar Nagar
To the
April 2021
Submitted by Guided by
Yash Kumar Nagar Dr. Geetanjali Shrivastava
18051175 Associate Professor
CERTIFICATE
It is certified that the work contained in the project report titled "IMPACT OF
E-BANKING ON CUSTOMER PREFERENCES IN PRIVATE AND PUBLIC
BANKS. A COMPARISON BETWEEN SBI AND HDFC," by "YASH
KUMAR NAGAR," has been carried out under my/our supervision and that this
work has not been submitted elsewhere for a degree.
Signature of Supervisor:
Name: Dr. Geetanjali Shrivastava, Associate Professor
Department: Commerce

April 2021
I
DECLARATION
I hereby declare that this project report entitled "IMPACT OF E-BANKING

ON CUSTOMER PREFERENCES IN PRIVATE AND PUBLIC BANKS. A
COMPARISON BETWEEN SBI AND HDFC" was carried out by me for the
degree of BCOM Honours under the guidance and supervision of Dr. Geetanjali
Shrivastava (Associate Professor) of Department of Commerce, BSSS College.
The interpretations put forth are based on my reading and understanding of the
original texts, and they are not published anywhere in any form. The other
books, articles, and websites I have used are acknowledged at the respective
place in the text. This research report is not submitted for any other degree or
diploma in any other University.
Place: Bhopal
Name of the Student: Yash Kumar Nagar
Class & Section: BCOM Honours
Date: 15/04/2021
II
ACKNOWLEDGEMENT
I would like to thank our Principal, Dr. Fr. John P.J., and Vice-Principal Dr. Sr.
Sonia Kurien for their immense support and blessings. I thank our HOD, Dr.
Amit Kumar Nag, for his support. I would like to express my special thanks of
gratitude to my research guide Dr. Geetanjali Shrivastava, Associate Professor
of Department of Commerce, for her valuable suggestions and guidance and for
giving me the golden opportunity to do this wonderful research project on the
topic: - IMPACT OF E-BANKING ON CUSTOMER PREFERENCES IN
PRIVATE AND PUBLIC BANKS. A COMPARISON BETWEEN SBI AND
HDFC, without her help, it would have been difficult for me to have reached
this state of completion of my project report. Also, I would like to thank my
parents and friends who helped me a lot in the preparation of this project.
I wish to acknowledge the help of all those who have provided me information,
guidance, and other help during my research period.
III
ABSTRACT
E-banking is the use of digital-era technologies to create both local and global
opportunities. IT allows a drastic reduction in transaction costs as well as the
development of new forms of banking opportunities that overcome time and
distance barriers. In e-banking, banking opportunities are local, global, and
immediate. Compared to other conventional banking distribution methods, e-
banking has many advantages. E-banking gives banks more customers, lower
costs, mass customization, product creativity, better marketing and connectivity,
the opportunity to grow non-core enterprises, and the ability to deliver services
regardless of location or time.
E-banking is expected to become an extensive banking system for customers as
new technology develops. E-banking saves money by giving consumers another
way to access their accounts without going to the Bank.
This research aims to examine the various online services offered by SBI and
HDFC in Bhopal and assess their effect on customers' preferences.
IV
TABLE OF CONTENTS
CHAPTER CONTENT PAGE NO.
1. INTRODUCTION 1
1.1 RATIONALE OF THE STUDY 2
1.2 INTRODUCTION TO BANKING INDUSTRY 2
1.3 INTRODUCTION TO SBI AND HDFC 5
1.3.1- SBI 5
1.3.2- HDFC 7
1.4 JUSTIFICATION OF THE TOPIC 8
2. REVIEW OF LITERATURE 9
2.1 NATIONAL REVIEWS 10
2.2 INTERNATIONAL REVIEWS 12
3. RESEARCH METHODOLOGY 15
3.1 OBJECTIVES 16
3.2 HYPOTHESIS 17
3.3 SCOPE OF THE STUDY 18
3.4 RESEARCH DESIGN 19
3.5 LIMITATIONS OF THE STUDY 20
V
4. DATA REPRESENTATION AND ANALYSIS 21
4.1 DATA REPRESENTATION 22
4.2 HYPOTHESIS TESTING 37
5. RESULTS AND DISCUSSION 44

5.1 MAJOR FINDINGS 45
5.2 SUGGESTIONS 45
5.3 CONCLUSION 46
6. REFERENCES 47
6.1 BIBLIOGRAPHY 48
6.2 WORKS CITED 49
7. ANNEXURE 51
7.1 QUESTIONNAIRE 52 - 56
VI
CHAPTER 1
INTRODUCTION
1.1 Rationale of the study

1.2 Introduction to the Banking Industry
1.3 Introduction to SBI and HDFC
1.4 Justification of the topic
1
Chapter 1
Introduction
1.1 Rationale of the Study-
E-banking is about using the technology of the digital era to build both local and global
opportunities. It allows a drastic reduction in transaction costs as well as the development of
new forms of banking opportunities that overcome time and distance barriers. In e-banking,
banking opportunities are local, global, and immediate. The benefits of internet banking over
other conventional banking distribution methods are numerous. Increased customer base, cost
savings, mass customization, product developments, better marketing, and communication,
ability to grow non-core businesses, and ability to provide services independent of location
and time constraints are all advantages of internet banking for banks. This research paper
aims to complement the existing expertise in the field of electronic banking. This study will
assist various individuals and institutions in understanding and developing an efficient
environment in the area of e-banking in India, which has seen a rapid increase in the field
following the current government's demonetization.
1.2 Introduction to Banking Industry-
1.2.1 BANKING INDUSTRY:
The banking sector is the most important component of the financial sector in the growth of
the Indian economy, accounting for roughly 70% of all funds flowing through the country's
financial sector. In India, the banking system serves three purposes:
• Payment system operations
• Depositor and protector of people's savings
• Issue loans to individuals and businesses

In every region, banking plays an important role. It is vital for a country's growth because it
provides funds for enterprises and plays an important role in the country's development. It
serves as a bridge for those who need funds for business purposes and those who have excess
funds. The banking industry has been adapting its operations to keep up with technological
advancements. Banks have evolved numerous systems and processes to carry out banking
transactions with ease and speed as a result of technological advancements. In a developing
country like India, where people are diverse and have varying needs and preferences, it is
evident that banks must provide high-quality services to their customers.
2
In India, banks are one of the most important actors in the financial system. Banking is
essential for any country's economic growth, or we might argue that the banking system is the
backbone of any economy. In 1786, India's first Bank was founded. The development of the
Indian banking system can be divided into three stages.
The first stage, which lasted from 1786 to 1969, saw the East India Company create
the Bank of Bengal (1809), the Bank of Bombay (1804), and the Bank of Madras (1843) as
separate units and rename them presidency banks. In 1920, these three banks merged to form
the Imperial Bank of India, which began as a private shareholders bank with mainly
European shareholders.
In the second stage, as part of the first stage of nationalization, the government took
significant steps. It nationalized the Imperial Bank of India (the State Bank of India Act) with
extensive banking facilities on a large scale, especially in rural and semi-urban areas. It
founded the State Bank of India (SBI), which acts as an agent for the Reserve Bank of India
(RBI) and handles all banking transactions for the country's union and state governments.
Due to the efforts of then-prime minister Mrs. Indira Gandhi, seven subsidiary banks of the
State Bank of India were nationalized in 1969, and 14 major private commercial banks in the
country were nationalized later that year.
In its reforms, the third stage of Indian banking growth introduced a slew of new
products and services to the banking sector. Under the chairmanship of M. Narasimha, a
committee was established in 1991 to work towards the liberalization of banking practices.
During this process, new international banks with ATM stations, as well as phone banking
and internet banking, were introduced. The system as a whole has become more user-friendly
and effective. Time, rather than money, is valued more highly in this scheme.
1.2.2 E-BANKING:
Online banking, also known as internet banking or online banking, is an electronic payment
system that allows Bank or other financial institution customers to make a variety of financial
transactions via the institution's website. In comparison to branch banking, which was the
conventional way customers accessed banking services, the online banking system would
usually link to or be a part of the Bank's core banking system. Some banks function as a
"direct bank" (also known as a "virtual bank"), relying solely on internet banking. Viewing
account balances, receiving statements, verifying recent transactions, moving money between
accounts, and making payments are only a few of the features offered by Internet banking
apps.
3
 History of e-banking
Distance banking services over electronic media, which began in the early 1980s, were the
forerunners of modern home banking services. The term 'internet' first became common in
the late 1980s, referring to the use of a phone line to access a banking system via a terminal,
keyboard, and TV or monitor. 'Home banking' may also refer to sending tones down a phone
line with directions to the Bank using a numeric keypad.
United American Bank, a community bank based in Knoxville, Tennessee, was the first to
offer home computer banking to customers in December 1980. United American teamed up
with Radio Shack to create a secure custom modem for its TRS-80 device, allowing bank
customers to securely access account information. Bill pay, account balance checks, and loan
applications were among the services available in the first year, as were game access, budget
and tax calculators, and daily newspapers. Thousands of people paid between $25 and $30 a
month for the service.
In 1981, four of New York's major banks (Citibank, Chase Manhattan, Chemical, and
Manufacturers Hanover) provided home banking services using the videotex scheme, many
on parallel tracks to United American. These banking services were only common in France
(where the use of videotex (Minitel) was subsidized by the telecom provider) and the United
Kingdom (where the Prestel system was used) due to the commercial failure of videotex.
When United American Bank collapsed in 1983 as a result of loan fraud on the part of bank
owner Jake Butcher, the 1978 Tennessee Democratic candidate for governor and organizer of
the 1982 Knoxville World's Fair, the creators of the first-to-market electronic banking system
sought to license it nationwide, but they were overtaken by competitors. The failed bank was
acquired by First Tennessee Bank, which made no effort to build or commercialize the
computer banking platform.
In the United Kingdom, online banking began in September 1982 with the introduction of
Nottingham Building Society's Homelink service, which was initially limited until being
extended nationwide in 1983. Homelink was made possible by a collaboration between the
Bank of Scotland and British Telecom's Prestel operation. The machine used a Prestel
viewlink system and a monitor or keyboard (Tandata Td1400) connected to the telephone
system and television set. Users may "move money between accounts, pay bills and arrange
loans, compare prices and order items from a few major retailers, search local restaurant
menus or real estate listings, plan vacations... join bids in Homelink's daily auctions, and send
electronic mail to other Homelink users," according to the website. To make bank transfers
and bill payments, a written instruction with the intended recipient's information had to be
4
submitted to the NBS, who entered the information into the Homelink system. Gas,
electricity, and telephone companies, as well as accounts with other banks, were common
recipients. The account holder used Prestel to enter the details of the payments to be made
into the NBS system. NBS then sent a check to the payee, along with advice detailing the
payment to the account holder. The payment was later transferred directly using BACS.
1.2.3 E-BANKING IN INDIA
The Reserve Bank of India's mission is to ensure that payment and settlement systems in
India are safe, effective, interoperable, approved, open, inclusive and consistent with
international standards. The vision is to aggressively promote electronic payment systems in
India in order to usher in a less cash-based society. The aim of the regulation is to encourage
creativity and competition in order to help payment systems meet international standards.
Various interventions of the Reserve Bank of India in the mid-eighties and early nineties
culminated in the provision of technology-based solutions. The need for a cost-effective
alternative method arose.
The Electronic Clearing Service (ECS) was founded in the 1990s to handle large and repeated
payments. A new avatar, the National Electronic Clearing Cell, was introduced in September
2008 to manage multiple credits to beneficiary accounts. The National Electronic Clearing
Service (NECS) is based on member banks' core banking systems. The retail funds' transfer
system was created in the 1990s to allow for electronic fund transfers for person-to-person
payments. In November 2005, a comprehensive framework was introduced to meet the needs
of individuals and businesses for one-to-one funds transfers. Prepaid instruments allow for
the exchange of goods and services in exchange for the value deposited on the payment
instrument. Smart cards, magnetic stripe cards, internet wallets, mobile accounts, mobile
wallets, and paper vouchers are all examples. Following the mobile banking guidelines, only
a few banks were allowed to offer the service after receiving the requisite permission from
the Reserve Bank of India. Retail payments in India present both obstacles and opportunities.
According to the Reserve Bank of India's Payment System Vision paper, the number of non-
cash transactions in India is low, at 6 per person. Government subsidies alone are expected to
be worth more than Rs.2.93 trillion, and electronic transactions have the potential to total
4.13 billion per year. Internet commerce is projected to cross Rs.465 billion by 2012,
according to a study by the Internet and Mobile Association of India (IAMAI).
The Reserve Bank of India founded the National Payment Corporation of India as an
umbrella organization to promote electrification. Many previous studies have emphasized the
major changes that are occurring in the banking sector as a result of the rapid advancement of
5
information technology. Sahai and Machiraju explored how emerging technology addressed
various needs and how these technologies interacted to create a universal e-marketplace and
e-service vision. While several new electronic payment products are being introduced, banks
must keep track of how they are being used. On the demand side, there has been concern
about the widening "digital divide" between the rich and the poor, as well as the different
operating environments in private and public sector banks on the supply side. Dutta and Roy
investigated internet growth from the perspective of a developing country and developed a
causal model using the System Dynamics (SD) approach to assist a developing country like
India in identifying the trend of Internet diffusion as a result of various policy options
pursued to foster internet diffusion in the country.
1.3 Introduction to SBI and HDFC-
1.3.1 SBI:
The State Bank of India (SBI) is a public sector banking and financial services statutory body
headquartered in Mumbai, Maharashtra, India. SBI is the world's 43rd largest Bank and the
only Indian Bank on the Fortune Global 500 list of the world's largest companies for 2020,
ranking 221st. It is India's largest public sector bank, with a 23 percent asset market share and
a 25 percent share of the overall loan and deposit market. The Bank is descended from the
Bank of Calcutta, which was established in 1806 via the Imperial Bank of India, making it the
Indian Subcontinent's oldest commercial Bank. The Bank of Madras combined with the Bank
of Calcutta and the Bank of Bombay, British India's other two presidency banks, and to create
the Imperial Bank of India, which later became the State Bank of India in 1955. In 1955, the
Indian government took control of the Imperial Bank of India, with the Reserve Bank of India
(India's Central Bank) holding a 60% stake and renaming the bank State Bank of India.
SBI's network of branches in India and abroad offers a variety of banking services,
including products for non-resident Indians (NRIs). SBI has 16 regional hubs and 57 zonal
offices located in India's most important cities.
In India, SBI has over 24000 branches. Its revenue in the financial year 2012–13 was
2.005 trillion (US$28 billion), with domestic operations accounting for 95.35 percent of
revenue. In the same financial year, domestic activities accounted for 88.37 percent of overall
earnings. SBI organized 11,300 camps and opened over 3 million accounts by September
under the Pradhan Mantri Jan Dhan Yojana, which was launched by the government in
August 2014 and included 2.1 million accounts in rural areas and 1.57 million accounts in
urban areas. The Bank had 191 overseas offices in 36 countries as of 2014–15, making it the
6
Indian Bank with the most international presence.
 HISTORY
The Bank of Calcutta, later renamed the Bank of Bengal, was established on 2 June 1806 and
became the forerunner of the State Bank of India in the first decade of the nineteenth century.
The Bank of Bengal was one of three Presidency banks, with the Bank of Bombay
(established on April 15, 1840) and the Bank of Madras (incorporated on 1 July 1843). Royal
charters culminated in the establishment of all three Presidency banks as joint-stock
companies. These three banks had exclusive rights to issue paper currency until 1861 when
the Government of India took over the right with the Paper Currency Act. On January 27,
1921, the Presidency banks merged, and the reorganized banking body was given the name
Imperial Bank of India. The Imperial Bank of India remained a joint-stock company, but it
was no longer backed by the government.
The Reserve Bank of India, India's Central Bank, gained a controlling interest in the
Imperial Bank of India under the terms of the State Bank of India Act of 1955. The Imperial
Bank of India became the State Bank of India on July 1, 1955. Since the RBI is the country's
banking regulatory body, the government of India purchased the Reserve Bank of India's
stake in SBI in 2008 to prevent any possible conflict of interest.
The State Bank of India (Subsidiary Banks) Act was passed by the government in
1959. As a result, SBI acquired eight banks that had previously been owned by princely
states. This was during the First Five-Year Plan, which put a heavy focus on rural
development. To increase its rural outreach, the government incorporated these banks into the
State Bank of India scheme. SBI merged the State Bank of Jaipur (founded in 1943) and the
State Bank of Bikaner in 1963 (est.1944).
1.3.2 HDFC:
HDFC Bank Limited, headquartered in Mumbai, Maharashtra, is an Indian development
finance institution. As of June 30, 2019, it had 104,154 permanent staff. By assets, HDFC
Bank is India's largest private sector bank. As of March 2020, it is India's largest bank by
market capitalization.
Wholesale banking, retail banking, treasury, auto loans, two-wheeler loans, personal
loans, loans against the land, consumer durable loans, lifestyle loans, and credit cards are
among the products and services offered by HDFC Bank. Payzapp and SmartBUY are two
other digital products available.
In February 2000, HDFC Bank and Times Bank merged. In the group of New
7
Generation private sector banks, this was the first merger of two private banks. Bennett,
Coleman and Co. Ltd., better known as The Times Group, India's largest media
conglomerate, founded Times Bank. Centurion Bank of Punjab (CBoP) was purchased by
HDFC Bank in 2008. The board of directors of HDFC Bank approved the acquisition of
CBoP for $95.1 billion, making it one of India's largest financial mergers. In 2021, the Bank
bought a 9.99 percent stake in FERBINE, a Tata Group-backed company that will run a pan-
India umbrella entity for retail payment systems similar to the National Payments
Corporation of India. Yes Bank received a 1,000 crore investment from HDFC (parent
company of HDFC BANK) in March 2020. According to Yes Bank's reconstruction plan, 75
percent of the company's overall investment will be locked in for three years. Yes Bank
allotted 100 crore shares with a face value of 2 each to the Corporation on March 14 for a
consideration of 10 per share (including an 8 premium), accounting for 7.97 percent of Yes
Bank's post-issue equity share capital.
 HISTORY
HDFC Bank, a subsidiary of the Housing Development Finance Corporation, was founded in
1994 and is headquartered in Mumbai, Maharashtra, India. Manmohan Singh, the Union
Finance Minister, inaugurated the company's first corporate office and a full-service branch at
Sandoz House in Worli. The Bank's distribution network had 5,500 branches in 2,764 cities
as of 30 June 2019. In the fiscal year 2017, the Bank also constructed 430,000 point-of-sale
terminals and issued 23,570,000 debit cards and 12 million credit cards.
1.4 Justification of the topic

The aim of this study is to fill a gap in the literature by focusing on the impact of internet
banking service quality on customer preferences among India's private and public sector
banks. This research compares the banking behemoths of both private and public banks,
namely HDFC and SBI.
8
CHAPTER 2
REVIEW OF
LITERATURE
2.1 National reviews

2.2 International reviews
9
CHAPTER 2
When a research study is conducted, one of the most important tasks is to review the current
literature to familiarise oneself with the body of information in the field of interest. The
literature review is an essential component of the research method, as it contributes to nearly
every operational phase.
This review looked at related literature in the form of books, periodicals, and journals to see
if it could provide a strong framework and help crystallize the definition. This literature
review is done after studying various points under Technological Development in Banking
Sector.
2.1.1 Safeena, Rehmath (2010) emphasis is on the customer's perspective with regard to
internet banking adaptation. The primary aim of this research is to explore the effect of
perceived utility and ease of use, as well as consumer perception and perceived confusion, on
consumer adoption of internet banking. The study's conclusion is that there are several factors
that enable consumers to use online banking, including its ease of use and decreased time
commitment.
2.1.2 Sharma, Himani (2011) reveals that bankers persuade their customers to use online
banking services because they are aware that these services will strengthen the relationship
between customers and bankers and that in today's competitive environment, this activity can
have a positive effect on the Bank's profitability and efficiency.
2.1.3 Krishnamoorthy, V. and R. Srinivasan (2013) conclude that retaining current
customers is extremely difficult for banks. Banks must address a number of critical issues in
order to ensure their long-term viability, such as developing deep confidence and
relationships with current customers or making new product innovations based on consumer
needs and desires.
2.1.4 Mishra A. K. (2005) found the reasons for customer satisfaction with the services
provided by the Urban Cooperative Bank (UCB) were investigated. UCB was a newcomer to
the banking system, and they realized that customer loyalty is the only way to remain alive in
this fierce competition. The investigation's conclusion was that the active involvement of
employees (at the bank level) is needed to improve customer service.
2.1.5 Subbarao (2009) concludes that increased technology investment would boost
efficiency, reduce costs, and enable businesses to operate more efficiently. Information
10
technologies and the advances they allow are strategic tools because they lower the costs of
financial transactions, increase the distribution of financial capital, and boost financial
institutions' productivity and performance. Consumer banking and financial services benefit
from technological innovation not only because it extends their scope but also because it
increases their capacity for long-term, inclusive growth.
2.1.6 Solanki (2018) found that e-banking is in its infancy in India. Despite the fact that
Indian banks are making sincere efforts to implement advanced technology and install e-
delivery platforms, the general public is still wary of the idea. Banks are working hard to
make e-banking services and goods more widely available. E-banking is gaining popularity
among the younger generation because of its convenience and benefits. E-banking will not
only be an acceptable mode of banking in the future, but it will also be the preferred mode of
banking.
2.1.7 Dr. BhupendraSingh Hada (2016) concluded that the study's findings confirmed the
researcher's established factors, such as perceived utility, ease of use, consumer knowledge,
consumer security issues, confidence, and privacy, influenced customer behavior, intentions,
and satisfaction with internet banking. According to the findings, perceived Usefulness,
Perceived Ease of Use, and Consumer Awareness all had a positive impact on internet
banking use. In the same way, the results revealed that two factors, Consumer Security
Concerns and Trust and Privacy, have a negative impact on internet banking use. When
opposed to public sector bank customers, the "ease of use" aspect has a greater impact on
private sector bank customers.
2.1.8 Malhotra and Singh (2010) found that in contrast to public sector banks, private and
international Internet banks performed well in terms of providing a broader range and more
specialized Internet banking services. As a result, private and international businesses were
able to serve their clients than their public-sector counterparts better.
2.1.9 According to Prema C (2011), the majority of the respondents in this study have access
to a computer and the internet, and they are mainly fluent in using them. Online banking,
telebanking, and mobile banking consumers, on average, spends more time on computers and
the internet than non-users of these services. When comparing users of technology-powered
banking self-service to non-users, hours of device use, frequency of internet use, and hours of
internet browsing were found to be significantly higher. It concludes that banks will target
customers who use computers, the internet, and other technology items in a high-frequency
manner.
2.1.10 Singh P (2013) examined the issues that customers in India face while using e-
11
banking services. It was discovered that the majority of customers are aware of their Bank's
e-banking services. According to the findings, there is a noticeable difference between the
various problems encountered when using e-banking services. It was also discovered that
certain concerns had a greater effect on banking services than others. It was concluded that
not all of the reasons for not using e-banking services are equally valid.
2.1.11 According to Ingle A and Pardeshi R (2012), users were influenced by factors such
as easy direct access, ease of use, anytime anywhere banking, status symbol, protection, and
security. The effect of the factors differed depending on the type of customer. Consumers
have varying degrees of proficiency when it comes to using the internet for banking. The
higher the customers' trust in their ability to handle internet banking, the more often they used
the service. Moderate and inexperienced internet banking users were less satisfied with their
experience.
2.1.12 the challenges and opportunities in the Indian banking sector were examined by
Karimzadeh M (2012). After analyzing the population characteristics, the analysis found
that only 28% of banking clients used internet banking. It was discovered that there was no
connection between age and the use of cyberbanking. It also showed that there is no
connection between gender and internet banking adoption. It was discovered that the
respondents' educational qualifications and income played a role in their acceptance of online
banking. The study concluded that it is imperative that users' financial literacy be increased
through a variety of programs run by banks in order to raise awareness of internet banking.
2.2.1 Jones and Sasser (1995) found that consumers are divided into four categories:
"Apostles," "Hostages," "Mercenaries," and "Terrorists." An "Apostle" is a customer who is
highly happy and loyal. Customers, for example, are likely to recommend a product or
service to others because of their loyalty and satisfaction, while "Hostages" are disappointed
but loyal customers because they have fewer options. Customers who are referred to as
"mercenaries" are those who are involved in switching suppliers in order to achieve lower
prices while being extremely pleased. Customers who are highly satisfied but not loyal are
defined as such.
2.2.2 Oliveira P., Eric V. H., (2011) found, According to the study, non-bank companies
developed and implemented 55 percent of today's computerized commercial banking services
for their own use, while individual service consumers developed and implemented 44 percent
of today's computerized retail banking services. Self-services were almost always created by
12
users as manual precursors to these services – manual procedures that performed functions
similar to computerized services in our study.
2.2.3 Lovelock and Wirtz (2007) stated that because of its significance as a variable of
business strategy in this highly competitive environment, customer satisfaction (CS) has
drawn a lot of attention and interest from academics and practitioners alike (Lovelock and
Wirtz, 2007).
2.2.3 Wungwanitchakorn (2002) stated that internet banking is still in its early stages of
development since fewer bank customers are accustomed to using electronic platforms to
handle their financial affairs, resulting in low internet banking adoption. Furthermore, the
high failure rates of most of the new products and services introduced add to the frustration
with electronic or internet banking.
2.2.4 Boateng and Molla (2006) found that the operational constraints of internet banking
are linked to the customer's location, the need to maintain customer satisfaction, and the
capabilities of the Bank's main software to act as motivating factors in motivating the
decision to join electronic banking services, influencing the user experience, and thus
affecting the level of satisfaction.
2.2.5 According to Huang, Haibo (2005), the performance of electronic money and e-
banking services is largely dependent on public acceptance. The key finding is that although
e-banking customers share certain characteristics, they vary across various types of e-banking
services.
2.2.6 Laukknen T., Lauronen J. (2005) found that the traditional television channels are
being replaced by new electronic channels. Smart devices are a relatively new trend in the
delivery of electronic services. A qualitative in-depth interviewing approach was used to
perform an exploratory analysis on seasoned electronic banking customers. The findings
contribute to a better understanding of the customer-perceived value and value development
based on mobile service attributes and customer-perceived drawbacks of mobile phones in
the sense of electronic banking. The findings allow practitioners to develop their services and
marketing strategies while also providing academics with knowledge on exciting new
research areas.
2.2.7 According to Luarn P., Lin H. H. (2005), Despite the fact that millions of dollars have
been spent on improving mobile banking systems, studies on mobile banking indicate that,
despite their availability, potential consumers might not be using them. As a result, further
research is required to evaluate the factors that affect users' acceptance of mobile banking.
While there has been a lot of research on the technology acceptance model (TAM), which
13
predicts whether people can accept and use information systems voluntarily, there are some
limitations to the TAM, such as the omission of an important trust-based construct in the
context of electronic/mobile commerce, and the assumption that there are no barriers
preventing someone from using an IS if they want to IS whether he or she takes the decision
to do so. This study expands the applicability of the TAM in a mobile banking context by
adding one trust-based construct (perceived credibility) and two resource-based constructs
(perceived self-efficacy and perceived financial cost) to the model while paying particular
attention to the placement of these constructs in the TAM. Using the structural equation
modeling method, data from 180 users in Taiwan were compared to the extended TAM. The
findings back up the extended TAM's ability to predict users' plans to use mobile
banking. The finding has a number of implications for IT/IS acceptance research and mobile
banking management practices.
2.2.8 According to Sylvie L., Xiaoyan L., (2005), In comparison to electronic bank users in
the West, Chinese online and mobile bank users were overwhelmingly males, not necessarily
young and highly educated. The most significant factor driving Chinese consumers' adoption
of online banking was found to be security concerns. The perception of risk, computer and
technical abilities, and Chinese traditional cash-carry banking culture were the main barriers
to online banking. Lack of knowledge and appreciation of the benefits of mobile banking
were the biggest roadblocks to adoption.
2.2.9 Crabbe M., Standing C., Standing S., Karajaluoto (2009) found that the effect of
social and cultural influences on technology adoption is still being examined. We look into
the reasons for mobile banking adoption and non-adoption in Ghana to learn more about it.
According to a survey of 271 people in Ghana, social and cultural factors such as perceived
legitimacy, facilitating circumstances, perceived utilization, and demographic factors all play
a role in adoption decisions. It has been discovered that utilization of technology and services
can be beneficial to adopters while being detrimental to non-adopters. In addition, attitudes
toward technology are affected by perceived reputation and encouraging circumstances. As
these factors are coupled with a number of demographic factors, the social and cultural
characteristics of the study's background can have a major impact.
2.2.10 According to Yang A. S. (2009), Among Taiwanese university students, factors
associated with embracing and resisting mobile banking technologies were examined. The
idea that mobile banking helps meet personal banking needs, offers location-free
conveniences, and is cost-effective were all factors in adoption. Concerns over device setup
stability and simple fees for mobile banking web connections were two of the main reasons
14
for resistance. These results are explored in terms of their theoretical and practical
consequences.
Research Gap
It has been discovered that none of the studies examined discuss issues such as evaluating E-
banking systems, technical advances in scheduled commercial banks, various factors
affecting customer satisfaction with E-banks, challenges, and prospects of E-banks, employee
and customer responses to E-banking, and a comparative analysis of public and private sector
banks. The study aims to recognize research gaps and fill them with research reviews.
CHAPTER 3
RESEARCH
METHODOLOGY
15
3.1 Objectives
3.2 Hypothesis
3.3 Scope of the study
3.4 Research Design
3.5 Limitations of the study
16
CHAPTER 3
What is research?
A logical and systematic search for new and valuable knowledge on a specific subject is
known as research. That is an inquiry into the empirical and systemic study of science and
social issues in order to find solutions. It's a search for wisdom or the uncovering of hidden
secrets. In this context, awareness refers to information about a subject. Knowledge may be
gathered from a variety of sources, including personal observations, human beings, books,
journals, and nature. New contributions to established knowledge may result from the
research. Progress in an area can only be achieved by analysis. Research is society, and it
defines a country's economic, social, and political growth. The findings of empirical study
often force a shift in one's political perspective on issues that range well beyond the scope of
science.
Research should not have to be exclusive to science and technology. Other sciences, such as
languages, literature, history, and sociology, have wide areas of study. Whatever the matter,
the analysis must be a proactive, methodical, and rigorous process of discovery,
interpretation, and revision of evidence, activities, attitudes, and theories. The application of
scientific findings to the refinement of science in other fields or to improving the quality of
human life is often considered research and development. The study, experiment,
observation, interpretation, analogy, and logic are all used in research. In reality, research is
all about us. . For instance, we know that cigarette smoking is harmful to one's health; heroin
is addictive; cow dung is a good source of biogas; malaria is caused by the virus plasmodium,
and AIDS (Acquired Immune Deficiency Syndrome) is caused by the virus HIV (Human
Immunodeficiency Virus). How did we come to discover all of this? Any of this material was
only discovered as a result of our study. More specifically, it is looking for event forecasts,
hypotheses, interactions, and theories. Gerald Milburn put it this way: Scientific research is a
jumbled market, full of red herrings, mistakes, and genuinely innovative ideas. Great science
breakthroughs are rarely the result of a single person working inexorably towards a target.
The key Concept behind the discovery can appear many times in various ways, only to be lost
in the shuffle of constant scientific debate.
3.1 Objectives:
 To identify the various dimensions of e-banking service quality of SBI and HDFC.
17
 To study the customer preference on e-banking between SBI and HDFC.
 To study the impact of e-banking service quality dimensions on customer preferences.
3.2 Hypothesis:
3.2.1 Concept:
In certain cases, a hypothesis is regarded as the most important tool in science. Its aim is to
generate new ideas for experiments and observations. In reality, several studies are conducted
with the explicit goal of proving a theory. Decision-makers often find themselves in positions
where they choose to test theories based on available data and then make conclusions based
on the results of those tests. Theory testing is a technique used often in social science to
determine whether a sample of data provides sufficient evidence for a hypothesis to allow
generalization. As a result of hypothesis checking, we can use likelihood statements about
population parameters. The theory cannot be proven beyond a reasonable doubt, but it is
agreed in principle if it has withstood critical scrutiny. Before we go into how hypotheses are
evaluated using various measures designed for the task, it's important to first define a
hypothesis and related terms so that we can better understand hypothesis testing techniques.
 Characteristics of a hypothesis
1. Hypotheses should be able to be empirically tested. It should be stated that theoretically,
such inferences can be deduced close to the level of concrete observation, allowing them to
be evaluated by field observation. That is, scientific referents should be used in the
hypotheses.
2. Hypotheses can be as similar as possible to things that can be observed. Without this,
scientific evidence will not be used to verify their agreement. "... theory must be constructed
in such a way that deductions can be taken from it and, as a result, a conclusion can be drawn
as to whether it does not justify the evidence considered," Cohen and Nagel correctly state.
3. The hypotheses must make sense conceptually. The preceding criterion makes this
argument implicit. The definitions used in the hypothesis should be described not only
formally but also operationally, if possible.
4. Unique hypotheses are needed. No one can confidently predict what will happen in the
next five minutes, but only because it is debunked does not mean it is devoid of specific facts.
We need to decide what will happen because if we agree to one point of view or another, we
become vulnerable; our prediction will be called into question if what was predicted does not
18
occur.
5. It is recommended that the hypotheses be linked to a body of theory or theoretical
orientation. This criterion pertains to a hypothesis's theoretical rationale, i.e., what are the
theoretical benefits of evaluating the hypothesis?
6. Hypotheses can be linked-to methods that are currently applicable. This is, of course, a fair
analytical criterion to apply to any challenge when assessing its study potential. The
researcher who is unaware of the methods that can be used to evaluate his theories is unable
to formulate useful questions.
Types of the Hypotheses
 Null Hypothesis-
In statistical hypothesis testing, a null hypothesis (H0) is a phenomenon that comes up.
The symbol H0 is often used to represent the null hypothesis. The null hypothesis
formally explains certain attributes of a data asset, and this definition is taken as true until
the data's real action violates this assertion. In other words, the null statement should
either be rejected or not rejected; it cannot be accepted. Failure to deny Ho implies that
there is no compelling basis to alter certain decisions or practices based on its reality, but
it also implies that more evidence may be obtained and the theory re-examined.
 Alternate Hypothesis-
A series of two hypotheses (research and negative) that states the opposite of the null
hypothesis is called the alternate hypothesis. Acceptance of Ho (null hypotheses) means
rejection of alternative hypothesis in a comparative evaluation of null hypothesis, and
rejection of Ho means acceptance of an alternative hypothesis.
Hypothesis for the research paper:
 H0: There is no significant difference between the type of Bank of the customer and
the consumer's preference toward e-banking.
 H1: There is a significant difference between the type of Bank of the customer and the
consumer's preference toward e-banking.
3.3 Scope of the Study-
The main goal of this research is to examine the various online services offered by
SBI and HDFC in Bhopal and to assess their effect on customer preference.
Compared to other conventional banking distribution methods, e-banking has a
19
number of advantages. E-banking gives banks more customers, lower costs, mass
customization, product creativity, better marketing and connectivity, the opportunity to grow
non-core enterprises, and the ability to deliver services regardless of location or time
constraints.
E-banking is expected to become a big banking system for customers as new
technology develops. E-banking saves money by giving consumers another way to access
their accounts without having to go to the Bank.
3.4 Research Design:
This study is exploratory and descriptive in nature. It helps in discovering new ideas
and insights. Exploratory research is conducted during the initial stage of the research
process, which helped to refine the problem into a researchable one. It has progressively
narrowed the scope of the research topic.
3.4.1 Geographical Area:
This study is in context with the population of Bhopal city.
3.4.2 Sample Size:
In this research, a total of 125 responses are taken.
3.4.3 Sampling Technique:
The samples have been selected through the method of convenience sampling, a non-
probability sampling method because it was not possible to access all the e-banking users in
Bhopal for random sampling.
3.4.4 Sample Selection:
The samples are selected from the respondents who are using the facility of e-banking
of SBI and HDFC banks in Bhopal.
3.4.5 Data Collection Procedure:
The data is collected from a questionnaire which was in the form of 'Google Forms'
and was circulated to the respondents through social media platforms (WhatsApp). The
questionnaire consists of 2 parts. The first part of the questionnaire consists of questions
about demographic information of the respondents and the second part consists of questions
about responsiveness and assurance of the e-banking services.
3.4.6 Data Analysis Procedure:
Chi-square test and Percentage methods are applied for analyzing the collected data
and testing the hypothesis.
20
3.4.7 Data Collection Instrument:
The instrument used here for data collection is a questionnaire. A questionnaire is a
data collection tool that almost always entails asking a subject to answer a series of oral or
written questions. This instrument is best suitable for this research because of its following
advantages –
1. When used properly, it has a lot of potential.
2. It is a cost-effective method of gathering important data from foreign marketers.
3. When the respondents are dispersed around the country, it would be a better method than
an interview or observation. It also allows for international coverage. It enables
communication with a large number of people that would otherwise be impossible to meet.
4. It allows for community management and is adaptable to any goals. It has the ability to
protect a large group at once.
5. It is simple to schedule, build, and manage.
6. After it has been skillfully designed, the individual conducting the research may ask
someone to administer it on his behalf.
3.5 Limitations of the study:

Following are the limitations of this study-
1. The research is limited to a few areas of Bhopal.
2. Some of the data were collected from friends and family members; hence it may not
represent the actual population.
3. The reliability of the information gathered from various respondents.
4. Data were analyzed from only 125 respondents, and it was not possible to collect the
data from the entire relevant population.
5. The researcher has no way of knowing whether or not the respondents always grasped
the true meaning of each question.
21
CHAPTER 4
DATA
REPRESENTATION
AND ANALYSIS
4.1 Data Representation

22
CHAPTER 4
DATA REPRESENTATION AND ANALYSIS
4.1 Data Representation
1. Classification of the respondents according to gender.
Gender Respondents (125) Percentage
Male 78 62.4
Female 47 37.6
Others 0 0
Interpretation-
The above pie chart shows the classification of the gender of the respondents who were
surveyed. Out of 125 respondents, 78 people are male with 62.4 % of total respondents, 47
are female with 37.6 % of the total, and zero fall in the category of others
2. Classification of the respondents according to their age.

Age Respondents Percentage
<20 25 20
23
20-30 yrs 47 37.2
30-40 yrs 23 18.4
40-50 yrs 12 9.6
50-60 yrs 9 7.2
>60 yrs 5 4
Prefer not to say 4 3.2
Interpretation-
The above chart shows the classification of the respondents according to their age group.
According to the chart, out of 125 respondents, 20 of them are below 20, most of them, i.e.,
47 are from 20-30 yrs age group, 23 of them are from 30-40 yrs age group, 12 are from 40-50
yrs age group, 9 are from 50-60 yrs age group, 5 are above 60 yrs, and 4 of them preferred
not to reveal their age.
3. Classification of respondents according to their working status.

Working Status Respondents(125) Percentage
Student 45 36
Employee 62 49.6
Businessman 13 10.4
24
Retired 5 4
Respondents
70
60
50
40
Respondents
30
20
10
0
Student Employee Businessman Retired
Interpretation-
The above column chart shows the classification of the respondents according to their
working status. It is clearly visible that out of 125 respondents, 45 of them with 366 % of the
total fall under the category of students, followed by them, 62 are employees comprising 49.6
% of the total, 13 of them are businessmen with 10.4 % of total and 5 of them are retired
forming 4 % of the total.
25
4. Classification of the respondents according to their salary.
Salary (in Rupees) Respondents (125) Percentage
No Salary 35 28
< 20000 10 8
20000 – 40000 33 26.4
40000 – 60000 28 22.4
> 60000 11 8.8
Prefer not to say 8 6.4
Interpretation-
The above chart shows the classification of the respondents according to their salary.
According to the chart, 35 of the respondents do not get any salary comprising 28 % of the
total respondents, 10 of them get less than 20000 rupees (8% of the total respondents), 33 of
the respondents get salary between 20000 – 40000 rupees (26.4 % of the total respondents),
28 of them get a salary between 40000 – 60000 rupees comprising 22.4 % of the total
population, 11 of the respondents get a salary more than 60000 rupees (8.8% of the total) and
8 of them didn't prefer to reveal their salary.
26
5. Respondents when asked about which Bank account they hold an account.
Name of Bank Respondents (132) Percentage
SBI 55 44
HDFC 54 43.2
Both 16 12.8
Respondents
60
50
40
30
Respondents
20
10
0
SBI HDFC Both
Interpretation-
A total of 132 responses were received from the questionnaire, but only 125 valid responses
were taken for analysis and for testing of the hypothesis. Among the 125 responses,
approximately equal responses from both banks are taken, i.e., 55 respondents from SBI
comprising 44 % of the total and 54 respondents from HDFC comprising 43.2 % from the
total, and 16 respondents are those who have an account in both banks with a share of 12.6 %
of the total respondents.
27
6. When asked, 'Were you aware of the e-banking services provided by the banks while
opening the account?'
Response SBI HDFC Both
N % N % N %
Yes 41 74.5 34 63.0 8 50
No 9 16.4 18 33.3 4 25
Maybe 5 9.1 2 3.7 4 25
100 100 100
90
80
70
60
50 Both
HDFC
40
SBI
30
20
10
0
Yes No Maybe
Interpretation-
From the above chart, we can conclude that customers of the State Bank of India (74.5%)
were more aware of the e-banking services provided to them at the time of account opening
as compared to the customers of HDFC (63.0%).
28
7. When asked, 'How did you get to know about E-banking services of your bank?'
Source Respondents (125) Percentage
Display info. at Bank 21 16.8
From bank executive 34 27.2
Advertisement 38 30.4
Friends/Relatives 23 18.4
Others 9 7.2
Interpretation-
From the above table and pie chart, we can observe that from the 125 respondents, 21
respondents (16.8 % of total) came to know about the e-banking services from the display
info at the Bank. 34 (27.2 % of total) of them from the bank executive, 38 (30.4 % of total)
from advertisement, 23 (18.4 % of total) from friends and relatives, and 9 (7.2 % of total)
respondents had other sources.
29
8. When asked, 'Do you use E-banking services?'
Response SBI HDFC Both
N % N % N %
Yes 38 69.1 57 87.0 8 50
No 13 23.6 5 9.3 4 25
Prefer Not to Say 4 7.3 2 3.7 4 25
100 100 100
120
100
80
Both
60
HDFC
SBI
40
20
0
Yes No Prefer Not to Say
Interpretation-
From the above chart, we can conclude that customers of the State Bank of India (69.1%)
are using the e-banking services provided to them as compared to the customers of HDFC
(63.0%). Therefore the usage of e-banking services by customers of HDFC is more as
compared to that of SBI.
30
9. When asked, 'How many of these e-banking services are you aware of?'
Banking services Respondents
aware of
SBI % HDFC % Both %
Debit card 36 65.45 32 59.25 9 56.25
Credit card 34 61.81 24 44.44 9 56.25
Phone banking 37 67.27 23 42.59 7 43.75
Mobile banking 38 69.09 34 62.96 11 68.75
Internet banking 32 58.18 39 72.22 11 68.75
ATM 33 60.00 28 51.85 13 81.25
UPI 36 65.45 33 61.11 12 75.00
Average % 63.89 56.34
UPI
ATM
Internet banking
Both
Mobile banking
HDFC
Phone banking (through SMS and calls) SBI
Credit card
Debit card
0 5 10 15 20 25 30 35 40 45
Interpretation-
The above table shows the e-banking services customers are aware of. If we analyze the
average percent of aware customers, we can say that the average percentage of customers of
SBI is greater than that of the customers of HDFC. Therefore we can conclude that the
customers of SBI are more aware of the e-banking services provided to them when
comparing them to the customers of HDFC.
10. When asked, 'How much satisfied are you with the above e-banking services?'
Satisfaction Respondents
31
SBI HDFC Both
Highly Satisfied 16 9 5
Satisfied 25 25 6
Neutral 8 16 2
Dissatisfied 4 3 2
Highly Dissatisfied 2 1 1
30
25
20
SBI
15
HDFC
Both
10
0
Highly Satisfied Satisfied Neutral Dissatisfied Highly Dissatisfied
Interpretation-
The above table shows the satisfaction level of the respondents regarding the e-banking
services mentioned in table no 9. In the above table, we can clearly see that more customers
of the HDFC bank are highly satisfied, both the banks are equally satisfied, more customers
of the SBI bank had a neutral response, more customers of the HDFC bank are dissatisfied,
and more customers of the HDFC bank are highly dissatisfied.
11. When asked, 'why do you prefer e-banking?'

Reason Respondents
SBI % HDFC % Both
All time availability 30 54.54 29 53.70 7
32
Ease of use 34 61.81 23 42.59 10
Everywhere Banking 26 47.27 29 53.70 6
Page security 27 49.09 29 53.70 5
Direct access 27 49.09 21 38.66 7
Time saving 34 61.81 35 64.81 6
Comfort of use 32 58.18 35 64.81 11
Inexpensive 25 45.45 21 38.66 4
Easy processing 24 43.63 23 42.59 7
Easy fund transfer 23 41.81 22 40.74 7
Other 2 3.63 1 1.85 1
I don't prefer e-banking 3 - 2 - 1
Average % 46.93 45.07
Other
I don’t prefer e-banking
Easy fund transfer
Easy processing
Inexpensive
Comfort of use Both
Time saving HDFC
Direct access SBI
Page security
Everywhere Banking
Ease of use
All time availability
0 5 10 15 20 25 30 35 40
Interpretation-
The above table shows the reason for the customers to use e-banking. If we analyze the
average percent of the respondents of both banks, we can say that the average percentage of
customers of SBI is greater than that of the customers of HDFC. Therefore we can conclude
that the customers of SBI have more preference for the e-banking services provided to them
when comparing them to the customers of HDFC.
33
12. When asked 'Problems Faced while Using E-Banking Services.'
Problems Respondents
SBI % HDFC % Both
Lack of computer knowledge 14 25.45 15 27.77 4
Time Consuming 8 14.54 17 31.48 5
Fear of leakage of info. 26 47.27 31 57.40 8
Amount debited but not withdrawn 25 45.45 28 51.85 7
Password forgotten 23 41.81 28 51.85 6
Change in phone number 20 36.36 23 42.59 8
Misuse of card 24 43.63 30 55.55 12
Others 1 1.81 6 11.11 3
Average % 32.04 41.20
I don't face any problem 9 16.37 5 9.25 3
I don’t face any problem
Others
Misuse of card
Change in phone number

Both
Password forgotten
HDFC
Amount debited but not withdrawn SBI
Fear of leakage of info.
Time Consuming
Lack of computer knowledge
0 5 10 15 20 25 30 35
Interpretation-
The above table shows the problems faced by the customers while using e-banking. If we
analyze the average percent of the respondents of both banks, we can say that the average
percentage of customers of HDFC is greater than that of the customers of HDFC. Therefore
34
we can conclude that the customers of HDFC face more problems while using the e-banking
services provided to them when comparing them to the customers of SBI.
13. When asked, 'Is your problem viewed and solved by your bank?'
SBI HDFC Both
Yes 25 21 5
Sometimes 24 23 8
Never 1 8 1
Prefer not to say 5 2 2
Prefer not to say
Never
SBI
HDFC
Both
Sometimes
Yes
0 10 20 30 40 50 60
Interpretation-
In the above table, we can clearly see that more customers of the SBI bank answered 'Yes'
when asked about their problems being solved by Bank, customers of both the banks had an
equal answer for 'sometimes,' more customers of the HDFC bank do not get their problems
35
solved by the Bank, more customers of the SBI bank preferred not to answer.
36
14. When asked, 'How satisfied are you for getting your problems solved by your bank.'
SBI HDFC Both
Highly Satisfied 16 15 6
Satisfied 23 21 4
Neutral 13 11 6
Dissatisfied 4 5 1
Highly Dissatisfied 3 7 0
25
20
15
SBI
HDFC
10 Both
0
Highly Satisfied Satisfied Neutral Dissatisfied Highly Dissatisfied
Interpretation-
The above table shows the satisfaction of the customers with their problems being solved by
their banks. In the above table, we can clearly see that more customers of the SBI bank are
highly satisfied, more customers of the SBI bank are satisfied, more customers of the SBI
bank had a neutral response, more customers of the HDFC bank are dissatisfied, and more
customers of the HDFC bank are highly dissatisfied.
15. When asked, 'What is your overall preference regarding E-banking services provided by
your banks.'
SBI HDFC Both
37
Highly Preferable 12 13 6
Preferable 22 23 3
Neutral 18 7 5
Non-Preferable 2 6 1
Highly Non-Preferable 1 5 1
25
20
15
SBI
HDFC
10
Both
0
Highly Preferable Preferable Neutral Non-Preferable Highly Non-
Preferable
Interpretation-
The above table shows the overall preference of the customers of both banks towards e-
banking. In the above table, we can clearly see that more customers of the HDFC bank are
highly preferable, more customers of the HDFC bank are preferable, more customers of the
SBI bank had a neutral response, more customers of the HDFC bank are non-preferable, and
more customers of the HDFC bank are highly non-preferable.
38
4.2 Hypothesis Testing-
4.2.1 What is Hypothesis Testing?
Hypothesis testing is a statistical procedure in which an analyst verifies a hypothesis about a
population parameter. The analyst's approach is determined by the quality of the data and the
purpose of the study.
The use of sample data to determine the plausibility of a hypothesis is known as
hypothesis checking. Such information could come from a broader community or a data-
gathering operation. In the following descriptions, the term "population" would be used to
describe all of these scenarios.
Steps to test the hypothesis-
A four-step process is used to test all hypotheses:
1. The analyst must first state the two theories so that only one can be right.
2. The next move is to create a study strategy that details how the data will be analyzed.
3. The third step is to put the strategy into action and test the sample data visually.
4. The fourth and final move is to interpret the findings and then deny or accept the null
hypothesis based on the available evidence.
The statistic to test the hypothesis used here is Chi-Square Test.
4.2.2 Chi-square Test-
A chi-square test is a test that evaluates how well a model matches real results. A chi-square
statistic needs data that is random, raw, mutually exclusive, taken from independent
variables, and drawn from a large enough sample.
In hypothesis testing, chi-square tests are often used. Given the size of the sample and
the number of variables in the relationship, the chi-square statistic compares the size of the
inconsistencies between the predicted and real performance. The degree of freedom is used in
these experiments to see whether a null statement can be discarded depending on the overall
number of factors and samples in the experiment.
4.4.3 Application of Chi-Square Test-

Here the chi-square test is performed for the purpose of testing the hypothesis. The value of
chi-square is obtained by the following formula-
39
Where,
X2c = Value of Chi Square.
Oi = Observed Variables.
Ei = Expected Variables.
And
i = No. of position of the Variable.
Observed Variables-
The variables that a researcher specifically measures are known as observed variables. When
a researcher uses structural equations models (SEM), they're dealing with data that's already
in their files—data that's been calculated and documented. There are two types of variables:
discrete and continuous variables.
Observed Values:
Two-Square Table for Observed Values
Satisfaction Bank Name
SBI HDFC Both Total
Highly Preferable 12 13 6 31
Preferable 22 23 3 48
Neutral 18 7 5 30
Non-Preferable 2 6 1 9
Highly Non-Preferable 1 5 1 7
40
Total 55 54 16 125
Expected Variables-
The expected value is precisely as it sounds like: the expected outcome of a certain action,
such as how many questions you'll get correct on a multiple-choice test if you guess.
Calculation of Expected Values

Expected Value = (Row Total * Column Total) / Grand total
Here,
The expected value of the first value i.e. 12 would be:
Ei = (Row total, i.e. 55) * (Column Total, i.e. 31) / Grand Total, i.e.
125
= 1705/125
= 13.64
Therefore after calculating all the expected values, the table is as follows:
Expected Values:
Two-Square Table for Expected Values
Satisfaction Bank Name
SBI HDFC Both Total
Highly Preferable 13.64 13.39 3.96 31
Preferable 21.12 20.73 6.14 48
Neutral 13.20 12.96 3.84 30
Non-Preferable 3.96 3.88 1.15 9
Highly Non-Preferable 3.08 3.02 0.89 7
Total 55 54 16 125
As the expected values are different from the observed values, the application of chi-square
begins.
So, now we have both, Observed and Expected values. Therefore we can calculate the value
41
of chi-square.
Calculation of Chi-Square X2:
X2 = (Observed Value – Expected Value) 2 / Expected Value
Therefore the value of X2 for the first value would be:
X2 = (12.00 – 13.64)2 / 13.64
= (- 1.64)2 / 13.64
= 2.6896 / 13.64
= 0.1971
So, the chi square value of 1st value is 0.1971.
To find the value of the chi-square of the whole group, the chi-square value of each value is
needed to be determined and then to be added up.
Therefore, after calculating all the Chi Square values, the table is as follows:
Observed Expected O-E (O – E)2 (O – E)2 / E
Values (O) Values (E)
12 13.64 -1.64 2.6896 0.1971
13 13.39 -0.39 0.1521 0.0113
6 3.96 2.04 4.1616 1.0509
22 21.12 0.88 0.7744 0.0366
23 20.73 2.27 5.1529 0.2485
3 6.14 -3.14 9.8496 1.6057
18 13.20 4.80 23.0400 1.7454
7 12.96 -5.96 35.5216 2.7408
5 3.84 1.16 1.3456 0.3504
2 3.96 -1.96 3.8416 0.9701
6 3.88 2.12 4.4944 1.1583
1 1.15 -0.15 0.0225 0.0195
1 3.08 -2.08 4.3264 1.4046
5 3.02 1.98 3.9204 1.2981
42
1 0.89 0.11 0.0121 0.0135
12.8508
(𝑂 – 𝐸 ) 2
X2 or  𝑬
Therefore the value of the calculated Chi-Square is:
Calculated X2 = 12.8508
Now, in order to test the hypothesis, we need to calculate the expected value of chi-square.
The expected value of chi-square is calculated by determining the degree of freedom and
finding the value of the degree of freedom from the Chi-Square distribution table.
Calculation of degree of freedom:
Degree of freedom is calculated by following formula-
df = (No. of Columns – 1) * (No. of Rows – 1)
Therefore, df = (3 – 1) * (5 – 1)
=2*4
Degree of freedom = 8
Chi Square Distribution table:
43
According to the table value of expected Chi-Square at the degree of freedom 8 and at 0.05
level of significance is
Expected X2 = 15.50
As the value of the calculated chi-square (12.8508) is less than the value of the expected chi-
square (15.507), the null hypothesis H0 is accepted.
44
CHAPTER 5
RESULT AND
DISCUSSION
5.1 Major Findings

5.2 Suggestions
5.3 Conclusion
45
CHAPTER 5
RESULT AND DISCUSSION
5.1 Major findings-
The most critical practical contribution of this study is that the results provide banking
decision-makers with insight into Indian customers' perceptions of internet banking. In India,
internet banking is becoming more widespread, and the findings of this study will help banks
fine-tune their e-banking services. Based on the above research following points were found:
1. When it came to opening accounts, the majority of SBI and HDFC customers were
aware of the e-banking options. This can also be concluded that SBI bank respondents
are more aware of the e-banking facilities as compared to HDFC.
2. When asked about internet banking, 58.18 percent of SBI customers and 72.22
percent of HDFC customers said they knew about it. The ultimate conclusion that can
be taken from this is that SBI customers are more aware of the various e-banking
services available to them.
3. On the whole level of preference, if the percentages of all the factors are combined to
take the average percentage, we can see that the average percentage of SBI was
46.93%, and the average percentage of HDFC was 45.07%. This states that customers
of SBI prefer e-banking services more when compared to that of HDFC.
4. At the overall level of the problems faced by customers, if the percentages of all the
factors are combined to take the average percentage, we can see that the average
percentage of SBI was 32.04%, and the average percentage of HDFC was 41.20%.
This states that customers of SBI face fewer problems while using e-banking when
compared to that of HDFC.
5. From the Chi-Square test, it can also be concluded that there was no significant
relationship between the type of the Bank and the overall preference of the customers
towards e-banking services provided to them by the banks.
5.2 Suggestions-
Based on this study, the researcher was able to give three major suggestions which shared
equal importance. Those suggestions are as follows:
46
1. Banks may persuade their customers to use e-banking by informing them of the
service's usefulness because if the customer finds it more convenient, they will almost
certainly use it. Consumer understanding and acceptance of e-banking will improve
with improved marketing contact and marketing strategies.
2. The perceived ease of use is the second important recommendation. That is, the only
requirement for a customer to consider e-banking is that they find it simple to use. As
a result, banks should strive to improve their e-banking sites to make them more user-
friendly. For that Bank, practical training sessions on how to use e-banking services
could be arranged for their customers.
3. Consumer protection issues had a negative impact on e-banking adoption. To increase

customer acceptance, banks should strive to alleviate their customers' doubts about e-
banking technology. Banks can also assess the trustworthiness and confidentiality of
their e-banking infrastructure and procedures.
5.3 Conclusion-
The researcher attempted a qualitative investigation of internet banking customer satisfaction
in Bhopal city in this report. The study attempted to classify key factors that influence
customers' desire for online banking. The study's findings confirmed that the researcher's
established variables, such as perceived utility, perceived ease of use, user perception,
consumer protection issues, confidence, and privacy, influenced customer behavior,
intentions, loyalty, and desire for internet banking.
Other interesting findings from the study include the fact that SBI customers are more
aware of the various e-banking services provided by the Bank, and the majority of HDFC
bank customers use the Bank's e-banking facility. This also indicates that SBI customers are
happier with their E-banking services than HDFC customers.
Customers of SBI and HDFC banks are pleased with E-banking services, but not
extremely so, according to the report. The study's results would be useful to Indian banks as
they prepare and upgrade their internet banking services.
Other issues, such as changing a mobile number, misplacing a card, misusing a card,
and using E-banking services, have a near-neutral response from both banks' customers.
However, this study shows that HDFC bank customers have a few more issues with E-
banking services than SBI bank customers.
47
48
CHAPTER 6
REFERENCES
6.1 Bibliography
6.2 Works Cited
49
CHAPTER 6
REFERENES
6.1 Bibliography
Bibliography
(n.d.). Retrieved from Project Clue: https://www.projectclue.com/banking-and-finance/project-topics-
materials-for-undergraduate-students/impact-of-electronic-banking-on-customer-satisfaction
Advantages and Disadvantages of Questionnaires. (n.d.). Retrieved from AccountLearning:
https://accountlearning.com/advantages-and-disadvantages-of-questionnaires/
B, D. (n.d.). Retrieved from Journal of Internet Banking and Commerce:
https://www.icommercecentral.com/open-access/the-electronic-banking-revolution-in-
india.php?aid=59261
Banking in India. (n.d.). Retrieved from Wikipedia: https://en.wikipedia.org/wiki/Banking_in_India
Chi Square. (n.d.). Retrieved from Statistics How To: https://www.statisticshowto.com/probability-
and-statistics/chi-square/
Chi Square Statistic. (n.d.). Retrieved from Investopedia: https://www.investopedia.com/terms/c/chi-
square-statistic.asp
Chi-Square Probabilities. (n.d.). Retrieved from Richland.edu:
https://people.richland.edu/james/lecture/m170/tbl-chi.html
Dr. S. Sangeetha, K. M. (2020). Customers Satisfaction Towards E-Banking Services With Special
Reference To Coimbatore City. INTERNATIONAL JOURNAL OF SCIENTIFIC &
TECHNOLOGY RESEARCH VOLUME 9, ISSUE 01, ISSN 2277-8616.
Expected Value. (n.d.). Retrieved from Statistics How To:
https://www.statisticshowto.com/probability-and-statistics/expected-value/
Firdous, S. (n.d.). Retrieved from Journal of Internet Banking and Commerce:
https://www.icommercecentral.com/open-access/impact-of-internet-banking-service-quality-
on-customer-satisfaction.php?aid=85570
Hada, D. B. (2016). Online Banking and Customer Satisfaction in Public and Private Sector Banks:
Evidence from India. IOSR Journal of Business and Management (IOSR-JBM) e-ISSN: 2278-
487X, p-ISSN: 2319-7668. Volume 18, Issue 4 .Ver. II, 10-20.
HDFC Bank. (n.d.). Retrieved from Wikipedia: https://en.wikipedia.org/wiki/HDFC_Bank
Hypothesis Testing. (n.d.). Retrieved from Investopedia:
https://www.investopedia.com/terms/h/hypothesistesting.asp
Jyotsna Sharma, J. S. (2020). Impact of E-Banking Service Quality on Customer Satisfaction.
International Journal of Recent Technology and Engineering (IJRTE) ISSN: 2277-3878,
50
Volume-8 Issue-5.
Observed Variables. (n.d.). Retrieved from Statistic HoW To:
https://www.statisticshowto.com/observed-variables/
Online Banking. (n.d.). Retrieved from Wikipedia: https://en.wikipedia.org/wiki/Online_banking
Solanki, U. (2018). Impact of E Banking on Customer Satisfaction. International Journal of Trend in
Scientific Research and Development (IJTSRD) ISSN: 2456-6470.
State Bank of India. (n.d.). Retrieved from Wikipedia:
https://en.wikipedia.org/wiki/State_Bank_of_India
6.2 Works Cited
Works Cited
A, W. (2002). Adoption Intention of Banks' Customers on Internet Banking Service. Retrieved from
ttp://www.journal.au.edu/abac_journal/2002/sep02/abacjournal_article05_sep02.pdf
Boateng, R. a. (2006). Developing E-banking Capabilities in a Ghanaian Bank: Preliminary Lessons.
Journal of Internet Banking and Commerce, Vol. 11, No. 2.
Crabbe M., S. C. (2009). An adoption model for mobile banking in Ghana.
D, S. (2009). Information Technology and Banking- A Contributing Agenda. Hyderabad: Institute for
Development & Research in Banking Technology.
Hada, D. B. (2016). Online Banking and Customer Satisfaction in Public and Private Sector Banks:
Evidence from India. IOSR Journal of Business and Management (IOSR-JBM) e-ISSN: 2278-
487X, p-ISSN: 2319-7668. Volume 18, Issue 4 .Ver. II, 10-20.
Huang, H. (2005). Essays in electronic money and banking.
Ingle, A., & Pardeshi, R. (2012). Internet Banking in India: Challenges and Opportunities. IBMRD's
Journal of Management and Research, Vol. 1, 13-18.
Jones, T. &. (1995). Why satisfied customers defect. Harvard Business Review, 88-99.
K, M. A. (2005). Internet Banking in India Part-I. Retrieved from Banknet India:
http://www.banknetindia.com
Karimzadeh, M., & Alam, D. (2012). Electronic banking challenges in India: An empirical
investigation. Interdisciplinary Journal of Contemporary Research in Business, Vol. 4 No. 2,
31-45.
Krishnamoorthy, V. a. (2013). Internet Banking as a tool for Customer Relationship Management – A
Study on Customer Perspective. Indian Journal of Research, Volume 2, Issue 2, 187-190.
Laukknen T., L. J. (2005). Consumer value creation in mobile banking .
Lovelock, C. H. (2007). Functional integration in service: understanding the links between marketing,
operations, and human resources.
51
Luarn P., L. H. (2005). Toward an understanding of the behavioral intention to use mobile banking.
Oliveira P., E. V. (2011). Users as service innovators: The case of banking services.
Prema, C. (2011). A framework for understanding consumer perceived characteristics of internet
banking as predictors of its adoption. Indian Journal of Marketing, Vol. 41, No. 2, 46-53.
S., Y. A. (2009). Exploring adoption difficulties in mobile banking services.
Safeena, R., Abdullah, & H. Date. (2010). Customer's Perspective on EBusiness Value: A Case Study
on Internet Banking. Journal of InternetBanking and Commerce, Volume 15, No. 1, pp 2 .
Sharma, H. (2011). Banker's Perspective on E-Banking, NJRIM, Volume 1, No. 1. NJRIM, Volume 1,
No. 1, 1.
Singh, B. a. (2004). Adoption of Internet banking: An empirical investigation of Indian banking
Sector. Journal of Internet Banking and Commerce, 9 (2).
Singh, P. (2013). An exploratory study on internet banking uses in semi urban areas in India.
International Journal of Scientific and Research Publications, Vol. 3, No. 8, 1-5.
Solanki, U. (2018). Impact of E Banking on Customer Satisfaction. International Journal of Trend in
Scientific Research and Development (IJTSRD) ISSN: 2456-6470.
Sylvie L., X. L. (2005). Consumers" attitudes towards online and mobile banking in China.
52
CHAPTER 7
ANNEXURE
7.1 Questionnaire
53
7.1 Questionnaire:
QUESTIONNAIRE ON CUSTOMER PREFERENCES

* Required
1. Type of Bank you currently hold an account. *
o SBI
o HDFC
o Both
o Do Not Have a Bank Account
2. Which Bank's e-banking services you would prefer more?
o SBI
o HDFC
3. Were you aware of the e banking services provided by the banks while opening the account? *
o Yes
o No
o Maybe
4. How did you get to know about E-banking services of your Bank? *
o Display information at Bank
o From the bank executive
o Advertisement
o Friends/Relatives
o Other
54
5. If other please specify.
o _________________________________________________________
6. Do you use E banking services? *
o Yes
o No
o Prefer not to say
7. How many of these e-banking services are you aware of? *

Check all that apply.
o Debit Card
o Credit Card
o Phone Banking (through SMS, Calls, Etc.)
o Mobile Banking
o Internet Banking
o ATM
o UPI
8. How much satisfied are you from the above e-banking services? *
o Highly Satisfied
o Satisfied
o Neutral
o Dissatisfied
o Highly Dissatisfied
9. Customers who are not using E-banking services presently, are you planning to start using E-
banking services?
o Yes
o No
55
o Maybe
o Prefer not to say

10. Why do you prefer e-banking? *
Check all that apply
o All time availability
o Ease of use
o Everywhere banking
o Page Security
o Direct Access
o Time saving
o Comfort of use (No need to go Bank)
o Inexpensive
o Easy processing
o Easy fund transfer
o I do not prefer e-banking
o Other
11. If other please specify.

____________________________________________
12. Problems Faced while Using E-Banking Services. *

Check all that apply.
o Lack of knowledge of computers
o Time consuming
o Fear of leakage of information
o Amount debited but not withdrawn
o Password forgotten
56
o Problem of change in mobile number
o Misuse of card
o Other
o I do not face any problem
13. If other please specify

________________________________________
14. Is your problem viewed and solved by your Bank? *
o Yes
o Sometimes
o Never
o Prefer not to say
15. How satisfied are you for getting your problems solved by your Bank. *
o Highly satisfied
o Satisfied
o Neutral
o Dissatisfied
o Highly dissatisfied
16. What is your satisfaction regarding E-banking services provided by your banks? *
o Highly preferable
o Preferable
o Neutral
o Non-Preferable
o Highly non-preferable
57
DEMOGRAPHIC INFORMATION
17. Age *
o < 20
o 20-30 yrs.
o 30-40 yrs.
o 40-50 yrs.
o 50-60 yrs.
o 60 yrs. <
o Prefer not to say
18. Gender *
o Male
o Female
o Others
19. Salary (in Rupees) *
o No Salary
o < 20,000
o 20,000 - 40,000
o 40,000 - 60,000
o 60,000
o Prefer not to say
20. Which category do you fall under? *
o Student
58
o Employee
o Businessman
o Retired
Forms
59
Mobilisation of savings through mutual
fund
CHAPTER 1
INTRODUCTION
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1.1 INTRODUCTION
A mutual fund is a form of collective investment. It is a trust that pools the

savings of a number of investors who share a common financial goal. It collects the
savings from the small investors, invest them in government and other corporate
securities and earn income through interest and dividends, besides capital gains.
Mutual fund is a collective savings scheme. It place an important role in mobilising the
savings of the small investors and channelling the same for productive ventures in the
Indian economy. Each fund is divided in to equal portions or unit. Units are allotted to
the person in proportion of his investment in mutual fund. Each fund is a pool of
diversified securities.
A mutual fund is nothing more than a collection of stocks and or

bonds. A mutual fund is a professionally managed type of collective investment scheme
that pools money from many investors to buy stocks, bonds, short-term money market
instrument, and/or other securities. It is made up of money that is financial intermediary.
Savings of investors are collected and these funds are invested in a large and well
diversified portfolio of securities such as money market instruments, corporate and
government bonds and equity shares of join stock companies. In other words a mutual
fund is just the connecting bridge or a financial intermediary that allows a group of
investors to pool their money together with a predetermined investment objective .The
mutual fund will have a fund manager who is responsible for investing the gathered
money into specific securities..When we invest in mutual fund, we are buying units or
portions of the mutual fund and thus on investing becomes a shareholder or unit holder
of the fund .mutual fund emerged as professional financial intermediaries bridging the
time and skill constraint. They have a who identify the right stocks and debt instruments
and construct a portfolio that promises to deliver the best possible ‘consttrained’returns
at the minimum possible cost. In effect, it involves outsourcing the management of
money.
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1.2 STATEMENT OF THE PROBLEM
In recent the mutual fund scheme could attain from the investors and whether this
financial asset is worth investing is the main problem before the common individual
investors. They are eagerly waiting to get a clear and real picture of the growth and
success dimensions of the industry.
While making an investment An investor considering investment in securities is facing

with the problem of choosing an investment from a large number of securities and how
to allocate his funds over this group of securities. The investors are confused of various
kinds of securities, his excess of wealth and rise of various investment schemes,
variation in financial instruments, tax policy of government, different investment
strategies, lack of awareness and knowledge among the investors, emotional
attachment to money, lack of financial inclusion, traditional thinking, fear of loss and risk
and return characteristics of schemes.. The investors try to get maximum return with
minimum risk by choosing a better investment schemes.
As in case of an investor while making an investment, faces a problem in

relation with selection of appropriate scheme of investment. That means there exist a
problem of selecting a better scheme that make better return and safety for the
investor.. An investor need to make investment in a scheme which maximizes the
return and minimizes the risk. So this study focused on the “mobilisation of savings
through mutual fund” and the study makes an attempt to analyses the problem of
investors in relation with the management of their individual securities.
1.3 OBJECTIVES OF THE STUDY
 To study the role of mutual fund in the mobilization of savings.

 To analyse the awareness level of investors of mutual fund.
 To examine the structure and growth pattern of mutual fund industry.
 To analyse the attitude of mutual fund investors towards the factors like safety,
liquidity, tax benefits, returns and savings
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1.4 SIGNIFICANCE OF THE STUDY
Mutual fund industry is of recent origin in India and is growing very fast to emerge
as a major player in mobilisation of savings. Investors have been showing keen interest
by subscribing to various mutual fund schemes anticipating higher returns and capital
gain. At the same time some of the schemes are failing due to some or other reasons.
Investors as well as the public are curious about the performance of various mutual
fund schemes. Almost all of the Business Dailies have regular articles and columns on
the functioning and evaluation of various mutual funds and there are umpteen numbers
of academic research and publications. But no comprehensive study was made on the
mutual fund industry of Malappuram till date. This study is indented to fill this gap and
help the investor public, whose saving potentials are increasing, to invest their savings,
which may help mobilising resources for the economic development of the country.
1.5 HYPOTHESIS USED
 H0: Experience of investing in mutual fund is identical terms of gender.

 H0: The two variables that the gender of the respondents and expectation from
mutual fund scheme are independent.
 H0: Level of satisfaction of the respondents is identical in terms of occupation of
the respondents.
1.6 SCOPE OF THE STUDY
A Mutual is a trust that pools the savings of a number of investors who share a
common financial goal. The money thus collected is then invested in capital market
instruments such shares, debentures and other securities .thus mutual fund provide so
many benefit to the investors that include it provide better return and safety and also
tax benefit, capital appreciation
,regular income ,it provide security and safety to the investor .They give assured and
consistent return they provide high return with low risk.
Mutual fund diversifies the risk of the investor by investing in a basket of asset. Thus
various mutual fund scheme provide various benefit to the investor there by increase
economies of scale
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of the investor .and also it provide the benefit of cheap access to expensive stocks. The
fact that investing in mutual fund lead to economic development of the country.
1.7 RESEARCH METHODOLOGY
Title of the study: “mobilisation of savings through mutual fund" The

research methodology is a way to systematically solve the research problem. It may
be understood as a science of studying how research is done systematically. This
uses various instruments for performing the research operations and it deals with
research design, data collection methods and various statistical tools.
1.7.1 SOURCES OF DATA
Primary Data
Primary data are those data which are collected for the first time. They are original
in character and are collected by the researcher. The primary data has been collected
with the help of questionnaire which is distributed and collected from the respondents
of Nilambur area.
Those investors having Systematic Investment Plan has been selected for data
collection.
Secondary Data
Secondary data are those data which have been already collected, tabulated and
presented in some form by someone else for some specific purpose . Secondary data
are collected from various websites, SEBI bulletins, RBI bulletins, various mutual fund
websites, general discussion with brokers of BSE, NSE etc.
1.7.2 SAMPLING DESIGN AND SIZE
The sampling technique involved convenience sampling. Convenience sampling is

a non- probability sampling technique where subjects are selected because of their
convenient accessibility proximity to the researcher. This sample is used because it
allows the researcher to obtain basic data and trends regarding his study without the
complications of using a randomized sample. This sampling technique is also useful in
documenting that particular quality of a substance or phenomenon occurs within a
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given sample. Such studies are very
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useful for detecting relationships among different phenomena. The sample size
considered for the study is 80. The respondents are selected from the malappuram
district.
1.7.3 TOOLS FOR ANALYSIS
To analyse the data obtained through primary data, the study itself used the
mathematical and statistical tools.
 Mann Whitney u test

 Kruskal wallies test
 Henry garret ranking.
 Chi-square
 Weighted Average Ranking
 Percentage
 Spearman’s ranking
1.7.4 TOOLS FOR PRESENTATION
 Tables
 Pie diagram
 Bar diagram
 Doughnut
1.8 AREA OF THE STUDY
The research concentrated in MALAPPURAM district.
1.9 PERIOD OF STUDY
The duration of the project study is 21 days.
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1.10 LIMITATIONS OF THE STUDY
 The study is based mainly on the data collected through primary sources
provided by the consumer in the form of answering questionnaire, so it
may have chances of errors.
 The study is based on secondary resources provided by the company and
also through the internet. Here there are chances of errors.
 The study is conducted by using some samples i.e., 80 respondents from
the number. So may have some bias of opinions of respondents.
 Limited time for study
 Sampling error
 Most of the respondents are educationally backward.
 Most of the respondents are not interested in answering the questionnaire.
 The study limits its scope to only Malappuram District.
 The sample size of the study is 80 respondents.
 The respondents are not ready to disclose their full investment details.
However sincere effort has been to collect the

data and interpret the same in the right perspective.
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1.11 CHAPTER PLAN
The present study is divided into five chapters. Following are the details showing.
Chapter 1:
INTRODUCTION
Chapter 2
Chapter 3
INDUSTRY, COMPANY, PRODUCT PROFILE AND THEORATICAL

FRAME WORK
Chapter 4:
DATA ANALYSIS AND INTERPRETATION
Chapter 5:
SUMMARY, FINDINGS, SUGGESTIONS AND

CONCLUSION
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CHAPTER 2
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PRITIMAN (2016) Conducted a study of investors perception towards mutual fund
in the city of Aurangabad by collecting primary data from thirty professionals like those
who wants invest in mutual fund and the investment options in Aurangabad city This
study aims at to know the investors view towards mutual fund to know the awareness
of mutual fund in Aurangabad people and to know the preference of people for
investment it founds that investors are not choosing or feeling confident in investing in
mutual fund because they think that mutual fund is risky than other investment option
the awareness level of mutual fund among the investors are very low because of only
having the partial knowledge about the mutual fund which prevent them to invest in
mutual fund to avoid risk bearing factor and lose of money. The preference of investors
is in fixed deposit because they feel that it provide safely and fixed returns and no loss
of money. The main reason for not selection of mutual fund investments is share
market uncertainties and risk associated with it
NUTAN VIJAY PASALKAR (2015) Conducted a comparative study of mutual fund

investment Vs equity investment of Indian individual investors with the main objective of
compare the mutual fund investment with direct equity investment and also study the
preference of the individual investors investing in mutual fund and present practices of
mutual fund investors in pune city 100 respondents from pune city were selected for
conducting the study, simple random sampling method is used to collect the primary
data. This study found that a remember able increases in the mutual fund investors but
direct equity investment is more favoured by the individual investors as compared to
the mutual fund open ended schemes are popular and preferred mutual fund scheme
because of the flexibility and freedom
DR.RAJESH KUMAR AND NITINGOEL (2014) In their study attempted to

analyse the purpose behind making investment factors considered before making
investment and method used for evaluating the performance of mutual fund
defielencles in functioning of mutual fund and investors perception about future
prospect of fund growth. Income and liquidity are the important objectives of the mutual
fund investment are found bye the study and absolute return on the mutual fund
scheme as the basis for evaluating their performance.
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PREETHKHIFOLIYA (2014) Studies the investors awareness and perceived risk
attitude towards mutual fund. An empirical study in Delhi. The target sample was 200
respondents in the
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age group og 25.55 in Delhi. Both primary and secondary sources of data are used in
the study. The study aims at to explore risk appetiteS of the respondent to understand
the preferred type of mutual funds. They found that the people are aware about the
mutual fund but a very list numbers of investors are in mutual fund Male investors are
willing to take risk for wealth maximisation than Female investors are do not ask the
assistance of consultants advisors due to high consultation fee
PRITAM .P. KOTHARI AND SHIVAGANGA.C.MINDARGI (2013) studied the

investors attitude towards mutual fund with special reference to investors in Solapurcity.
This study provides future of mutual funds industries information as well as awareness
level among people and it also helps the management as how to the mutual funds are
performing in the current market situation . This study is descriptive in nature based on
survey method by using both primary and secondary data. Primary data is collected
from 200 respondents from solapurcity through questionnaire. The study shows that
investors are ready to take risk and change the traditional pattern of investment. The
half of the population is not interested to invest in mutual fund from the two hundered
respondents. the main sources of information are the financial advisors and
advertisement in media
G. PRATHAB AND DR.A.RAJMOHAN (2013) Conducted a study on status of

awareness among mutual fund investors in Tamilnadu to find the investors awareness
regarding mutual fund investment and measure the investors level of satisfaction
towards mutual fund investment. The sample size used for the study is 500 investors of
Tamilnadu Where spread 5 different districts namely Cuddalore, Coimbatore, Chennai,
Madurai and Trichy. They are identified for the study is by using purposive sampling
method. This study found that investors have high level awareness and positive
approach towards investing in mutual fund
GOURAVAGARVAL AND DR MINI JAIN (2013) conducted a study on investor’s

performance towards mutual fund in comparison on other investment avenues with the
objective of to find the most preferred investment avenue of the investors of Madhura
over all criterions of investors regarding investment. Main bases of different investment
avenues and investors preference towards mutual fund. They found that real estate is
the most preferred Investment Avenue and the criteria for investment is mainly fund
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because of the high return from the investment
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DR.BINOD KUMAR SINGH (2012) Conducted a study on investors attitude towards
Mutual fund as an investment option with the objective of analyse the impact of various
demographic Factors on investors attitude towards mutual fund and factors responsible
for the selection of mutual fund as an investment option. The study shows that most of
the respondents are confused about the mutual fund and not make any awareness
about the various function of mutual fund. Demographic factors are gender income and
level of education have influence on investors attitude and age and occupation are not
influenced by the investors return and liquidity are the main factors responsible for the
selection of mutual fund and followed by the flexibility transparency and affordability. He
also found that in India there is a lot of scope for the growth of mutual fund
JAYABRATA BANERJEE AND SWARNENDU ROY (2012) Conducted a technical

analysis towards customer perception on mutual fund products with collecting response
from 1051 respondents covering different group of investors the study found that
customer orientation is necessary in the market small investors are buy mutual fund
due to the multiple reason depending upon customers risk return trade off the reason
for investing in mutual fund is reduction in the bank interest rates high degree of
volatility in Indian stock market and bond market also in recession due to its interest
party. So investors are looking for an attractive investment which provide higher return
and safty
DR.SARITHABAHL AND MEENAKSHRANI (2012) Has done a comparative

analysis of mutual fund scheme in India. They investigated the performance of 29 open
ended, growth oriented equity schemes for the period from April 2005 to March 2011
Monthly NAV of different schemes have been used to calculate the returns from the
fund scheme BSE- Sense is used for market portfolio. The result also shows 14 out of
29 mutual fund schemes are underperformed. These scheme were facing
diversification problem
DR.NISH SHARMA (2012) conducted a study on Indian investor’s perception

towards mutual funds. The data is collected through structured questionnaire from 250
respondents online as well as in person this study analyse the investors perspective
towards investment in mutual fund to understand the desirable characteristics of mutual
fund schemes to know the various factors that may affect selection of mutual funds
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directly or indirectly and to present a summarised picture of different qualitative aspects
which are essential to secure investors
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patronage to mutual fund. The study found that all the benefits given by the mutual fund
and sponsor related attributes monetary benefits given by the mutual fund and sponsor
related attributes. The mutual fund companies are expected ensure full disclosure and
regular updates of their relevant information with the assurance of safety and monitory
benefits for securing the patronage of Indian investors
MRS. PURNIMA UMESH MEHTA (2011) studied the profile and perception of
investors towards mutual funds in the selected cities of Gujarat. It focuses on investor’s
perception towards mutual funds in cities of Sural Ahmadabad and Vadodara. The main
objective of the study is to study the perception of investors towards mutual fund and
subsidiary objectives are to identify the problems of investors in investing their money
in mutual fund scheme to analyse the investors level of fulfilment regarding mutual fund
to examine the pattern of investment and the investors preference with regards to
mutual fund Vs other investment products. The study reveals that main purpose of
investment in mutual fund is children education retirement plan and tax planning.
People are more invested in growth scheme of mutual fund
SIMRANSAINI, DR.BIMALANJUM AND RAMAN DEEP SAINT (2011) where

conducted a study on investors awareness an perception about mutual fund to analyse
the growth of mutual fund industry in India and to analyse the investors awareness and
perception regarding investing in mutual fund and find the deficiencies in the working of
mutual fund industry. The study reveals that mutual fund industry task is to convert the
potential investors into the reality investors and new and innovative schemes launched
for increasing investor’s confidence. It will lead to the overall growth and development
of the mutual fund
DR.BINOD KUMAR SINGH AND ASHUTOSKR.JHA (2009) Conducted a study on

awareness and acceptability of mutual fund to find the awareness and acceptability of
mutual found among investors and factors considered by the investors which investing
in the mutual fund. They found that large numbers of people are aware about mutual
fund and they considered it as safe. The factors behind the investment in mutual found
are wealth creation, Tax and steady income Factors considered by investors before
investing in mutual found are security, liquidity high return
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CHAPTER 3
INDUSTRY, COMPANY PROFILE
AND THEROTICAL
FRAMEWORK
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INTRODUCTION
Financial markets have become more complex and

sophisticated. In order to be successful, investors need an
intermediary who provides the required knowledge and professional
expertise. The concept of mutual fund emerged to play this role of intermediary.
In the previous chapter, we have reviewed the available literature on mutual
funds and mobilisation of savings. In continuation of that chapter, in this
chapter, an attempt is made to explain the fundamental concepts of
mutual funds in general and its working and regulation in the Indian context.
CONCEPT OF MUTUAL FUND
Mutual fund is an investment vehicle that is made up of a pool of funds collected

from many investors for the purpose of investing in securities such as stock, bonds,
money market instrument and similar assets. Each shareholder participates
proportionally in the gain or loss of the fund.
Mutual fund units or shares are issued and can typically be purchased
redeemed as needed at the fund’s current Net Asset Value (NAV) per share, which is
sometimes expressed as NAVPS. Mutual funds as an intermediation mechanism and
products play an important role in India’s financial sector development. Apart from
pooling resources from small investors, they also provide informed decision making
mechanism to them. Thus they contribute to not only financial sector participation, but
also financial inclusion and thereby enhance market efficiency. Additionally they
contribute to financial stability and help in enhancing market transparency.
While the mutual fund is a collection of money, it requires some person or

body to mobilize and manage these assets. This entity is usually an organization, aptly
known as Asset Management Company (AMC). The AMC is thus the physical entity,
the organization and the company, which generates the collective investments from the
public with a view to invest in securities and generate returns. By virtue of its
mobilization function, the AMC has offices or branches in number of cities. These
branches collect money from investors and are one of the visible faces of mutual fund.
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fund
As this money has to be invested and managed, the AMC has an
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fund
investment team. The head of this team, the fund manager or the chief investment
officer is another visible face of the mutual fund. The fund manager is at the head of the
decision making process which takes strategic and tactical decisions on where to
invest.
Concept of Mutual Fund
Many investors with common

financial objectives pool of
their money
Investors on a proportionate basis, get

mutual fund units for the sum
contributed to the pool
The money collected from investors is

invested into shares, debentures and
other securities by the fund manager
The fund manager realizes the gains or

losses, and collects dividend or interest
income
Any capital gains or losses from such

investments are passed on to the investor
on proportion of the number of units held
by them
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DEFINITIONS
Different scholars have defined Mutual Fund differently. Frank K. Reilly has defined
mutual fund as an investment company, which pools funds belonging to many
individuals that is used to acquire a collection of individual investments
such as stocks, bonds, other publicly traded securities. John A. Halin defines it
as a major type of investment-company that pools the funds of investors
who are seeking some general investment objective and invest them in
a number of frequently traded different types of securities. Mutual fund is the
institution, which collectively manages the funds from different small investors.
It mobilizes savings from the public and provides those attractive returns, security
and liquidity by investing in capital market. It is a fund established in the form
of a Trust by a sponsor to raise monies by the Trustees through the sale
of units to the public under one or more schemes for investing in
securities. It is a diversified portfolio of stocks, bonds, of other securities run
by a professional money manager or, in some cases, a management
teams. It provides instant diversification in a given area within objectives
laid. These offer a variety of diversified options for investments looking into varied
risks and returns Regulation, 2(q) of the Securities and Exchange Board of India
(Mutual Funds) Regulations, 1996 defines a mutual fund as a f und established in
the form of a trust to raise monies through the sale of units to the public or a
section of the public under one or more schemes for investing in securities,
including money market instruments". Thus a mutual fund is an institutional
device or an investment vehicle through which, the investors pool their funds
under the direction of an investment manager. These funds are invested in wide
variety of portfolios of securities in such a way as to minimize risk, while ensuring
safety and steady returns.
ADVANTAGES OF MUTUAL FUNDS
 Portfolio diversification
 Professional management
 Reduction of risk
 Liquidity
 Flexibility & convenience
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fund
 Reduction in transportation cost
 Safety of regulated environment
 Choice of schemes
 Transparency
DISADVANTAGES OF MUTUAL FUND

 No control over cost in the hands of an investor
 No tailor-made portfolios
 Managing a portfolio funds
 Difficulty in selecting a suitable fund schemes
HISTORY OF THE INDIAN MUTUAL FUND INDUSTRY
The mutual fund industry in India started in 1953 with the formation of unit trust of
India, at the initiative of Government of India and reserve bank. Though the growth was
slow, but it accelerated from the year 1987 when non-UTI players entered the industry.
In the past decade, Indian mutual fund Industry had seen a dramatic improvement,
both qualities wise as well as quantity wise. Before, the monopoly of the market had
seen ending phase; the Assets under Management (AUM) was Rs67 billion. The
private sector entry to the fund family raised the Annum to Rs. 470 billion in March 1993
and till April 2004; it reached the height if Rs.1540 billion.
The Mutual Fund Industry is obviously growing at a tremendous space with the
mutual fund industry can be broadly put into four phases according to the development
of the sector. Each phase is briefly described as under.
First Phase-1964-87
Unit Trust of India (UTI) was established on 1963 by an Act of Parliament t Reserve
Bank of India and functioned under the Regulatory and administrative control of the
Reserve bank of India. In 1978 UTI was de-linked from the RBI and the Industrial
development bank of India (IDBI) took over the regulatory and administrative control in
place of RBI. The first scheme launched by UTI was until scheme 1964. UTI had Rs.6,
700 cores of assets under management
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Second Phase-1987-1993(Entry of Public Sector Funds)
1987 marked the entry of non-UTI-public Sector mutual funds set up by public
sector banks and life Insurance Corporation of India (LIC) and General Insurance
Corporation of India (GIC). SBI Mutual Fund was the first n o n - UTI Mutual
Fund established In June 1987 followed by Can bank Mutual Fund (Dec 87)
Punjab National Bank Mutual Fund (Aug 89), Indian Bank Mutual Fund (Nov 89).
Bank of India (Jun 90).Bank of Baroda Mutual Fund (Oct 92). LIC established its
mutual fund in June 1989 white GIC had set up its mutual fund in December 1990. At
the end of 1993, the mutual fund Industry had assets under management of Rs.47, 004
crores.
Third Phase-1993-2003(Entry of Private Sector Funds)
1993 was the year in which the first Mutual Fund Regulations came into being, under
which all mutual funds, except UTI were to be registered and governed. The erstwhile
Kothari pioneer (now merged with Flanklin Templeton) was the first private sector
mutual fund registered in July 1993.
The 1993 SEBI (Mutual Fund) Regulations were substituted by a more
comprehensive and revised Mutual Fund Regulations in 1996, The Industry now
functions under the SEBI (Mutual Fund) Regulations 1996. As at the end of January
2003, there were 33 mutual funds with total assets of Rs. 1.21,805 crores.
Fourth Phase-since February 2003
In February 2003, following the repeal of the Unit Trust of India Act 1963
UTI was bifurcated into two separate entities. One is the Specified Undertaking of
the Unit Trust Of India with assets under management of Rs29.835 crores as at the
end of January 2003, representing broadly, the assets of US 64 scheme, assured
return and certain Other schemes.
The second Is the UTI Mutual Fund Ltd, sponsored by SBI,PNB,BOB and LIC.It
is registered with SEBI and functions under the Mutual Fund Regulations.
Consolidation and growth. As at the end of September, 2004, there were 29 funds,
which manage assets of Rs.153108 cranes under 421 schemes.
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STRUCTURE OF THE INDIAN MUTUAL FUND INDUSTRY:
The Indian mutual fund Industry is dominated by me Unit Trust of India and which
has a total corpus of Rs 700bn collected from more than 20 million Investors .The UTI
has many fund
/schemes In all categories i.e. equity, balanced, Income etc with some being The NIS
Academy, Aurangabad. Open ended and some being closed ended. The united
scheme 1964 commonly referred to as US64, which is a balanced fund, is the biggest
scheme with a corpus of about Rs 200bn URI was floated by financial institution and is
governed by a special act of the Parliament. Most of Its Investors believe that the UTI is
government owned and controlled which, while legally Incorrect. is
trueforallpracticalpurposes.
The second largest categories of mutual funds are the ones floated by nationalized
banks. Can bank Asset management floated
by Canara Bank and SBI Funds
Management floated by the State Bank of India are the largest of these. GIC AMC
floated by General Insurance Corporation and Jeevan Bima Sahayog AMC floated by
the LIC are some of the prominent ones. The aggregate corpus of funds managed by
this category of AMC's is about Rs 150 billion.
The third largest categories of the mutual funds are the once floated by me private
sector and by the foreign asset management companies. The largest of these are
Prudential ICICI AMC and Birla SUN LIFE AMC. The aggregate corpus of the asset
managed by this category of AMC s is in excess of Rs 250bn.
RECENT TRENDS IN THE MUTUAL FUND INDUSTRY:
The most important in the mutual fund industry is the aggressive expansion of
the foreign owned mutual fund companies and the decline of the companies floated by
the nationalized bank and smaller private sector players. Many nationalized banks got
into the mutual fund business In the early nineties and go off to a good start due to
the Stock market boom prevailing then. These banks did not really understand the
mutual fund business and they just viewed it as another kind of banking
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activity. Few hired specialized staff and generally choose to transfer staff from
the parent organization. Some schemes had offered guaranteed returns and their
patent organization had to ball out these AMCs by paying large amount of
money the difference between the guaranteed and actual returns. The service
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fund
level was also bad. Most of these AMCs have not been able to retain staffs, float,
and new schemes etc. and It Is doubtful whether barring a few expectations;
they have serious plans of confusing the activity in a major way.
The experience of some of the AMCs floated by private sector Indian companies
was also very similar. They quickly realized that the AMCs business is a business,
which makes money in the long term and requires deep pocketed support in the
intermediate years. Some have sold out to foreign owned companies, some have
merged with the others and there is general restructuring going on.
The foreign owned companies have deep pockets and have come in here with the
expectation of a long haul. They can be credited with introducing many new practices
such as new product innovation, sharp improvement in the service standards and
disclosure, usage of technology, broker education etc. In fact they have forced the
Industry to upgrade itself and service levels of the organization like UTI have improved
dramatically in the last few years in response to the competition provided by these.
FUTURE SCENARIO:
The asset base will continue to grow at an annual rate of about 30 to 35% over the
next few years as investor’s shift their asset from banks and other traditional
avenues. Some of the older public and private sector players will either close
or be taken over. Out of ten public sectors players five will sell out, close down or
merge with strong players in three to four years. In the private sector this trend has
already started with two mergers and one takeover. Here too some of them will
down their shutter in the near future to come.
But this does not mean there is no room for other players. The market will witness
a flurry of new players entering the area. There will be a large number of offers
from various asset management companies in times to come. Some big names like
Fidelity, Principal and Old Mutual etc. are looking at Indian market seriously. The
mutual fund industry is awaiting the derivation In India as this would enable it to
hedge its risk and this in turn would be reflected in its Net Asset Value (NAV).
SEBI is working out the norms for enabling the existing mutual fund scheme to trade in
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fund
derivatives. Importantly, many market players have called on me Regulator to initiate
the process immediately, so that the mutual funds can implement the changes that are
required to trade in derivates.
ROLE OF SEBI IN MUTUAL FUND:
In the year 1992 SEBI act was passed. The objectives of SEBI are - to protect the
interest of investors in securities, to promote the development of, and to regulate the
securities market. As far as mutual are concerned SEBI formulates policies and
regulation the mutual fund to protect the Interest of the investors. SEBI notified
regulation for mutual funds in 1993. Thereafter mutual fund sponsored by private sector
entities were allowed to enter the capital market, the regulations were fully revised in
1996 and been amended. Therefore, from time to time SEBI has also issued guidelines
to the mutual fund from time to time to protect the interest of the investors.
All mutual funds whether promoted by public sector or private sector entities including
those promoted by foreign entities are governed by the same set of regulation. There is
no distinction in regulatory requirement of the mutual fund and all are subject to
monitoring and inspecting by SEBI. The risks associated with the scheme launched by
mutual funds sponsored by these entitiesareofsimilar type.
MUTUAL FUNDS CAN BE CLASSIFIED AS FOLLOW:
 Based on their structure

 Open ended funds: Investors can buy andsell the units from the fund at any point
of time.
 Close-ended funds: These funds raise money from investors only once.
Therefore, after the offer Period, fresh investments cannot be made into the fund. If
the fund is listed on a stocks exchange the units can be traded like stocks (E.g.,
Morgan Stanley Growth Fund). Recently, most of the New Fund Offers of close
ended funds provided liquidity window on a periodic basis such as monthly or
weekly. Redemption of units can be made
during specified intervals. Therefore, Such funds have relatively low liquidity.
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 BasedontheirInvestmentobjective:
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 Equity funds: These funds invest in equities and equity related instruments,
With fluctuating share prices, such funds show volatile performance, even losses,
However, short term fluctuations in the market generally smoothens out in the
long term, thereby on ring higher returns at relatively lower volatility. At the same
time, such funds can yield great capital appreciation as, historically, equities
have outperformed all asset classes in the long term, Hence, investment in equity
funds should be considered for a period of at least 3-5 years. It can
befurtherclassifiedas:
 Index funds: In this case a key stock market Index, like BSE Sensex or Nifty is
tracked. Their Portfolio mirrors the benchmark index both in terms of
composition and Individual stock weightages.
 Equity diversified funds: 100% of the capital is invested in equities spreading
across differentsectors andstocks.
 Dividend yield funds: it is similar to the equity diversified funds except that they
invest In companies offering high dividend yields.
 Thematic funds: Invest 100% of the assets in sectors which are related through
some theme.
 Sector funds:invest 100% of the capital in a specific sector. e.g. - A banking
sector fund will invest in banking stocks.
 ELSS- Equity Linked Saving Scheme provides tax benefit tome investors.
 Balanced fund: Their investment portfolio includes both debt and equity. As a
result, on the risk-return ladder, they fall between equity and debt funds.
Balanced funds are the Ideal mutual funds vehicle for investors who prefer
spreading their risk across various Instruments. Following are balanced funds
classes:
 Debt-oriented funds: Investmentbelow 65% Inequities.
 Equity-oriented funds: Invest at least 65% In equities, remaining in debt.
 Debt fund: They Invest only In debt instruments, and are a good option for
Investors averse to idea of taking risk associated with equities. Therefore, they
invest exclusively in fixed-income instruments like bonds, debentures,
Government of India securities; and money market instruments such as
certificates of deposit (CD), commercial paper (CP) and call money. Put your
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money into any of these debt funds depending on your investment horizon and
needs.
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 Liquid funds: These funds invest 100% in money market Instruments, a
large portion being Invested in call money market
 Gilt funds ST: They Invest 100% of their portfolio in government securities of
and T- bills.
 Floating rate funds: Invest in short-term debt papers- Floaters invest in debt
Instruments which have variable coupon rate.
 Arbitrage fund- They generate Income through arbitrage opportunities due to
mis- pricing between cash market and derivatives market, Funds are allocated to
equities, derivatives and money markets. Higher proportion (around 75%)
is put in money markets. in the absence of arbitrage opportunities.
 Gilt funds LT: They most 100% of their portfolio in long-term
government securities.
 Income funds LT: Typically, such funds invest a major portion of the
portfolio in long-term debt papers.
 MIPs: Monthly Income Plans have an exposure of 70%-90%to debt and an
exposure of 10%.30% to equities.
 FMPs: fixed monthly plans invest In debt papers whose maturity ls In line with
that of me fund.
INVESTMENT STRATEGIES:
 Systematic Investment Plan: under this a fixed sum is Invested each month on
a fixed date of a month, Payment is made through post-dated cheques or direct
debit facilities. The investor gets fewer units when the NAY is high and more units
when the NAV is low. This is called as thebenefit of Rupee Cost Averaging (RCA).
 Systematic Transfer Plan: under this an Investor Invest in debt oriented fund
and give instructions to transfer a fixed sum, at a fixed Interval, to equity scheme
of the same mutualfund.
 Systematic Withdrawal Plan: If someone wishes to withdraw from a mutual
fund then he can withdraws fixed amount each month.
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RISK V/S. RETURN
RETURN SECTORAL FUNDS
EQUITY FUNDS
INDEX FUNDS
BALANCED FUND
DEBT FUNDS
LIQUID FUNDS
RISK
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MAJOR PLAYERS
 Bank sponsored
 Joint Ventures - Predominantly Indian
1. SBl Funds Management Private Ltd.
 Others
1. BOB Asset Management Co. Ltd.
2. Canbank investment Management Services Ltd,,
3. Asset Management Co, Private Ltd.
 Institutions
 Jeevan Bima Sahayog Asset Management Co, Ltd.
 Private Sector
 Indian
1. Benchmark Asset Management Co, Private Ltd.
2. Cholamandalam Asset Management Co, Ltd.
3. Credit Capital Asset Management Co, ltd.
4. Escorts Asset Management Ltd.
5. J. M. Financial Asset Management Private Ltd
6. Kotak Mahindra Asset Management Co, Ltd.
7. Reliance Capital Asset Management Ltd.
8. Sahara Asset Management Co- Private Ltd
9. Sundaram Asset Management
Co.Ltd. 10.Tata Asset Management Ltd
 Joint Ventures - Predominantly Sudan
1. Birla Sun Life Asset Management Co.Ltd.
2. DSP MerriIl Lynch Fund Managers Ltd. ,
3. HDFC Asset Management Co. Ltd.
4. Prudential ICICI Asset Management Co. Ltd.
 Joint Ventures - Predominantly Foreign
1. ASH AMRO Asset Management (India) Ltd.
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2. Deutsche Asset Management (India) Private Ltd
3. Fidelity Fund Management Private Ltd.
4. Franklin Templeton Asset Management (India) Private Ltd_
5. HSBC Asset Management (India) Private Ltd,
6. ING Investment Management (India)Private Ltd,
7. Morgan Stanley Investment Management Private Ltd
8. Principal Pnb mot Management Co. Private Ltd-
9. Standard Chartered Asset Management Co. Private Ltd
WHO CAN INVEST?
Who can Invest in Mutual Funds In India, First of all, distributors need to be
aware or who mutual fund units. Mutual funds In India are open to investment by
 Residents including:
 Resident Indian Individuals.
 Indian Companies/Partnership Firms.
 Indian Trust/Charitable Institutions.
 Banks/Financial Institutions.
 Non-Banking Finance Companies.
 Insurance Companies.
 Provident funds.
 Mutual funds.
 Non-Residents Including:
 Non-Resident Indians, and Persons of Indian Origin.
 Overseas Corporate Bodies {OCBs) and
 Foreign entities, viz
 Foreign Institutional Investors(FlI) registered with SEBI
 Foreign Citizens/ entities are not allowed to Invest in mutual funds
in India.
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MUTUAL FUND INDUSTRY OF KERALA
There are no mutual funds with theirhead office in kerala. But, all of the mutual
funds of india have operation in kerala through either their own branches or
agents. The main business of these offices is concentrated in the major cities of
kerala ,cochin, trichur, trivandrum and calicut. The UTI itself has three main
branches in kerala, in cochin, trichur and trivandrum and many franchisee offices
agents spread throughout the state. No organisation collects statistics about
mutual fund mobilisation from kerala. The GOVT of kerala don’t have any statistics
since there are no governmental agencies directly or indirectly involved in the
mobilisation of units of mutual funds. Mutual funds including the UTI are not willing
to share the information with the researcher in spite of the repeated appeals and
visits to their regional/head offices. Similar is the situation with the published data,
all of which compelled to limit the study to an empirical one.
SAVINGS
“Savings “are cash or physical products set aside for future use. People in rural and
other low- income communities, although poor, can save when they are guided and
encouraged. In rural communities, savings are made through traditional credit rotation
groups, or purchase of domestic animals.
FACTORS OF SAVINGS
The factors affecting savings are:
 The level of the real interest rate
 The level of per capita GDP
 Fiscal policy
 The proportion of labour remuneration in national income
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 The distribution of income
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 Financial reforms
 Uncertainty
 The effects of taxation
 Demographic factors
 Pension plans
MOBILISATION OF SAVINGS
Mobilisation of savings is no matter how poor a person may seem s/he should be
persuaded and encouraged to save as the income rises for reasons earlier mentioned.
Mobilisation of savings is low income individuals in developing countries clearly

express a desire to build up savings. Saving therefore offer significant leverage for
economic development and self-sufficiency and are valuable to both microfinance
institutions and their clients or members.
MOBILISATION OF SAVINGS THROUGH MUTUAL FUND

Only by relating the savings and investment pattern of the people of the country
the real size, magnitude and significance of the mutual fund industry can be
assessed. The role of mutual funds in mobilising savings of the household should
also be verified by analysing the proportion of mutual fund
Savings is one of the factors influence financial development. The primary mode
through which this occurs is financial savings and in particular, intermediated
financial savings. India is one of the few countries today to maintain a steady growth
rate in domestic savings. Savings being the prime mover of economic development,
Indian planners have always focussed on this aspect of economic development. The
Indian saving experience during the period 1970-71 to 1998-99 was marked by a
simultaneous secular increase in the rate of Gross Domestic saving (GDS, as a
percentage of GDP at current market prices) and the rise in the rate of financial
saving of the household sector and private corporate sector.
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ROLE OF MUTUAL FUNDS IN THE FINANCIAL MARKET

Mutual funds have assumed the important role as a financial intermediary
mainly due to the complex and risky environment of the stock market. They have to
play a two-fold role in the financial market, viz.,
 Promoter of capital market, and

 Intermediary of household savings
Promoter of capital market
A developed financial market is a necessary pre condition for the overall economic
development and mutual funds play an active role in promoting a healthy capital
market. Mutual funds increase liquidity in the money market. Mutual funds could
change the proportion of financial assets in the total annual savings, which increased
from 23.7% in 1970-75 to 34.9% in 1980-85 and to 44.5% in 1993-99 . Mutual funds in
India have created awareness among investors about equity-oriented investment and
its benefits.
Intermediary of household savings
Mutual funds are the fastest growing institutions in the household savings sector. The
share of mutual funds in household savings is one indicator of the importance of mutual
funds in the savings markets.
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CHAPTER 4
DATA ANALYSIS AND

INTERPRETATION
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INTRODUCTION:
This chapter deals with analysis and interpretation of data collected with the help of
questionnaire directly from the MUTUAL FUND investors. The present study intended to
examine MOBILISATION OF SAVING THROUGH MUTUAL FUND INVESTORS of in
Malappuram district.
The data is analysed and presented in the form of table with necessary interpretation
alongside. Various types of statistical methods are used for analysis of data. This
analysis is supplemented by explanation, tables and diagrams.
4.1 CLASSIFICATION OF RESPONDENTS IN ALL CLASSIFICATORY VARIABLES

Demographic profile of the respondent
Sl.nos variable No of percentage

responde
nt
1 Age below 35 16 20
Between 35 38 47.
and 55 5
Above 55 26 32.5
Total 80 100
2 Gender Male 67 83.75
Female 13 16.25
Total 80 100
3 Educational Post graduate 8 10

qualification
Graduate 3 3.75
Under 3 3.75
graduate
Professional 43 53.75
Technical 23 28.75
Total 80 100
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4 Occupation Govt sector 34 42.5
Pvt sector 21 26.2

5
Business 18 22.5
Agriculture 4 5
Others 3 3.75
Total 80 100
5 Residence Urban 4 5
location
Semi urban 55 35
Rural 21 7.5
Total 80 100
6 Annual income Above 5 46 57.5

lakh
3-5 lakh 28 35
Below 3 6 7.5
lakh
80 100
7 Annual Above 2.5 lakh 26 32.5

expenditur
e
2 - 2.5 lakh 44 55
Below 2 10 12.5
lakh
Total 80 100
TABLE 4.1 Source: Primary data
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INTEPRETATION
The study was conducted by taking a sample of 80 customers. Table 4.1 examines
the demographic profile of the respondents. It is clear from the analysis that majority
respondents i.e.
,38 respondent are between 36 and 55.it means maximum belongings to that group.
And minimum number is 35 and below. And 26 respondent are belonging to above 55.
The above table executed that majority of the respondent are belonging to male
83.75% and 13 respondents are belonging to female,
The above table shows that majority of the respondent are professional 43.and 23
respondent were technical and 8 respondent were post graduate. And 3 respondents
were under graduate respectively.
The above table show that majority of the respondent were govt sector (42.5%) and
(26.25%) are pvt sector and 22.5%are business. And 5%agriculture and 3,75% are
others.
The above table show that majority of 55 respondents are belonging to semi urban
location and 21 respondents were rural area and 4 respondents were in urban area
respectively.
The above table executed that majority of the respondent income were belonging to >5 lakh.
And 28 respondent are rs 3-5 lakh and 6 respondent were<3 lakh.
The above table show that majority of the respondents expenditure is belonging rs 2-
2.5 lakh and 26 respondent were rs 2.5 lakh and 10 respondent were <2 lakh.
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4.2 CLASSIFICATION ON THE BASIS OF PERCENTAGE OF SAVING INVESTED IN
MUTUAL FUND
Percentage of saving No of respondents Percentage

Up to 10% 17 21.2
5
10 -25% 26 32.5
25-50% 22 27.5
Above 50% 15 18.7
5
Total 80 100
Table 4.2 Source: Primary
data
PERCENTAGE OF SAVING INVESTED IN MUTUAL FUND
Percentage
32.5
35
27.5
30
25 21.25
18.75
20
15
10
5
0
Up to 10 - 25- Above
10% 25% 50% 50%
CHART 4.2
Interpretation:
From the above table show that majority of the respondent will choose 10-to 25% as
their percentage on saving and then the respondent will choose 25-50% and then
choose up to 10% and then choose above 50%.
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4.3 CLASSIFICATION ON THE BASIS OF PERIOD OF INVESTING IN MUTUAL
FUND
Period No of Percenta
respondent ge
Below 1 year 3 3.75
1 year to 3 18 22.5
year
3 year to 6 55 68.75
year
Above 6 year 4 5
Total 80 100
PERIOD OF INVESTING IN MUTUAL FUND
4 3
18
<1 year
1 year to 3 year
3 year to 6 year
55
>6 year
CHART 4.3
Interpretation:
From the above table show that majority of the respondent will prefer 3 year to 6 year as
investing in mutual fund (68.75%).and then 1 year to 3 year (22.5%).and then Above 6
year 5% and Below 1 year (3.75%) respectively.
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4.4 CLASSIFICATION ON THE BASIS OF PRIMARY MOTIVE OF INVESTMENT
Under this study 8factors are used to find out the primary motive of investment that
the investors may prefer most. Hentry Garrett Ranking is used to identify the highly
prefering factor.
To apply Hentry Garrett Ranking Method, first arrange the data on the basis of rank get
for each factor. That means 1st rank to 8th rank for each problem factors. Then calculate
Percent Position of each rank by using the formula 100(Rij-0.5)/Nj. Rij stands for 1st, 2nd,3rd
, 4th, 5th,6th
,7th, 8th Ranks. Nj stands for the highest rank given by the respondents. Here Nj is .
Find out Garrett Value for each Per cent Position from Garret Conversion Table. The
number of observation in 1st rank to 8th rank in each factor is multiplied with
corresponding Garret Value
of Ranks. And calculate Garret Score of each factor by adding the multiplication result.
Then calculate average score by dividing Garrett Score with sample size. Highest
average score is given the 1st rank and this way sequentially gives the rank highest to
lowest average score.
The following tables’ shows the motive of investment that the investors
may prefer most and respective average score with matching rank calculated on the
basis of Garret ranking method.
MOTIVES 1 2 3 4 5 6 7 8
Meet the emergencies 23 18 12 14 4 3 2 4
Meet educational expenses 25 14 8 12 6 2 4 9
Meet marriage expenses 12 16 10 8 16 9 4 5
Buy properties & durables,etc 3 12 14 17 12 8 10 4
Save tax 5 6 12 4 14 9 18 12
Start or expand business 6 7 9 12 10 12 14 10
Multiple purposes 4 3 13 10 12 22 10 6
Meet other expenses 2 4 2 3 6 15 18 30
Total 80 80 80 80 80 80 80 80
TABLE 4.4.1 Source: Primary data
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fund
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PER CENT POSITION AND GARETT VALUE
Ran 100(Rij- Per cent position Garret

k 0.5)/Nj value value
1 100(1-0.5)/8 6.25 80
2 100(2-0.5)/8 18.75 67
3 100(3-0.5)/8 31.25 60
4 100(4-0.5)/8 43.75 53
5 100(5-0.5)/8 56.25 47
6 100(6-0.5)/8 68.75 40
7 100(7-0.5)/8 81.25 33
8 100(8-0.5)/8 93.75 20
TABLE 4.4.2
Per cent position values are computed by using the above formula for the 8 ranks given
by the 80 respondents regarding primary motive of their investment. Then their
respective garret values are found out by using Henry garret table.
SCORE TABLE
Factors Total /80 Average score Rank

Meet the emergencies 4962/80 62.025 1
Meet educational expenses 4728/80 59.1 2
Meet marriage expenses 4400/80 55 3
Buy properties & 4079/80 50.9875 4
durables,etc
Save tax 3586/80 44.825 7
Start or expand business 3737/80 46.7125 5
Multiple purposes 3725/80 46.5625 6
Meet other expenses 2783/80 34.7875 8
TABLE 4.4.3
Interpretation:
In the above table as per Henry garret ranking method, the factor Meet the
emergencies has got the first rank. Meet education expenses at the second position
and meet marriage expenses is at the third position. That shows primary motive of the
Page 39
investment is depend upon the meet the emergencies.
fund
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4.5 CLASSIFICATION ON THE BASIS OF SAVING HABIT OF RESPONDENT
Saving No of percentag
habit respondent e
Regular 2 2.5
Occasional 7 88.7
1 5
Not
7 8.75
applicable
8 100
Total Table
0 4.5 Source: Primary data
SAVING HABIT OF RESPONDENT
100
88.75
90
80
70
60
50
40
30
20
10 8.75
0 2.5
REGUL OCCASION NOT

AR AL APPLICABLE
CHART 4.5
Interpretation:
From the above table it is show that most of the respondents are in occasional investors
in mutual fund(88.75%).and then the investors will prefer not applicable as case may
be(8.75%).And then the investors will regular investors in mutual fund (2.5%)
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4.6 CLASSICATION ON THE BASIS OF PREFERENCE OF THE INVESTOR
Facto RANK
r
1 2 3 4 5 6 7 8 TOTAL
Safety 12 30 22 12 4 0 0 0 80
Liquidity 10 18 22 15 8 7 0 0 80
Tax benefits 2 7 22 21 6 11 11 0 80
Return & savings 50 15 9 6 0 0 0 0 80
Performance of past schemes 0 0 1 5 8 14 10 42 80
Rating of MF by agencies 6 10 3 13 30 10 8 0 80
Recommendations of friends 0 0 0 3 3 28 27 19 80
and
relatives
Advertisement 0 0 1 5 21 10 24 19 80
TOTAL 80 80 80 80 80 80 80 80 640
TABLE 4.6 .1 Source: Primary data
WEIGHTED AVEREGE
FACTOR TOTAL WEIGHT MEAN MEAN RANK

S SCORE
1 514 6.43 2
2 466 5.83 3
3 381 4.76 4
4 589 7.36 1
5 167 2.09 8
6 367 4.59 5
7 184 2.30 7
8 212 2.65 6
Interpretation:
From the above table shows that majority of respondents give first preference to Return
& savings. Secondly they prefer Safety. Third and fourth rank is given to Liquidity and
Tax benefits respectively. Subsequent ranks given to Rating of MF by agencies,
Advertisement, Recommendations of friends and relatives. Performance of past
Page 40
schemes is the least influencing one, because it’s rank is 8.
fund
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fund
4.7 CLASSIFICATION ON THE BASIS OF AWARENESS ABOUT MUTUAL FUND
SCHEMES
The following table shows the awareness about mutual fund schemes. The weighted
average is used to rank the mutual fund schemes. Here the mutual funds schemes are
analysed by taking the units highly aware, aware, neutral lower aware and least aware.
M.F SCHEMES H.A A N L.A L.A likert Weight Rank

scor ed avg
e
Balanced fund 20 20 28 12 0 288 3.6 4
Money market/Liquid fund 6 20 48 4 2 264 3.3 5
Tax saving scheme 18 30 30 2 0 304 3.8 2
Index funds 12 24 20 16 8 256 3.2 6
Growth/Equity oriented scheme 30 40 10 0 0 340 4.25 1
Income/Debt oriented schemes 25 31 4 13 7 294 3.67 3
Sector specific scheme 2 10 38 20 10 214 2.68 7
Interpretation:
From the above table shows that Growth/Equity oriented scheme get the first rank, and
Tax saving scheme get the second rank, and Income/Debt oriented schemes get the
third rank and Sector specific scheme get the last rank.
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4.8 CLASSIFICATION ON THE BASIS OF AWARENESS ABOUT INVESTOR
RIGHTS AND AMFI
The following table shows the awareness about investor’s rights and AMFI. The
weighted average is used to rank the investors awareness about their rights and AMFI.
Here the mutual funds schemes are analysed by taking the units highly aware, aware,
neutral lower aware and least aware.
INVESTORS RIGHTS AND H.A A N L.A L.A likert Weight Rank

AMFI scor ed avg
e
Right to “proportionate
30 38 9 2 1 334 4.17 1
beneficial
ownership”
Right to timely services
12 44 11 10 2 296 3.7 3
Right to information
35 23 6 11 5 312 3.9 2
Right to approve change in

20 25 15 12 8 277 3.46 5
fundamental attributes of the
Scheme
AMFI is an apex body of all
20 26 15 11 8 279 3.48 4
asset
management companies
AMFI Protects and promotes
15 17 22 18 8 253 3.16 6
the
interests of mutual funds as
well
as their unit holders
INTERPRETATION:
From the above table shows that majority of respondents give first rank to Right
to“proportionate beneficial ownership”. Secondly they prefer Right to information. Third
and fourth rank is given to Right to timely services and AMFI is an apex body of all asset
management companies respectively. Subsequent ranks given to Right to approve
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change in fundamental attributes of the scheme and AMFI Protects and promote the
interests of mutual funds as well as their unit holders.
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4.9 CLASSIFICATION ON THE BASIS OF SOURCES OF MUTUAL FUND
NO OF
SOURCES RESPONDEN PERCENTAGE
T
Advertisement 4 5
Peer group 6 7.5
Bank 12 15
Internet 13 16.2
5
Magazines 16 20
Financial advisors 29 36.2
5
Total 80 100
SOURCES OF MUTUAL FUND
Percentage 36.25
40
35
30 20
25 15 16.25
20
15 7.5
5
10
5
0
CHART 4.9
Interpretation:
From the above table it is show that majority of the respondent prefer financial advisors
for getting the sources of information related in mutual fund 36.25%.and then the
investors will prefer the magazines 20% and then prefer internet 16.25%.and then the
investors will prefer the bank for getting the information 15%.and then the investors will
Page 43
prefer peer group 7.5%.and then only they aware in advertisement 5%.
fund
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fund
4.10 CLASSIFICATION ON THE BASIS OF FEATURE OF MUTUAL FUND
Under this study 5 factors are used to find out the factor of mutual fund which attracts
the investor. Hentry Garrett Ranking is used to identify the most attracting factor.
To apply Hentry Garrett Ranking Method, first arrange the data on the
basis of rank get for each factor. That means, 1st rank to 5th rank for each problem
factors. Then calculate Percent Position of each rank by using the formula 100(R ij-
0.5)/Nj. Rij stands for 1st, 2nd,3rd , 4th and5th Ranks. Nj stands for the highest rank
given by the respondents. Here Nj is 5. Find out Garrett Value for each Percent Position
from Garret Conversion Table. The number of observation in 1st rank to 5th rank in each
factor is multiplied with corresponding Garret Value
of Ranks. And calculate Garret Score of each factor by adding the multiplication result.
Then calculate average score by dividing Garrett Score with sample size. Highest
average score is given the 1st rank and this way sequentially gives the rank highest to
lowest average score.
The following tables shows the different factors of mutual fund which
attracts the investors and respective average score with matching rank calculated on
the basis of Garret ranking method.
SOURCES OF INFORMATION ABOUT THE FEATURE OF MUTUAL FUND
WHICH ATTRACT THE INVESTOR
FEATURES 1 2 3 4 5
Diversification
12 23 9 14 22
better return &safety
19 18 19 17 7
Tax benefit
12 15 30 13 10
Regular income
20 12 13 22 13
less risk 17 12 9 14 28
TOTAL 80 80 80 80 80
Calculate Per cent position =100(Rij-0.5)/Nj

Rij =1st,2nd, 3rd ................ 5th ranks
Nj= Total rank given by respondent =5
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PER CENT POSITION AND GARETT VALUE
Rank 100(Rij-0.5)/Nj Per cent position value Garret value

1 100(1-0.5)/5 10 75
2 100(2-0.5)/5 30 60
3 100(3-0.5/5 50 50
4 100(4-0.5)/5 70 40
5 100(5-0.5)/5 90 25
TABLE 4.10.2
Per cent position values are computed by using the above formula for the 5 ranks given
by the 80 respondents regarding the feature of mutual fund which attract the investor.
Then their respective garret values are found out by using Henry garret table.
SCORE TABLE
Factors Total /80 Average score Rank

Diversification 3840/80 48 4
better return &safety 4310/80 53.875 1
Tax benefit 4070/80 50.875 3
Regular income 4075/80 50.9375 2
less risk 3705/80 46.3125 5
TABLE 4.10.3
Interpretation:
In the above table as per Henry garret ranking method, the source of information
better safety and return has got the first rank. Regular income at the second position
and tax benefit are at third position. That shows the information on mutual fund is
getting more for the better safety and return.
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4.11 CLASSIFICATION ON THE BASIS OF PREFERENCE OF INVESTORS
ON MUTUAL FUND
CHOICE NO OF RESPONDENT PERCENTAGE

Open ended 69 86.2
5
Close ended 2 2.5
ETF exchange traded 9 11.2
fund 5
Total 80 100
TABLE 4.11 Source: Primary
data
PREFERENCE OF INVESTORS ON INVESTMENT
Percentage
86.25
90
80
70
60
50
40
30
11.25
20
2.5
10
0
Open ended Close ended ETF exchange
traded fund
CHART 4.11
Interpretation:
From the above table show that majority of the respondent will prefer the open ended
scheme (86.25%).and then the investors will prefer the ETF exchange traded fund
(11.25%).and some respondents will prefer close ended scheme(2.5%.)
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4.12 CLASSIFICATION ON THE BASIS OF CHOICE OF INVESTORS ON FUND
SCHEME
CHOICE NO OF RESPONDENT PERCENTAGE

Growth fund 17 21.2
5
Large cap 7 8.75
Diversified 10 12.5
Gilt 5 6.25
Mid cap 5 6.25
Regular 3 3.75
income
Liquid fund 33 41.2
5
Sector 10 12.5
Total 80 100
.CHOICE OF INVESTORS ON FUND SCHEME
Percentage 41.25
45
40
35
30
25 21.25
20 12.5 12.5
15 8.75
6.25 6.25
10 3.75
5
0
CHART 4.12
Interpretation:
From the table show that majority of the respondent will prefer liquid fund 33,and then
the investors will prefer growth fund17, and 10 respondent were choose diversified and
sector, and 7 respondent choose large cap.and 5 respondent choose gilt and mid cap
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fund
respectively
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4.13 CLASSIFICATION ON THE BASIS OF PREFERENCE INVESTORS
ON CHANNEL
CHANNEL No of Percentage
respondent
Financial 24 30
advisor
Banks 14 17.5
AMC 12 15
Online 21 26.25
Others 9 11.25
Total 80 100
PREFERENCE INVESTORS ON CHANNEL
11.25
30
Financial advisor
Bank
26.25 s
AMC
Online
Others
17.5
15
CHART 4.13
Interpretation:
From the table show that majority of the respondent will prefer financial advisors as their
channel 24 and then the investors will choose online 21 and then choose banks 14 and
then choose AMC 12, and then the investors will choose other channel 9.
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4.14 CLASSIFICATION ON THE BASIS OF PREFERENCE AMONG THE MUTUAL
FUND
PREFERENCE NO OF PERCENTAG
RESPONDENT E
UTI 2 2.5
Franklin 5 6.25
Templeton
ICICI pru 13 16.25
Birla sl 14 17.5
SBI 25 31.25
RELIANCE 18 22.5
OTHERS 3 3.75
TOTAL 80 100
PREFERENCE AMONG THE MUTUAL FUND
35 31.25
30
25 22.5
20 16.25 17.5
15
10 6.25
3.75
5 2.5
0
CHART 4.14
Interpretation:
From the above table it is show that majority of the respondent will prefer SBI as its
investment 25.and then choose reliance 18 and then choose Birla sl 14.and then
choose ICICI pru 13 ,and then choose franklin Templeton 5 and choose others 3
respectively
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4.15 CLASSIFICATION ON THE BASIS OF FACTOR INFLUENCED BY THE
INVESTOR
Factor Highly Influent neutral Lower Least likert Weight Rank

influent ial influential influential scor ed avg
e
ial
Better return 39 23 8 7 3 328 4.1 1
High growth 32 21 9 6 2 285 3.56 4

potential
Performance 28 27 12 9 4 306 3.825 3
Strong pms 18 29 15 12 6 281 3.51 5

Diversificatio 32 27 6 14 1 315 3.93 2
n
FACTOR INFLUNCED BY THE INVESTOR
4.1
4.1 3.93
4 3.825
3.9
3.8
3.56
3.7 3.51
3.6
3.5
3.4
3.3
3.2
CHART 4.15
Interpretation:
From the above table it is show that factor better return get the first rank ,and
diversification get the second rank ,and performance factor get the third rank ,high
growth potential get the fourth rank,and strong pms get the 5 th rank
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4.16 CLASSIFICATION ON THE BASIS OF TYPE OF PORTFOLIO CHOOSE BY
INVESTORS
TYPE OF NO. OF PERCENTAG

PORTFOLIO RESPONDENTS E
Equity 3 3.75
Debt 10 12.5
Commodity 10 12.5
Hybrid 57 71.2
Total 80 100
TYPE OF PORTFOLIO CHOOSE BY INVESTORS
3.75
12.5
Equity
12.5 Debt
Commodity
Hybrid
71.2
CHART 4.16
Interpretation:
From the table show that majority of the respondent will prefer hybrid (71.2%),and then
the respondent will prefer the debt and commodity (12.5%).and some respondent
choose equity (3.75%).
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4.17 CLASSIFICATION ON THE BASIS OF MODE OF GETTING RETURN FROM
MUTUAL FUND
Mode of return No of Percenta

respondent ge
Dividend pay-out 21 26.25
Growth in NAV 18 22.5
Dividend re 36 45
investment
Others 5 6.25
Total 80 100
MODE OF GETTING RETURN FROM MUTUAL FUND
Percentage
45
45
40
35
30
25
20 26.25
22.5
15
10 5
0 6.25
Dividen Growth in Dividend re Others

d NAV investment
payout
CHART 4.17
Interpretation:
From the above table show that majority of the respondent will choose dividend
reinvestment (45%) and then choose dividend pay-out as mode of return (26.25%)and
some respondent will prefer growth in NAV (22.5%) and choose others respectively
6.25%.
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4.18 CLASSIFICATION ON THE BASIS OF RESPONDENTS EXPERIENCE IN
INVESTING IN MUTUAL FUND
The following table shows experience influencing the investors while investing in mutual
fund. The weighted average is used to rank the factor of investing in mutual fund. Here
the factor of investing in mutual funds are analysed by taking the units highly satisfied,
satisfied, neutral , dissatisfied and highly dissatisfied.
Gender H.S S N D H.D Likert Weighted Rank

score avg
Male 11 26 27 3 0 246 3.075 1
Femal 5 3 4 1 0 51 0.6375 2
e
RESPONDENTS EXPERINCE IN INVESTING IN MUTUAL FUND IN TERMS OF

GENDER
Here the Mann Whitney u test is used to analyze the respondents experience
investing in mutual funds on the basis of gender.
Ho: Experience of investing in mutual fund is identical in terms of gender.
H1: Experience of investing in mutual fund is not identical in terms of gender.
Gender Sum SD Z-value P- value Accept/reject

of
ranks
Male 33 4.76 1.05 .2933 Accep
t
Femal 22
e
TABLE 4.18.2
Interpretation
Since the p-value is greater than 0.05 the null hypothesis is accepted. That means the
experience of investing in mutual fund is identical in terms of gender.
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4.19 CLASSIFICATION ON THE BASIS OF INVESTORS EXPECTATION
FROM
MUTUAL FUND SCHEMES
EXPECTATION No of Percentage
respondent
Maximum tax 25 31.25
saving
Capital 32 40
appreciation
Regular income 13 16.25
Insurance benefit 5 6.25
Loan facility 3 3.75
others 2 2.5
Total 80 100
TABLE 4.19.1 Source: Primary
data
INVESTORS EXPECTATION FROM MUTUAL FUND SCHEMES BASED ON

GENDER
To analyze the relationship between investors expectation from mutual fund

and gender of respondents a chi-square test is used. The gender is classified
into male and female.
Gender Maximum Capital Regular Insurance Loan Others

tax saving appreciatio income benefit facility
n
Male 21 30 10 3 2 1
female 4 2 3 2 1 1
HO: The two variables that the gender of the respondents and expectation from
mutual fund scheme are independent.
H1: The two variables that the gender of the respondents and expectation
from mutual fund scheme are dependent.
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INVESTORS EXPECTATION AND GENDER
Chi-square value 7.19

Degree of freedom 5
P-value .2071
TABLE 4.19.3
Interpretation
Since the p-value is greater than 0.05 the null hypothesis is accepted. That means, the
two variables namely gender and the expectation of investors in mutual fund is independ
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fund
4.20 CLASSIFICATION ON THE BASIS OF OPINION THAT MUTUAL FUNDS
ARE A POWERFUL TOOL FOR MOBILISATION OF SAVING OUR
COUNTRY
The following table shows that mutual fund is a powerful tool for mobilisation
saving in our country. Here the factor of investing in mutual funds are analysed
by taking the sectors that govt sector,pvt sector,business,agriculture and NRI and
others.And it is showed in weighted avg method.
FACTOR LIKERT SCORE WEIGHTED AVG RANK
Govt sector 309 3.8625 1
Pvt sector 303 3.7875 2
Bussiness 299 3.7375 3
Agriculture 286 3.575 4
NRIs 273 3.4125 6
Others 27.5 3.4375 5
TABLE4.20
Interpretation
From the above table it is showed that Govt sector get the first rank and Pvt sector
get the second rank, and
business get the third rank respectively
Kruskal Wallis Test
For the purpose of finding out the level of satisfaction of the respondent
towards certain sectors of mutual fund based on the occupation of the
respondents kruskal wallis test is used.
H0: Level of satisfaction of the respondent is identical in terms of occupation of the

respondents
H1: Level of satisfaction of the respondent is not identical in terms of occupation of the
respondents
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DIFFERENT SECTORS AND OCCUPATION
Sl.no Factors Averag Median Degree H P Accept

e Rank of or
freedo Reject
m
1 Govt 18.90 5.00 4 11.871 .0183 Reject
sector 16.30 4.00
15.70 2.00
7.90 1.00
6.20 0.00
2 Pvt sec tor 21.50 6.00 4 15.586 .0036 Reject
11.50 1.00
17.60 3.00
7.60 0.00
6.80 0.00
3 Business 19.00 9.00 4 11.478 .0217 Reject
17.90 3.00
13.00 2.00
7.50 0.00
7.60 1.00
4 Agriculture 19.50 4.00 3 10.948 0.0120 Reject
16.20 2.00
14.70 4.00
7.60 0.00
7 0.00
5 NRI 20.10 7.00 4 15.535 .0037 Reject
16.70 4.00
15.70 4.00
6.70 1.00
5.80 0.00
6 Others 21.40 7.00 3 9.993 0.0186 Reject
14.20 2.00
16.10 3.00
7.10 0.00
6.20 0.00
TABLE4.2O.1
Interpretation
Since the P value of factors such as Govt sector ,Pvt sector ,Business,
Agriculture, NRI, Others are less than 0.05 thus the null hypothesis is
rejected.05.So level satisfaction of the respondents is not identical in terms of
occupation of the respondents.
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4.21 CLASIFICATION ON THE BASIS OF PROBLEM FACED BY
THE INVESSTOR WHILE INVESTING IN MUTUAL FUND
The following table shows problems faced by the investor while investing in
mutual fund.The weighted average is used to rank the factor of investing in
mutual fund.Here the problem of investing in mutual funds are analysed by taking
the units highly agree,agree,neutral,disagree and stongly disagree.
Problems SA A N D SD Likert Weighte Rank

score d avg
Little 43 17 7 6 7 323 4.0375 1
past
experienc
e
Lack of 26 34 16 3 1 321 4.0125 2
knowledg
e
Lack of 25 31 4 13 7 294 3.675 4
confidenc
e in
service
provided
Difficulty 24 32 12 8 4 304 3.8 3
in
selection
of
scheme
TABLE 4.21 Source: Primary
Interpretation
From the above table it is showed that major problem of facing mutual fund
industry are lack of experience.And it get the first rank.And lack of knowledge
gets the second rank.And difficulty in selection of scheme get the third rank.And
lack of confidence in service provided get the forth rank.
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fund
4.22 CLASSIFICATION ON THE BASIS OF INVESTORS INVESTMENT IN
MUTUAL FUND
The following table shows the volume of the investor while investing in mutual
fund.The weighted average is used to rank the factor of investing in mutual
fund.Here the volume of investing in mutual funds are analysed by taking below
one year, and1-3 and 3-6 year and above six year.
Experience Up to 10-25% 25-50% Above50% Likert Weighted Rank

volume 10% score avg
Below 1 12 25 40 3 206 2.575 3
year
1-3 year 40 25 10 5 260 3.25 1
3-6year 21 23 24 12 213 2.6625 2
Above6yea 8 20 33 19 177 2.2125 4
r
TABLE 4.22 Sources: Primary Data
Interpretation
From the above table it is show that majority of the respondent will invest in
mutual fund up to 1-3 year,and it get the 1st rank and then prefer 3-6 year and
then below 1 year and above 6 year respectively.
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fund
CHAPTER 5
SUMMARY, FINDINGS, SUGGESTIONS

AND CONCLUSION
Page 60
Mobilisation of savings through mutual fund
5.1 SUMMARY
The study attempted to reveal “mobilisation of savings through mutual fund with Special
Reference to Malappuram District”. This study intended to make an analysis on investors
towards mutual fund and their satisfaction, awareness etc... about it. This survey also studied
various factors which effect the selection of mutual fund and various kinds of mutual funds
available in the market. The whole project divided in to five chapters.
The ﬁrst chapter contains the INTRODUCTION about the study. lt also contains the
statement of the problem, significance of the study, objectives of the study, methodology,
limitation of the study, and chapterisation.
The second chapter deals with the REVIEW OF LITERATURE, previous projects and
research’s details are included in this area.
The third chapter deals with the INDUSTRY COMPANY PROFILE AND
THEORATICAL FRAMEWORK. It contains an overview of mutual fund.
The fourth chapter deals with the ANALYSIS AND INTERPRETATION OF DATA. The data
which are collected by using schedule of questions are analyzed in this chapter. Simple
Statistical tools like tables, graphs, diagrams etc. are used in this analysis. The responses of
the respondent are arranged in such a manner so as to simplify analysis process by using the
tables.
The Fifth chapter presents A BRIEF SUMMARY OF THE STUDY, Findings,

suggestions and conclusion based on the study.
Page 61
5.2FINDINGS
 The GOVT sector investors are strongly agrees that mutual fund is a powerful tool for
mobilisation of savings in our country but NRIs are least agree with this opinion.
 The study shows that, most of the respondents are satisfied with the mutual fund.
 The main purpose of saving is to meet emergencies. The other purposes are to
meet educational expenses, to meet marriage expenses, etc.
 Respondents are mostly aware about Equity oriented scheme.
 On the basis of awareness of rights and AMFI majority of respondents give first rank to
Right to proportionate beneficial ownership.
 68.75% investors prefer 3 year to 6 year as investing in mutual fund.
 36.25% respondents prefer financial advisors for getting the sources of information
related in mutual fund.
 86.25% respondents will prefer the open ended scheme.
 On the basis of choice of investors on fund scheme majority of the respondent will
prefer liquid fund.
 30% respondent will prefer financial advisors as their channel.
 Most of the investors had invested in SBI and RELIANCE mutual fund.
 The study shows that, mostly respondents preferred Return & savings while investment.
 40% respondent’s expectation from mutual fund is capital appreciation.
 Most of the respondents give first preference to Return & savings.
 Most of the respondents are influenced by the better return and diversification while
investing in mutual fund.
 71.2% respondents will prefer hybrid portfolio and the least preferred portfolio was
equity.
 The study shows that 45% respondent will choose dividend re investment as mode of
return.
 In malappuram district, largely the semi urban people subscribe mutual funds
schemes and the investment by the rural people is very negligible.
 In malappuram district in the age group of 35 – 55 years were more numbers in
investing mutual fund.
 In malappuram most of the investors were professionals or technical and under
graduate there very few in numbers.
Page 62
 Govt and pvt sectors investors are the main contributors to the mutual fund schemes.
Page 63
 88.5% respondents are occasional investors in mutual fund.

 57.5% respondent’s income were belonging to more than 5 lakh , 55% respondent’s
expenditure is between 2 - 2.5 lakh and 32.5% investors are will choose 10-to 25%
as their percentage on saving.
 The study shows that, experience of investing in mutual fund is identical in terms of
gender.
 The study shows that, gender and the expectation of investors in mutual fund are
independent.
 The study shows that, level of satisfaction of the respondents is not identical in terms
of occupation of the respondents.
 The study shows that, major problem of facing mutual fund industry are lack of
experience and lack of knowledge.
 The study reveals that, majority of the respondent will invest in mutual fund up to 1-3
year.
5.3 SUGGESTIONS
The following are the main suggestions about the study
 Select mutual fund in blue chip equities it is more profitable

 More awareness and information should be given to investors and also to attract new
investors.
 Improve the performance of intermediaries(brockers)
 Better to invest in more than one funds to spread the risk(diversificaition)
 Understand the investor’s needs and expectations; here brockers must play a vital
role to help them.
 To attract the investors to mutual fund the companies will play an important role to
bring low risk, high return, safety mutual funds.
 Mutual fund companies should provide income generating schemes to attract female
investors, now majority of female investors are not aware about mutual fund
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5.4 CONCLUSION
The study of mobilisation of savings through mutual fund is carried with the objectives
of evaluating the various kinds of mutual funds available in the market. In this study it
is found that open ended fund is the most popular and more using fund in the market.
The factors influencing to the selection of mutual fund includes return, safety
and risk. Investors give more importance to these three factors. There are some
problems also faced by investors of mutual fund is very less and female investors are
not much more invested in mutual fund. Investors use magazines as the source of
information provider and brokers also play a vital role in this sector. Investors are
satisfied with their funds.
The study point out some suggestions which helps to improve the performance
of mutual fund. Companies and brokers it also helps to attract new investors.
Page 65
BIBLIOGRAPHY
Page 66
BOOKS USED
 C R Kothari “Quantitative technics”.Vikas publishing house pvt LTD,Third revised

edition.
 C.H Kothari,’Research methodology,New international publications
 Mohammed Anif Pasha.’securities analysis and portfolio
management”,Vrinda Publications(p)LTD,93-104
 Prasanna Chandra.”Investment analysis and portfolio management.”Ludhiana
Kalyani publishers 2012
JOURNALS USED
 PreethiKhitolia(2014)investors awareness perceived risk attitude towards mutual

fund:An empirical study in Delhi,international journal of commerce,Bussiness and
management Vol- 3,pp-450-456,www.iraest.org
 Pritham.P.Kothari and ShivagangaC Mindargi(2013)A study of investorsattitude
towards mutual fund with special reference to investors in solapur city,international
journal of aaconting and financial management research,Vol 3 www,tjpre.org
 Priti Mane(2016)A study of Investors pereception towards Mutual Funds in the City of
Aurangabad,standard International journal,Vol,Pp30-38www.thesij.com
 SimraSaini and Dr.BimalAnjum(2011)Investors awareness and perception about
mutual funds International journal of multidisciplinary Research,Vol 1 Pp14-29
 Dr.Nishi Sharma(2012)Indian investors perception towards mutual fund,Business
management Dynamics,Vol 2,Pp1-9 www.dmdynamics.com
 Mrs.PoornimaUmeshMehtha (2011)Profile and perception of investors towards mutual
funds-a study of selected cities in Gujarat,www.shodhganga.inflibnet.ac.in
 Dr.Binod Kumar Singh(2009)An empirical study on awareness and acceptability of
mutual fund,Pp1-11,www.researchgate.net/publication.
 Ms.T.Rajeswari and Prof.Ramamoorthy(2002)An empirical study of factors influencing
the mutual fund/sheme selection by retail investors,Pp-25,www.citeseerx.ist.psu.edu
 Pritimane(2016)A study of Investors Perception towards Mutual fund in the city of
Aurangabad,Standard International Journal,Vol,Pp30-38www.thesij.com
Page 67
 Mrs.Nutan Vijay Pasalkar(2015) A comparative study of Mutual fund investment Vs

Iquity investment of Indian individual investors.Pp 482-496,www.asmgroup.edu.in
 Dr.Rajesh Kumar Nithin Goel(2014),An empirical study on investors perception
towards mutual fund,International journal of research in management and business
studies,Vol,1,Pp450-456,www.iraest.org
 G.Prathap and Dr.A Rajamohan(2013) A study on status of awareness among mutual
funds investors in Tamilnadu,journal of exclusive management seciebce,Vol-2
www.jems.net.in
 Gaurav Agarwal and Dr Mini jain (2013),investors preference towards mutual fund in
comparison to other investment avenue,journal of Indian research,Vol 4,Pp 115-131
www.mujournal.mewaruniversity.in
 Dr.Binod Kumar Singh(2012)Astudy on investors attitude towards Mutual fund as an
investment option,international journal of research in management,vol 2,Pp 61-
70,www.rs publication.com
 Jayabrata Banerjee and Swarnendu(2012)customer perception on mutual fund
product technical analysis,Inter science Management Review IMR vol2,Pp63-66
www.interscience.in
 Dr.Saritha Bahl and Meenakshi Rani(2012)A Comparative Analysis of Mutual fund
schemes in India,international Journal of marketing,Financial services and
Management Research vol 1,Pp 67-79www.Indianresearchjournals.com
 Dr.Nishi Sharma(2012) Indian investors perception towards Mutual fund Business
management Dynamics vol 2 Pp1-9dmdynamics.com
WEBSITE USED
 w w w . t h e si j . c o m
 w w w . i j e m h s. c o m
 w w w . i r a e st . c o m
 www.tj pr e.c o m
 w w w . j e m s. n e t . i n
 www.m ujournal
 www.r spublication.com
Page 68
 w w w . i n t e r sc i e n c e . i n
 w w w . d m d y n a m i c s. c o m
Page 69
APPENDIX
QUESTIONNAIRE
Respected Madam/sir,
Page 70
I am a student of sullamussalam science college areecode doing my project on

the topic”MOBILIZATION OF SAVINGS THROUGH MUTUAL FUND WITH SPECIAL
REFERENCE TO MALAPPURAM DISTRICT”.
I will be grateful to you, if you extent your support by sparing a few minutes from
your busy schedule for the successful completion of my project. The answers provided by
you will only be used for the academic purpose and will be kept confidential.
1. Personal details
a. NAME:
b. AGE :
c. Gender
Male female
2. Education
Post graduate graduate under
graduate Professional technical
others
3. Occupation
Govt sector pvt sector business agriculture others
4. Residence location
Urban Semi-urban Rural
5. Please specify your annual income?
Below 300000 300000-500000 Above 500000
6. Please specify your annual expenditure?
Below200000 200000-250000 Above 250000
7. What percentage of your savings do you invest in mutual
fund? Up to 10% 10-25% 25-50%
above 50%
8. How long you are investing in mutual fund?
Below 1year 1 year – 3 year 3 year – 6year Above 6 year
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9. Can you specify the primary motive of your saving/investment?
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SL NO MOTIVES RANK
1 Meet the emergencies

2 Meet educational expenses
3 Meet marriage expenses
4 Buy properties &durables,etcss
5 Save tax
6 Start or expand business
7 Multiple purposes
8 Meet other expenses
10. Can you specify the nature of your saving habits?
Regula Occasion Not applicable

r al
11. While investing your savings, which factor will you prefer most?
SL Factors RANK
NO
1 Safety
2 Liquidity
3 Tax benefits
4 Return & savings
5 Performance of past schemes
6 Rating of MF by agencies
7 Recommendations of friends
and
relatives
8 Advertisement
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12. To what extend you’re aware about the following mutual fund schemes?
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SL M.F schemes Highly Aware Neutral Lower Least

NO aware aware aware
1 Balanced fund
2 Money market/Liquid fund
3 Tax saving scheme
4 Index funds
5 Growth/Equity oriented
scheme
6 Income/Debt oriented
schemes
7 Sector specific scheme
13. Awareness about investor rights and association mutual fund in India (AMFI)
S.NO Are you aware about HA A N LA LA

1 Right to “proportionate beneficial
ownership”
2 Right to timely services
3 Right to information
4 Right to approve change in
fundamental attributes of the
scheme
5 AMFI is an apex body of all asset
management companies
6 AMFI Protects and promotes
the interests of mutual funds as
well as
their unit holders
14. How did you become aware about the mutual
fund? Advertisement peer
group Banks Internet Financial
advisors Magazines
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15. Which features of mutual fund attracted you most?
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SL.NO Features Ran

k
1 Diversification
2 Regular income
3 better return
&safety
4 Tax benefit
5 less risk
16. Which type of fund you prefer?
Open ended close ended ETFs – Exchange traded fund
17. Give your choice among following mutual fund
schemes? Growth large cap diversification
gilt mid cap Regular income Liquid fund
sector specific
18. Which channel will you prefer for purchasing mutual fund?
Financial advisors banks AMC online
others
19. Which AMC will you prefer?
UTI SBI ICICI Birla SL
reliance Franklin Templeton
Others
20. Which factors are more influenced for the above preference?
SL.NO FACTORS Highly Influential Neutral Lower Least

influential influential influential
1 High growth
potential
2 performance
3 strong PMS
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4 better return
5 Diversified schemes
21. Which type of portfolio would you chose?
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Equity Debt Commodity Hybrid
22. How would you like to receive the returns from mutual fund?
Dividend pay-out growth in NAV dividend reinvestment others
23. How was your experience of investing in mutual fund?
Highly satisfied satisfied neutral dissatisfied highly dissatisfied
24. Can you give your expectation from mutual fund
schemes? Max tax savings capital
appreciation regular income Insurance benefits
Loan facility others
25. Give your attitude towards the statement “mutual fund is a powerful tool for
mobilization Of savings in our country”?
SECTORS Strongl Agree Neutral Disagree Strongl

y agree y
disagre
e
Govt sector
Pvt sector
Business
Agriculture
NRIs
others
26. What are the problems faced by you while invest in mutual fund?
SL. PROBLEM Strongly Agree Neutral Disagree Strongly

S
NO agree disagree
1 Little past experience
2 Lack of knowledge
3 Lack of confidence in service
provided
4 Difficulty in selection of scheme
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27. Give your volume of investment of MFs in relation to the experience in investing?
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Experience\volum Up to 10% 10-25% 25-50% Above 50%

e
Below 1 year
1-3 years
3-6 years
Above 6 years
28. If you have any suggestions
please DATE:
PLACE:
THANK YOU
Page 75
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Title of the Research Project
FINANCIAL PERFORMANCE ANALYSIS OF THE STATE BANK OF INDIA.
Research Project Submitted in Partial Fulfilment of the Requirements for the Degree of
BCOM Honours
By
YASHASVI POTDAR
to the

15th April ' 2021
Submitted by, Guided by,

Yashasvi Potdar Dr. Geetanjali Shrivastava
Assistant Professor
DECLARATION
I hereby declare that this project report entitled “FINANCIAL PERFORMANCE ANALYSIS
OF THE STATE BANK OF INDIA “was carried out by me for the degree of BCOM Honours
under the guidance and supervision of DR GEETANJALI SHRIVASTAVA of Department of
Commerce, BSSS College. The interpretations put forth are based on my reading and
understanding of the original texts and they are not published anywhere in any form. The other
books, articles and websites, which I have made use of are acknowledged at the respective place
in the text. This research report is not submitted for any other degree or diploma in any other
University.
Page 84
Place: Bhopal
Name of the Student: YASHASVI POTDAR
Class & Section: BCOM HONS 'A'
Date: 15/04/2021
CERTIFICATE
It is certified that the work contained in the project report titled “FINANCIAL PERFORMANCE
ANALYSIS OF THE STATE BANK OF INDIA,” by “Yashasvi potdar” has been carried out
under my/our supervision and that this work has not been submitted elsewhere for a degree*
Signature of Supervisor: …………….
Name : Dr GEETANJALI SHRIVASTAVA, Assistant Professor

April, 2021
Page 85
ACKNOWLEDGEMENT
I would like to thank our Principal Dr. Fr. John P.J. and Vice Principal Dr Sr Sonia Kurien for
their immense support and blessings. I thank our HOD Dr Amit Kumar Nag for his support. I
would like to express my special thanks of gratitude to my research guide Dr. Geetanjali
Shrivastava, Assistant Professor of Department of Commerce for her valuable suggestions and
guidance and for giving me the golden opportunity to do this wonderful research project on the
topic: FINANCIAL PERFORMANCE ANALYSIS OF THE STATE BANK OF INDIA,
Without her help it would have been difficult for me to have reached this state of completion of
my project report. Also, I would like to thank my parents and friends who helped me a lot in the
preparation of this project.
I wish to acknowledge the help of all those who have provided me information, guidance and
other help during my research period.
CHAPTER 1
Page 86
1.1 Rationale of the study

SBI is the India's biggest business bank as far as resources, stores and representatives. SBI is the
favoured broker for a large portion of public area companies. It possesses a remarkable spot in
the Indian currency market as it orders more than 33% of India's bank assets. Public has colossal
confidence in State bank of India in view of its devoted administrations. This investigation
targets breaking down the Financial Ratio examination of State Bank of India. The fundamental
target for business bank is to boost the estimation of benefit. To do as such, banks focus on their
monetary presentation investigation and endeavour to structure their portfolios to expand their
return. The most well known instrument/method for examining the Financial Statement of Bank
is Ratio Analysis. Proportion investigation empowers the administration of banks to distinguish
the reasons for the adjustments in their advances, pay, stores, use, benefits and productivity
throughout the timeframe and along these lines helps in pinpointing the bearing of activity
needed for expanding the stores, pay, advances and lessening the use and for modifying the
productivity possibilities of the banks in future. In this manner the examination was embraced to
dissect monetary status of public area bank particularly to SBI (State Bank of India)
The goal of the current paper is to investigate the monetary exhibition of SBI (State Bank of
India) over a time of five years (2016 – 2020).
For this reason, monetary proportion examination has been utilized. With the assistance of this
investigation, it was gathered that in the public area banks, SBI is the highest level bank in India,
with its exhibition as far as monetary sufficiency being the awesome. For this investigation,
speculation valuation proportion, benefit proportion, the executives proficiency proportion,
monetary record proportion, and income pointers were utilized. Results show that the
presentation of SBI in the examination time frame has been fantastic. SBI's phenomenal
presentation can be credited to the selection of current innovation, banking changes, and great
recuperation components. Be that as it may, SBI needs to improve its situation with respect to a
couple of boundaries including obligation value, working benefit, and non-interest pay to add up
to pay.
1.2
Introduction to the industry
Banking sector
The quick change in the financial business throughout the most recent decade has made the
business more grounded, cleaner, straightforward, proficient, quicker, restrained and much
more serious. The financial business in India has an immense campaign of history, which
covers the conventional financial practices from the hour of britisher to the changes time
frame, nationalization to privatization of banks and now expanding quantities of unfamiliar
banks in India. Accordingly, banking in India has experienced a long excursion. Country
banking and miniature financing are the two doors for the Indian banks to develop and rival
worldwide banks.
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The utilization of innovation has acquired an upset the working style of the banks and it has
infested every single part of human existence in an exceptional way.
Life has changed gigantically because of contraptions and machines getting simple to utilize
and that as well, in moderate costs.
Cell phones, Digital cameras, I-telephones, Dish TV are currently basic family products and
not any more come in classification of extravagance things. Along with that, the section of
plastic cash has opened new roads for credit only exchanges considered more secure and
more advantageous than observing each time whether the wallets are as yet struck in our hip
pockets, vanity sacks or not when we move out for shopping or on ventures.
As we probably are aware money is considered as the existence blood of every monetary
movement and has become indispensable piece of present day business. A country's
monetary framework works in a bunch of monetary business sectors, monetary
administrations and monetary establishments.
 Broadly, the financial market is categorized into two groups viz.:

 1 Money market which manages momentary account
And
 2 Capital market which manages long haul reserves.
 Banking industry is the spine for the development of any economy. In the new time, we
are seen that the World Economy is going through some little subtleties or parts
conditions as liquidation of banking and monetary foundations, obligation emergency in
significant economies of the world and euro zone emergency. The financial situation has
become extremely dubious causing downturn in significant economies like US and
Europe.
 For the most part banking in India was genuinely adult regarding supply, item reach and
reach-despite the fact that reach in rustic India and to the helpless actually stays a test.
The public authority has created activities to address this through the State Bank of India
extending its branch organization and through the National Bank for Agriculture and
Rural Development with things like microfinance. This additionally incorporated the
2014 arrangement by the at that point executive to bring ledgers to the assessed 40% of
the populace that were still unbanked. Banks are a subset of the monetary administrations
industry.
 For recent many years, India's financial framework has a few exceptional
accomplishments shockingly. The banks are the fundamental members of the monetary
framework in India. The Banking area offers a few offices and freedoms to their clients.
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Every one of the banks protect the cash and assets and give advances, credit, and
instalment administrations, for example, financial records, cash request, and clerk's
checks.
 2. Need of the Banks:
 Prior to the foundation of banks, the monetary exercises were taken care of by cash loan
specialists and people. Around then the loan fees were high. Again there were no security
of public reserve funds and no consistency with respect to credits. Along these lines, as to
beat such issues the coordinated financial area was set up, which was completely
managed by the public authority. The coordinated heating area works inside the monetary
framework to give credits, acknowledge stores and offer different types of assistance to
their clients.
 The accompanying elements of the bank clarify the need of the bank and its significance
 To give the security to the investment funds of client.
 ii. To control the stockpile of cash and credit.
 iii. To support public trust in the working of the monetary framework, increment reserve
funds expediently and proficiently.
 iv. To maintain a strategic distance from focal point of monetary forces in the possession
of a couple of people and organizations.
 v. To set equivalent standards and conditions (for example pace of interest, time of
loaning and so forth) to a wide range of clients.
 After Liberalization:
 In the mid 1990s, the then Narashimha Rao government set out on a strategy of
progression, authorizing few private banks. These came to be known as New Generation
educated banks, and included Global Trust Bank (the first of such new age banks to be
set up), which later amalgamated with Oriental Bank of Commerce, UTI Bank (since
Page 89
renamed Axis), ICICI Bank and HDFC Bank.
 This move, alongside the quick development in the economy of India, revived the
financial area in India, which has seen fast development with solid commitment from
every one of the three areas of banks, in particular, government banks, private banks and
unfamiliar banks.
 The following stage for the Indian banking has been set up with the proposed unwinding
in the standards for unfamiliar direct speculation, where all unfamiliar financial backers
in banks might be given democratic rights which could surpass the current cap of 10% as
of now. It has gone up to 74% for certain limitations.
 The new arrangement shook the Banking area in India totally. Brokers, till this time, were
utilized to the 4-6-4 technique (acquire at 4%; loan at 6%; return home at 4) of working.
The new wave introduced a cutting edge viewpoint and educated techniques for working
for customary banks. This prompted the retail blast in India. Individuals requested more
from their banks and got more.
 Presently (2007), banking in India is for the most part genuinely develop as far as supply,
item reach and reach-despite the fact that reach in country India actually stays a test for
the private area and unfamiliar banks. Regarding nature of resources and capital
sufficiency, Indian banks are considered to have spotless, solid and straightforward
accounting reports when contrasted with different banks exceptional economies in its
area.
 The Reserve Bank of India is a self-sufficient body, with negligible pressing factor from
the public authority. The expressed approach of the Bank on the Indian Rupee is to
oversee unpredictability yet with no fixed conversion scale and this has for the most part
been valid. With the development in the Indian economy expected to be solid for a long
while particularly in its administrations area the interest for banking administrations,
particularly retail banking, home loans and speculation administrations are required to be
solid.
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 Design of Indian Banking Industry:
 All banks which are remembered for the Second Schedule to the Reserve Bank of India
Act, 1934 are Scheduled Banks. These banks involve Scheduled Commercial Banks and
Scheduled Co-operative Banks. Planned Commercial Banks in India are ordered into five
distinct gatherings as per their possession as well as nature of activity.
 These bank bunches are:
 1 .State Bank of India and its Associates

 2.Nationalized Banks
 3. Private Sector Banks Foreign Banks.4.Local Rural Banks.
 In the bank bunch savvy grouping, IDBI Bank Ltd. is remembered for Nationalized
Banks. Planned Co-employable Banks comprise of Scheduled State Co-usable Banks and
Scheduled Urban Cooperative Banks.
 Development of Banking in India:
 By 2010, banking in India was by and large genuinely develop as far as supply, item
reach and reach-despite the fact that reach in provincial India actually stays a test for the
private area and unfamiliar banks. As far as nature of resources and capital ampleness,
Indian banks are considered to have perfect, solid and straightforward accounting reports
comparative with different banks in tantamount economies in its area. The Reserve Bank
of India is an independent body, with insignificant pressing factor from the public
authority.
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 With the development in the Indian economy expected to be solid for a long while
particularly in its administrations area the interest for banking administrations,
particularly retail banking, home loans and venture administrations are required to be
solid. In March 2006, the Reserve Bank of India permitted Warburg Pincus to expand its
stake in Kotak Mahindra Bank (a private area bank) to 10%. This is the first run through
a financial backer has been permitted to hold over 5% in a private area bank since the
RBI reported standards in 2005 that any stake surpassing 5% in the private area banks
would should be checked by them.
 three significant changes in the financial area after advancement are:
 Step to build the money outpouring through decrease in the legal liquidity and money
save proportion.
 ii. Nationalized banks including SBI were permitted to offer stakes to private area and
private financial backers were permitted to enter the financial space. Unfamiliar banks
were given more prominent admittance to the homegrown market, both as auxiliaries and
branches, given the unfamiliar banks kept a base allocated capital and would be
administered by similar guidelines and guidelines overseeing homegrown banks.
 iii. Banks were given more prominent opportunity to use the capital business sectors and
decide their resource portfolios. The banks were permitted to give progresses against
value gave as security and give bank certifications to the broking local area.
 India's administrations area has consistently served the Indian economy well,
representing almost 57% of the total national output (GDP). Here, the monetary
administrations portion has been a critical donor.
 The monetary administrations area in India is overwhelmed by business banks which

have more than 60% portion of the all out resources; different fragments incorporate
shared assets, protection firms, non-banking establishments, cooperatives and annuity
reserves.
 The Government of India has acquainted changes with change, manage and improve the
country's monetary administrations industry. By and by, the nation can profess to be one
of the world's most dynamic capital business sectors. Despite the difficulties that are still
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there, the area's future looks acceptable.
 1.3
 Introduction to the company
 State Bank of India

 The State Bank of India, popularly known as SBI, is India’s largest commercial bank
with a glorious history of more than 200 years. State Bank of India Introduction(SBI),
Owned by The Government of India, is categorized as an Indian Multinational, Public
sector banking and Financial services company, with its headquarters located in Mumbai,
Maharashtra.
 The chapter State Bank of India Introduction gives a brief introduction about State Bank
of India (SBI)
 With more than 14,000 branches in India, SBI is the largest and one of the premium
banking and financial services company in India by assets, deposits, profits, branches,
customers, and employees. SBI has also established and secured its roots globally with
191 foreign offices spread across 36 countries.
Page 93
 ORIGIN
 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 1806 in Calcutta. 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.
 Primarily Anglo–Indian creations, the three presidency banks came into existence either
as a result of the compulsions of imperial finance or by the felt needs of local European
commerce and were not imposed from outside in an arbitrary manner to modernise
India's economy. Their evolution was, however, shaped by ideas culled from similar
developments in Europe and England, and was influenced by changes occurring in the
structure of both the local trading environment and those in the relations of the Indian
economy to the economy of Europe and the global economic framework.
 The State Bank of India, the country’s oldest bank and a premier in term of balance sheet
size, number of branches, market capitalization and profits is today going through a
momentous phase of change and transformation – the two hundred year old public sector
behemoth is today stirring out of its public sector legacy and moving with an agility to
give the private and foreign banks a run for their money.
 The bank is entering into many new businesses with strategic tie ups – Pension Funds,
General Insurance, Custodial Services, Private Equity, Mobile Banking, Point of Sale
Merchant Acquisition, Advisory Services, structured products etc – each one of these
initiatives having a huge potential for growth.
 The bank is forging ahead with cutting edge technology and innovative new banking
models, to expand its rural banking base, looking at the vast untapped potential in the
hinterland and proposes to cover 100,000 villages in the next two years. At the end
March, 2011, the total number of branches was 13,542 while the number of ATMs stood
at 20,084 across the country.
 It is also focusing at the top end of the market, on whole sale banking capabilities to
provide India’s growing mid / large corporate with a complete array of products and
services. It is consolidating its global treasury operations and entering into structured
products and derivative instruments. Today, the bank is the largest provider of
infrastructure debt and the largest arranger of external commercial borrowings in the
country. It is the only Indian bank to feature in the Fortune 500 list.
Page 94
 The bank is actively involved since 1973 in non–profit activity called Community
Services Banking. All branches and administrative offices throughout the country
sponsor and participate in large number of welfare activities and social causes. Their
business is more than banking because they touch the lives of people anywhere in many
ways .State Bank of India (SBI) has received an approval from the Government of India
(GOI) for acquisition of SBI Commercial and International Bank (SBICI Bank). The
government had issued the 'Acquisition of SBICI Bank Order 2011' vide order dated July
29, 2011.
 SHAPE RANKING
 SBI is one of the Big Four banks of India, along with ICICI Bank, Bank of Baroda and
Punjab National Bank. As of 2016, SBI is ranked 232nd on the Fortune Global 500 list of
the world’s biggest corporations, and stands as the proxy for the Indian Economy. SBI
was ranked 152nd in The Forbes list of Global 2000 firms in May 2015. The Government
of India owns 58.60% of SBI and thus is the largest shareholder of SBI, a Fortune 500
company.
 SHAPE HISTORY
 SBI, the oldest commercial bank, traces its ancestry to the 19th century (British India)
when the Bank of Calcutta was founded in 1806. In 1921, the Bank of Calcutta, merged
with the banks of Madras and Bombay to form the Imperial Bank of India. In 1955, when
the Government of India nationalized the Imperial Bank along with the RBI, the Imperial
Bank acquired the name State Bank of India. Since its beginning, SBI has been constantly
endeavouring to provide utmost customer satisfaction to the most ideal degree.
 SHAPE RECRUITMENT
 SBI provides several ambitious employment opportunities for young graduates as well as
experienced professionals for accelerated career growth. SBI is prominently known for
being one of the largest employers of probationary officers and special officers in India.
According to the Google search trends, SBI jobs is one of the most searched keywords in
Page 95
2016 as compared to other banks.
 SBI ensures an amicable, collaborative, composed, dynamic, motivating, exciting, and a

fast-paced work environment for both professional and personal development. Learning
is a constant process for all the employees associated with SBI.
 Key people  Dinesh Kumar Khara

(Chairman)[1]
 Retail banking
 Products
 Corporate banking
 Investment banking
 Mortgage loans
 Private banking
 Wealth management
 Credit cards
 Finance and Insurance
 Revenue  ₹368,010.6492
crore (US$52 billion) [2] (20
20)
 Operating  ₹75,105.2876
income crore (US$11 billion) [2] (20
20)
 Net income  ₹11,439.4023

crore (US$1.6 billion) [2] (2
020)
Page 96
 Total assets  ₹4,197,492.3443

020)
 Total equity  ₹250,167.6630

20)
 Number of  249,448 (March 2020)

employees
 Parent  Government of India
 SBI Life Insurance Ltd

 Subsidiaries  SBI Cards and Payment
Services Ltd
 SBI General
Insurance (70%)
 Jio Payments Bank (30%)
 Yes Bank (30%)
 Andhra Pradesh
GrameenaVikas
Bank (35%
 CHAIRMAN OF THE STATE BANK OF INDIA
Page 97
 Mr. DINESH KUMAR KHARA
 State Bank of India (SBI) managing director Dinesh Kumar Khara has been named as the
bank's chairman, effective today. Dinesh Kumar Khara was elected chairman of the bank
by the government on Tuesday for a three-year term beginning October 7. He has taken
over as SBI chairman from Rajnish Kumar, whose three-year term ends on October 7.
Khara's appointment comes at a time when the banking sector, along with the rest of the
economy, is in flux.
 Dinesh Kumar Khara began his career with SBI as a probationary officer in 1984 and
now has over 33 years of experience in retail credit, SME/corporate credit, deposit
mobilisation, foreign banking activities, and branch management.
 The 59-year-old banker has a post-graduate degree in business administration from Delhi
University's Faculty of Management Studies.
 Foundation of State Bank of India:
Page 98
 STAMP DEDICATED TO THE STATE BANK OFINDIA IN THE YEAR 2005
 The State Bank of India is the greatest business bank and stands firm on an uncommon
foothold in the cutting edge business banking framework in India. It appeared on July 1,
1955 after the nationalization of Imperial Bank of India. The Imperial Bank of India was
set up in 1921 by amalgamating the three Presidency Banks of Madras, Bombay and
Bengal.
 Until the foundation of the Reserve Bank of India in 1935, the Imperial Bank of India,
notwithstanding its ordinary business banking capacities had been playing out certain
focal financial capacities. It used to go about as the financier to the public authority, as
investor's bank and as the clearing house.
 After the foundation of the Reserve Bank of India, the Imperial Bank of India left its
focal financial capacities, however kept on filling in as the specialist of the Reserve Bank
in the regions where the last didn't have its branches.
 In 1955, on the suggestions of the Rural Credit Survey Committee, the Imperial Bank of
India was nationalized and renamed as the State Bank of India through the State Bank of
India Act 1955.
 Association of State Bank of India:
Page 99
 Capital.
 The state Bank of India has an approved capital of Rs. 20 crore which has been separated
into 20 lakh portions of Rs. 100 each. The gave capital of the State Bank is Rs. 5.6 crore.
The portions of the State Bank are held by the Reserve Bank, insurance agencies and the
overall population. Toward the finish of March 2001, the settled up capital and the stores
of the State Bank were Rs. 13461 crore.
 ii. The board:
 The administration of the State Bank of India is heavily influenced by a Central Board of
Directors comprising of 20 individuals.
 The primary goals and elements of the State Bank of India are given beneath:
 Destinations:
 The State Bank of India has been set up to work on the ordinary business standards, with
the lone distinction that, in contrast to other business banks in the country, it
contemplates and reacts in a logically liberal way the monetary prerequisites of agreeable
establishments and limited scope ventures, especially in the provincial regions of the
country.
 The principle destinations of the State Bank are:
 To act as per the expansive monetary arrangements of the public authority;
 (ii) To energize and assemble reserve funds by opening branches in provincial
 and semi-metropolitan territories and to advance rustic credit;
 (iii) To set up government organization in the arrangement of helpful credit;
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100
 (iv) To broaden monetary assistance for the foundation of authorized stockrooms and
helpful promoting social orders;
 (v) To give monetary assistance to the limited scale and bungalow enterprises;
 (vi) To give settlement offices to the financial foundations.
 The State Bank of India plays out a wide range of business banking capacities:
 It gets stores from the public.(ii) It gives credits and advances against qualified
protections including products, bills of trade, promissory notes, completely paid portions
of organizations, enduring property or records of title, debentures, and so on
 (ii) It puts its overflow assets in government protections, rail route protections and
protections of companies and depository bills.
 4. DIFFERENT FUNCTIONS:
 The State Bank of India likewise plays out the accompanying different capacities:
 It purchases and sells gold and silver.
 (ii) It goes about as specialist of agreeable banks.
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101
 (iii) It guarantees issues of stocks, offers, debentures, and different protections in which it
is approved to contribute reserves.
 (iv) It oversees, separately or together, domains for any reason as agent, trustee or
something else.
 (v) It draws bills of trade and awards letters of credit payable out of India.
 (vi) It purchases bills of trade payable out of India with the endorsement of the Reserve
Bank; it buys in purchases, obtains, holds and sells partakes in the capital of banking
organizations.
 5. Restricted Functions:
 The State Bank of India has been precluded from doing certain organizations by the State
Bank of India Act:
 The State Bank can't concede advances against stocks and offers for a period over a half
year.
 (ii) It can buy no steady property other than its own workplaces.
 (iii) It can neither rediscount nor offer advances against the security of trade charges
whose development period surpasses a half year.
 (iv) It can't rediscount charges which don't convey in any event two great marks.
 (v) It can neither rebate bills nor award credit to people or firms over as far aspossible.
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102
 Accomplishments of State Bank of India:
 Coming up next are the significant accomplishments of the State Bank of India in various
fields:
 General Progress:
 The State Bank of India has gained an enormous headway since its initiation in 1955.
 Table shows the advancement of the bank in the fields of store activation, credit
extension and branch development:
 Store Mobilization:
 There has been an expanding pattern with respect to assembly of stores by the State Bank
of India. Complete stores and different records which were Rs. 226 crore toward the
finish of 1955, expanded to Rs.1227 crore toward the finish of 1969 and further to Rs.
242828 crore toward the finish of March 2001. In this way, there has been around
multiple times expansion in Banks' stores during 1955 to 2001.
 ii. Credit Expansion:
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103
 The advancement in the field of credit extension has additionally been impressive
throughout the long term. Toward the finish of 1955, complete advances made by the
State Bank were Rs. 106 crore. These advances expanded to Rs. 841 crore in 1969 and
Rs. 113590 crore in March 2001. This shows that there has been multiple times
expansion in progresses during 1955 to 2001.
 iii. Branch Expansion:
 The quantity of parts of the State Bank of India has likewise developed astoundingly
since its foundation. In 1955, the Bank had 497 workplaces, in 1969 and 2001, the
number expanded to 1673 and 9078 individually.
 iv. Present Position of State Bank Group:
 Before the finish of March 2001, complete stores of the State Bank Group (i.e., State
Bank of India and its seven partners) had arrived at Rs. 312117 crore, absolute advances
allowed by the gathering were Rs. 150390 crore, and complete number of parts of the
Group was 13509.
 Along these lines, the State Bank of India Group represented around 41% of stores, 35%
of advances and around 21% of the workplaces of all planned business banks in India.
The settled up capital and stores of the Group were Rs. 4751 crore toward the finish of
March 1994. Net benefits of the gathering were Rs. 2222 crore (Rs. 1604 crore of the SBI
and Rs. 618 crore of the partner branches) during 2000-01.
 v. Benefits, Efficiency and Capital Adequacy:
 Throughout the long term, the SBI kept on showing better execution as far as benefits,
productivity and capital sufficiency. It recorded a net benefit of Rs. 1604 crore for the
year 2000-01 against Rs. 832 crore for 1995-96, showing an increment of 48%.
 The major contributing elements for improved net benefits were higher premium pay
from propels just as venture tasks, lower working expense and better execution of
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104
unfamiliar workplaces. The Bank's money to hazard weighted resources proportion was
12.79% during 2000-01. This is well over the globally acknowledged proportion of 8%.
Net NPA of the Bank was 6.03% in March 2001 against 6.41% in March 2000.
 vi. Worldwide Banking:
 As of now (March 2001), the SBI has an organization of 52 abroad workplaces with their
tasks spread more than 31 nations. These unfamiliar workplaces predominantly take into
account the requirements of the country's unfamiliar exchange and give unfamiliar cash
assets to the Indian corporates.
 During 2000-01, the unfamiliar workplaces of the SBI procured a net benefit or Rs. 248
crore. The stores and advances of the Bank's unfamiliar workplaces were Rs. 7932 crore
and Rs. 14797 crore individually toward the finish of March 2001.
 vii. Innovation Upgradation and Consumer Services:
 The State Bank of India (SBI) has taken huge activities in the fields of innovation
upgradation and better purchaser administrations.
 Su
 Justification of the study:
 SBI has served the needs of Indian economic development since nationalisation by
launching rural-development initiatives and microcredit programmes, as well as financing
major agricultural and industrial projects and raising government loans.
 SBI is governed by a board of directors, with a chairman at the helm. The bank's
chairman and managing directors are chosen by the governmentthe area of credit growth.
The State Bank had made a tot the end of 1955. In 1969, these developments to90 crore.
This means that
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105
 e has al
 AWARDS AND Appreciation. For the second year in a row, “The Asian Banker” has
named us the best transaction bank in India. For the eighth year in a row, “The Best
Trade Finance Bank (India)-2019” has been awarded. Green Bond Pioneer Award” for
being the most significant new emerging market. ‘Large Bank Award for Best MSME
Bank' CIMSME is an organisation that focuses on small and medium-sized companies.
YONO, our digital initiative, received the award for "Mobile Banking Initiative of the
Year - North America.Singapore and India” at the Asian Banking and Finance Retail
Banking Awards was awarded at the 2018 Asian Banker Financial Technology
Innovation Awards.
 Over the years, there has also been significant improvement in the area of credit growth.
The State Bank had made a total of Rs. 106 crore in advances by the end of 1955. In
1969, these developments totalled Rs. 841 crore, and in March 2001, they totaled Rs.
113590 crore. This means that between 1955 and 2001, advancements increased by 1072
times.
 After its inception, the State Bank of India's branch network has expanded dramatically.
The Bank had 497 offices in 1955, but by 1969 and 2001, the number had risen to 1673
and 9078, respectively.
 The group's overall advances were Rs. 150390 crore, and the group's total number of
branches was 13509. As a result, the State Bank of India Group accounted for roughly
41% of deposits, 35% of advances, and 21% of all scheduled commercial banks' offices
in India.
CHAPTER 2
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106
INTERNATIONAL REVIEW(10)
1.
Noel Capon et al (1994) published a meta-analysis on the impact of the strategic
planning on financial performance which has omitted a major study on corporate
planning in the fortune five hundred manufacturing firms. Finally, the
conclusions were that there is a small but positive relationship between the
strategic planning and the performance existed.
2.
Robertomisnter (2009) An Empirical Test of Financial Ratio analysis for Small
Business Failure. This study developed and empirically tested a number of
methods for analyzing financial ratios to predict the failure of small business.
3.
Edward I. Altman (1968) Financial ratios, discriminant analysis and the prediction of
corporate bankruptcy. This study used to analyse the performance of the business
enterprise by using ratio analysis as the analytical technique.
4.
R.J.Taffler (1982) Forecasting company failure in the UK using discriminant
analysis and financial ratio data. This paper reported on the discriminant model
of operational for the purpose of identification of the british companies which
was under the risk of failure and discussed the results from their application
since from their development0) A financial ratio analysis of commercial bank
performance in South Africa. This paper investigated the South Africa’s
performance of commercial banking sector period for 2005-2009.this financial
ratio is used to measure the liquidity, profitability and credit quality performance
of large five commercial banks of South Africa.
5.
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107
Query-Jen Yeh (1996) The application of Data Envelopment analysis in conjunction

with financial ratios for bank performance evaluation. This paper demonstrated
the application of DEA in respect to the conjunction with financial ratios to help
the bank regulators in Taiwan to gain the insight of various financial dimensions
which is link to the financial operational decisions of banks.
6.
James A.Largay et al (1980) Cash flows, Ratio analysis and the W.T. grant company
bankruptcy. The W.T Grant company problems such as bankruptcy, liquidation
was not raised at overnight. The traditional analysis which is the ratio
analysis only cannot reveal the company problems whereas cash flow analysis reveal
most of the problems of the company.
7.
Frederick D.S. Choi et al (1983) Analysing foreign financial statements: The use and
misuse of International ratio
analysis. The foreign companies are often misused the measurement of financial and
return. This paper used to explain the differences in the international accounting
principles.
8.
G.E. Halkos (2004) Efficiency measurement of the Greek commercial banks with
the use of financial ratios: a data
envelopment analysis approach. This paper studied about the application of the non-
parametric analytic technique in respect of the DEA (Data Envelopment
Analysis) to measure the performance of Greek banking sector.
9.
Foster, (1986) reviewed of the literature describing methods and theories for
evaluating and predicting financial performance reveals that although methods
have become increasingly complex, few researchers
adequately address the problems associated with the sample used. For example, most
ratio analysis studies use multivariate analysis that is based on the assumption of
a normal distribution of the financial ratios. Without confirming the
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108
approximation of normality of ratio distribution, the researcher is at risk of

drawing erroneous
inferences. When considering the distribution of financial ratios in any database, the
normality of the distribution can be skewed by data recording errors, negative
denominators and denominators approaching zero.
10.
Malhotra and McLeod, (1994) argued that the only way to assess future financial
performance is through the inclusion of subjective measures.
Ross et al., (2007) implied that the most researchers divide the financial ratios into
four groups i.e. profitability, solvency, liquidity and activity ratios. Lasher,
(2005) reviewed dept. ratios show how effectively the organization uses other
people’s money and whether it is using a lot of borrowed money. Trelawney,
(2006) described the nature of the organization influences the ratios employed.
For example, in the case of a bank, the liquidity ratio is used to determine the
amount of liquidity that a bank needs in order to meet its liabilities; a bank also
uses
profitability ratios
NATIONAL REVIEW(10)
1. Manish Mittal and Arunna Dhademade (2005) they found that higher profitability
is th
only major parameter for evaluating banking sector performance from the
shareholders point of view. It is for the banks to strike a balance between
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109
commercial and social objectives. They found that public sector banks are less
profitable than private sector banks. Foreign banks top the list in terms of net
profitability. Private sector banks earn higher non-interest income than public
sector banks, because these banks offer 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 banks.
2. I.M. Pandey (2005): An efficient allocation of capital is the most important

financial functioning 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 of large 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 structure decision.
The assets of a company can be financed either by increasing the owners claims
on the creditors’ claims. The various means of financing represent the financials
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. Vasant desai (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 formulations of 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
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. These banks are either foreign or domestic banks with
foreign partnerships. Some of them have been set 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 high-
tech operations from the initial stage and made the elite of the country to taste
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110
the best banking practices that happens in the western countries. They have
foreseen the digital world and have seen the emerging electronic market, which
has encouraged them to have a better customers service strategy that would be
able to deliver the things as per customer’s requirement.
6. Hr Michigan international publishers (2009): Efficiency can be considered from

technical, economical or empirical considerations. Technical efficiency implies
increase in output. In the case 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 know the quality of
financial decisions on its impact or performance of banks in terms of efficiency,
profitability ,competitiveness and other economic variables.
7. DR.S. Gurusamy (2009): One of the key elements of importance for shaping the
financial system of a country is the pension fund. The fund contributes to the
development of social
security systems of a country is the pension fund. The fund contributes to the
development of social security system of a country. A fund is established by
private employers, governments, or unions for the payment of retirement
benefits. Pension funds are designed to provide for poverty relief, consumption
smoothing etc. Pension funds not only provide compensation for the loyal
service rendered in the past, but in a broader significance.
8. Dangwal and kapoor (2010) also undertook the study on financial performance of
nationalized banks in India and assessed the growth index value of various
parameters through overall profitability indices. They found that out of 19 banks,
four banks had excellent performance, five banks had good performance and six
banks had poor performance. Thus the performance of nationalized banks differ
widely
9. Prasana Chandra (2010): Fundamental of financial management covers all the

aspects of the subject from the basics overview of the financial environment to
the financial analysis and financial planning. The basic consists of forms of
business organization which gives detailed information about the financial
management of the organization. After the analysis part budgeting of capital and
fundamental valuation of concept is in detail. It provides an introduction to the
financial management and to the financial environment. The fundamental of
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111
financial management provides a good coverage of the basic concepts relating to

the financial environment. The topics are explained with various examples like
the tax system, financial institution, banking arrangement & the regulatory
framework. All the concepts are explained using numerous examples &
illustration besides the illustration given within the chapter, additional concepts,
tools & technique with illustration are provided at the end of chapter section.
10. Jha DK and D S Sarangi (2011): The financial performance of seven public
sector and private sector banks during the period 2009-10. They used three sets
of ratio, operating performance ratio, financial ratio and Efficiency ratio. The
study revealed that Axis bank was on the top of these banks followed by ICICI,
BOT, PNB, SBI, IDBI and HDFC.
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112
CHAPTER 3
 The examination has been directed concerning the information within SBI. The
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113
examination looks at the monetary exhibition of certain factors and looks at the
exhibition of SBI for the time of 2016-2020
 The examination is an exploratory also, scientific in nature with an endeavour to

investigate the monetary execution of SBI.
 Wellspring of Data Collection: The Data assortment is auxiliary source was utilized as
reports through web.
 Sources for Data Collection: The information needed for the investigation will be
gathered from
o Annual reports of separate banks
o Journals and reports on patterns
o Progress of Banking of India
o Books and sites
 Devices for Data Analysis: The information instrument utilizing R
o Mean
o , Standard Deviation
o , Covariance,
 P-esteem
o Hypothesis
o Lower Correlation
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114
o 3.1 : Objective of the study.
o To evaluate the short term financial position of the State Bank of India.
o To evaluate the long term financial position of the State Bank of India.
o To evaluate the profitability ratio of financial position of the State Bank of India.
o To evaluate the performance ratio of financial position of the State Bank of India.
o 3.2 : Research hypothesis.
o H01: There is no significant differences in the short term solvency position of

state Bank of India.
o H02: There is no significant differences in the long term solvency position of the
State Bank of India..
o H03: There is no significant differences in the efficiency of the State Bank of

India over the study period.
o H04: There is no significant differences in the profitability position of the State

Bank of India during the study period.
 3.3: Scope of the study
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115
 The research paper will also help to understand the financial performance SBI. This study
will throw light on the different aspects where the State Bank of India stand out and how
the banks will provide an opportunity in corresponding its activities to achieve the best
performance.
 3.4 : Limitation of the study
 The study was bounded to only 5 years of financial data analysis.
 The study is entirely based on secondary data which were taken from annual reports of
SBI
 The ratio is enumerated from past financial statements and these are not future indicators.
 The study is considered only on the past records.
 Inadequacy of required data to evaluate and analyse the performance.
CHAPTER 4
DATA REPRESENTATION AND INTERPRETATION
4.1: Data representation and interpretation

TOOLS FOR THE STUDY
Ratio Analysis: Ratios analysis helps in knowing how liquid, profitable and sound a business
is. Below is the analysis of the financial performance of the STATE BANK OFINDIA .The
following ratios are calculated in order to analyse the financial position of the SBI under
study:
Operating margin ratio.
Gross profit margin
Net profit margin
Current Ratio
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116
Quick Ratio
Inventory turnover ratio.
Return on equity
Return on assets
Net interest margin
Debt to equity
1.OPERATING MARGIN
The operating ratio compares a company's overall operating cost (OPEX) to net revenue to
determine management performance. The operating ratio demonstrates how well a company's
management keeps costs down when increasing revenue or sales. The lower the ratio, the
more efficient the business is at generating revenue compared to total expenses.
The operating ratio measures a company's gross operating cost to net revenue to assess how
effective its management is.
A declining operating ratio is regarded as a positive indicator, as it shows that operating

expenses are becoming a smaller percentage of net sales.
YEAR 2020 2019 2018 2017 2016

RATIOS 10.31 9.53 8.95 8.14 -6.65
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12
10
4
OPERATING RATIO
2
0
2020 2019 2018 2017 2016
-2
-4
-6
-8
INTERPRETATION:
The success of a business can be analysed in a variety of ways by investment

analysts. The operating ratio is one of the most common ways to measure efficiency
since it focuses on core business operations. It is commonly used to calculate a
company's operating performance, alongside return on assets and return on equity. It's
helpful to keep track of the operating ratio over time to spot changes in operational
performance or inefficiency.
An growing operating ratio is regarded as a negative sign, as it implies that operating

costs are rising in relation to sales or income , as it can be dented from the table that
gradually till the year 2020 , the ratio has augmented by 10.31. Thus, the costs are
pacing up . If the operating ratio is declining, expenditures are decreasing, or income
is increasing, on the other hand.
2.GROSS PROFIT MARGIN
Analysts use gross profit margin to measure a company's financial health by

measuring the amount of money left over after subtracting the cost of products sold
from product revenues (COGS). Gross profit margin is often expressed as a
percentage of revenue and is often referred to as the gross margin ratio.
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118
The gross profit margin is an analytical statistic that is calculated by subtracting a

company's net profits from its cost of goods sold (COGS).
The gross profit margin is often expressed as a percentage of net revenue.
The gross profit margin reflects the profit before deducting marketing, general, and
administrative expenses, which is the net profit margin of the company.
YEAR 2020 2019 2018 2017 2016
RATIOS 9.28 8.22 7.26 6.81 -7.93
GROSS PROFIT MARGIN

12
10
8
6
4
2
GROSS PROFIT MARGIN
0
2020 2019 2018 2017 2016
-2
-4
-6
-8
-10
INTERPREATATION:
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119
If a company's gross profit margin fluctuates wildly, it may suggest bad management
and/or inferior goods. Such fluctuations, on the other hand, can be justified when
an organisation makes significant operational changes to its business model, in
which case temporary instability should not be a cause for concern.
For example, if a business chooses to automate certain supply chain functions, the
initial expenditure might be high, but the final cost of products would be lower
due to lower labour costs as a result of the automation.
Gross margins can be influenced by shifts in commodity pricing. With all other
factors being equal, if a business sells its goods at a premium,
3.NET PROFIT RATIO

The net profit margin, or simply net margin, is equal to how much net income or profit is
generated as a percentage of revenue. Net profit margin is the ratio of net profits to revenues for
a company or business segment. Net profit margin is typically expressed as a percentage but can
also be represented in decimal form. The net profit margin illustrates how much of each dollar in
revenue collected by a company translates into profit.
 Net profit margin measures how much net income is generated as a percentage of
revenues received.
 Net profit margin helps investors assess if a company's management is generating enough
profit from its sales and whether operating costs and overhead costs are being contained.
 Net profit margin is one of the most important indicators of a company's overall financial
health.
YEAR 2020 2019 2018 2017 2016
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RATIOS 5.63 0.35 -2.96 5.97 6.06
NET PROFIT RATIO

7
6
5
4
3
2
NET PROFIT RATIO
1
0
2020 2019 2018 2017 2016
-1
-2
-3
-4
INTERPRETATION:
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121
The net profit margin influences all facets of a company's operations, including:
1.Total income
2.All incoming and outgoing funds,
3.Additional sources of income,
4.COGS as well as other operating costs,
5.Payments on debts, including interest,
6.Profits from savings and secondary activities,
7.One-time payments for unexpected cases like litigation and taxes.
One of the most important indicators of a company's financial health is its net profit
margin. A business can determine if current strategies are working and forecast
profits based on sales by monitoring increases and decreases in its net profit
margin. It is possible to compare net profit margins since they are expressed as a
percentage rather than a dollar sum.
LIQUIDITY RATIO
1.CURRENT RATIO
The current ratio is a liquidity ratio that assesses a company's ability to pay short-
term or one-year obligations. It explains to investors and analysts how a
company can use existing assets on its balance sheet to pay off current debt and
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122
other obligations.
A current ratio of equal to or slightly higher than the industry average is usually
regarded as appropriate. A lower current ratio than the industry average could
suggest a higher risk of default or distress. Similarly, if a company's current ratio
is exceptionally high relative to its peers, it means that management isn't making
the best use of its cash.
YEAR 2020 2019 2018 2017 2016
RATIOS 1.78 1.83 1.36 0.99 0.88
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CURRENT RATIO
2
1.8
1.6
1.4
1.2
1
CURRENT RATIO
0.8
0.6
0.4
0.2
0
2020 2019 2018 2017 2016
INTERPRETATION:
A company's ability to pay existing, or short-term, liabilities (debts and payables)

with current, or short-term, assets is determined by the current ratio (such as
cash, inventory, and receivables). In certain situations, a company with a current
ratio less than 1.0 does not have the liquidity on hand to fulfil all of its short-term
commitments at once, while a current ratio greater than one implies that the
company has the financial resources to stay stable in the short term. However,
since the current ratio is just a snapshot of any given time, it is rarely a complete
picture of a company's short-term liquidity or long-term solvency.
For instance, a company may have a very high profit margin.
A current ratio of less than 1.0 means that a company's obligations due in the next
year or less are greater than its assets (cash or other short-term assets expected to
be converted to cash within a year or less.)
The higher the current ratio, on the other hand, the more capable a corporation is of
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meeting its commitments because it has a higher proportion of short-term asset

value compared to the value of its short-term liabilities as it’s ostensibly denoted
from the above table that eventually in the year 2020 the current ratio took its
pace.
Although a high ratio, say over 3, may mean that a company can cover its current
liabilities three times over, it may also indicate that the company isn't making the
best use of its current assets, isn't securing funding well, or isn't managing its
cash flow well.
2.QUICK RATIO
The fast ratio is a measure of a company's ability to fulfil short-term obligations with
its most liquid assets and is an indication of its short-term liquidity status.
It's also known as the acid test ratio because it shows a company's ability to pay
down current liabilities rapidly using near-cash assets (assets that can be
converted quickly to cash). A fast test designed to produce instant results is
referred to as a "acid test.
The fast ratio assesses a company's ability to fulfil existing commitments without
selling inventory or receiving additional funding.
The short ratio is thought to be a more conservative metric than the current ratio.
YEAR 2020 2019 2018 2017 2016
RATIOS 17.05 18.06 13.83 11.94 10.89
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QUICK RATIO
20
18
16
14
12
10
QUICK RATIO
8
6
4
2
0
2020 2019 2018 2017 2016
INTERPRETATION:
The fast ratio compares the amount of liquid assets available to the amount of
current liabilities owed by a corporation. Current assets are those that can be
easily turned into cash with no effect on the price earned in the open market,
while current liabilities are a company's debts or commitments that must be paid
to creditors within a year.
The usual fast ratio is described as a result of one. It means the company has
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precisely enough money to pay off its existing liabilities in a moment. A

business with a fast ratio of less than one may not be able to pay off all of its
current liabilities in the short term.
3.INVENTORY TURNOVER RATIO
Inventory turnover is a financial ratio that indicates how many times a company's
inventory has been sold and replaced in a given timeframe. The days it takes to
sell the inventory on hand can then be calculated by multiplying the number of
days in the timeframe by the inventory turnover formula.
Calculating inventory turnover can assist companies in making better pricing,

production, marketing, and inventory purchase decisions.
Inventory turnover refers to how many times a business can replace its sold
inventory in a given time span.
A slow turnover ratio indicates low sales and likely surplus inventory, while a faster
ratio indicates high sales or inadequate inventory.
YEAR 2020 2019 2018 2017 2016
RATIOS 0.06 0.06 0.06 0.06 0.07
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0.072
0.07
0.068
0.066
0.064
0.062 INVENTORY TURNOVER RATIO
0.06
0.058
0.056
0.054
2020 2019 2018 2017 2016
INTERPRETATION:
Stock turnover is a metric that analysts use to assess how quickly a business sells
inventory to market averages. As by the above table by the year 2020, the sales
were unchanged or rather ,Low turnover indicates sluggish sales and, likely,
surplus inventory (also known as overstocking).
It may be the result of poor promotion or a problem with the products being offered
for sale.
A high ratio indicates either high sales or a lack of inventory. The former is
preferable, while the latter can result in a loss of business. When prices are
expected to increase (inventory pre-positioned to meet rapidly growing demand)
or when shortages are expected, a low inventory turnover rate may be
advantageous.
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4.DEBT TO EQUITY RATIO
Divide a company's total liabilities by its shareholder equity to get the debt-to-equity
(D/E) ratio. The balance sheet of a company's financial statements contains these
figures.
The ratio is used to determine the financial leverage of a business. In corporate

finance, the D/E ratio is a crucial measure. It's an indicator of how much a
corporation relies on debt to finance its activities rather than wholly-owned
funds. In the event of a market downturn, it represents the willingness of
shareholder equity to pay all outstanding debts.
The debt-to-equity (D/E) ratio is a calculation of how much debt a corporation has
relative to how much equity it has.
YEAR 2020 2019 2018 2017 2016
RATIO 17.08 16.89 15.79 15.08 14.24
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DEBT TO EQUTIY RATIO
17.5
17
16.5
16
15.5
15 DEBT TO EQUTIY RATIO
14.5
14
13.5
13
12.5
2020 2019 2018 2017 2016
INTERPRETATION:
A high debt/equity ratio is also correlated with high risk; it implies that a business
has used debt to finance its expansion.
When a lot of debt is used to fund growth, a business might be able to produce more
earnings than it would have been able to without it. Shareholders should continue
to gain if leverage raises profits by more than the debt's expense (interest). Share
prices will fall if the cost of debt financing outweighs the increased income
produced. The cost of debt will fluctuate depending on market conditions. As a
result, unprofitable borrowing can go undetected at first.
5. RETURN ON ASSETS RATIO
 Return on assets (ROA) is a calculation of a company's profitability in relation to its total

assets. The return on assets (ROA) tells a manager, investor, or analyst how effectively a
company's management is using its assets to produce profits. The ROA is expressed as a
percentage; the higher the ROA, the better.
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 Return on Assets (ROA) is a metric that measures how profitable a company's assets are
used.
 When comparing related companies or a company's previous results, ROA is the most
useful metric.
 Unlike other related metrics like Return on Equity, ROA considers a company's debt
(ROE).
YEARS 2020 2019 2018 2017 2016

RATIOS 0.45 0.08 -0.12 -0.01 0.44
RETURN ON ASSET RATIO
2016
2017
2018
RETURN ON ASSET RATIO
2019
2020
-0.2 -0.1 0 0.1 0.2 0.3 0.4 0.5
INTERPRETATION
In simple terms, return on assets (ROA) indicates how much profit was earned from invested
capital (assets). The return on investment (ROI) for public corporations can vary significantly
and is highly dependent on the industry. As a result, it's better to equate ROA to a company's
previous ROA numbers or a similar company's ROA when using it as a comparative measure.
The return on investment (ROI) figure tells investors how well a business converts its
investments into profit.
The higher the return on investment (ROI), the better, because the company is making more
money with less investment.
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6.RETURN ON EQUITY RATIO
The return on equity (ROE) is a financial performance indicator that is determined by dividing
net profits by shareholders' equity. Since shareholders' equity equals a company's assets minus its
debt, the return on net assets is referred to as ROE. The return on equity (ROE) is an indicator of
a company's profitability in relation to its stockholders' equity.
Return on equity (ROE) is a metric that calculates a company's profitability in relation to its
stockholders' equity.
If a ROE is deemed satisfactory, it will be determined by what is considered common in the
industry or among company peers.
Investors should consider a ROE near the long-term average of the S&P 500 (14% ) as an
appropriate ratio .
YEARS 2020 2019 2018 2017 2016

RATIOS 8.32 1.48 -2.16 -2.16 -0.22
RETURN ON EQUITY RATIO

10
4
RETURN ON EQUITY RATIO
2
0
2020 2019 2018 2017 2016
-2
-4
INTERPRETATION
What constitutes a good or bad ROE will be determined by what is considered common among a
stock's peers. Utilities, for example, have a lot of assets and debt on their balance sheet due to a
small amount of net profits. In the utility sector, a typical return on investment (ROI) could be as
low as 10%. A technology or retail business with smaller balance sheet accounts compared to net
income which have a typical ROE of 18% or higher.
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A reasonable rule of thumb is to strive for a ROE that is equal to or slightly higher than the peer
group's average.
7 Net Interest Margin (NIM)
The NIM ratio calculates a company's benefit from its investment activities as a percentage of its
total investing assets. This ratio is commonly used by banks and other financial institutions to
assess investment decisions and monitor the profitability of their lending operations. This allows
them to fine-tune their lending activities to increase profits.
This margin is also used by investment firms to assess the effectiveness of a fund manager's
investment decisions. A positive percentage means that the fund manager made wise decisions
and profited from his investments. A negative ratio, on the other hand, suggests that the fund
manager has lost money on his assets as a result of his decisions.
YEARS 2020 2019 2018 2017 2016
RATIOS 2.82 2.73 2.47 2.54 2.69
NET INTEREST MARGIN
2016
2017
2018 NET INTEREST MARGIN
2019
2020
0% 20% 40% 60% 80% 100%
INTERPRETATION:
The net margin is a metric that shows how effective an investment manager or business is at
making investment decisions and allocating capital. If this ratio is negative, it means the firm or
organisation hasn't made good investment decisions. In other words, the company "won" a
negative margin by losing money on its investments.
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A positive number, on the other hand, indicates that the investment decisions were good and that
the fund manager or business made money.
4.3:Hypothesis testing
1. Standard deviation 7.147

Mean 6.056
1. H0 hypothesis
Since p-value > α, H0 is accepted.
The average of Group-1's population is considered to be equal to the μ0.
In other words, the difference between the average of the Group-1 and μ0 is not big
enough to be statistically significant.
2. P-value
p-value equals 0.790934, ( p(x≤Z) = 0.604533 ). This means that if we would reject H0,
the chance of type I error (rejecting a correct H0) would be too high: 0.7909 (79.09%).
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The larger the p-value the more it supports H0.
3. The statistics
The test statistic Z equals 0.265099, is in the 95% critical value accepted range: [-1.9600 :
1.9600].
x=6.06, is in the 95% accepted range: [-44.7700 : 44.7700].
The statistic S' equals 22.844 .
4. Effect size
The observed standardized effect size is small (0.12). That indicates that the magnitude
of the difference between the average and μ0 is small.
1. Standard Deviation, s: 7.173

Mean, x̄: 4.8
1. H0 hypothesis
In other words, the difference between the average of the Group-1 and μ0 is not big enough to be
statistically significant.
2. P-value
p-value equals 0.834751, ( p(x≤Z) = 0.582625 ). This means that if we would reject H0, the
chance of type I error (rejecting a correct H0) would be too high: 0.8348 (83.48%).
3. The statistics
1.9600].
4. Effect size
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The observed standardized effect size is small (0.093). That indicates that the magnitude of the
difference between the average and μ0 is small.

Mean, x̄:3.01
1. H0 hypothesis
In other words, the difference between the average of the Group-1 and μ0 is not
big enough to be statistically significant.
2. P-value
p-value equals 0.690631, ( p(x≤Z) = 0.654685 ). This means that if we would reject H0, the
chance of type I error (rejecting a correct H0) would be too high: 0.6906 (69.06%).
3. The statistics
1.9600].
4. Effect size
The observed standardized effect size is small (0.18). That indicates that the magnitude
of the difference between the average and μ0 is small.
Mean, x̄:1.368
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1. H0 hypothesis
Since p-value < α, H0 is rejected.
The average of Group-1's population is considered to be not equal to the μ0.
In other words, the difference between the average of the Group-1 and μ0 is big
2. P-value
p-value equals 0.00000, ( p(x≤Z) = 1.000000 ). This means that the chance of type1
error (rejecting a correct H0) is small: 0.000 (0.0%).
The smaller the p-value the more it supports H1.
3. The statistics
The test statistic Z equals 16.015398, is not in the 95% critical value accepted range: [-
1.9600 : 1.9600].
x=1.37, is not in the 95% accepted range: [-0.1700 : 0.1700].
4. Effect size
The observed standardized effect size is large (7.16). That indicates that the magnitude
of the difference between the average and μ0 is large.
Mean, x̄:14.35
1. H0 hypothesis
2. P-value
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3. The statistics
The test statistic Z equals 3.284296, is not in the 95% critical value accepted range: [-
1.9600 : 1.9600].
4. Effect size
The observed standardized effect size is large (1.47). That indicates that the magnitude
of the difference between the average and μ0 is large.

Mean, x̄: 0.062
1. H0 hypothesis
2. P-value
3. The statistics
The test statistic Z equals 6931.810730, is not in the 95% critical value accepted range:
[-1.9600 : 1.9600].
4. Effect size
The observed standardized effect size is large (3100.00). That indicates that the
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magnitude of the difference between the average and μ0 is large.
CHAPTER 5
FINDINGS AND DISCUSSIONS
5.1: MAJOR FINDINGS
The study is case method of research and comparative financial performance analysis in nature,
the study used entirely secondary data that was assembled from research articles, reports and
thesis works already done on the subject and collaboratively took the ministrations from the
annual reports of the STATE BANK OF INDIA . The figures and findings were enumerated for
the year from 2016-2020, i.e. 5 years. For this study 6 specific ratios are used to measure
profitability, solvency ,short term and long term position levels
The findings for the study are as follows:
1 .OPERATING MARGIN RATIO
The operating ratio compares a company's overall operating cost (OPEX) to net revenue to
determine management performance. The operating ratio demonstrates how well a company's
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management keeps costs down when increasing revenue or sales. The lower the ratio, the more
efficient the business is at generating revenue compared to total expenses.
The operating ratio measures a company's gross operating cost to net revenue to assess how
effective its management is.
As from the enumerated figures the ratios are increasing, which shows the operating expenses
are higher when juxtaposed with revenue ,as in 2016it was less compared to the eventual year
ahead.
A declining operating ratio is regarded as a positive indicator, as it shows that operating expenses
are becoming a smaller percentage of net sales.
2.GROSS PROFIT MARGIN RATIO.
If a company's gross profit margin fluctuates wildly, it may suggest bad management and/or inferior
goods. Such fluctuations, on the other hand, can be justified when an organisation makes
significant operational changes to its business model, in which case temporary instability should
not be a cause for concern.
The higher the profit margin, the more efficient the bank is, as by enumeration it can be ostensibly
verified that gradually in the years ahead , the ratio augmented by the year 2020 it went up by
9.28.
3.NET PROFIT RATIO

The net profit margin, or simply net margin, is equal to how much net income or profit is
generated as a percentage of revenue. Net profit margin is the ratio of net profits to revenues for
a company or business segment. Net profit margin is typically expressed as a percentage but can
also be represented in decimal form. The net profit margin illustrates how much of each dollar in
revenue collected by a company translates into profit.
Net profit margin measures the overall profitability of the Industry considering all direct as well as
indirect cost.
As by the figures enumerated, by the year 2020 it had already gone up by 5.63 despite of certain
negative consideration in the year 2018 and so.
LIQUIDITY RATIO
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1. CURRENT RATIO
The current ratio is a liquidity ratio that assesses a company's ability to pay short-term or one-year
obligations. It explains to investors and analysts how a company can use existing assets on its
balance sheet to pay off current debt and other obligations.
A current ratio of equal to or slightly higher than the industry average is usually regarded as
appropriate. A lower current ratio than the industry average could suggest a higher risk of default
or distress. Similarly, if a company's current ratio is exceptionally high relative to its peers, it
means that management isn't making the best use of its cash.
A low current ratio indicates that the industry does not have the liquidity on hand to fulfil all of its
short-term commitments at once, while a current ratio greater than one such as the figures
enumerated from the year 2019&2020 i.e. 1.78 and 1.83 , implies that the company has the
financial resources to stay stable in the short term.
2.QUICK RATIO
The fast ratio compares the amount of liquid assets available to the amount of current liabilities
owed by a corporation. Current assets are those that can be easily turned into cash with no effect
on the price earned in the open market, while current liabilities are a company's debts or
commitments that must be paid to creditors within a year.
The usual fast ratio is described as a result of one. By the figure provided from year 2020 and
2019, means the company has precisely enough money to pay off its existing liabilities in a
moment. A business with a fast ratio of less than one may not be able to pay off all of its current
liabilities in the short term.
3.INVENTORY TURNOVER RATIO.
Stock turnover is a metric that analysts use to assess how quickly a business sells inventory to
market averages. As by the above table by the year 2020 , the sales were unchanged or rather ,
Low turnover indicates sluggish sales and, likely, surplus inventory (also known as
overstocking).
It may be the result of poor promotion or a problem with the products being offered for sale.
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A high ratio indicates either high sales or a lack of inventory. The former is preferable, while the
latter can result in a loss of business as the growth was constant despite of higher growth in
2016.
4.RETURN ON ASSETS RATIO

The return on assets furfure gives investors an idea of how effective the company is in
converting the money it invests into net money.
The higher the ROA money , the better, because the company is earning more money on lit
investment.
The higher the ROA the better , as considering the figure in the year 2020 i.e 0.45 , it’s
pontificated ostensibly that the bank is earning more money.
5.RETURN ON EQUUTY RATIO

A high ROE suggests that a company’s management team is more efficient when it comes to
utilising investment financing. Thus , by the figure obtained in the year 2020 which is 8.32 it’s
higher when juxtaposed with the rest of the years.
6.NET INTEREST MARGIN RATIO.

This margin is also used by investment firms to assess the effectiveness of a fund manager's
investment decisions. A positive percentage means that the fund manager made wise decisions
and profited from his investments. Hence , by the figures from the table in each year gradually
the percentage augmented to 2.82 , which henceforth means that the entity operates profitably.
7.DEBT TO EQUITY RATIO.

A high debt/equity ratio is also correlated with high risk; it implies that a business has used debt
to finance its expansion.
The more an entity’s operations are funded by borrowed money , the greater the risk of
bankruptcy , which is clear from the gradual increase in ratios obtained from the year 2018.
5.2 : Discussion and suggestion

1. Decline in profitability of the banking system due to unsecured loans and advances.
2. The performance will indirectly affect the profitability of SBI.
3. Proper control over leverage should be taken in order to magnify DP ratio.
4. The DER is quite high viz. worrisome, as it indicates a precarious amount of leverage.
5. There should be a steady stream of sustainable dividends from a company, the dividend pay-
out ratio analysis is important.
6. A consistent trend in this ratio is usually more important than a high or low ratio
7. Bank has fallen a percentage each year for the last five years might indicate that the company
can no longer afford to pay such high dividends. This could be an indication of inclined
operating performance.
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5.3: Conclusion.
The banking sector is critical for a country's economic growth. SBI is one of India's most well-
known public-sector banks. SBI has a stronger market place. The results show that there is no
discernible difference between deposits, savings, profitability, long and short term ratios, net
profit, and so on. The SBI group is becoming increasingly concerned about the banking system's
deteriorating profitability as a result of unsecured loans and advances. It has been extremely
overburdened and is looking for ways to reduce the viability of the current banking philosophy's
value. As a result, in the current study report, an attempt has been made to evaluate the financial
performance.
The keeping money division is exceptionally critical for the economic development of a nation.
The SBI is one of the driving bank of Open division Bank in India. The showcase position of
SBI is better. The investigation uncovers that there's no significant difference between
Advances, Net Profit , liquidity ratio, solvency ratio etc., there's developing prove of concern by
the SBI gather on the declining productivity of the banking framework due to unsecured
advances and progresses. It has becomes greatly over and finds remedial measures to reduce the
benefit within the esteem of modern keeping money philosophy. Hence, within the show paper
of the ponder an endeavour has been made to analyse the budgetary execution of SBI.
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143
REFERENCE
(n.d.). Retrieved from the economic times:
https://economictimes.indiatimes.com/defaultinterstitial.cms
the economic times. (n.d.). Retrieved from
(sbi)

sbi. (n.d.). Retrieved from https://us.shop.battle.net/en-us/product/call-of-duty-warzone
(htt) (money control) (htt1) (htt2) (htt3) (htt4) (htt5) (htt6) (htt7) (htt8) (htt9)
n., n. (n.d.). Retrieved from research gate:

https://www.researchgate.net/publication/329144516_A_STUDY_ON_FINANCIAL_PERFORMA
NCE_OF_STATE_BANK_OF_INDIA

(n.d.). Retrieved from
https://www.google.com/search?q=sbi+ratio+analysis+2016+TO+2020+rediff&sxsrf=ALeKk00q
DC8cUh3ew51f6R1q4aDgL3VFWg%3A1617350689841&ei=IdBmYLXzMpX1rQH5pIDwCg&oq
=sbi+ratio+analysis+2016+TO+2020+rediff&gs_lcp=Cgdnd3Mtd2l6EAM6BwgAEEcQsAM6BAgj
ECdQ7yxY42dgjnFoA3AC
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(n.d.). Retrieved from money control:

https://www.moneycontrol.com/financials/statebankofindia/ratiosVI/SBI
(n.d.). Retrieved from https://www.equitymaster.com/stock-research/financial-data/SBI/STATE-
BANK-OF-INDIA-Detailed-Share-Analysis
(n.d.). Retrieved from https://www.sbifoundation.in/board-of-directors
(n.d.). Retrieved from https://stock-financials.valuestocks.in/en/sbi-ratio-analysis
(n.d.). Retrieved from https://economictimes.indiatimes.com/definition/return-on-equity
(n.d.). Retrieved from https://en.wikipedia.org/wiki/State_Bank_of_India#cite_note-1
(n.d.). Retrieved from https://www.journalcra.com/article/study-financial-performance-state-
bank-india
(n.d.). Retrieved from
https://www.researchgate.net/publication/329144516_A_STUDY_ON_FINANCIAL_PERFORMA
NCE_OF_STATE_BANK_OF_INDIA
(n.d.). Retrieved from https://www.emerald.com/insight/publication/issn/0265-2323
(n.d.). Retrieved from https://www.moneycontrol.com/annual-report/statebankindia/directors-
report/SBI#SBI
sbi. (n.d.). Retrieved from https://us.shop.battle.net/en-us/product/call-of-duty-warzone
Page
145
Building of a Brand Image Through Various Social Media Marketing

with Special
Reference to The Face Shop
Research Project Submitted in Partial Fulfillment of the

Requirements for the Degree of
BCOM Honours
By
Yashika Gupta
to the
Dr. Geetanjali Shrivastava
April, 2021
Submitted by Guided by
Yashika Gupta Dr. Geetanjali Shrivastava
CERTIFICATE
It is certified that the work contained in the project report titled “Building of a
Brand image through various Social Media Marketing with special reference
to THE FACE SHOP,” by “Yashika Gupta,” has been carried out under my
supervision and that this work has not been submitted elsewhere for a degree*
Name : Dr Geetanjali Shrivastava
146 | P a g e

April, 2021
DECLARATION
I hereby declare that this project report entitled “Building of a Brand image
through various Social Media Marketing with special reference to THE FACE
SHOP” was carried out by me for the degree of BCOM Honours under the
guidance and supervision of Dr. GEETANJALI SHRIVASTAVA of
Department of Commerce, BSSS College. The interpretations put forth are based
on my reading and understanding of the original texts and they are not published
anywhere in any form. The other books, articles and websites, which I have made
use of are acknowledged at the respective place in the text. This research report is
not submitted for any other degree or diploma in any other University.
Place: Bhopal
Name of the Student: Yashika Gupta
Class & Section: Bcom Honours 3C
Date: 30th April 2021
147 | P a g e
ACKNOWLEDGEMENT
I would like to thank our Principal Dr. Fr. John P.J. and Vice Principal Dr Sr
Sonia Kurien for their immense support and blessings. I thank our HOD Dr Amit
Kumar Nag for his support. I would like to express my special thanks of gratitude
to my research guide Dr. Smitha Pillai, Associate Professor of Department of
Commerce for her valuable suggestions and guidance and for giving me the golden
opportunity to do this wonderful research project on the topic: “Building of a
Brand image through various Social Media Marketing with special reference
to THE FACE SHOP” Without her help it would have been difficult for me to
have reached this state of completion of my project report. Also, I would like to
thank my parents and friends who helped me a lot in the preparation of this project.
I wish to acknowledge the help of all those who have provided me information,
guidance and other help during my research period.
148 | P a g e
Summary
Social media has become more critical than ever in the business of communicating with
customers in any feasible way, particularly in the period of utilizing social sites such as
Instagram, facebook, youtube and others as a part of everyday lives. Customer expect businesses
to utilize social sites to communicate with them, and the importance of social media as a contact
medium is rapidly increasing. It shows in what way social media has become increasingly
importance in all aspects of branding by creating a link between customers and brands, resulting
in brand improvement. The data has been taken from both primary and secondary sources
through questionnaires particularly from the different articles, published research papers etc.
The face shop makes natural products as they are inspired by nature offers variety to meet the all.
The company emphasizes its natural goods. Easy, alluring and functional products with fresh
smelling packaging. The face shop created superior class reasonably priced items and sold them
exclusively through their acknowledge forte stores when it first launched the brand. Market
recognition of the newly introduced brand was improved by retail stores providing qualified root
domain this raised customer realization of the label’s latest launch.
INDEX
S.NO. CONTENTS PAGE

NO.
149 | P a g e
1. Rationale of the study 8
2. Introduction to the industry 8
3. Introduction to the company 9
4. Justification of the topic 9
5. Review of literature 12
6. Objectives of the study 18
7. Research Hypothesis 18
8. Scope of the study 18
9. Limitation of the study 19
10. Data representation and interpretation 21
11. Hypothesis testing 42
12. Major findings 45
13. Discussions and suggestions 46
14. Conclusions 47
15. Annexure 48
16. References 52
150 | P a g e
CHAPTER 1
1.2 Introduction to the industry

1.3 Introduction to the Company
1.4 Justification of the study
1.1 RATIONAL OF THE STUDY:
1.1.1 Why the need for the study?
 To build up a brand image through various social media marketing
 To face the challenges that comes through social media and how they can handled or
mitigated.
 To understand their marketing strategies

1.1.2 What information will the study add?
 It will help in analyzing the company strategies
 It will help in building of an opportunity and challenge for business to participate in and
offer phenomenal cyberspace experiences to their stakeholders.
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 It will make us gain the knowledge, marketing strategies, strength and contribution
towards society.
1.2 INTRODUCTION OF THE INDUSTRY:

The strategy of enticing customers to participate in the company’s own website, social media
presence, blogs and forums, among other things. Social media has become more critical than
ever in the business of communicating with customers in any feasible way, particularly in the
period of utilizing social sites such as Instagram, facebook, youtube and others as a part of
everyday lives. When attending a social activity finance by the office, such as business meeting,
cocktail gathering, etc social networking has evolved dramatically. It also includes socializing
through computerized and web mediator. Over the last decade, the social media has changed the
way business operate, and as a result, has created its own presence in the business world. The
widespread acceptance of social media as a vital component of people’s everyday lives has had a
significant impact on customer purchasing habits. Customer expect businesses to utilize social
sites to communicate with them, and the importance of social media as a contact medium is
rapidly increasing. It shows in what way social media has become increasingly importance in all
aspects of branding by creating a link between customers and brands, resulting in brand
improvement. Label stories have evolved in a modern type of marketing in which customers are
viewed as as primary writers of the label and are encouraged to express their individual
experiences with others through social media. Brands must consider in what ways the gesture of
social media has turn the tables of marketing game in global ways.
1.2 INTRODUCTION TO THE COMPANY:

The Face Shop, a Korean cosmetics brand that began as a small enterprise in 2003, it is the third
largest cosmetics company in the world. It has expanded to become a market leader in the highly
cut-throat Korean cosmetic industry. It operates more than 800 shops in korea and 38 outlets in
19 countries. The face shop makes natural products as they are inspired by nature offers variety
to meet the all. The company emphasizes its natural goods. Easy, alluring and functional
products with fresh smelling packaging. Every month, about 30 new items are added to the over
1000 currently available. Products are available for men and women of all ages agree that
everybody has natural beauty and that there is something for all.The face shop is recently top k-
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beauty trend by extending its line into international markets with an emphasis on middle eastern
countries. The solicitation of SPA (Specialty retailers of private label apparel) game plan of the
cosmetic market, which provides customers with latest value that was formerly unavailable in the
Asian cosmetic industry, is a mainstay in this success. The face shop created superior class
reasonably priced items and sold them exclusively through their acknowledge forte stores when
it first launched the brand. Market recognition of the newly introduced brand was improved by
retail stores providing qualified root domain this raised customer realization of the label’s latest
launch.
1.3 JUSTIFICATION OF THE STUDY:
For market participants, the era of information technology and online marketing provides a
plethora of latest possibilities and supports. Taking benefit of technology has made
developing and introducing a brand new product which is much simpler than before for
companies. It can be seen that the digital age presents both opportunities and threats for
both businesses and customers. A good digital media game plan that allows for competitive
benefit is the secret to success unlatch such a situation. This document will provide an
analysis of the solidity and disadvantages of the firm’s game plan as well as a summary of
their positioning plan for more effective marketing movement, by reviewing the firm’s
strategies. Companies should take opportunity to use social sites network to raise brand
awareness while also exploring the obstacles they face in order to attract the interest of
firm’s who are just getting started with social media. The ultimate goal of implementing a
successful marketing game plan is to provide consumers with distinction and prime value
while still increasing profitability for the company.
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CHAPTER 2
LITERATURE REVIEW
National Reviews
International Reviews
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NATIONAL REVIEWS
1. (Yadav & Rahman, 2017) This is probably the opening comprehensive analysis on
social media of the literature from 2004 to March 2015, which includes both
categorizing of literature and different put up used in social network research. It adds
to the current body of information by offering a more detailed understanding of the
patterns in social media research.
2. (Zahoor & Qureshi, 2017) It has opened up new lines of communication and
engagement between consumers and the organization that go far off conventional sell
and corporate model. As a result , for the sake of remain fierce later, marketers must
research and develop the connection linking these principles.
3. (Dwivedi & Kapoor, 2015) Extensive research have overdone ,analyzed and
documented numerous applied (Yadav & Rahman, 2017)application which also
includes social network marketing. It aims to compile current research on social
network marketing in order to showcase a summary of 71 articles that will cover the
numerous aspects of this increasingly growing the medium of social media marketing.
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4. (Shukla, 2011) This research reveals how interpersonal impact and branding signals
affect customer opulence purchasing purpose. The formation , possessions , mean
amount of vulnerability to interpersonal impact are investigated and compared in this
analysis, which emphasizes the interfunctional interconnection.
5. (Arora & Sanni, 2019) The thesis analysis issue papers on social network marketing
in the publication of advancement management issue since 2007 to synthesize studies
in make an appearance of social network marketing province. We discussed some
new investigation foci & directions in social network marketing as well as research
suggestion for theory and application.
6. (Alalwan, Rana, & Dwivedi, 2017) Academics and research have been focusing on
the connected matter of social network marketing in order to extend their existing
apprehension of certain phenomena in the marketing field. The investigators have
been giving an outline of the major themes and developments balanced by the related
literature including the part of social network in commercial , automatic , consumer
connection management , and firm branding and results.
7. (Lall & Kishore, 2014) Established medicines are used by a huge percentage of the
population to meet their physical and emotional health requirements. Because of their
ethnomedicinal traditions , many medicinal herbs have recently obtained popularity
as ingredients in cosmetic articulation and many cosmetic hems vend in stores are of
native origin.
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8. (Prakash & Sharma, 2016) Impetuous purchasing is a much discussed and

investigating subject , particularly given how much money it give rise to all over the
universe. Skincare goods take on the characteristics of the people who use them. The
aim of this study is to determine the significance of numerous factors exist almost
during the time of purchase and the extent to which they serve as constructive input in
impulsive skin awareness purchases.
9. (Raj, Jose, Sumod, & Sabitha, 2012) Nanotechnology has been used in a variety of
fields , from automated to medicine , has been now establish uses in the cosmetics
industry under the label nanocosmetics concerns about the welfare of such
nanocosmetics have recently emerged, prompting the cosmetics industry to restrict
the use of nanotechnology in cosmetics and to enforce regulations requiring complete
safety testing before entering the market.
10. (Alam & Khan, 2015) User experiences on social network also altered the marketing
landscape. Businesses are involved on social network sites in order to learn how their
customers react to something relevant to their products. This is critical because the
brands reputation and buying intentions are shaped by customer online experiences
and discussions. Firm –created content on social media has a significant impact on
working label image, while user-generated content has notable impact on brand
recognition and luxurious brand label.
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 INTERNATIONAL REVIEWS
1. (Alani, Davis, & Yiannias, 2013) Selfcare products such as haircare products ,&
sunscreens are all included in the broad concept of cosmetics. Since producer invest
thickly in protection , quality assurance, and field test prior to release of a product for
the sell. Most consumers find present day cosmetics to be cautious and unfavourable
reactions are extremely rare.
2. (Liobikiene & Bernatoniene, 2017) One way to reduce goods environmental effect
and to get feasibility is to promote green buying. Green marketing & green
purchasing behavior analysis has only recently become a topic of study. Future
research should look at categories to which specific green goods can be assigned, as
different factors affect the purchasing of different products in different ways.
3. (Haas, 2008) In todays culture, the obsession with physical appearance is growing in
popularity. The media through magazines, television, & music defines beauty in
American culture having an impeccable figure is central to having the ideal career,
family, social standing, and high self-esteem.
4. (Timmermans & Depierreux, 2019) Toxic type A is generally safe for cosmetic or
medical use, but it can sometimes cause iatrogenic botulism. Since both BONT-A and
antiacetylcholine receptor antibodies inhibit neuromuscular transmission iatrogenic
botulism and myasthenia gravis have similar clinical features.
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5. (Zhang, 2015) Since its inception the idea of “brand picture” has piqued the interest
of instructional and practitioners alike, owing to its importance in marketing
activities. Despite the fact that brand image is a key driver of brand asset and success,
few studies have looked into the connection between brand image & brand equity.
6. (Guzman, 2005) In the decade, the core concern of brand building literature has
shifted dramatically. The conventional understanding of branding and the position of
brands was constantly questioned and redefined. The name given to one or more
products in a business line to describe the items source of character.
7. (Lee, James, & Kim, 2014) The foundation for better strategic marketing conclusion
regarding pick out particular market section and locating a product is the brand
picture. However different researchers have described and put in the term “brand
picture” in numerous ways. When it comes to brand image analysis and
corresponding assessments of brand value and positioning, the various definitions
may be ambiguous.
8. (Alves, Fernandes, & Raposo, 2016) The research examines the quality of
publications on social network marketing in the tangle of science database was
analyzed and systematized for their research. The findings show that the majority of
the learning examined examined concentrate on the user view point in terms of social
network use, sharing, and impact on customer conclusion and recognition.
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9. (Khan & Jan, 2015) While the term “social network” “social network marketing” are
often used as vice-versa the two are distinct. The aim of this investigation writing is
to go through the literature on either topics and see how they are related in scientific
terms. We began by reviewing the existing literature on social network and
determinimg its basic functions.
10. (Paquette, 2013) In present day technology obsessed universe, social media
platforms have become a way for distributor to reach a broader audience with their
marketing campaigns. Although providing a particular platform and legal tender for
convenient connecting and social interconnection, it also serves as a relationship
between label and customers.
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CHAPTER 3
3.1 Objectives of the study

3.3 Scope of the study
3.1 OBJECTIVES OF THE STUDY:
 To know the building up a brand image through various social media marketing
 To measure and understand the statistical data of customer satisfaction
 To know their marketing strategies
3.2 RESEARCH HYPOTHESIS:
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• H0- There is no significant difference between the male and female customers of The
Face Shop on the basis of the brand’s rating scaling from 1-5.
3.3 SCOPE OF THE STUDY:

The study is being conducted to better understand the building of a brand image through various
social media marketing. The study is conducted from the with special reference to the face shop
the benefits and the drawbacks of the people buying from the face shop. The cosmetic industry is
rapidly growing. It covers an analysis of consumer satisfaction on different products. The
geographical scope of the study is the Bhopal city of Madhya Pradesh, India.
3.4 PRIMARY AND SECONDARY DATA:

In this research project, both primary and secondary data is used for the research primary data is
the data which is collected directly form the data source without going through an existing
source and in this study, it is collected by questionnaire. Secondary data is the data which already
collected through primary data and readily available.
3.4.1POPULATION
Population is defined as a finite totality of the data set. In this study a portion of the population is
observed. It insures that the results and the findings apply to the correct category.
3.4.2SAMPLE
Sample is a portion of a population. Sample is gathered from data collected through survey
method using the tool questionnaire from the face shop.
3.4.3 SAMPLE SIZE

Sample size is a no of participants included in a study. Questionnaire contain both close ended
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and open-ended questions and also contain Likert scale questions. Out of the total population 100
respondents have been taken as a sample size.
3.4.4SAMPLING METHOD
Non-probability sampling method is used. Random people have been selected the one who used
the face shop and that don’t use some are from the Bhopal and some are from out of the Bhopal
were selected for primary data.
3.5 LIMITATION OF THE STUDY:

The sample size is small for the accurate study of building of a brand image through various
social media marketing with special reference to the face shop so its results may vary from all
over india due to different lifestyle and regional differences. Also, the researcher could not cover
all the information due to which proper information could not be extracted. However, these
limitations provide scope for further research in future.
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CHAPTER 4
DATA REPRESENTATION AND ANALYSIS
1.1 Data Representation and

Interpretation
4.1 DATA REPRESENTATION AND INTERPRETATION:
4.1.1
Gender Total
Male 47
Female 53
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Grand Total 100
Interpretation
53% of the respondents are females and 47% of them are males.
4.1.2
Age Total
12-18 25
18-35 63
35-50 9
Above 50 3
Grand Total 100
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Interpretation
25% of respondents come under the age group of 12-18, 9% come under the
age group of 35-50, 63% come under the age group of 18-35 and rest are of
the age group of above 50.
4.1.3
Looking for in a skin care Total

product
Fast-absorbing 28
Rich and nourishing texture 59
Nice scent 13
Grand Total 100
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Interpretation
59% of respondents are looking for rich and nourishing texture in a skin care
product while 28% of them are looking for fast-absorbing skin care product and
rest 13% are looking for nice scent in skin care product.
4.1.4
Ever purchased the face

Total
shop product based on
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social media influences

Yes 48
No 52
Grand Total 100
Interpretation
52% of respondents have purchased the face shop product based on social
media influences whereas 48% of the respondents have not purchased the
face shop product based on social media influences either in store or online.
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4.1.5
Skin type product you are Total
currently using
Dry skin 25
Combination 25
Oily 23
Sensitive 7
Normal skin 20
Grand Total 100
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Interpretation
25% of the respondents are using the products for the dry skin, 25% of them
are using for combination, 23% of the respondents are of oily skin type, 7% of
them are using the products for sensitive skin and rest 20% of them are using
for normal skin.
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4.1.6
Time taken during skincare Total

routine
5 min a day 54
10 min a day 30
More than 10 min 16
Grand Total 100
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Interpretation
54% of people 5 min a day in their daily skincare routine, while 30% of people
took 10 min a day and rest 16% of people take more than 10 min a day in their
daily skincare routine.
4.1.7
Money spend on skincare Total

each month
500 Rs 47
1000 Rs 27
2000 Rs 10
More than 2000 Rs 16
Grand Total 100
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Interpretation
47% of the respondents spend upto rupees 500 on skincare each month, 27%
of the respondents spend rupees 1000 on their skincare, while 10% of the
respondents spend rupees 2000 on skincare each month and the rest 16% of
the respondents spend more than 2000 rupees on their skincare each month.
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4.1.8
Concerns Total
Visible red blood vessels 3

Clogged pores 3
Pimples 29
Rough skin 24
Acne scars 17
Pigmentation sports 6
Any Other 15
Grand Total 100
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Interpretation
29% of the respondents are concerned about their pimples, 24% of
respondents are concerned about their rough skin, while 17% of the
respondents are concerned about their acne scars, and rest of them are
concerned about pigmentation spots whereas rest of them are concerned
about any other problem.
4.1.9
Skin look and feel after daily Total

cleansing
Reddened 12
Tight feeling 19
Dry 32
None of the above 37
Grand Total 100
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Interpretation
12% of the respondents feels that their skin looks to be reddened after their
daily cleansing, 19% of people says that their skin look and feels to be tight,
32% of respondents feels that their skin look and feels to be dry after their daily
cleansing and rest 37% of them feels none of them above.
4.1.10
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Face shop advertising Total
Instagram 39
You Tube 16
Google 15
Facebook 9
Any Other 21
Grand Total 100
Interpretation
39% of the respondents saw the face shop advertising on Instagram, 16% of
the respondents saw the advertising on youtube, while 15% of respondents
saw it on google, also 9% of respondents saw the advertising on facebook,
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whereas 21% of the respondents saw the face shop advertising on any other
platform.
4.1.11
Products people like the most Total
Rice water bright cleansing foam 19

White seed brightening
14
Chia seed hydro cream 18
Jesu aloe fresh soothing gel 19
Any Other 30
Grand Total 100
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Interpretation
19% of the respondents like the rice water bright cleansing foam of face shop
product, 14% of the respondents likes the white seed brightening serum of the
face shop, while 19% of the respondents likes the jesu aloe fresh soothing gel
product of the face shop, whereas 18% of the respondents likes the chia seed
hydro cream face shop product and rest 30% of them likes any other.
4.1.12
Products a bit high priced Total

Yes 58
No 42
Grand Total 100
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Interpretation
58% of the respondents find that the face shop products are of bit high priced
whereas 42% the respondents find that the face shop products are not high
priced.
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4.1.13
Products Total
Damyang bamboo fresh soothing gel 14

Cheery blossom daily perfumed hand
cream 22
Sheet masks 34
Cc cushion compacts 12
Any Other 18
Grand Total 100
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Interpretation
14% of the respondents choose damyang bamboo fresh soothing gel that they
wanna try from face shop because of the hype created due to social media
marketing, 22% of the respondents choose cheery blossom daily perfumed
hand cream, while 34% of the respondents choose sheet masks, whereas 12%
of the respondents choose cc cushion compacts that they want to try from face
shop and the rest 18% of the respondents choose any other.
4.1.14
Scale Total
1 11
2 18
3 31
4 27
5 30
Grand Total 100
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Interpretation
31% of the respondents ranked the face shop at No.3, 27% of the respondents
ranked face shop at No.4, while 13% of the respondents ranked the face shop
at No.5, also 18% of the respondents ranked the face shop at No.2, whereas
11% of the respondents ranked the face shop at No.1 when compared to
different skincare brands like biotique, klairs, plum etc.
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HYPOTHESIS TESTING
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4.2 HYPOTHESIS TESTING:

T – Test
Group Statistics
Group A N Mean Std. Deviation Std. Error Mean
Group B 1 47 3.19 1.439 .210
2 53 3.08 .917 .126
Independent Samples Test
Levene's Test for

Equality of
Variances t-test for Equality of Means
Std. 95% Confidence
Mean Error Interval of the
Sig. (2- Differenc Differenc Difference
F Sig. t df tailed) e e Lower Upper
Group B Equal variances 16.686 .000 .486 98 .628 .116 .239 -.357 .590
assumed
Equal variances .474 76.31 .637 .116 .245 -.372 .604
not assumed 6
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T test was conducted to check if there was significant difference between the
male and female customers of face shop on the brand’s rating scale from 1 to
5. Since p is more than p>0.05, H0 is accepted and hence it is proved that
there is no significant difference between the male and
female customers of face shop on the brand’s rating scale from 1 to 5.
RESULTS AND FINDINGS
Since p is more than p>0.05, H0 is accepted and hence it is proved that there
is no significant difference between the male and female customers of face
shop on the brand’s rating scaling from 1 to 5.
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CHAPTER 5
RESULTS AND
DISCUSSIONS
5.1 Major findings

5.2 Discussion and Suggestion
5.3 Conclusion
5.1 MAJOR FINDINGS:

From the data analysis and data interpretation following findings have emerged
1. Majority of the respondents fall in the category of females
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2. Majority of the respondents are under the age group of 18-35
3. Most of the respondents look for rich and nourishing texture in a skin care product
4. The majority of the respondents do not purchased the face shop product based on social
media influences either in store or online
5. Most of the respondents have dry skin as well as combination skin type are products that
they are currently using
6. Majority of the respondents took 5 min a day for their daily skincare routine
7. Most of the respondents spend Rupees 500 on skincare each month
8. Majority of them concerns to have pimples
9. Most of the respondents choose none of the above that how their skin look and feel after
their daily cleansing
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10. Majority of the respondents saw the face shop advertising on Instagram
11. Most of them choose any other face shop product that they like the most
12. Majority of the respondents found that the face shop products a bit high priced
13. Most of the respondents choose sheet masks product that they want to try from the face
shop because of the hype created due to social media marketing
14. Majority of the respondents ranked the face shop at No.3 when compared to different
skin care brands like biotique, klairs, plum, etc
5.2 DISCUSSION AND SUGGESTIONS:

From this research it is suggested that because of less outlets product reach is less so it
will become difficult for customers to buy from one shop so they should improve that. It
is suggested that they should improve their low brand awareness because of less use of
outdoor advertising. Low level of insight in many smaller regions. The face shop products
should reduce bit of their charges so that it is affordable for everyone to buy. They should try to
communicate more effectively with their customers by keep them updated or informed always.
5.2 CONCLUSION:
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According to this research project, the face shop products have more of favorable than
unfavorable effect as the majority of the respondents are more pleased than had a little bit of
disappointment with some other factors. It has been noticed that a majority of participants
believed that the face shop products makes the natural products as they are inspired by nature
offers variety to meet the all. The company emphasizes its natural goods. Easy, alluring and
functional products with fresh smelling packaging. It has been found that the respondents are
unsure if they can trust the commitment of these face shop products with their customer base,
they believe that because of less outlets product reach is less so it will become difficult for
customers to buy from one shop. They believe they have a bit high priced of their products.
It is mainly observed that the face shop product have more of positive impact than a negative on
the face shop products. The face shop use of Korean celebrities helps in attracting younger
consumers in buying the products. It is also concluded that consumers are responding positively
to the products they have been trying new differentiation game plan in the cosmetic industry.
ANNEXURE
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A study on Building of a Brand image through various Social Media

Marketing with special reference to THE FACE SHOP
Name (Optional)
-----------------------------
Email
------------------------------------------------------------------------------
Gender
o Male
o Female
Age
o 12-18
o 18-35
o 35-50
o Above 50
What are you looking for in a skin care product?
o Fast-absorbing
o Rich and nourishing texture
o Nice scent
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Have you ever purchased the face shop product based on social media
influences? Either in store or online.
o Yes
o No
For which skin type are the products you are currently using?
o Dry skin
o Combination
o Oily
o Sensitive
o Normal skin
How long does your daily skincare routine take?
o 5 min a day
o 10 min a day
o More than 10 min
How much do you spend on skincare each month?
o 500 Rs
o 1000 Rs
o 2000 Rs
o More than 2000 Rs
What are your concerns?
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o Visible red blood vessels
o Clogged pores
o Pimples
o Rough skin
o Acne scars
o Pigmentation spots
o Any other
How does your skin look and feel after your daily cleansing?
o Reddened
o Tight feeling
o Dry
o None of the above
Where do you see the face shop advertising?
o Instagram
o You tube
o Google
o Facebook
o Any other
Which face shop product do you like the most?
o Rice water bright cleansing foam
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o White seed brightening serum
o Chia seed hydro cream
o Jesu aloe fresh soothing gel
o Any other
Do you find shop products a bit high priced?
o Yes
o No
Please select any one product you wanna try from face shop because of the
hype created due to social media marketing?
o Damyang bamboo fresh soothing gel
o Cheery blossom daily perfumed hand cream
o Sheet masks
o Cc cushion compacts
o Any other
At what rank would you keep face shop when compared to different skincare
brands like biotique, klairs, plum?
o 1
o 2
o 3
o 4
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REFERENCES
https://www.researchgate.net/publication/334706484_AN_INTRODUCTION_TO_BRAND_BU
ILDING_VIA_SOCIAL_MEDIA
https://www.theseus.fi/bitstream/handle/10024/44591/Christine.A.Odhiambo.pdf?sequence=1
https://label.averydennison.asia/content/dam/averydennison/lpm/na/en/doc/home/resource%20ce
nter/case%20studies/CS_THEFACESHOP/AD_LPM_CS_THEFACESHOP.pdf
https://www.slideshare.net/karmaine/thefaceshop
https://www.researchgate.net/publication/339200252_The_Face_Shop_The_Market_Leader_Tra
nsforming_the_Landscape_of_the_Korean_Cosmetics_Industry
https://www.academia.edu/23192200/Marketing_and_Consumer_Behaviour_for_TheFaceShop
195 | P a g e
DIGITAL PLATFORMS INFLUENCE LUXURY
PURCHASE BEHAVIOR OF HENRYs IN INDIA
Research Project Submitted in Partial Fulfillment of the Requirements for

the Degree of
BCOM Honours
By
Yashraj Singh Sisodiya
To the
April, 2021
Submitted by : Guided by :
Yashraj Singh Sisodiya Dr. Geetanjali Shrivastava
Associate Professor
CERTIFICATE
It is certified that the work contained in the project report titled “DIGITAL
PLATFORMS INFLUENCE LUXURY PURCHASE BEHAVIOR OF
HENRYs IN INDIA” by “YASHRAJ SINGH SISODIYA” has been carried
out under my/our supervision and that this work has not been submitted
elsewhere for a degree*
Name: Dr. Geetanjali Shrivastava (Associate Professor)
Department: Commerce
April, 2021
Page 197 of 401

PREFACE
Dissertation is one of the key for understanding more deeply the
concepts learned from formal education by going through practical
practices being adapted by organizations. It is essential requirement for
each and every student to have some practical exposure towards real
world situations. A systematized practical experience is there to
inculcate self confidence in a student to prepare him for today’s
competitive era.
With immense pleasure and deep sense of sincerity, I am worked on this
dissertation. During this dissertation, I believe that I learned the multiple
dimensions of HENRYs consumers and luxury purchase behaviours.
Page 198 of 401

DECLARATION
I hereby declare that this project report entitled “DIGITAL PLATFORMS
INFLUENCE LUXURY PURCHASE BEHAVIOR OF HENRYs IN INDIA”
was carried out by me for the degree of BCOM Honours under the
guidance and supervision of Dr. Geetanjali Shrivastava (Associate
Professor) of Department of Commerce, BSSS College. The
interpretations put forth are based on my reading and understanding of
the original texts and they are not published anywhere in any form. The
other books, articles and websites, which I have made use of are
acknowledged at the respective place in the text. This research report is
not submitted for any other degree or diploma in any other University.
Place: Bhopal
Name of the Student: Yashraj Singh Sisodiya
Class & Section: B.com (Hons.) 3rd year “C”
Date: April,2021
Page 199 of 401

ACKNOWLEDGEMENT
I would like to thank our Principal Dr. Fr. John P.J. and Vice Principal Dr
Sr Sonia Kurien for their immense support and blessings. I thank our HOD
Dr Amit Kumar Nag for his support. I would like to express my special
thanks of gratitude to my research guide Dr Geetanjali Shrivastava,
Associate Professor of Department of Commerce for her valuable
suggestions and guidance and for giving me the golden opportunity to do
this wonderful research project on the topic: Digital platforms influence
luxury purchase behavior of henry’s in India, Without her help it would
have been difficult for me to have reached this state of completion of my
project report. Also, I would like to thank my parents and friends who
helped me a lot in the preparation of this project.
I am making this project not only for Marks but to also increase my
knowledge.
THANKS AGAIN TO ALL WHO HELPED ME.
Page 200 of 401

Contents
Chapter One: Introduction........................................................................................................ 202
1.1 Facts: Luxury Market Globally ......................................................................................................... 203
1.2 Emergence of a new luxury segment – the HENRY’s ....................................................................... 205
1.3 Who are the HENRYs?...................................................................................................................... 205
1.4 Luxury products market outlook in India......................................................................................... 206
1.5 Source of information: Tommy Hilfiger & Calvin Klein .................................................................... 206
Chapter Two: Review of Literature ....................................................................................... 208

2.1 Studies on Digital Platforms Influence On Luxury Purchase Behavior ............................................ 209
Chapter Three: Research Methodology .............................................................................. 215

3.1 Need of the study ................................................................................. Error! Bookmark not defined.
3.2 Objectives of the Study- .................................................................................................................. 216
3.3 Research Methodology .................................................................................................................... 216
Chapter Four: Data representation & Analysis ............................................................... 217

Hypothesis Testing................................................................................................................................. 226
I Hypothesis ........................................................................................................................................... 226
II Hypothesis .......................................................................................................................................... 228
Chapter Five: Results & Discussion ....................................................................................... 231
5.1 Theoretical Contributions and Managerial Implications ................................................................. 232
5.2 Limitations of the study ................................................................................................................... 232
5.3 Conclusion........................................................................................................................................ 233
REFERENCES ........................................................................................................................................... 233
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Chapter One: Introduction
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1.1 Facts: Luxury Market Globally
Globally, luxury sales are expected to reach US$1.5 trillion by 2025, with India and China
being the leading emerging market. The Indian luxury market, growing by double digits, will
reach US$30 billion and increase by ~5% annually. Luxury brand awareness is high among
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the Indian consumers as they are educated and have developed high spending habits.
Because of resources and interest, luxury brands are explored extensively by consumers
through digital media. To do so, Internet availability becomes imperative. In India, the ‘young
Indians' are tech savvy and like to experiment with luxury brands. Due to rapid economic
expansion and the continuing growth of young digital consumers, there has been an
exponential growth in social media usage. This segment will surpass the revenue of those in
many developed nations within a decade. More specifically, however, globalization and
digitalization have further increased the complexity involved in understanding luxury sales and
branding.
More specifically, the research on luxury products has focused on different emerging areas
such as levels of luxury, experience and purchase, evaluation of luxury brands perception,
online luxury challenges, experiential luxury, luxury buying behaviour, and, luxury brands on
websites, some conceptual pieces on luxury branding and digital platforms such as luxury
branding and design, trends in digital luxury, mobile and luxury branding and digital
selfbranding and luxury branding. More scholarly work and papers are clearly needed on
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social media consumption patterns vis-à-vis luxury brands and the role of these platforms on
luxury purchases. Based on a thorough review, no studies were found that dealt with luxury
branding and digital platforms for this promising, new and emerging segment of digital
consumers.
In an age of fast changing trends, luxury companies have started to keep an eye on a new
consumer class that is rising nowadays and is going to become increasingly relevant in the
future: the HENRYs (High-Earners-Not–Rich-Yet). In addition, companies are committing
to make significant investments in stimulating the interest of the younger segments of the
population, namely Millennials and Gen Z: the customers of the future.
Since these ‘new’ tech savvy generations look for individualized, seamless brand
relationship, brands are investing worldwide to market digitally, increasingly using social
media to engage with these consumers.
Meanwhile, companies are also re-examining the value of brand heritage and brand history
for their customers. Consumer demand has become the core focus of the business, hence
the adoption of an Omni-personal approach, irrespective of the choice of channel.
To do that, they rely more and more on digital technologies, such as Artificial Intelligence
(AI) and Big Data, which are helping them in redesigning customer engagement techniques
through data analytics.
In this path between the old and the new, they are facing customers' increasing sensitivity
towards privacy but are trying to convert it into an opportunity to offer more personalized
products and services to their customer base.
1.2 Emergence of a new luxury segment – the HENRY’s

Luxury brands have started to initiate and sustain longstanding relationships with a new
consumer class who is likely to become or remain affluent or ultra-affluent in the future. A
new consumer class has started to rise recently and is likely going to be very relevant in the
future, especially for luxury brands: the HENRYs (High-Earners-Not–Rich-Yet). Currently,
they have a significant discretionary income and are highly likely to be wealthy in future.
HENRYs earn between US$100,000 and US$250, 0001 though according to Equifax’s much
broader definition, HENRYs are aged on average 43, with an income of more than
US$100,000 and investable assets of less than US$1 million. HENRYs are digital savvy,
love online shopping and are big spenders, in particular the Millennial HENRYs. With
HENRYs likely to become some of the wealthiest members of society, the potential benefits
of on boarding this demographic to luxury brands' product and service portfolio are twofold:
securing valuable present customers and building client relationships and business with
those most likely to be amongst the most affluent consumers in future.
Therefore, luxury brands wishing to target HENRYs must offer inclusive, yet individualized
and self-expressive products. As HENRYs are a critically important customer segment, loyalty
could be built by endorsing their core values, such as authenticity, reliability, commitment to
do the right thing, and following sustainable practices. Consequently, brands have started to
deliberately focus on values shared by this aspirational demographic. Finally, since HENRYs
are heavily influenced by modern technology and use of social media to form their buying
decisions, luxury brands have started to engage with these customers by leveraging on social
media platforms.
1.3 Who are the HENRYs?

Millennial reject the stereotypes of traditional wealth and looks for new values to define
status – from social connections to insider knowledge. They are likely to make value-based
acquisitions and purchases. Luxury weaves its way through their experiences, free time,
travel, community, self-growth and security. Keen to express their entrepreneurial spirit,
individuality and self-made success, they are in search of luxury brands that are aligned with
their personal values, and that provide a seamless digital experience. They have an
expectation for fast, tailored service, in both the physical and digital realms.
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• HENRYs are the group of people, mostly millennial, who earn between 100000 INR to
250000 INR but feel broke. Millennial have a penchant for lavish lifestyle, but when
combined with student loan debt and living costs, there’s not much left over for wealth
building. Average age of HENRYs in India is 32 to 40 years. Average incomes of
HENRYs are 135000 INR and have less than 1 million investable assets.
• Credit Preference: HENRYs prefer to pay online with mobile devices. They prefer
credit/debit cards with rewards (cash backs, airline miles, offers, etc.). Since they are not
into savings so they prefer to have loans (car, mortgage, health, home, etc.).
1.4 Luxury products market outlook in India

The luxury products market in India continues to experience a high growth rate, with a rising
disposable income segment supplementing purchasing decisions that are enabled by the
power of technology. Markets beyond the major metros and a growing number of HENRYs
((High-Earners-Not–Rich-Yet) spending on luxury goods are largely responsible for the
growth of this market. The next few years are going to be dynamic for the Indian luxury
market with increasing growth and competition seen especially in the ‘bridge to luxury'
segment. Traditional ‘definitions’ and ‘characteristics’ of luxury are evolving, thereby creating
new opportunities for both existing players and entrants.
While the usual challenges like quality staff and real estate remain, many players are
changing their business models or strategy to overcome these. As a result, there is
significant investment in boutique stores by luxury brands in luxury malls or hotels or by
forming a joint venture with a local distributor. The sector is also seeing the ever increasing
emergence of Indian players who have created a niche for themselves in the luxury segment
by leveraging the traditional Indian strengths in areas such as arts, crafts and medicines. If
the luxury market is to continue to achieve these gains there will need to be political stability
following the 2019 national elections, support from the government to address the barrier of
import duties, and stabilisation of the Indian rupee versus the US dollar.
1.5 Source of information: Tommy

Hilfiger & Calvin Klein
PVH is one of the most admired fashion and lifestyle companies in the world that power
brands that drive FASHION FORWARD – for good. Their brand portfolio includes the iconic
CALVIN KLEIN, TOMMY HILFIGER, Van Heusen, IZOD, ARROW, Speedo,
Warner’s, Olga and Geoffrey Beene brands, as well as the digital-centric True&Co. intimates
brand. They market a variety of goods under these and other nationally and internationally
known owned and licensed brands. PVH has over 38,000 associates operating in over 40
countries and generated $9.7 billion in annual revenues in 2018.That‟s the Power of Us.
That’s the POWER OF PVH.
Tommy Hilfiger is a US $6 billion apparel and retail company founded in 1985 by American
fashion designer, Tommy Hilfiger. The product line consists of men’s, women’s and
children’s apparel, sportswear, denim, and a range of licensed products such as
accessories, watches, fragrances and home furnishings. The company’s headquarters are in
Hong Kong, Amsterdam and New Jersey. Tommy Hilfiger has become a global brand with a
good distribution network in over 90 countries and operating more than 1,000 retail stores
throughout North America, Europe, Central and South America and Asia Pacific. Tommy
Hilfiger’s Indian subsidiary opened in 2004 with Arvind Brands as their partners. The
subsidiary currently operates more than 1000 stores in 98 cities and in on an expansion
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drive throughout the country. Tommy Hilfiger is the first designer wear brand to start
operations in India which provides a unique position in the market.
Tommy Hilfiger Business believes that they can further grow TOMMY HILFIGER global retail
sales through a number of product and regional initiatives, which include:
• Being consumer-centric and enhancing global brand relevance with marketing campaigns
and consumer engagement
• initiatives designed to drive growth and reflect TOMMY HILFIGER’s accessible premium
positioning and classic American cool aesthetic.
• Driving regional expansion, particularly in Asia Pacific.
• Gaining greater control of the brand by acquiring licensed businesses to operate them
directly.
• Digitizing the complete brand experience, from our stores to our online offerings.
• Evolving our supply chain to adapt more quickly to change.
• Sharpening our processes and personalizing our customer relationships as we enhance
our data capabilities.
CALVIN KLEIN is one of the world’s most recognized brands, synonymous with bold,
progressive ideals and a seductive aesthetic. Global retail sales of products sold under the
CALVIN KLEIN brands, including sales by our licensees, were approximately $9.8 billion in
2018. The CALVIN KLEIN brands provide us with the opportunity to market products both
domestically and internationally at various price points, through multiple distribution channels
and to different consumer groups. Our tiered-brand strategy provides a focused, consistent
approach to global growth and development that preserves the brand’s prestige and image.
Calvin Klein Business believes growth opportunities exist to drive further global retail sales
and improvements in operating margins of CALVIN KLEIN over time, including through:
• Being consumer-centric and enhancing global brand relevance through marketing
campaigns and consumer engagement initiatives designed to drive growth and further
resonate with youth-minded consumers.
• Commercializing the CALVIN KLEIN creative vision to drive product improvement and
expansion, particularly within men’s and women’s sportswear, performance apparel,
Jeanswear, accessories and women’s intimates.
• Expanding our distribution by increasing our digital businesses and growing our presence
in specialty stores.
• Identifying operating efficiencies across the business to drive improvements in our
operating margins.
• Sharpening our processes and personalizing our customer relationships as we enhance
our data capabilities.
• Enhancing our supply chain to react more quickly to emerging business trends.
• Gaining greater control of the brand by acquiring licensed businesses to operate them
directly.
This is especially the case with respect to the TOMMY HILFIGER and CALVIN KLEIN
brands, as these brands enjoy significant worldwide consumer recognition and their
generally higher pricing (as compared to other heritage brands) provides significant
opportunity and incentive for counterfeiters and infringer.
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Chapter Two: Review of
Literature
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2.1 Studies on Digital Platforms
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Influence On Luxury Purchase
Behavior
# Title Author (s) Study Purpose Relevant Findings Further Scope
1 Discovering Don E. To understand the Individual self is

India's three Schultz & perception, affected by internal
levels of luxury Varsha Jain orientation, and motives and thus
consumption: levels of luxury influences individual
An exploratory consumption as they luxury consumption.
research to find are Digital self affects the
a related to the networks of motive and
conceptual concept of self. relationships and
framework thereby impacts
interactive luxury
consumption and
behaviour.
2 Consumerbased Ridwan To explore the role of Brand followership,

brand Adetunji social media increasing brand
equity (CBBE) Raji, communications on image and awareness,
and the Sabrina automotive brands. recall, and recognition
role of social Mohd are underscored as the
media
Rashid & major implications of
communication
s: Qualitative Sobhi Mohd social media
findings from Ishak communications on
the Malaysian brand equity.
automotive
industry
3 Endorser Rana Sobh To study the The use of local models Future research
ethnicity & Khaled moderator (minority should consider
impact on Soltan effects of product group) larger samples
advertising type (utilitarian Is also likely to result in from these different
effectiveness: versus hedonic more positive ethnicities and
effects of the product) and responses among examine how
majority vs. product ethnic foreigners (majority different ethnic
minority orientation (ethnic group) if the advertised groups within the
status of the oriented versus product is hedonic. foreign population
global product) for would respond to
target audience
both, the endorsers from
minority and their own ethnicity
mainstream groups as compared to
local endorsers
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4 How digital Varsha Jain & To explain how Pre-purchase is digital
It would be
platforms Don E. digital platforms and hedonic, purchaseparticularly
influence Schultz influence is experiential and interesting to
luxury consumers' decision enjoyable while digital
conduct studies on
purchase for media is used and the influence of
Behaviour in Luxury brands in postpurchase is basedpeers and friends
India? India. on aspirations,
on the purchase
lifestyles and virtual
networks. decision made
More importantly, about luxury
these consumers are products as they
always connected to seem to have a
reference significant role to
groups digitally who play in the product
significantly affect buying and
postpurchase
process.
5 Opening the B. Sung, To examine the psychophysiological Further research is
‘black box’ of I. Phau & V. feasibility of using methods can provide necessary to
luxury C. Duong psychophysiological valuable insights identify factors that
consumers: An methods to about luxury may evoke anger
application of measure luxury consumebe' emotional in a luxury
psychophysiolo consumers' process beyond those marketing context.
gical method emotional processes captured by self-report
This is an
beyond those
measures. important future
captured by
selfreport research direction
measures. as it will provide
valuable insight to
marketers to better
manage
consumers'
negative emotional
reaction toward
luxury brands.
6 Understanding Eunsun Lee, To impact of cultural Perceived quality value Future research
the moderating Steven M. differences on young had a more powerful should examine
effect of Edwards, consumers' attitudes effect on the role of unique
motivational Seounmi and purchase individualists' and hedonic
values on Youn & intentions toward purchase intention values in
young Taiwoong luxury brands. compared with that of accounting for
consumers' Yun collectivists. prestige-seeking
responses to behaviours in a
luxury brands: cross-cultural
A crosscultural study.
study
of South Korea
and the USA
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7 What and how Bikram Jit To investigates the Corporate associations Future research
to Singh Mann differential impact of do not always have a may investigate
communicate & Mandeep various relevant positive effect on the whether corporate
about a Kaur corporate brand consumers; under brand associations
corporate Ghuman associations on certain circumstances, are more likely to
brand with the consumers’ influence consumer
these might either
consumers: An cognitive (product purchase behaviour
have no effect or have
attitude and when these are
exploratory a negative effect on
purchase intention) more salient in their
study the consumers.
and minds. Further, this
affective responses suggests that
(affective corporate marketers should
commitment) in the communicate with
three sectors, the consumers the
namely durables, relevant and
services and fast sufficiently detailed
moving information about
consumer goods. corporate brand
associations, so
that these become
accessible and
diagnostic in the
minds of the
consumers.
8 Consumer Huynh Thi To investigate how The findings clarify our Future research
participation in Xuan Mai personal values and understanding of how may investigate
virtual & Svein personality jointly personal values and other potentially
communities: Otta Olsen influence personality differently interesting values
The role of consumers' predict consumer and traits in this
personal values attitude and participation in virtual
study’s framework.
and personality behaviour communities, and
towards their confirm the role of
participation in personal values and
virtual communities the
VAB model in
explaining this
phenomenon.
9 Do low R. K. To examine the role Low involved products Future product
involved Srivastava of the product get more mileage from placement studies
brands have placement in the film product placement. should take this
better on purchase fact into
consumer intention, attitude consideration by
perception due and change in taking a particular
to product perception. brand placed in
placement in
films with the
emerging
targeted
markets?
consumers.
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10 Disruptions in Tushar Oka, To find the The ability to collect,
Retail through Sachi Ghai, opportunities process and share
Digital Prasanna presented by digital large quantities of data
Transformatio Venktesan, and is primarily has led to some
n : Digital Aditya driven by a low risk fundamental
Transformatio Bagri propensity to disruptions in the
n allocate scarce design of business
Reimagining resources to models.
the Store of the what can be a
Future fundamental
disruptor to
the business model
of retailers.
11 Utilitarian, Weichen To identifies the Epistemic value is the Further research or

hedonic, Teng premium value most important driver cross-validation
collecting, hierarchy that drives behind making a studies are
epistemic, and attractiveness premium reward suggested in
high from the consumer’s attractive, which in countries with
values as perspective. turn, raises customers' wider
determinants and more varied
brand attitude toward
of the samples and using
the retailer and
attractiveness a more
purchase intention in representative
of
premium the retailer’s stores. data-set in Taiwan
promotions to address this
sampling bias and
account for the
moderating
variables.
12 Industry 4.0 : Herald To identify today’s Successful companies
Opportunities Dutzler et R&C environment is will see this
and al. marked by huge transformative period
challenges for changes in as an opportunity to
consumer technology, both grow revenue and
product and consumer profits in the short term
retail preferences, sales and redesign their
companies channels, organizations for the
marketing next industrial
approaches,
revolution in the long
barriers to entry,
term.
and supply
chain and logistics
strategies. No
company in this
sector can afford to
ignore these massive
shifts.
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13 What triggers Jun Heo & To evaluate how Findings showed that Future research
young Sidharth consumers’ EC level EC (i.e. attitudinal could replicate the
Millennials to Muralidhara mediates the outcome) mediated the current study using
purchase n relationship between relationship between both younger and
ecofriendly knowledge and socialization agents older Millennials.
products?: the ECCB as well as (i.e. family and peers) Also, a longitudinal
interrelationshi PCE and ECCB and green buying study of younger
ps among behaviour. Millennials could
knowledge, Communicating with reveal whether the
perceived peers and family findings of the
consumer members about green current study are
effectiveness, consumerism could dependent on age
and elevate one’s concern
or specific to this
environmental for the environment,
further inducing eco- particular cohort.
concern
friendly buying
behaviour.
14 Global Powers Marzia To discuss the key Italy was once again
of Luxury Casale, trends shaping the the leading luxury
Goods 2019 : Venessa luxury market and goods country in terms
Bridging the Lee, Valeria provides a global of the number of
gap between Scaramuzzi, economic outlook. companies, but it still
the old and
Pranasha faces growth
new
Sahu, challenges; France
Abhilasha was the best-
Singh, Lisa performing country in
Su, terms of sales growth
Frances and also contributed
Trought and the largest share to the
Annie Wal Top 100 luxury goods
sales.
15 Analysing The Desiree Highlight the The luxury landscape Further studies and
Personal Gonsalves relatively new is experiencing strong analysis on this
Luxury Goods market that has evolutionary subject could focus
Market In opened up in luxury undercurrents with on areas other than
India: Progress branding of personal changing consumer Personal Goods.
And good in India in the profiles, government
Roadblocks past decade as well policy and the way
as highlight the luxury players operate.
problems and
roadblocks peculiar
to the Indian
scenario
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Chapter Three: Research
Methodology
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3.1 Need of study
Luxury is directly associated with style, strong identity, exclusivity, high awareness and
strong emotional, hedonic and symbolic relationships in the developed nations. Many
middleclass consumers appear to have traded up to match their rising aspirations. This
meeting of aspirations leads to ‘luxuryfication’. And ‘luxuryfication’ of society has taken place
within the global context. This change has resulted in the new needs, requirements and
desires of consumers. Unfortunately, much of the literature on luxury branding focuses on
conventional consumers from the developed nations. Thus, more studies are needed on the
new, emerging and tech savvy consumers from a non-US context such as HENRYs in
developing nations.
3.2
Objectives
of the
Study-
This study goal is
• To understand the role of digital media in influencing Indian HENRYs consumers'
luxury brand purchases.
• To uncover how consumers engage with social media and how it helps in
understanding how these consumers develop strong relationships with various brands
in their repertoire.
3.3 Research Methodology

The research methodology consists of two studies conducted in Bhopal, Primary data will be
collected, and statistical measures will be taken care for achieving the objective of the study
with the help of different indicators.
• Type of research - Descriptive Research
• Data collection - Primary Sources - Survey & Observation & Secondary Sources -
Reports & Articles
• Research tool - Questionnaire
• Sample size - 30 Salespersons and other employees of Tommy Hilfiger and Calvin
Klein
• Sampling Area – Bhopal
• Sampling technique – Simple Random Sampling (Probability Sampling)
• Statistical tool – Inferential Statistics – z-test
• Scaling technique – 5-point Likert scale
• Hypothesis
I Hypothesis
 H01-Pre-purchase of the luxury product is not hedonic and digital in nature.
 Ha1- Pre-purchase of the luxury product is hedonic and digital in nature.
II Hypothesis
 H02- Post-purchase is not based on aspirations and lifestyle of the consumers that
can be displayed on virtual platforms.
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 Ha2- Post-purchase is based on aspirations and lifestyle of the consumers that
Chapter Four:
Data representation
& Analysis
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4.1 Organization
Tommy Hilfiger 15 Equal number of respondents isfrom both
Calvin Klein 15
Calvin Tommy
Klein Hilfiger
50% 50%
4.2 Designation
CRO 22 22 of the respondents are CRO (Chief Relationship Officer) and
Manager 2 others are Manager, Assistant Manager, Accountant, Sr.
Assistant Manager 2 Accountant and Visual Merchandiser i.e. major chunk of the
Accountant 1 sample belongs to direct sales to customers.
Sr. Accountant 1
Visual Merchandiser 2
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22
2 2 1 1 2
4.3 Buying Behaviour
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CROs find HENRYs and most of them can identify HENRYs by their buying behaviour.
Find Henry at workplace

0%
Yes
No
100%
Can be identified by buying behaviour
7%
Yes
No
93%
Can be differentiated between a regular

shopper and a HENRY shopper
20%
Yes
No
80%
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4
4.4 Virtual platforms influence the customer to purchase
Strongly Disagree 0
Disagree 0 Out of 30 respondents 22 respondents strongly agree that virtual
Neutral 0 platforms influence the customers to purchase.
Agree 8
Strongly Agree 22
Strongly Disagree Neutral

Disagree 0% 0%
0%
Agree
27%
Strongly Agree
73%
4.5 Customers tend to perform digital pre-purchase to know more

about the quality, style and exclusivity of the brand
0% 0% 4%
23% Strongly Disagree

Disagree
Neutral
Agree
73% Strongly Agree
 In the mentioned frequency we can clearly see that the major chunk of sales persons
responded ‘Yes’ that customers tend to perform pre-purchase to know more about the
product.
4.6 Companies prefer stylish videos and posters to influence luxury
purchase
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4
Strongly Disagree 0  The mentioned result shows out of 30
Disagree 0 respondents 23 strongly agrees that companies
Neutral 1 prefer stylish videos and posters as
Agree 7 advertisements to influence customers to
Strongly Agree 22 purchase those articles.
Strongly
Disagree
Disagree
0%
0%
Neutral
4%
Strongly Agree
73% Agree
23%
4.7 Customers wish to have the luxury brands to be elegant and

stylish as it makes them happy
0% 0%
0%
23%
Strongly Disagree
Disagree
Neutral
Agree
Strongly Agree
77%
 The mentioned result shows out of 30 respondents 23 strongly agrees that Customers
wish to have the luxury brands to be elegant.
4.8 High earning people want experiential shopping
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4
0% 0%
4%
23%
Strongly Disagree
Disagree
Neutral
Agree
Strongly Agree
73%
 Majority of the respondents believe that high earning people too want experiential
shopping.
4.9 Customers wish to indulge in luxury purchase at stores to feel the

product quality and design
0% 0%
4%
23% Strongly Disagree

Disagree
Neutral
Agree
Strongly Agree
73%
 Majority of the respondents believe that Customers wish to indulge in luxury purchase at
stores to feel the product quality and design.
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4.10 Posting pictures on social platforms also influence a luxury
purchase
Strongly Disagree 0 Majority of the respondents assume that posting pictures on different
Disagree 0 social media platforms like Facebook, Instagram, and Snapchat etc.
Neutral 0 motivate customers to purchase luxury products.
Agree 8
Strongly Agree 22
Agree
27%
Strongly Agree
73%
4.11 Luxury purchase fulfill the desire and

Strongly Disagree 0 aspiration needs
Disagree 0 The data displayed prove that luxury purchase fulfils the
Neutral 1 desire and aspiration needs of customers.
Agree 7
Strongly Agree 22
Strongly Disagree Neutral

Disagree 0% 4%
0%
Agree
23%
Strongly Agree
73%
4.12 Knowledge and understanding of customer relationship
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officer/marketers help in buying luxury products
Strongly Disagree 0 Respondents agree themselves that knowledge and understanding of
Disagree 0 sales person impacts a lot to the sale opportunity and help the
Neutral 0 customers to choose and purchase products.
Agree 7
Strongly Agree 23 Strongly Disagree Neutral
Disagree 0% 0%
0% Agree
13%
Strongly Agree
87%
4.13 Intrinsic & extrinsic cues for customers to purchase luxury

products
 These percentages are reflecting the impacts of intrinsic and extrinsic cues in luxury
purchase.
4.14 Digital purchase helps
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29%
35% Evaluate
Compare
Explore
36%
 The shown percentage clearly reflects the added benefits of digital purchase.
Hypothesis Testing
I Hypothesis
 H01-Pre-purchase of the luxury product is not hedonic and digital in nature. 
Ha1- Pre-purchase of the luxury product is hedonic and digital in nature.
z-Test: One Sample for

Means
virtual platform influence the customer to

purchase
Mean 4.5
Known Variance 25
Observations 30
Hypothesized Mean
Difference 4
Z 0.547722525
P(Z<=z) one-tail 0.291941222
z Critical one-tail 1.644853627
P(Z<=z) two-tail 0.583882443
z Critical two-tail 1.959963985
Rejection Region:
The idealized model in the figures, and thus H0, is described by a bell-shaped normal
probability curve.
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In a two-sided test the null hypothesis is rejected if the test statistic is either too small or too
large. Thus the rejection region for such a test consists of two parts: one on the left and one
on the right.
The significance level alpha is 0.005. We have one tail critical values as 1.95. That is we will
reject the H01 if the z statistics is less than -1.95 or if it is greater than +1.95.
Test Statistics:
We have z= +0.547.
P-value:
P-value of the test will be two tailed p-value which rounded gives 0.6.
if p≤α, reject H0; otherwise, if p>α do not reject H0.
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Decisions/Conclusion:
The test statistics +0.547 do not fall into the rejection region. So we will fail to reject the null
hypothesis. Using the p-value we also see that 0.6 here is greater than our significance level
0f 0.005. And that also tell us not to reject the null hypothesis.
There is not enough evidence to conclude that the pre-purchase of the luxury product is not
hedonic and digital in nature. That concludes the test.
II Hypothesis
 H02- Post-purchase is not based on aspirations and lifestyle of the consumers that
 Ha2- Post-purchase is based on aspirations and lifestyle of the consumers that can
be displayed on virtual platforms.
z-Test: One Sample for

Means
luxury post-purchase fulfil the desire and

aspiration needs
Mean 4.766666667
Known Variance 25
Observations 30
Hypothesized Mean
Difference 4
z 0.839841204
P(Z<=z) one-tail 0.200498714
z Critical one-tail 1.281551566
P(Z<=z) two-tail 0.400997427
z Critical two-tail 1.644853627
Rejection Region:
The idealized model in the figures, and thus H0, is described by a bell-shaped normal
probability curve.
Page 228 of 401

In a two-sided test the null hypothesis is rejected if the test statistic is either too small or too
large. Thus the rejection region for such a test consists of two parts: one on the left and one
on the right.
The significance level alpha is 0.005. We have one tail critical values as 1.28. That is we will
reject the H01 if the z statistics is less than -1.28 or if it is greater than +1.28.
Test Statistics:
We have z= +0.839.
P-value:
P-value of the test will be two tailed p-value which rounded gives 0.4.
if p≤α, reject H0; otherwise, if p>α do not reject H0.
Decisions/Conclusion:
Page 229 of 401

The test statistics +1.28 do not fall into the rejection region. So we will fail to reject the null
hypothesis. Using the p-value we also see that 0.4 here is greater than our significance level
0f 0.005. And that also tell us not to reject the null hypothesis.
There is not enough evidence to conclude that post-purchase is not based on aspirations
and lifestyle of the consumers that can be displayed on virtual platforms. That concludes the
test.
Page 230 of 401

Chapter Five:
Results & discussion
Page 231 of 401

5.1 Theoretical Contributions and
Managerial Implications
• This study clearly defines that luxury brands should focus on the subtle and hedonic
attributes at the pre-purchase stage.
• Managers need to focus on the quality, aesthetics and personalization of brands as they
drive the consumers toward product purchase.
• Brand managers have to emphasize identity, personality, satisfaction and happiness as
consumers look for these elements while purchasing the products.
• Consumers also focus on their self-identity while buying luxury brands. Thus, luxury
marketers should focus on the persona of the luxury brands through visual identity and
familiar brand imagery.
• Luxury brand managers should also understand that consumers believe that these
product purchases should occur in experiential and pleasant purchase situations.
• Consumers may extensively use virtual platforms for pre-purchase and post-purchase.
However, they might want to buy the luxury brands physically from the stores as they
would like to indulge in the ‘luxury world’.
5.2 Limitations of the study

The study conducted was only limited to one city of India. Due to time and convenience
constraints, this study includes limited parameters related to the purchasing of luxury
products. This study includes only two luxury brands as a sample for study e.g. Tommy
Hilfiger and Calvin Klein. The other brands can be included in the study.
Page 232 of 401

5.3 Conclusion
This study on digital purchase influence on luxury products have provided a more clear
understanding of a new consumer class that is rising nowadays and is going to become
increasingly relevant in the future: the HENRYs (High-Earners-Not–Rich-Yet). This study
was focused to understand the role of digital media in influencing Indian HENRYs
consumers' luxury brand purchases and how it is helping consumers to engage with social
media with a understanding of developing strong relationships with various brands in their
repertoire by these consumers. Current findings suggest that the pre-purchase of luxury
product is hedonic and digital in nature. However it can vary for various segments and for
different preferences of customer. It can also vary for the same of different countries like
middle class customers of developed and developing countries. Post-purchase is based on
aspirations and lifestyle of the consumers that can be displayed on virtual platforms. Many
middle-class consumers appear to have traded up to match their rising aspirations. This
meeting of aspirations leads to ‘luxuryfication’. And ‘luxuryfication’ of society has taken place
within the global context. This change has resulted in the new needs, requirements and
desires of consumers.
REFERENCES
• B. Sung, I. P. (2019). Opening the ‘black box' of luxury consumers: An application of
psychophysiological method. Journal of Marketing Communications, 20.
• Deloitte. (2019). Global Powers of Luxury Goods 2019. Globally: Deloitte Touche
Tohmatsu Limited.
• Eunsun Lee, S. M. (2014). Understanding the moderating effect of motivational
values on young consumers' responses to luxury brands: A cross-cultural study of
South Korea and the USA. Journal of Marketing Communications.
• Ghuman, B. J. (2015). What and how to communicate about a corporate brand with
the consumers: An exploratory study. Journal of Marketing Communications, 21.
• Gonsalves, D. (2016). Analysing the Personal Luxury Goods Market In India:
Progress And Roadblocks. IOSR Journal of Business and Management (IOSR-JBM).
• Jain, D. E. (2015). Discovering India's three levels of luxury consumption: An
exploratory research to find a conceptual framework. Journal of Marketing
Communications.
• Jain, V. (2017). Luxury: Not for Consumption but Developing Extended Digital Self.
Journal of Human Values.
• Lalwani, D. (2016). Young consumers online and offline channel purchase behaviour.
ARCADA.
• Muralidharan, J. H. (2017). What triggers young Millennials to purchase eco-friendly
products? the interrelationships among knowledge, perceived consumer
effectiveness, and environmental concern. Journal of Marketing Communications.
• PWC. (2020). Industry 4.0: Opportunities and challenges for consumer product and
retail companies. PWC Strategy& analysis.
• Ridwan Adetunji Raji, S. M. (2018). Consumer-based brand equity (CBBE) and the
role of social media communications: Qualitative findings from the Malaysian
automotive industry. Journal of Marketing Communications.
• Romaniuk, J. (2010). Brand attributes – ‘distribution outlets’ in the mind. Journal of
Marketing Communications.
• Schultz, V. J. (2016). How digital platforms influence luxury purchase behaviour in
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India? Journal of Marketing Communications.
• Stastica. (2020). Retrieved from Stastica Outlook of global luxury sales.
• Teng, W. (2018). Utilitarian, hedonic, collecting, epistemic, and high values as
determinants of the attractiveness of premium promotions. Journal of Marketing
Communications.
• Yazıcı, B. (2016). Attitudes Of Generation Y Towards Luxury Products And YouthLed
Change In Luxury Consumption Behaviour. The Turkish Online Journal of Design, Art
and Communication.
ANNEXURE
QUESTIONNAIRE SURVEY
Survey on digital platforms influence luxury purchase behaviour of HENRYs in India
I am Yashraj Singh Sisodiya pursuing B.com honours third year from the Bhopal school of
social sciences . This survey is undertaken as a part of our curriculum . Kindly co-operate by
giving true responses to the following questions.
* Required
1.Name *
_________________________________
2.Email address *
_________________________________
3.Contact no.
__________________________________
4.Age *
___________________________________________
5.Gender *
Mark only one oval.
 Female
 Male
 Prefer not to say
Page 234 of 401

 Other
6.Organization *
Mark only one oval.
 Tommy Hilfiger
 Calvin Klein
7.Designation *
Mark only one oval.
 CRO
 Manager
 Assistant Manager
 Accountant
 Sr. Accountant
 Visual Merchandiser
8.Buying Behavior *
Mark only one oval per row.
Yes No
Find Henry at workplace ⚫ ⚫

Can be identified by buying behaviour ⚫ ⚫
Can be differentiated between a regular shopper and a HENRY shopper ⚫ ⚫
9.Virtual platforms influence the customer to purchase *

Mark only one oval.
 Strongly disagree
Page 235 of 401

 Disagree
 Neutral
 Agree
 Strongly agree
10.Customers tend to perform digital pre-purchase to know more about the quality, style
and exclusivity of the brand *
Mark only one oval.
 Disagree
 Neutral
 Agree
 Strongly agree
11.Companies prefer stylish videos and posters to influence luxury purchase *

Mark only one oval.
 Disagree
 Neutral
 Agree
 Strongly agree
12.Customers wish to have the luxury brands to be elegant and stylish as it makes them
happy *
Mark only one oval.
 Disagree
 Neutral
Page 236 of 401

 Agree
 Strongly agree
13.High earning people want experiential shopping *

Mark only one oval.
 Strongly agree
 Agree
 Neutral
 Disagree
 Strongly Disagree
14.Customers wish to indulge in luxury purchase at stores to feel the product quality and
design *
Mark only one oval.
 Disagree
 Neutral
 Agree
 Strongly agree
15.Posting pictures on social platforms also influence a luxury purchase *

Mark only one oval.
 Disagree
 Neutral
 Agree
 Strongly agree
16.Luxury purchase fulfill the desire and aspiration needs *
Page 237 of 401

Mark only one oval.
 Disagree
 Neutral
 Agree
 Strongly agree
17.Knowledge and understanding of customer relationship officer/marketers help in buying

luxury products *
Mark only one oval.
 Disagree
 Neutral
 Agree
 Strongly agree
18.Digital purchase helps *

Mark only one oval.
 Evaluate
 Compare
 Explore
Page 238 of 401

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A COMPARATIVE ANALYSIS BETWEEN SHOPPERS STOP LTD.

Submitted by: Guided by:

Ms. Yaashi Ahuja Dr. Geetanjali Shrivastava

B.Com Honors Assistant Professor

Signature of Supervisor: .................

Name : Dr. Geetanjali Shrivastava

Bhopal School of Social Sciences

Name of the Student: Yaashi Ahuja

1 Introduction of the Topic 7-11

1.1 Rationale of the Study 8

1.2 Indian Retail Industry 9

1.3 Introduction to Shoppers Stop Ltd. and

Trent Ltd. 9-11

1.4 Justification of the Study 11

2 Review of Literature 12-17

2.1 International Reviews 13-15

2.2 National Reviews 15-17

3 Research Methodology 18-20

3.1 Objectives of the Study 19

3.2 Research Hypothesis 19

3.3 Scope of the Study 19

3.4 Source of Data 19

3.5 Limitations of the Study 19-20

4 Data Analysis 21-54

4.1 Data Representation and Interpretation 20-50

4.2 Hypothesis Testing 51-54

5 Results & Discussions 55-57

5.1 Major Findings 56

5.2 Discussions & Suggestions 56-57

Introduction of the Topic

1.1 Rationale of the Study

1.2 Indian Retail Industry

1.3 Introduction to Shoppers Stop Ltd. and Trent Ltd.

1.4 Justification of the Study

1.1 Rationale of the Study

1.3.1 Shoppers Stop Ltd.

1.3.2 Trent Ltd.

1.4 Justification of the Study

2.1 International Reviews

2.2 National Reviews

2.1 International Reviews

3. Demirgüneş, Kartal. (2016). The Effect of Liquidity on Financial Performance:

4. Savio, Riccardo. (2021). Organizational behavior and firm performance: A study of

2.2 National Reviews

1. Chellasamy, P. & Nagaling, Ponsabariraj. (2013). Profitability and trend analysis of

2. Roy, Satyajit. (2011). An Overview of Retail Industry in India: Its Growth,

3. Athanassopoulos, Antreas. (1995). Performance improvement decision aid systems

5. Kumar, Nilesh. (2021). An Overview of Emerging Technologies in the Indian Retail

7. Dash, Sakti & Swain, Rabindra. (2020). DETERMINANTS OF CORPORATE

9. Bhanawat, Hemant. (2018). Financial Performance of Indian Cement Industry: Study

3.1 Objectives of the Study

3.2 Research Hypothesis

3.3 Scope of the Study

3.4 Source of Data

3.5 Limitations of the Study

3.1 Objectives of the Study

 To analyze the short-term solvency of Shoppers Stop and Trent Ltd.

 To determine the long-term solvency position of the companies.

 To analyze the overall efficiency of both companies.

 To examine the profitability of Shoppers Stop and Trent Ltd.

3.2 Research Hypothesis

3.3 Scope of the Study

3.4 Source of Data

3.5 Limitations of the Study