Financial Statement Analysis of ICICI Bank and a Comparative study with Axis Bank.

Submitted By: Sridhar Kar Roll No: U210049

ICICI bank is the second largest Bank in India and Third largest in market
capitalization. Bank has a presence in 19 countries with 2528 branches and over
8000 ATMs. Products- Corporate banking, Finance & Insurance, Investment Banking,
Mortgage loan, Private banking & Wealth Management. Revenue: USD 13.82 Billion
Profit: USD 1.66 Billion Total Asset: USD 119.69 Billion Total Equity: USD 12.21
Billion Employee: 80000

Source of Information:     Director’s report Management Discussion and Analysis

Schedule and notes of FS Auditor’s Report

Techniques used for FSA

  

Horizontal Analysis: It is a comparative information for the current year as well

as previous year. Trend Analysis: It is a calculation of percentage change in the
Financial Statement items for a number of successive years. Ratio Analysis: It is a
establishment of relevant financial relationship between components of financial
statements. Financial ratios are the indicators of company’s financial health.

Profitability Ratio: It measures the degree of operating success of the company. 

  Profit Margin Ratio Ratio Asset Turnover Ratio Earnings per share Ratio
Profit Margin Ratio Net Profit/Revenue It measures the amount of net profit earned
by each rupee of revenue. Year 2011 2010 Asset Turnover Ratio Revenue/ Average
Total Asset It measures firm’s efficiency in utilizing its assets. Year 2011 2010
Earning Per Share NPAT+Peference Dividend/No. of Equity Shares EPS is useful in
comparing companies’ performance Year 2011 2010 Solvency Ratio 1.It indicates the
business is affected by the extent of the debt used to finance the asset of the
company. 2.The presence of heavy debt in a company’s capital structure is thought
to reduce the companies solvency because debt is more risky than Equity ICICI BANK
44.72 34.94 AXIS BANK 81.35 66.16 ICICI BANK 0.15 0.16 AXIS BANK 0.21 0.16 ICICI
BANK 8.66% 6.46% AXIS BANK 7.29% 7.14%
    

Debt-to-Equity Ratio Interest Coverage Ratio Credit-to Deposit Ratio NPA Ratio CASA
Ratio

Debt-to-Equity Ratio Secured + Unsecured Loan/Shareholder’s Equity It measures the

relationship of capital provided by creditors to the amount provided by the
shareholder’s. Year 2011 2010 Interest Coverage Ratio PBIT/Interest Expenses It
measures the protection available to creditors for payment of interest charges by
the company Year 2011 2010 Credit -to-Deposit Ratio Total Advances/ Total Deposit
It indicates how much of the Advances lent by bank is done through deposit. Higher
the ratio, the higher the loan-assets credited from deposit. Year 2011 2010 ICICI
Bank 95.90% 89.69% Axis Bank 75.28% 73.85% ICICI BANK 1.39 1.30 AXIS BANK 1.59 1.57
ICICI BANK 6.37 6.04 AXIS BANK 11.83 10.29
Non Performing Assets Ratio Net Net NPA/ Net Customer Assets It used as a measure
of the overall quality of the bank’s loan book. An NPA are those assets for which
interest is overdue for more than 90 days. Higher ratio reflects rising bad quality
of loans. Year 2011 2010 CASA Ratio Current & Saving a/c deposits / Total Deposits
The CASA ratio shows how much deposit a bank has in the form of current and saving
account deposits in the total deposit. A higher CASA ratio means higher portion of
the deposits of the bank has come from current and savings deposit, which is
generally a cheaper source of fund. Higher the CASA ratio better the net interest
margin, which means better operating efficiency of the bank. Year 2011 2010 Capital
Adequacy Ratio Tier one capital + Tier two capital / Risk Weighted Assets This
ratio is used to protect depositors and promote the stability and efficiency of
financial system around the world. Year 2011 2010 ICICI BANK 13.11% 29.72% AXIS
BANK 17.42% 36.5% ICICI Bank 45% 41% Axis Bank 41% 46% ICICI Bank 0.94% 1.86% Axis
Bank 0.26% 0.36%
Capital Market Ratio It relate the market price of a company’s share to the company
earning & dividends Price Earnings Ratio Market price per Equity share / Earning
per Share It is a indicator of firm’s growth prospect. High price earning ratio
indicates the stock market confidence in company’s future earning growth Year 2011
2010 Key Ratios at a glance Ratios ROE PE Ratio CASA Ratio NPA Ratio Capital
Adequacy Ratio Conclusions Based on the financial assessment of key indicators of
banks, ICICI Bank Ltd is leading ahead of Axis Bank. Balance sheet ICICI Bank
Annual Report FY2011.pdf Page-80 Profit & Loss account ICICI Bank Annual Report
FY2011.pdf Page 81 Cash flow statement ICICI Bank Annual Report FY2011.pdf Page 82
Thank you!!! ICICI (2011) 6.4% 19.78 45% 0.94% 3.11% AXIS (2011) 5.1% 16.09 41%
0.26% 17.42% ICICI (2010) 2.7% 23.47 41% 1.86% 29.72% AXIS (2010) 2.1% 15.26 46%
0.36% 36.5% ICICI BANK 19.78 23.47 AXIS BANK 16.09 15.26