CHAPTER-I

INTRODUCTION

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 Introduction to Financial Statement Analysis

Financial statement analysis can be referred as a process of understanding the risk

and profitability of a company by analyzing reported financial info, especially annual
and quarterly reports. Putting another way, financial statement analysis is a study
about accounting ratios among various items included in the balance sheet. These
ratios include asset utilization ratios, profitability ratios, leverage ratios, liquidity
ratios, and valuation ratios. Moreover, financial statement analysis is a quantifying
method for determining the past, current, and prospective performance of a company.
Advantages of financial statement analysis

The different advantages of financial statement analysis are listed below:

 The most important benefit if financial statement analysis is that it provides an
idea to the investors about deciding on investing their funds in a particular
company.
 Another advantage of financial statement analysis is that regulatory authorities
like IASB can ensure the company following the required accounting standards.
 Financial statement analysis is helpful to the government agencies in
analyzing the taxation owed to the firm.
 Above all, the company is able to analyze its own performance over a specific
time period.

Financial statements are prepared primarily for decision making. They play a
dominant role in setting the framework of managerial decisions. But the information
provided in the financial statements is not an end in itself as no meaningful
conclusions can be drawn from these statements alone. However, the information
provided in the financial statements is of immense use in making decisions through
analysis and interpretation of financial statements. Financial analysis ‘the process of
identifying the financial strengths and weaknesses of the firm by properly establishing
relationship between the items of the balance sheet and the profit and loss account’.
There are various methods or techniques used in analyzing financial statements
financial statements are an important source of information for evaluating the
performance and prospects of firm, if properly analyzed and interpreted these

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statements can provide valuable insights into firm’s performance. Analysis of
financial statements is if interest to lenders, investors, security analyst, manager and
others.
Financial statements analysis may be done for a variety of purposes,
which may range from simple analysis of short term liquidity position of the
form to a comprehensive assessment of the strengths and weakness of the firm in
various areas, it is helpful in assessing corporate excellence , judging credit
worthiness forecasting bond rating, evaluating intrinsic value of equity shares
predicting bankruptcy and assessing market risk.

Financial statements:
Managers, shareholders, creditors and other interested groups seek answer
to the following question about firm:

 What is the financial position of the firm at a given point of time?

 How has the firm performed financially over a given period of time?

 What have been the sources and uses of cash over a given period?

To answer these questions, accountant prepares two principle

statements, the Balance sheet and the profit and loss account, ancillary
statement, the Cash Flow statement.

Analysis of financial statement

Analysis refers to the process of critical examination of the financial

information contained in the financial statement in order to understand and make
decisions regarding the operations of the firm. The analysis is basically study of
the relationship among various financial facts and figure as given in a set of
financial statements. Complex figures as given in this statements are dissected\
broken up into simple and variable elements and significant

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relationship are established between the elements of the same statements are different
financial statements.

This process of dissection, establishing and identifying the financial

weaknesses and strengths of the firm. It is indicative of two aspects of a firm i.e. The
profitability and the financial position and it are what are known as the objectives of
the analysis.

Types of Financial Analysis

On the basis of material used on the basis of modus

operandi

I. On the basis of material used:-According to material used,

Financial analysis can be of two types:

1. External analysis:-

This analysis is done by outsiders who do not have access to the detailed internal
accounting records of the business firm. These outsiders include investors, potential
investors, creditors, potential creditors, government agencies, credit agencies and the
general public.

2. Internal Analysis:-

The analysis conducted by persons who have access to the internal accounting records
of a business firm is known as internal analysis. Such an analysis can, therefore, be
performed by executives and employees of the organization as well as government
agencies which have statutory powers vested in them.

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II. On the basis of modus operandi:-
According to the method of operation followed in the analysis, financial analysis can
also be of

1. Horizontal analysis:-

Horizontal analysis refers to the comparison of financial data of a company for

several years. The figures for this types of analysis are presented horizontally
over a number of columns. The figures of the various year are compared with
standard or base year. This type of analysis is also ‘Dynamic analysis’ as it is
based on the data from year to year rather than on

2. Vertical Analysis:-

Vertical analysis refers to the study of relationship of the various items in the financial
statements of one accounting period. In the types of analysis is the figures from
financial statement of a year are compared with a base selected from the same year’s
statement. It is also known as ‘Static analyses.
Procedure of Financial Statements Analysis

Broadly speaking there are three steps involved in the analysis of financial
statements. There are:
i)Selection,
ii)Classification,
iii)Interpretation.

The first step involves selection of information (data). The second step involved is
the methodical classification of the data and the third step includes drawing of
internees and conclusions.
The following procedure is adopted for the analysis and

Interpretation of financial statements:

1) The analyst should acquaint himself with the principles and postulates of
accounting.
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2) The extent of analysis should be determined so that the sphere of work may be
decided.

3) The financial data given in the statements should be re-organized and re-arranged.

4) A relationship is established among financial statements with the help of tools and
techniques of analysis such as ratios, trends, common size, funds flow etc.,

5) The information is interpreted in a simple and understandable way. The

significance and utility of financial data is explained for helping decision-taking.

6) The conclusions drawn from interpretation are presented to the management in the
form of reports.

OBJECTIVES OF FINANCIAL STATEMENTS

Broadly the objective of the Analysis of Financial statement is to

understand the information contained in the financial statement with a view to
the weakness and strengths of the firm and to make forecast about the future
prospects of the firm and their by enabling the financial analyst to take
different decision regarding the operation of the firm. The objectives of the
analysis can be identified as:

a. To assess the present profitability and operating efficiency of the firm as a whole
as well as for its different departments
b. To find out the relative importance of different components of the financial
position of the firm.
c. To identify the reasons for change in the profitability\financial position of the
firm.
d. To assess the short-term as well as the long-term liquidity position of the firm.
e. To examine the solvency of the firm.
f. To find out the ability of the firm to meet its current obligations.

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SCOPE OF THE STUDY

Analysis of financial statement can be undertaken by different

persons and for different purposes, therefore, the scope of the AFS may be
varying from one situation to another.
However, the following are some the techniques of the AFS:

a) Comparative financial statements.

b) Common-size financial statements.
c) Trend percentage analysis.
d) Statement of changes in financial position.
e) Cost-volume-profit relations, and
f) Ratio analysis and others.

The last technique i.e. The ratio analysis is the most common,
comprehensive and powerful tool of the AFS. The importance of ratio
analysis lies in the fact that it presents facts on a comparative basis. As
such, this study focuses only on this (ratio) analysis.

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 NEED FOR STUDY

 Need of financial statement analysis study to diagnose the information contain

in financial statement. So as to judge the profitability and financial position of
the firm ICICI BANK LIMITED

 Financial analyst analyses the financial statements with various tools of

analysis before commanding upon the financial health of the firm.

 Essential to bring out the history of ICICI BANK LIMITED

 Significance and meaning of the financial statements.

OBJECTIVES OF THE STUDY

The main objective of the project is to analyze the financial statements of the
company using the financial statements viz, comparative and ratio analysis for this
purpose of analysis. It has been utilized the secondary data of the company ICICI
BANK LIMITED i.e., annual reports from 2015-2016 to 2019-2020 this will help in
evaluating the company’s liquidity conditions profitability long term solving and
operational efficiency.

The following are main objectives of the study.

 To determine the financial statements and weakness of the firm.

 To determine the short –term solving of the firm

 To diagnose the information contained to financial statements so as to judge

the profitability and fondness of the firm.

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  To establish relationship between various figures or the income statement and
balance sheet.

RESEARCH METHODOLOGY

RESEARCH DESIGN

This is a systematic way to solve the research problem and it is important

component for the study without which researches may not be able to obtain the
format. A research design is the arrangement of conditions for collection and analysis
of data in a manager that aims to combine for collection and analysis of data
relevance to the research purpose with economy in procedure.

MEANING OF RESEARCH DESIGN

The formidable problem that follows the task of defining the research problem
is the preparation of design of the research project, popularly known as the research
design, decision regarding what, where, when, how much, by what means concerning
an inquiry of a research study constitute a research design. A research design is the
arrangement of conditions for collection and analysis of data in a manager that aims to
combine for collection and analysis of data relevance to the research purpose with
economy in procedure.

SOURCES OF DATA

Data we collected based on two sources.

 Primary data.
 Secondary data.

Primary data

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 The Primary data are those information’s, which are collected afresh and for
the first time, and thus happen to be original in character.

Secondary Data:

The Secondary data are those which have already been collected by some
other agency and which have already been processed. The sources of Secondary data
are Annual Reports, browsing Internet, through magazines.

1. It includes data gathered from the annual reports of ICICI BANK LIMITED
2. Articles are collected from official website of ICICI BANK LIMITED

LIMITATIONS OF FINANCIAL STATEMENTS

 It is only a study of interim reports.

 Financial analysis is based upon only monetary information and non monetary
factors are ignored.

 Different people may interpret the same analysis in different ways.

 It does not consider the changes in prices level.

 Changes in accounting procedure by firm may often make financial analysis

misleading.

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 CHAPTER-II
REVIEW OF LITERATURE

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Financial Statement Analysis

Introduction:-

The term ‘financial analysis also known as analysis and

interpretation of financial statements’ , refers to the process of determining financial
strength and weaknesses of the firm by establishing strategic relationship between the
items of the balance sheet , profit and loss account and other operative data.

“Analyzing financial statements” by Metcalf and Titard

“Financial analysis is a process of evaluating the relationship between

component parts of a financial statement to obtain a better understanding of a firms
position and performance” by Myers

The purpose of financial analysis is to diagnose the information

contained in financial statements so as to Jude the profitability and financial
soundness of the firm. Just like a doctor examines his patient by recording his body
temperature, blood pressure , ect. Before making his conclusion regarding the illness
and before giving his treatment, a financial analyst analysis the financial statements
with various tools of analysis before commenting upon the financial health or
weaknesses of an enterprise .
The analysis and interpretation of financial statements is essential to bring out
the mystery behind the figures in financial statements. Financial statements analysis is
an attempt to determine the significance and meaning of the financial statement data
so that forecast may be made of the future earnings, ability to pay interest and debt
maturities (both current and long term) and profitability of a sound divided policy.

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 Types of financial analysis:-

Financial analysis into different categories depending upon

(1) The material used and

(2) The method of operation followed in the analysis or the modus operandi of
analysis

Types of financial analysis

On the basis of material used on the basis of modus operandi

External Internal Horizontal Vertical

Analysis Analysis Analysis Analysis

1.On the basis of material used :- According to material used, financial

analysis can be of two types

External analysis
Internal analysis

External analysis :- This analysis is done by outsiders who do not have

access to the detailed internal outsiders include investors,potential investors ,
Creditors, Potential Creditors, Government Agencies , Credit Ggencies and General
Public.for financial analysis, these external parties to the firm depend almost entirely
on the published financial statements.

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 Internal analysis:- The analysis conducted by persons who have access to the
internal accounting records of a business firm is known as internal analysis .

2 On the basis of modus operandi :- According to the modus operandi

financial analysis can also be of two types
a.Horizontal analysis
b.Vertical analysis
Horizontal analysis:- Horizontal analysis refers to the comparison of financial
data of a company for several years. The figures for this type of analysis are presented
horizontally over a number of columns.the figuresof the various years are compared
with standard or base year . a base year is year chosen as begining point. This type of
analysis is also called ‘dynamic analysis’ as it is based on the data form year to year
rather than on data of any one year . The horizontal analysis makes it possible to focus
attention on items that have changed significantly during the period under view

b. Vertical analysis:- Vertical analysis refers to the study of relationship of the

various items in the financial statements of one accounting period . in this types of
analysis the figures from financial statement of a year are compared with a base
selected from the same years statement

Methods of financial analysis:-

The following methods of analysis are generally used:-

1. Comparative Statements.
2. Trend Analysis.
3. Common-Size Statements.
4. Funds flow Analysis .
5. Cash Analysis
6. Ratio Analysis
7. Cost-volume-Profit Analysis

Comparative statements:-

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 The comparative financial statements are statements of the financial position
at different periods of time .the elements of financial position are show in a
Comparative Statement provides an idea of financial position at two or more
periods. Generally two financial statements (balance sheet and income statement) are
prepared in comparative form for financial analysis.

THE COMPARATIVE STATEMENT MAY SHOW:-

1. Absolute figures (rupee amounts)

2. Changes in absolute figures i.e increase or decrease in absolute figures.
3. Absolute data in terms of percentages.
4. Increase or decrease in terms of percentages.

THE TWO COMPARATIVE STATEMENTS ARE:-

1. Comparative balance sheet, and
2. Income statement.

(1) Comparative balance sheet:- The comparative balance sheet analysis is the
study of the trend of the same items,group of items and computed items in two or
more balance sheets of the same business enterprise on different dates. The change in
periodic balance sheet items reflect the conduct of a business the change can be
observed by comparison of the balance sheet at the beginning and at the end of a
period and these changes can help in forming an opinion about the progress of an
enterprise.

GUIDE LINES FOR INTERPRETATION OF COMPARATIVE BALANCE

SHEET:-

While interpreting comparative balance sheet the interpreter is expected to

study the following aspects:-
1. Current financial position and liquidity position
2. Long-term financial position
3. Profitability of the concern.
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 COMMON SIZE STATEMENT:-

The common-size statements, balance sheet and income statement are show in
analytical percentages. The figures are shown as percentages of total assets, total
liabilities and total sales. The total assets are taken as 100 and different assets are
expressed as a percentage of the total similarly, various liabilities are taken as a part
of total liabilities.

COMMON SIZE BALANCE SHEET:-

A statement in which balance sheet items are expressed as the ratio of each
asset to total assets and the ratio of each liability is expressed as a ratio of total
liabilities is called common size balance. The common size balance sheet can be used
to compare companies of differing size. The comparison of figures in different
periods is not useful because total figures may be affected by a number of factors. It is
not possible to establish standard norms for various assets. The trends of figures from
year to year may not be studied and even they may not give proper results.

TREND ANALYSIS OF BALANCE SHEET:-

Trend analysis is Very important tool of horizontal financial analysis.
This analysis enables to known the change in the financial function and operating
efficiency in between the time period chosen.
By studding the trend analysis of each item we can known the direction of changes
and based upon the direction of changes, the options can be changed.
Trend =Absolute Value of item in the statement understudy *100
Absolute Value of same item in the base statement

RATIO ANALYSIS
INTRODUCTION:
Ratio analysis is one of the techniques of financial analysis where ratios are used as a
yardstick for evaluating the financial condition and performance of a firm. Analysis
and interpretation of various accounting ratios gives skilled and experienced analysis,

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a better understanding of the financial condition and performance of the firm than
what he could have obtained only through a perusal of financial statements.

MEANING OF RATIOS:
Ratios are relationships expressed in mathematical terms between figures which are
connected with each other in some manner. Obviously, no purpose will be served by
comparing two sets of figures which are not at all connected with each other.
Moreover, absolute figures are also unfit for comparison.

There are various techniques or models for analyzing information contained in

the financial statements viz. Comparative statements, common size statements, trend
percentages, funds flow analysis, cash flow analysis and ratio analysis. Financial
analysis is undertaken by the management of the firm or by parties outside to it viz.
owners, creditors, investors, etc.

Ratio analysis is most widely used and powerful tool or technique of financial
analysis. The term ratio refers to the numerical quantitative relationship between two
variables. It shows arithmetical relationship between two figures, which can be
expressed in three ways.
 Percentage
 Fraction
 Proportion

A study of the trend of strategic ratios helps the management in planning,

forecasting and decision – making. It helps in identifying specific work areas. In
short, though the technique of ratio analysis, the firm’s solvency, efficiency and
profitability can be assessed.

IMPORTANCE OF RATIO ANALYSIS

 Ratio analysis helps in simplifying the financial statement for easy
understanding.

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  It helps in drawing out meaningful conclusion from the information provided
in the financial statements which is useful for decision making and framing
sound policies for business in future.
 It helps in assessing the financial strength and weakness of the firm and this
enhances the value of the financial statements.
 Comparative study of the ratios between the competing firms helps to know
the efficiency of the firm.
 It helps the investor to assess the financial position of the concern in which he
is going to invest.
 Ratio analysis helps the employees interested in wage increase and fringe
benefits that are related the volume of profits earned by the concern.
 Ratio analysis provides data for inter-firm comparison. Ratios highlight the
factors associated with successful and unsuccessful firms. They also reveal
strong firms and weak firms, over – valued and under – valued firms.
 Ratio analysis helps in planning and forecasting. Over a period of time a firm
or industry develops certain norms that may include future success or failure.
If relationship changes in firm’s data over different time periods, the ratios
may provide clues on trends and future problems.
 Ratio analysis also makes possible comparison of the performance of the
different divisions of the firm. The ratios are helpful in deciding about their
efficiency or otherwise in the past and likely performance in the future.

Thus, “ratios can assist management in its basic function of forecasting,

planning, coordination, control and communication”.

LIMITATIONS OF RATIO ANALYSIS

 Ratios are of limited use and thus single ratio may not be useful. Better
interpretation is possible with the calculation of number of ratios, which may
lead to confusion to the analyst in making any meaningful conclusion.
 Ratios are calculated on the basis of past results, which may not necessarily
true indicators of the future, if the business policies are constantly changing.

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  Change in accounting procedure may be misleading for ratio analysis. For
example, change in inventory valuation methods from LIFO to FIFO may also
influence in the analysis.
 Ratio analysis considers only quantitative aspects, but not qualitative factors.
 Ratio analysis may give misleading results If the effects of price level changes
are not considered.
 Ratio analysis when interpreted by different people in different way may
encounter with the personal bias or prejudice of the analyst.

Ratios are classified as:

1. LIQUIDITY RATIOS
2. LEVERAGE RATIOS
3. COVERAGE RATIOS
4. ACTIVITY RATIOS (OR) TURNOVER RATIOS
5. PROFITABILTY
RATIOS 6.
1. LIQUIDITY RATIOS :

Liquidity ratios is also known as short-term solvency. These ratios are used to
measure the firm’s ability to meet short – term obligations. They compare short-term
obligation to short term (or current) resources available to meet these obligations.
From these ratios, much insight can be obtained into the present cash solvency of the
firm and firm’s ability to remain solvent in the event of adversity. The creditors of
the firm are primarily interested in the short – term solvency of the firm. A firm’s
liquidity should be neither too high nor too low but adequate.
Low liquidity implies the firm’s inability to meet its maturing obligations.
This will result in bad credit rating, loss of creditor’s confidence or even technical
insolvency, ultimately leading to the closure of the firm.
A very high liquidity position is also bad. It means that the firm’s current
assets are too high in proportion to maturing obligations. Idle assets earn nothing to
the firm. The firm’s funds will be unnecessarily locked up in current assets, which if,
released can be used to generate profits to the firm.

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 The ratios, which measure, and indicate the extent of a firm’s liquidity, are
known as liquidity ratios or short-term solvency ratios. Commonly used liquidity
ratios include.
 CURRENT RATIO (OR) WORKING CAPITAL RATIO
 QUICK RATIO (OR) ACID TEST RATIO
 CASH POSITION RATIO (OR) SUPER STOCK QUICK RATIO

2. LEVERAGE RATIO :

These ratios are also known as capital structure ratios or solvency ratios or
capital gearing ratios. The long-term creditors are more concerned with the firm’s
long-term financial position. They judge the financial soundness of the firm in the
firm in term of the ability to pay interest promptly as well as making repayment of the
principal. The long-term solvency of the firm can be examined with the help of
leverage ratios. They measure the funds supplied by owners as compared with the
financial provided only a small proportion of total financing, the risks of the business
are borne mainly by the creditors.
Firm with low leverage have less risk of loss, but they also have lower
expected returns. Conversely, firm with high leverage ratios have the risk of large
losses but also have a chance of earning huge profits. Therefore, before deciding
whether a firm should have debt, it must balance higher expected returns against
increased risks. The most commonly examined leverage: ratios are
 DEBT EQUITY RATIO
 PROPRIETORY RATIO
 DEBT TO CAPITAL RATIO
 GROSS FIXED ASSETS TO SHAREHOLDERS FUNDS
 FIXED ASSETS RATIO

3. COVERAGE RATIOS :

These ratios indicate the extent to which the interest of the persons entitled to
get a fixed return (i.e. interest or dividend) or a scheduled repayment as per

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 agreed terms are safe. The higher the cover the better it is. Under this
category the following ratios are calculated.
 FIXED INTEREST COVERAGE RATIO
 FIXED DIVIDENT COVERAGE RATIO
 DEBT SERVICE COVERAGE RATIO

4. ACTIVITY RATIO (OR) TURNOVER RATIO :

The finances obtained by the firm from its owners and creditors will be
inverted in assets, which the firm uses to generate sales and profits. The
amount of sales generated and the profit earned depend on the effective and
efficient management of these assets by the firm. Activity ratios measure the
efficiency with which the firm manages and uses its assets. That is why
activity ratios are known as efficiency ratios, because these ratios are
converted or turned over in to sales.
Thus the turnover or activity ratios measure the relationship between sales on
one side and various assets on the other side. Higher the turnover ratio, the better the
profitability and use of capital.
Many activity ratios can be calculated to measure the efficiency of assets
utilization. Following are some of the important activity ratios.
 TOTAL ASSETS TURNOVER RATIO
 CAPTAIL EMPLOYED TURNOVER RATIO
 FIXED ASSETS TURNOVER RATIO
 CURRENT ASSETS TURNOVER RATIO
 WORKING CAPITAL TURNOVER RATIO
 STOCK TURNOVER RATIO
 DEBTORS TURNOVER RATIO
 CREDITORS TURNOVER RATIO
5. PROFITABILITY RATIOS :

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 Profitability is the ability to make profits. Every firm should earn adequate
profits in order to survive in the immediate present and grow in future. In fact, profit
is what makes the business run. Profitability is the net results of large number of
policies and decisions. Profitability ratios give final answers about how efficiency the
firm is managed. The profitability ratios relates profits earned by a firm by its
parameters like sales, capital employed and net worth. But while making ratio
analysis relating to profits, it should be remembered that there are different concepts
of profit such as concepts of profit such as contribution, gross profits, net profits,
EBIT, operating profits, profits before depreciation and before tax etc. profitability
ratios are important for a concern. These ratios are calculated to enlighten the end
results of business activities, which is the sole criterion of the overall efficiency of a
business concern. The following are the important profitability ratio, which are based
on.
1. Sales
2. Investment
 GROSS PROFIT RATIO
 OPERATING RATIO
 OPERATING PROFIT RATIO
 NET PROFIT RATIO
 RETRUN ON CAPITAL EMPLOYED
 RETURN ON SHAREHOLDERS EQUITY
 RETURN ON TOTAL ASSETS
 EARNING PER SHARE

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 CHAPTER-III
INDUSTRIAL PROFILE
&
COMAPANY PROFILE

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 INDUSTRY PROFILE
A bank is a financial institution that accepts deposits and channels those deposits into
lending activities. Banks primarily provide financial services to customers while
enriching investors. Government restrictions on financial activities by banks vary over
time and location. Banks are important players in financial markets and offer services
such as investment funds and loans. In some countries such as Germany, banks have
historically owned major stakes in industrial corporations while in other countries
such as the United States banks are prohibited from owning non-financial companies.
In Japan, banks are usually the nexus of a cross-share holding entity known as the
keiretsu. In France, bancassurance is prevalent, as most banks offer insurance services
(and now real estate services) to their clients.

Introduction
India’s banking sector is constantly growing. Since the turn of the century, there has
been a noticeable upsurge in transactions through ATMs, and also internet and mobile
banking.
Following the passing of the Banking Laws (Amendment) Bill by the Indian
Parliament in 2015, the landscape of the banking industry began to change. The bill
allows the Reserve Bank of India (RBI) to make final guidelines on issuing new
licenses, which could lead to a bigger number of banks in the country. Some banks
have already received licences from the government, and the RBI's new norms will
provide incentives to banks to spot bad loans and take requisite action to keep rogue
borrowers in check.
Over the next decade, the banking sector is projected to create up to two million new
jobs, driven by the efforts of the RBI and the Government of India to integrate
financial services into rural areas. Also, the traditional way of operations will slowly
give way to modern technology.
Market size
Total banking assets in India touched US$ 1.8 trillion in FY16 and are anticipated to
cross US$ 28.5 trillion in FY25.
Bank deposits have grown at a compound annual growth rate (CAGR) of 21.2 per
cent over FY06–16. Total deposits in FY16 were US$ 1,274.3 billion.

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Total banking sector credit is anticipated to grow at a CAGR of 18.1 per cent (in
terms of INR) to reach US$ 2.4 trillion by 2020.
In FY19, private sector lenders witnessed discernable growth in credit cards and
personal loan businesses. ICICI Bank witnessed 191.6 per cent growth in personal
loan disbursement in FY19, as per a report by Emkay Global Financial Services. Axis
Bank's personal loan business also rose 49.8 per cent and its credit card business
expanded by 31.1 per cent.
Investments
Bengaluru-based software services exporter Mphasis Ltd has bagged a five-year
contract from Punjab National Bank (PNB) to set up the bank’s contact centres in
Mangalore and Noida (UP). Mphasis will provide support for all banking products
and services, including deposits operations, lending services, banking processes,
internet banking, and account and card-related services. The company will also offer
services in multiple languages.
Microfinance companies have committed to setting up at least 30 million bank
accounts within a year through tie-ups with banks, as part of the Indian government’s
financial inclusion plan. The commitment was made at a meeting of representatives of
25 large microfinance companies and banks and government representatives, which
included financial services secretary Mr GS Sandhu.
Export-Import Bank of India (Exim Bank) will increase its focus on supporting
project exports from India to South Asia, Africa and Latin America, as per Mr
Yaduvendra Mathur, Chairman and MD, Exim Bank. The bank has moved up the
value chain by supporting project exports so that India earns foreign exchange. In
2015–16, Exim Bank lent support to 85 project export contracts worth Rs 24,255
crore (US$ 3.96 billion) secured by 47 companies in 23 countries.

Government Initiatives
The RBI has given banks greater flexibility to refinance current long-gestation project
loans worth Rs 1,000 crore (US$ 193.42 million) and more, and has allowed partial
buyout of such loans by other financial institutions as standard practice. The earlier
stipulation was that buyers should purchase at least 50 per cent of the loan from the
existing banks. Now, they get as low as 25 per cent of the loan value and the loan will
still be treated as ‘standard’.

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The RBI has also relaxed norms for mortgage guarantee companies (MGC) enabling
these firms to use contingency reserves to cover for the losses suffered by the
mortgage guarantee holders, without the approval of the apex bank. However, such a
measure can only be initiated if there is no single option left to recoup the losses.
SBI is planning to launch a contact-less or tap-and-go card facility to make payments
in India. Contact-less payment is a technology that has been adopted in several
countries, including Australia, Canada and the UK, where customers can simply tap
or wave their card over a reader at a point-of-sale terminal, which reads the card and
allows transactions.
SBI and its five associate banks also plan to empower account holders at the bottom
of the social pyramid with a customer call facility. The proposed facility will help
customers get an update on available balance, last five transactions and cheque book
request on their mobile phones.
Road Ahead
India is yet to tap into the potential of mobile banking and digital financial services.
Forty-seven per cent of the populace have bank accounts, of which half lie dormant
due to reliance on cash transactions, as per a report. Still, the industry holds a lot of
promise.
India's banking sector could become the fifth largest banking sector in the world by
2020 and the third largest by 2025. These days, Indian banks are turning their focus to
servicing clients and enhancing their technology infrastructure, which can help
improve customer experience as well as give banks a competitive edge.
Exchange Rate Used: INR 1 = US$ 0.0193 as on October 28, 2019

The level of government regulation of the banking industry varies widely, with
countries such as Iceland, having relatively light regulation of the banking sector, and
countries such as China having a wide variety of regulations but no systematic
process that can be followed typical of a communist system.

The oldest bank still in existence is Monte dei Paschi di Siena, headquartered in
Siena, Italy, which has been operating continuously since 1972.

History

Origin of the word

26
The name bank derives from the Italian word banco "desk/bench", used during the
Renaissance by Jewish Florentine bankers, who used to make their transactions above
a desk covered by a green tablecloth. However, there are traces of banking activity
even in ancient times, which indicates that the word 'bank' might not necessarily come
from the word 'banco'.

In fact, the word traces its origins back to the Ancient Roman Empire, where
moneylenders would set up their stalls in the middle of enclosed courtyards called
macella on a long bench called a bancu, from which the words banco and bank are
derived. As a moneychanger, the merchant at the bancu did not so much invest money
as merely convert the foreign currency into the only legal tender in Rome—that of the
Imperial Mint.

The earliest evidence of money-changing activity is depicted on a silver drachm coin

from ancient Hellenic colony Trapezus on the Black Sea, modern Trabzon, c. 350–
325 BC, presented in the British Museum in London. The coin shows a banker's table
(trapeza) laden with coins, a pun on the name of the city.

In fact, even today in Modern Greek the word Trapeza (Τράπεζα) means both a table
and a bank.

Traditional banking activities

Banks act as payment agents by conducting checking or current accounts for

customers, paying cheques drawn by customers on the bank, and collecting cheques
deposited to customers' current accounts. Banks also enable customer payments via
other payment methods such as telegraphic transfer, EFTPOS, and ATM.

Banks borrow money by accepting funds deposited on current accounts, by accepting

term deposits, and by issuing debt securities such as banknotes and bonds. Banks lend
money by making advances to customers on current accounts, by making installment

27
loans, and by investing in marketable debt securities and other forms of money
lending.

Banks provide almost all payment services, and a bank account is considered
indispensable by most businesses, individuals and governments. Non-banks that
provide payment services such as remittance companies are not normally considered
an adequate substitute for having a bank account.

Banks borrow most funds from households and non-financial businesses, and lend
most funds to households and non-financial businesses, but non-bank lenders provide
a significant and in many cases adequate substitute for bank loans, and money market
funds, cash management trusts and other non-bank financial institutions in many cases
provide an adequate substitute to banks for lending savings to.

Entry regulation

Currently in most jurisdictions commercial banks are regulated by government

entities and require a special bank licence to operate.

Usually the definition of the business of banking for the purposes of regulation is
extended to include acceptance of deposits, even if they are not repayable to the
customer's order—although money lending, by itself, is generally not included in the
definition.

Unlike most other regulated industries, the regulator is typically also a participant in
the market, i.e. a government-owned (central) bank. Central banks also typically have
a monopoly on the business of issuing banknotes. However, in some countries this is
not the case. In the UK, for example, the Financial Services Authority licences banks,
and some commercial banks (such as the Bank of Scotland) issue their own banknotes
in addition to those issued by the Bank of England, the UK government's central
bank.

Accounting for bank accounts

Bank statements are accounting records produced by banks under the various
accounting standards of the world. Under GAAP and IFRS there are two kinds of

28
accounts: debit and credit. Credit accounts are Revenue, Equity and Liabilities. Debit
Accounts are Assets and Expenses. This means you credit a credit account to increase
its balance, and you debit a debit account to decrease its balance.

This also means you debit your savings account every time you deposit money into it
(and the account is normally in deficit), while you credit your credit card account
every time you spend money from it (and the account is normally in credit).

However, if you read your bank statement, it will say the opposite—that you credit
your account when you deposit money, and you debit it when you withdraw funds. If
you have cash in your account, you have a positive (or credit) balance; if you are
overdrawn, you have a negative (or deficit) balance.

The reason for this is that the bank, and not you, has produced the bank statement.
Your savings might be your assets, but the bank's liability, so they are credit accounts
(which should have a positive balance). Conversely, your loans are your liabilities but
the bank's assets, so they are debit accounts (which should also have a positive
balance).

Where bank transactions, balances, credits and debits are discussed below, they are
done so from the viewpoint of the account holder—which is traditionally what most
people are used to seeing.

Economic functions

1. issue of money, in the form of banknotes and current accounts subject to

cheque or payment at the customer's order. These claims on banks can act as
money because they are negotiable and/or repayable on demand, and hence
valued at par. They are effectively transferable by mere delivery, in the case of
banknotes, or by drawing a cheque that the payee may bank or cash.
2. netting and settlement of payments – banks act as both collection and paying
agents for customers, participating in interbank clearing and settlement

29
 systems to collect, present, be presented with, and pay payment instruments.
This enables banks to economise on reserves held for settlement of payments,
since inward and outward payments offset each other. It also enables the
offsetting of payment flows between geographical areas, reducing the cost of
settlement between them.
3. credit intermediation – banks borrow and lend back-to-back on their own
account as middle men.
4. credit quality improvement – banks lend money to ordinary commercial and
personal borrowers (ordinary credit quality), but are high quality borrowers.
The improvement comes from diversification of the bank's assets and capital
which provides a buffer to absorb losses without defaulting on its obligations.
However, banknotes and deposits are generally unsecured; if the bank gets
into difficulty and pledges assets as security, to raise the funding it needs to
continue to operate, this puts the note holders and depositors in an
economically subordinated position.
5. maturity transformation – banks borrow more on demand debt and short term
debt, but provide more long term loans. In other words, they borrow short and
lend long. With a stronger credit quality than most other borrowers, banks can
do this by aggregating issues (e.g. accepting deposits and issuing banknotes)
and redemptions (e.g. withdrawals and redemptions of banknotes),
maintaining reserves of cash, investing in marketable securities that can be
readily converted to cash if needed, and raising replacement funding as needed
from various sources (e.g. wholesale cash markets and securities markets).

Law of banking

Banking law is based on a contractual analysis of the relationship between the bank
(defined above) and the customer—defined as any entity for which the bank agrees to
conduct an account.

The law implies rights and obligations into this relationship as follows:

30
 1. The bank account balance is the financial position between the bank and the
customer: when the account is in credit, the bank owes the balance to the
customer; when the account is overdrawn, the customer owes the balance to
the bank.
2. The bank agrees to pay the customer's cheques up to the amount standing to
the credit of the customer's account, plus any agreed overdraft limit.
3. The bank may not pay from the customer's account without a mandate from
the customer, e.g. a cheque drawn by the customer.
4. The bank agrees to promptly collect the cheques deposited to the customer's
account as the customer's agent, and to credit the proceeds to the customer's
account.
5. The bank has a right to combine the customer's accounts, since each account is
just an aspect of the same credit relationship.
6. The bank has a lien on cheques deposited to the customer's account, to the
extent that the customer is indebted to the bank.
7. The bank must not disclose details of transactions through the customer's
account—unless the customer consents, there is a public duty to disclose, the
bank's interests require it, or the law demands it.
8. The bank must not close a customer's account without reasonable notice, since
cheques are outstanding in the ordinary course of business for several days.

These implied contractual terms may be modified by express agreement between the
customer and the bank. The statutes and regulations in force within a particular
jurisdiction may also modify the above terms and/or create new rights, obligations or
limitations relevant to the bank-customer relationship.

Some types of financial institution, such as building societies and credit unions, may
be partly or wholly exempt from bank licence requirements, and therefore regulated
under separate rules.

The requirements for the issue of a bank licence vary between jurisdictions but
typically include:

1. Minimum capital
2. Minimum capital ratio

31
 3. 'Fit and Proper' requirements for the bank's controllers, owners, directors,
and/or senior officers
4. Approval of the bank's business plan as being sufficiently prudent and
plausible.

Types of banks

Banks' activities can be divided into retail banking, dealing directly with individuals
and small businesses; business banking, providing services to mid-market business;
corporate banking, directed at large business entities; private banking, providing
wealth management services to high net worth individuals and families; and
investment banking, relating to activities on the financial markets. Most banks are
profit-making, private enterprises. However, some are owned by government, or are
non-profit organizations.

Central banks are normally government-owned and charged with quasi-regulatory

responsibilities, such as supervising commercial banks, or controlling the cash interest
rate. They generally provide liquidity to the banking system and act as the lender of
last resort in event of a crisis.

Types of retail banks

 Commercial bank: the term used for a normal bank to distinguish it from an
investment bank. After the Great Depression, the U.S. Congress required that
banks only engage in banking activities, whereas investment banks were
limited to capital market activities. Since the two no longer have to be under
separate ownership, some use the term "commercial bank" to refer to a bank or

32
 a division of a bank that mostly deals with deposits and loans from
corporations or large businesses.
 Community Banks: locally operated financial institutions that empower
employees to make local decisions to serve their customers and the partners.
 Community development banks: regulated banks that provide financial
services and credit to under-served markets or populations.
 Postal savings banks: savings banks associated with national postal systems.
 Private banks: banks that manage the assets of high net worth individuals.
 Offshore banks: banks located in jurisdictions with low taxation and
regulation. Many offshore banks are essentially private banks.
 Savings bank: in Europe, savings banks take their roots in the 19th or
sometimes even 18th century. Their original objective was to provide easily
accessible savings products to all strata of the population. In some countries,
savings banks were created on public initiative; in others, socially committed
individuals created foundations to put in place the necessary infrastructure.
Nowadays, European savings banks have kept their focus on retail banking:
payments, savings products, credits and insurances for individuals or small
and medium-sized enterprises. Apart from this retail focus, they also differ
from commercial banks by their broadly decentralised distribution network,
providing local and regional outreach—and by their socially responsible
approach to business and society.
 Building societies and Landesbanks: institutions that conduct retail banking.
 Ethical banks: banks that prioritize the transparency of all operations and
make only what they consider to be socially-responsible investments.
 Islamic banks: Banks that transact according to Islamic principles.

Types of investment banks

 Investment banks "underwrite" (guarantee the sale of) stock and bond issues,
trade for their own accounts, make markets, and advise corporations on capital
market activities such as mergers and acquisitions.
 Merchant banks were traditionally banks which engaged in trade finance. The
modern definition, however, refers to banks which provide capital to firms in
33
 the form of shares rather than loans. Unlike venture capital firms, they tend
not to invest in new companies.

Both combined

 Universal banks, more commonly known as financial services companies,

engage in several of these activities. These big banks are very diversified
groups that, among other services, also distribute insurance— hence the term
bancassurance, a portmanteau word combining "banque or bank" and
"assurance", signifying that both banking and insurance are provided by the
same corporate entity.

Other types of banks

 Islamic banks adhere to the concepts of Islamic law. This form of banking
revolves around several well-established principles based on Islamic canons.
All banking activities must avoid interest, a concept that is forbidden in Islam.
Instead, the bank earns profit (markup) and fees on the financing facilities that
it extends to customers.

COMPANY PROFILE

ICICI Bank is India's largest private sector bank with total assets of Rs. 5,946.42
billion (US$ 99 billion) at March 31, 2019 and profit after tax Rs. 98.10 billion (US$
1,637 million) for the year ended March 31, 2019.ICICI Bank currently has a network
of 3,839 Branches and 11,943 ATM's across India.
History

34
1955
The Industrial Credit and Investment Corporation of India Limited (ICICI)
incorporated at the initiative of the World Bank, the Government of India and
representatives of Indian industry, with the objective of creating a development
financial institution for providing medium-term and long-term project financing to
Indian businesses. Mr.A.Ramaswami Mudaliar elected as the first Chairman of ICICI
Limited.
ICICI emerges as the major source of foreign currency loans to Indian industry.
Besides funding from the World Bank and other multi-lateral agencies, ICICI was
also among the first Indian companies to raise funds from international markets.

ICICI Bank was originally promoted in 1994 by ICICI Limited, an Indian financial
institution, and was its wholly-owned subsidiary. ICICI's shareholding in ICICI Bank
was reduced to 46% through a public offering of shares in India in fiscal 1998, an
equity offering in the form of ADRs listed on the NYSE in fiscal 2000, ICICI Bank's
acquisition of Bank of Madura Limited in an all-stock amalgamation in fiscal 2001,
and secondary market sales by ICICI to institutional investors in fiscal 2001 and fiscal
2002. ICICI was formed in 1955 at the initiative of the World Bank, the Government
of India and representatives of Indian industry. The principal objective was to create a
development financial institution for providing medium-term and long-term project
financing to Indian businesses.

In the 1990s, ICICI transformed its business from a development financial institution
offering only project finance to a diversified financial services group offering a wide
variety of products and services, both directly and through a number of subsidiaries
and affiliates like ICICI Bank. In 1999, ICICI become the first Indian company and
the first bank or financial institution from non-Japan Asia to be listed on the NYSE.
After consideration of various corporate structuring alternatives in the context of the
emerging competitive scenario in the Indian banking industry, and the move towards
universal banking, the managements of ICICI and ICICI Bank formed the view that
the merger of ICICI with ICICI Bank would be the optimal strategic alternative for
both entities, and would create the optimal legal structure for the ICICI group's
universal banking strategy. The merger would enhance value for ICICI shareholders
through the merged entity's access to low-cost deposits, greater opportunities for

35
earning fee-based income and the ability to participate in the payments system and
provide transaction-banking services. The merger would enhance value for ICICI
Bank shareholders through a large capital base and scale of operations, seamless
access to ICICI's strong corporate relationships built up over five decades, entry into
new business segments, higher market share in various business segments,
particularly fee-based services, and access to the vast talent pool of ICICI and its
subsidiaries.
In October 2001, the Boards of Directors of ICICI and ICICI Bank approved the
merger of ICICI and two of its wholly-owned retail finance subsidiaries, ICICI
Personal Financial Services Limited and ICICI Capital Services Limited, with ICICI
Bank. The merger was approved by shareholders of ICICI and ICICI Bank in January
2002, by the High Court of Gujarat at Ahmedabad in March 2002, and by the High
Court of Judicature at Mumbai and the Reserve Bank of India in April 2002.
Consequent to the merger, the ICICI group's financing and banking operations, both
wholesale and retail, have been integrated in a single entity.

ICICI Group ICICI Lombard General Insurance

Companies Company
http://www.icicilombard.com
ICICI
Group

http://www.icicigroupcompanies.com

ICICI Prudential Life Insurance

Company ICICI Prudential AMC & Trust
http://www.iciciprulife.com/public/def http://www.icicipruamc.com
ault.htm

ICICI Venture
ICICI Securities http://www.iciciventure.com
http://www.icicisecurities.com

ICICI Direct
http://www.icicidirect.com
36
 ICICI Foundation Disha Financial Counselling
http://www.icicifoundation.org http://www.icicifoundation.org

Board of Directors
Mr. K. V. Kamath, Chairman ..............................................
.............................................. Mr. Alok Tandon
Mr. Dileep Choksi Ms. Chanda Kochhar,
.............................................. Managing Director & CEO
Mr. Homi R. Khusrokhan ...........................................
.............................................. Mr. N. S. Kannan,
Mr. M.S. Ramachandran Executive Director
.............................................. ...........................................
Dr. Tushaar Shah Mr. K. Ramkumar,
.............................................. Executive Director
Mr. V. K. Sharma ...........................................
.............................................. Mr. Rajiv Sabharwal,
Mr. V. Sridar Executive Director
Awards -
2020 ICICI
Bank

 Ms. Chanda Kochhar received an honorary Doctor of Laws from Carleton

University, Canada. The university conferred this award on Ms. Kochhar in
recognition of her pioneering work in the financial sector, effective leadership in a
time of economic crisis and support for engaged business practices.
 Ms Chanda Kochhar featured in The Telegraph (UK) list of '11 most
important women in finance'.
 ICICI Bank has been recognised as one of the 'Top Companies for Leaders' in
India in a study conducted by Aon Hewitt.
 IDRBT has given awards to ICICI Bank in the categories of 'Social Media and
Mobile Banking' and' Business Intelligence Initiatives'.
 ICICI Bank won the award for the Best Bank - Global Business Development
(Private Sector) in the Dun & Bradstreet - Polaris Financial Technology Banking
Awards 2019.
37
 ICICI Bank was awarded the Certificate of Recognition as one of the Top 5
Companies in Corporate Governance in the 19th ICSI (The Institute of Company
Secretaries of India) National Awards for Corporate Governance.
 ICICI Bank has been honoured as The Best Service Provider - Risk
Management, India at The Asset Triple A Transaction Banking, Treasury, Trade and
Risk Management Awards 2019.
 Mr Rakesh Jha has been ranked as the Best CFO in India at the 19th Annual
Finance Asia's Best Managed Companies Poll.
 ICICI Bank has won The Corporate Treasurer Awards 2016 in the categories
of 'Best Cash Management Bank in India' & 'Best Trade Finance Bank in India'.
 ICICI Bank has been awarded the 'Best Retail Bank in India', 'Best
Microfinance Business' and Best Retail Banking Branch Innovation' under the
'Excellence in Retail Financial Services awards 2019' by The Asian Banker.
 Ms Chanda Kochhar, MD & CEO, ICICI Bank, has been named among
Fortune's 50 most powerful women in business for the fourth consecutive year.
 Ms. Chanda Kochhar, MD and CEO received the 'Mumbai Women Of The
Decade' award by ASSOCHAM.

ICICI Bank, India’s largest private sector bank, today announced the launch of
India’s only credit card with a unique transparent design and a distinctive look. The
‘ICICI Bank Coral American Express Credit Card’ is the latest addition to the Bank’s
exclusive ‘Gemstone Collection’ of credit cards.

Speaking at the launch, Mr. Rajiv Sabharwal, Executive Director, ICICI Bank
said, "At ICICI Bank, it is our constant endeavour to deliver innovative, powerful and
distinctive value propositions to our discerning customers. We are delighted to launch
the ‘ICICI Bank Coral American Express Credit Card’, the only card in the country
with a youthful, transparent design. Aimed at providing significant lifestyle benefits,
this card re-affirms our commitment to bring forth innovative services to our
customers. We are also introducing a host of exciting privileges including an
introductory extended credit period offer and bonus reward points on online
transactions. We believe this card will be yet another compelling addition to our
Gemstone collection of credit cards."

38
 Ms. Siew Choo Ng, Senior Vice President, Head of Global Network Partnerships,
Asia, American Express International, Inc. said, "We are delighted to have further
strengthened our long and cherished relationship with ICICI Bank with the launch of
the new ICICI Bank Coral American Express Credit Card. Designed to appeal to
value seeking customers, the Card reinforces our consistent endeavor to provide
differentiated products and services to our customers. The Card offers a wide array of
exclusive privileges and features including additional PAYBACK points on online
spend and an innovative transparent design. At American Express, we always strive to
work closely with our partners to develop the most relevant and compelling products
for our valued card members."

Mr. Sanjay Rishi, President, South Asia, American Express, said, “This launch
marks a further strengthening of the relationship between ICICI Bank and American
Express. We already partner with ICICI Bank on customer loyalty programs,
insurance services, retail banking services as well as initiatives to expand card
accepting merchants. The launch of the ICICI Bank Coral American Express Card
combines the strengths and capabilities of both organizations to offer an exciting new
payment choice to customers.
The ICICI Bank Coral American Express® Credit Card offers a wide range of
attractive benefits to its card members:

 Extended Credit Period; a unique proposition offering card members ability to

carry over the retail purchase balances in first two billing statements by simply paying
the minimum amount due. No interest shall be charged in such cases and the total
amount due shall be payable as per the third billing statement. TnC apply, for
complete details please visit www.icicibank.com.
 4 PAYBACK points per Rs.100 spent on dining, groceries and at
supermarkets, 3 PAYBACK points per Rs.100 of online spends and 2 PAYBACK
points per Rs.100 on other spends
 Complimentary movie tickets with 'buy one get one free' offer
 on www.bookmyshow.com
 Complimentary visits to Altitude lounges at Mumbai and Delhi airports
 Minimum 19% discount on dining bills at leading restaurants across India with
the ICICI Bank ‘Culinary Treats’ programme

39
 No fuel surcharge on fuel transactions at HPCL fuel stations

OVERVIEW ICICI Group

ICICI Group offers a wide range of banking products and financial services to
corporate and retail customers through a variety of delivery channels and through its
specialised group companies and subsidiaries in the areas of personal banking,
investment banking, life and general insurance, venture capital and asset management.
With a strong customer focus, the ICICI Group Companies have maintained and
enhanced their leadership positions in their respective sectors.

ICICI Bank is India's second-largest bank with total assets of Rs. 4,736.47 billion
(US$ 93 billion) at March 31, 2015 and profit after tax Rs. 64.65 billion (US$ 1,271
million) for the year ended March 31, 2015. The Bank has a network of 2,791
branches and 10,021 ATMs in India, and has a presence in 19 countries, including
India.

ICICI Prudential Life Insurance is a joint venture between ICICI Bank, a premier
financial powerhouse, and Prudential plc, a leading international financial services
group headquartered in the United Kingdom. ICICI Prudential Life was amongst the
first private sector insurance companies to begin operations in December 2000 after
receiving approval from Insurance Regulatory Development Authority (IRDA). ICICI
Prudential Life's capital stands at Rs. 47.91 billion (as of March 31, 2015) with ICICI
Bank and Prudential plc holding 74% and 26% stake respectively. For FY 2015, the
company garnered Rs.190.22 billion of total premiums and has underwritten over 16
million policies since inception. The company has assets held over Rs. 707.71 billion
as on March 31, 2015.

ICICI Lombard General Insurance Company, is a joint venture between ICICI Bank
Limited, India's second largest bank with consolidated total assets of over USD 91
billion at March 31, 2015 and Fairfax Financial Holdings Limited, a Canada based
USD 30 billion diversified financial services company engaged in general insurance,
reinsurance, insurance claims management and investment management. ICICI
Lombard GIC Ltd. is the largest private sector general insurance company in India

40
with a Gross Written Premium (GWP) of Rs. 5,358 crore for the year ended March
31, 2015. The company issued over 76 lakh policies and settled over 44 lakh claims
and has a claim disposal ratio of 99% (percentage of claims settled against claims
reported) as on March 31, 2015.

ICICI Securities Ltd is the largest integrated securities firm covering the needs of
corporate and retail customers through investment banking, institutional broking,
retail broking and financial product distribution businesses. Among the many awards
that ICICI Securities has won, the noteworthy awards for 2015 were: Asiamoney
`Best Domestic Equity House for 2015; 'BSE IPF D&B Equity Broking Awards 2015'
under two categories:- Best Equity Broking House - Cash Segment and Largest E-
Broking House; the Chief Learning Officer Award from World HRD Congress for
Innovation in Learning category. IDG India's CIO magazine has recognized ICICI
Securities as a recipient of CIO 100 award in 2009, 2010,2015 and 2015. I-Sec won
this awards 4 times in a row for which the CIO Hall of Fame award was additionally
conferred in 2015.

ICICI Securities Primary Dealership Limited (‘I-Sec PD’) is the largest primary
dealer in Government Securities. It is an acknowledged leader in the Indian fixed
income and money markets, with a strong franchise across the spectrum of interest
rate products and services - institutional sales and trading, resource mobilisation,
portfolio management services and research. One of the first entities to be granted
primary dealership license by RBI, I-Sec PD has made pioneering contributions since
inception to debt market development in India. I-Sec PD is also credited with
pioneering debt market research in India. It is one of the largest portfolio managers in
the country and amongst PDs, managing the largest AUM under discretionary
portfolio management.
I- Sec PD’s leadership position and research expertise have been consistently
recognised by domestic and international agencies. In recognition of our performance
in the Fixed Income market, we have received the following awards:

 “Best Domestic Bond House” in India - 2007, 2005, 2004, 2002 by Asia
Money

41
  “Best Bond House” - 2009, 2007, 2006, 2005, 2004, 2001 by Finance Asia
 “Best Domestic Bond House” – 2009 by The Asset Magazine’s annual Triple
A Country Awards
 Ranked volume leader - by Greenwich Associates in 2010 Asian Fixed-
Income Investors Study. Ranked 5th in ‘Domestic Currency Asian Credit’
with market share of 4.5%, Only Domestic entity to be ranked.
 “Best Debt House in India” – 2015 by EUROMONEY

ICICI Prudential Asset Management is the third largest mutual fund with average
asset under management of Rs. 688.19 billion and a market share ( mutual fund ) of
10.34% as on March 31, 2015. The Company manages a comprehensive range of
mutual fund schemes and portfolio management services to meet the varying
investment needs of its investors through150 branches and 196 CAMS official point
of transaction acceptance spread across the country.
ICICI Venture is one of the largest and most successful alternative asset managers in
India with funds under management of over US$ 2 billion. It has been a pioneer in the
Indian alternative asset industry since its establishment in 1988, having managed
several funds across various asset classes over multiple economic cycles. ICICI
Venture is a wholly owned subsidiary of ICICI Bank

GROUP PHILOSOPHY

As India transforms into a key player in the global economic arena, multiple
opportunities for the financial services sector have emerged. We, at ICICI Group,
seek to partner the country's growth and globalization through the delivery of world-
class financial services across all cross-sections of society.
From providing project and working capital finance to the buoyant manufacturing and
infrastructure sectors, meeting the foreign investment and treasury requirements of the
Indian corporate with increasing levels of international engagement, servicing the
India linked needs of the growing Indian diaspora, being a catalyst to the consumer
finance story to serving the financially under-served segments of the society, our
technology empowered solutions and distribution network have helped us touch
millions of lives.

Vision:

42
To be the leading provider of financial services in India and a major global bank.

Mission:
We will leverage our people, technology, speed and financial capital to:

 be the banker of first choice for our customers by delivering high quality,
world-class products and services.
 expand the frontiers of our business globally.
 play a proactive role in the full realisation of India’s potential.
 maintain a healthy financial profile and diversify our earnings across
businesses and geographies.
 maintain high standards of governance and ethics.
 contribute positively to the various countries and markets in which we operate.
 create value for our stakeholders.

Towards Sustainable Development

As India's fastest growing financial services conglomerate, with deep moorings in the
Indian economy for over five decades, ICICI Group of companies have endeavored to
contribute to address the challenges posed to the community in multiple ways.
1) ICICI Foundation for Inclusive Growth: ICICI Foundation for Inclusive Growth
(ICICI Foundation) was founded by the ICICI Group in early 2019 to carry forward
and build upon its legacy of promoting inclusive growth. ICICI Foundation works
within public systems and specialised grassroots organisations to support
developmental work in four identified focus areas. We are committed to investing in
long-term efforts to support inclusive growth through effective interventions.
2) Disha Counselling: Disha Financial Counselling services are free to all in areas
like financial education, credit counselling and debt management.
3) Technology Finance Group: TFG's programmes are designed to assist industry
and institutions to undertake collaborative R&D and technology development
projects.
4) Read to Lead campaign: ICICI Bank has pledged to educate 1,00,000 children
through the 'Read to Lead initiative. Because education today means a better life
tomorrow.
5) Go Green. Each one for a better earth: ICICI Bank, is a responsible corporate

43
citizen and believes that every small 'green' step today would go a long way in
building a greener future and that each one of us can work towards a better earth.
Go Green' is an organisation wide initiative that moves beyond moving ourselves, our
processes and our customers to cost efficient automated channels to building
awareness and consciousness of our environment, our nation and our society.
PERSONAL BANKING
Deposits
ICICI Bank offers wide variety of Deposit Products to suit your requirements.
Convenience of networked branches/ ATMs and facility of E-channels like Internet
and Mobile Banking, Select any of our deposit products and provide your details
online and our representative will contact you.
Loans
ICICI Bank offers wide variety of Loans Products to suit your requirements. Coupled
with convenience of networked branches/ ATMs and facility of E-channels like
Internet and Mobile Banking, ICICI Bank brings banking at your doorstep. Select any
of our loan product and provide your details online and our representative will contact
you for getting loans.
Cards
ICICI Bank offers a variety of cards to suit your different transactional needs. Our
range includes Credit Cards, Debit Cards and Prepaid cards. These cards offer you
convenience for your financial transactions like cash withdrawal, shopping and travel.
These cards are widely accepted both in India and abroad. Read on for details and
features of each.
Wealth Management
Wealth is the result of a recognized opportunity. We understand this and we work
with you to plan and manage your financial opportunities prudently. Not just that, we
also extend a host of services so you can remain focused on immediate objectives
while we take care of all your wealth management requirements.

44
 CHAPTER-IV
DATA
ANALYSIS AND
INTERPRETATIONS

DATA ANALYSIS

In this chapter an attempt has been made to analysis how efficiently the analysis of

Financial statement is managed in Dr ready’s laboratories. Financial tools such as

45
schedule of changes in ratio analysis, least squares, comparative statements have

been used for the purpose of analysis. The financial statement involves

recording classifying and summarizing of various business transactions. It is

prepared for the purpose of presenting a periodical review or report of the

progress made by the concern and deals with the state of the investment, in

the business and ‘result achieved’ during the accounting period. Financial

statement, income statement and position statement are the outcome of

accounting process.

Ratio analysis is a technique of analysis and interpretation of financial

statements. It is used as a device to analysis and interpret the financial health

of a firm. Analysis of a financial statement with the aid of ratio helps to

arrangements in decision making control.

1) Current Ratio

46
 Current ratio may be defined as the relationships between current assets

and current liabilities. It is the most common ratio for measuring liquidity. It

is calculated by dividing current assets by current liabilities. Current assets

are those, the amount of which can be realized within a period of one year.

Current liabilities are those amounts which are payable within a period of

one year. A current ratio of 2:1 is considerable ideal.

Current Assets

Current Ratio =

Current liabilities

TABLE – 4.1 Current Ratio

(in

crores)

Year Current Assets Current Current Ratio

liabilities
2015-2016 15343 8446 1.57
2016-2017 18331 19321 1.58
2017-2018 21963 16420 1.46
2018-2019 27705 20821 1.39
2019-2020 36901 28333 1.30
Source : secondary Data

Interpretation

Current ratio during the year 15-16 is the 1.57. In the next year 2016-17 it

was maximum 1.58 and in the year 2017- 18 it was 1.46. In the year 2018-19

47
the current ratio is 1.39 and in the last year 2019--20 the current ratio

decreased to 1.30.

The ideal value of current ratio 2:1, but during the period of study,

the current ratio is lesser than the standard. This shows the current ratio to

shows a do down ward which indicates the inefficiency of the company to

meet its current obligations.

CHART NO.1

4000

3500

3000

2500

2000

1500

1000

500

0
YEAR 2008 2009 2010 2011
-500

2) Liquid Ratio:-

48
 The teem ‘Liquidity’ refers to the ability of a firm to pay its short –

term obligations as and when they become due. The term quick assets or

liquid assets refers current assets, which can be converted into cash

immediately. It comprises all current assets except stock and prepaid

expenses. It is determined by dividing quick assets by quick liabilities.

Liquid Assets

Liquid Ratio =

Liquid Liabilities

TABLE – 4.2 Liquid Ratio

(in crores)

Year Current Assets Current Current Ratio

liabilities
2015-2016 19427 8446 1.23
2016-2017 12587 19321 1.21
2017-2018 21921 16420 1.45
2018-2019 27648 20821 1.39
2019-2020 36823 28333 1.29

Source : Secondary Data

Interpretation

Liquid ratio during the year 2017-2018 it attains the maximum value

of 5.20. in the above year it was slightly reduced to 2015 – 16 to 1.23. In the

49
next year, 2016-17 it further decreased to 1.21 and in the next year 2018-19

1.39. in the last year decreased 2019—2020 to 1.29.

During the period of study, the value of liquid ratio is higher than the

ideal value which indicates the efficiency of the company to meet is

immediate requirements. The overall trend of liquid ratio shows up and

down ward trend.

CHART NO.2

600

500

400
PERCENTAGE CHANGE (%)
300 ABSOLUTE CHANGE
PRICE ($)*
200

100

0
2008 2009 2010 2011 2012

3) Proprietary Ratio :

Proprietary ratio relates to the proprietors funds to total assets. It revels the

owners’ contribution to the total value of assets. This ratio shows the long –

50
time solvency of the business. It is calculated by dividing proprietor’s funds

by the total tangible assets.

Proprietor’s Funds

Proprietary Ratio = -------------------------------

Total Tangible Assets

TABLE – 4.3 Proprietary Ratios

Year Proprietary Total Proprietary

Fund Assets Ratio

2015-2016 6027 16483 0.41
2016-2017 7301 19498 0.41
2017-2018 8788 22354 0.39
2018-2019 19774 29344 0.36
2019-2020 12939 39528 0.32
(in crores)

Source : Secondary Data

Interpretation

Proprietary ratio during the year 2015-16 and 2016-17 it attains the maximum

value of 0.41. In the year2015-16 the proprietary ratio was slightly reduced to

0.39. In the next year, 2018-19 It further reduced to 0.36. During the year

2019-20 it further decreased to 0.32.

51
CHART NO.3

45000

40000

35000

30000

25000 Proprietary Fund

Total Assets
20000 Proprietary Ratio

15000

10000

5000

4) Net Profit Ratio

Net Profit Ratio establishes a relationship between net profit (after

taxes) and sales. It is determined by dividing the net income after tax to the net

sales for the period and measures the profit per rupees of sales.

Net Profit

Net Profit Ratio =-----------------------------------------190

52
 Sales

TABLE- 4.4 Net Profit Ratio

(in crores)

Year Net Profit Sales Net Profit

Ratio
2015-2016 953 19336 9.2%
2016-2017 1879 16,525 20.6%
2017-2018 2417 20739 12.9%
2018-2019 2859 21601 15.4%
2019-2020 3158 28033 20.20%

Source : Secondary Data

Interpretation

From the table, it is found that the net profit has been fluctuating during

the study period. In the year 2015-16 the net profit ratio was 9.2%. In the year

2016-17 it was increased to 20.6%. In the next year 2017-18 it was further

increased 12.9%. During the year 2018-19 there was a slight increases to

15.4%. During the year 2019-20 the net profit ratio was 20.20%.

53
CHART NO.4

30000

25000

20000

15000
Net Profit
10000
Sales
5000 Net Profit Ratio

0 Net Profit Ratio

Net Profit

5) Stock Turnover Ratio:

This ratio Indicates whether investment in inventory is efficiently used

or not. It explains whether investment in inventories in within proper limits or

not. It also measures the effectiveness of the firm’s sales efforts. The ratio is

calculated as follows.

Cost of goods sold

Stock Turnover = -------------------------------

Average Stock

Cost of goods sold = Sales- Gross Profit

54
Average stock = Opening stock + Closing stock

TABLE – 4.5 STOCK TURNOVER RATIO

(in crores)

Year Cost of goods Average Stock

sold Stock Turnover Ratio

2015-2016 8673 2920 2.97
2016-2017 20902 3653 3.25
2017-2018 16960 4971 3.00
2018-2019 18936 7187 2.38
2019-2020 23173 9350 2.47

Source : Secondary Data

Interpretation

From the table, it is found that the stock Turnover ratio has been

fluctuating during the study period. In the year 2015-16 it was 2.97, It

increases during the year 2016-17 was slightly to 3.25. In the year 2017-18 it

was 3.00 and decreases to 2.38 in the year 2018-19 and during the year 2019-

2020 it was increased to 2.47.

CHART NO.5

55
 100%
90%
80%
70%
60%
50%
Stock Turnover Ratio
40%
Average Stock
30% Cost of goods sold
20%
10%
0%

6) Average debt collection period

The average number of days that lapsed between the receipt of the

invoice by customers and the actual payment of the invoice . When measured

against the credit terms obtained from suppliers, average the account period

shows the length of time during which the firm is financing the account

receivable either with its own funds or borrowed funds. The radio may be

calculated as follows:

56
 Debtors B/R

Average debt collection period = -------------------------------

Net Credit sales

TABLE - 4.6 Debt Collection Period

(in crores)

Year Debtors Credit Sales Debt Collection

Period
2015-2016 5972 19336 219 days
2016-2017 7189 16525 200 days
2017-2018 9695 20739 208 days
2018-2019 20975 21601 204 days
2019-2020 17976 28033 217 days

57
Source : Secondary Data

Interpretation

Debt Collection period ratio in the year 15-16 was 219 days. In next

year 16-17 it further reduced to 200 days. In the next year 17-18 it was 208

days. In the next year 2018-19 it was 204 days. During the years 2019-20 it

was 217 days.

From the above it is inferred that the debt collection period shows a fluting

trend, which indicates quick recovery of money from debtors and also

indirectly shows that the management in highly efficient in collecting debts

promptly.

CHART NO.6

2017-2018 15976 28033

100%
80%
60%
40%
2017-2018 15976 28033
20% 0
0%

58
7) Creditors turnover ratio:

It indicates the number of times on the average that the creditors

turnover each year. Creditors turnover ratio indicates the number of items the

accounts payable rotate in a year. It signifies credit period enjoyed by the firm

in paying its creditors. Account payable include traded creditors and bills

payable.

. Credit Purchases

Creditors Turnover Ratio = -------------------------------

Average account payable

TABLE – 4.7 Creditor Turnover Ratio

(in crores)

Year Credit Purchase Average Creditor

Account Turnover ratio

payable
2015-2016 4892 2190 2.32
2016-2017 6866 284 24.19
2017-2018 19202 3538 2.87
2018-2019 20821 4424 2.67
2019-2020 19620 5852 3.0

59
Source : Secondary Data

The creditor Turnover ratio during the year 15-16 was 2.32. In the year

16-17 it was increased to 24.19. In the year 17-18 creditors turnover ratio

slightly reduced to 2.87. In the year 16-17 it was reduced to 2.67. During the

year 2019-2020 it was increased to 3.0

From the above it in inferred that the creditors turnover ratio shows an

upward trend which indicates that the company is highly efficient in making.

Speedy settlements of debts to its creditors.

CHART NO.7

20000
18000
16000
14000
12000
Credit Purchase
10000 Average Account payable
8000 Creditor Turnover ratio

6000
4000
2000
0

60
The radio gives the average credit period enjoyed by the firm from its

creditors. It can be as follows.

61
8) Fixed assets turnover Ratio:

The ratio indicates that extent to which the investments in Fixed assets

contributes towards sales. If compared with a previous year, it indicates

whether the investment in Fixed assets has been judicious or not. The ratio is

calculate as follows.

Sales

Fixed assets turnover ratio = -------------------------------

Fixed assets

4.8 Fixed asset Turnover ratio

(in crores)

Sales Fixed asset Fixed asset

Year Turnover
2015-2016 19336 2040 9.15
2016-2017 16525 2067 12.44
2017-2018 20739 1291 16.51
2018-2019 21601 1839 15.05
2019-2020 28033 2627 19.67
Source : Secondary Data

Interpretation

62
 The fixed asset turnover ratio during the year 2015-16 was 9.15. It is

found that the fixed asset turnover ration has been fluctuating during the study

period. In the year 16-17 it was 12.44. In the year 17-18 it was 16.51. During

the year 2016-17 the fixed asset turn over ratio was 15.05. This, last year

2019-2020 it was decreased to 19.67.

CHART NO.8

35000

30000

25000

20000

15000 Fixed asset Turnover

Fixed asset
10000 Sales

5000

63
9) Capital Turnover Radio:

Managerial efficiency is also calculated by establishing the

relationship between cost of sales or sales with the amount of capital invested
in the business. Capital turnover Ratio is calculated with the help of the
following formula.
Sales
Capital turnover ratio = --------------------------------------
Net worth (Or) Proprietor’s fund
TABLE – 4.9 Capital Turnover ratio (in crores)

Year Net worth (or) Sales Capital

Proprietor’s fund Turnover ratio

2015-2016 6027 19336 1.71
2016-2017 7302 16525 1.98
2017-2018 8789 20739 2.15
2018-2019 19775 21601 1.98
2019-2020 12939 28033 2.18

Sources : Secondary Data

Interpretation

It is inferred from the above table the capital turnover ratio for the year

15-16 was 1.71. In the year 16-17 it was 1.98. where as In the year was 2017-

18 it was increased to 2.15. In the year 2018-19 it was slightly decreased to

1.98. But during the year 17-18 it was increased further to 2.18.

64
CHART NO.9

100%
90%
80%
70%
60%
50% Capital Turnover ratio
40% Sales
30% Net worth (or) Proprietor’s
fund
20%
10%
0%

10) Return on total assets:

Profitability can be measured in terms of relationship between net

profit and total assets. It measures the profitability of investment. The overall

profitability can be known by applying this ratio.

Net Profit

Return on total Assets =------------------------------------190

Table assets

65
TABLE – 4.10 Return on Total assets

Year Net Profit Total asset Return on Total

assets
2015-2016 1782 16482 19.92
2016-2017 2564 19497 16.65
2017-2018 3736 22354 18.71
2018-2019 4430 29344 17.18
2019-2020 4849 39528 12.26

Source : Secondary Data

Interpretation

From, the above table, it was found that the return on total asset has

been fluctuating during the study period. In the year 2015-16 it was 19.92. In

the year 2016-17 it was increased to 16.65. In the year 2017-18 was increased

further increased to 18.71 and in the year 18-19 it was reduced to 17.18.

During the year 2019-20 it was slightly decreased to 12.26.

CHART NO.10

66
 45000
40000
35000
30000
25000
20000 Return on Total
15000 assets Total asset
Net Profit
10000
5000
0

11) Operating Ratio

Operating ratio is an indicative of the proportion that the cost of sales

bears to sales. ‘Cost of sales’ includes direct cost of goods sold as well as

other operating expenses. It is an important ratio that is used to discuss the

general profitability of the concern. It is calculated by dividing the total

operating cost by net sales.

Cost of goods sold + Net operating expenses

Operating ratio = X190

Sales

Cost of goods sold = sales = gross profit.

67
TABLE – 4.11

TABLE – 4.16 Operating ratio

(in crores)

Year Cost of goods Sales Operating ratio

sold + operating

expenses
2015-2016 8673 19336 83.9
2016-2017 20902 16525 81.9
2017-2018 16960 20739 79.8
2018-2019 18936 21601 79.1
2019-2020 23173 28033 82.5

Source : Secondary Data

Interpretation

The above table clearly reveals that the Operating ratio for the year 15-

16 was 83.9. But in the year 16-17 it was slightly reduced to 81.9 and in the

year 17-18 it was further reduced to 79.8. In the year 18-19 It was 79.1.

During the year last year 2019-2020 it was increased to 82.5.

CHART NO.11

68
 60000

50000

40000

30000 Operating ratio

Sales
20000 Cost of goods sold
+ operating
10000 expenses

12) Assets Turnover Ratio

This ratio is also called as Investments Turnover Ratio”. It expresses

the relationship between cost of goods sold / net sales and assets/ investments

of a firm. The figure of net sales can be used where information regarding cost

of goods sold is not available. There are many variants of this ratio

accordingly as there are differences in the concept of assets employed.

Total Assets

Assets Turnover Ratio = -------------------------------

Sales

TABLE – 4.12 Asset turnover ratio

(in crores)

69
 Year Fixed Current Total Sales Assets

assets assets assets Turnover

ratio
2015-2016 2039 15343 16481 19336 1.4
2016-2017 2066 18331 19496 16525 1.2
2017-2018 1291 21963 22353 20739 1.1
2018-2019 1839 27705 29343 21601 1.3
2019-2020 2627 36901 39528 28033 1.4
Source : Secondary Data

Interpretation

From the table, it is understood that the Asset turnover ratio for the 2015-16

was 1.4. In the year 2016-17 it was reduced to 1.2. In the year 2017-18 it was

further reduced to 1.1. In the year 2018-2019 there is slight increase to

1.3.while in the year 2019-2020 it was slightly increaed to 1.4

CHART NO.12

70
 140000

120000

100000

80000

60000

40000

20000

0
Fixed assets Current assets Total assets Sales Assets Turnover ratio

15) Gross Profit Ratio:

Gross Profit ratio measures the relationship of gross profit to net sales

and is usually represented as a percentage. This ratio plays an important role

in two management areas. In the area of financial management, the ratio

serves as a valuable indicator of the firm’s ability to utilize effectively outside

sources of fund. Secondly, this ratio also serves as important tool in shipping

the pricing policy of the firm. This ratio is calculated by dividing gross profit

by net sales.

Gross Profit

Gross Profit Ratio =------------------------------------190

Net Sales

71
Table – 4.15 Gross Profit ratio

(in crores)

Year Gross profit Sales Gross Profit

Ratio
2015-2016 1863 19336 18.0%
2016-2017 2623 16525 20.0%
2017-2018 3779 20739 20.1 %
2018-2019 4465 21601 20.8 %
2019-2020 4880 28033 19.4 %

Source : Secondary Data : The above table shaows that the Gross profit
Ratio during the year 2015-16 was 18.0%. In the year 2016-17 it was
increased to 20.0%. In the following year 2017-18 increased to 20.1 %. In the
year 2018-19 there was slight increases to 20.8 %. In this last year was 2019-
20 the gross profit ratio was 19.4 %
CHART NO.15

30000

25000

20000

Gross profit
15000 Sales
Gross Profit Ratio

10000

5000

TABLE – 4.16 Comparative Statement for the year

2015-16 to 2016-17

(in crores)

72
 Particulars 2015-16 2016-17 Absolute % of

change change
Assets:

Fixed Asset 2040 2067 27 2.36

Current asset 15343 18331 2988 22.39
Total 16483 19498 3017 20.81
Liabilities :

Current 7120 8817 1888 23.70

Liabilities
Others 1525 1712 207 16.20
Total 8445 19320 2075 22.20

Sources : Secondary Data

Interpretation

From this table, it is found that the comparative statement for the year

has been fluctuating during the study period. In the year 2015-16 to 2016-17

having fixed assets was 2.36 & current asset was increased to 22.39. and in

the year 2015-16 to 2016-17 current liabilities increased 23.70 and other

liabilities it was 16.20.

CHART NO.16

73
 20000
18000
16000
14000
12000
10000
8000
6000
4000
2000
0

TABLE – 4.17

74
 Comparative Statement for the year

2016-17 to 2017-18

(in crores)

Particulars 2016-17 2017-18 Absolute % of

change change
Assets: 2067 1291 124 19.62

Fixed Asset
Current 1833 21963 4732 28.97

asset
Total 19498 22354 4856 27.75
Liabilities : 8817 20898 3180 35.17

Current

Liabilities
Others 1712 2522 1919 66.79
Total 19320 16420 4190 39.72

Sources : Secondary Data

Interpretation

From this, table was comparative statement for the year has been fluctuating

during the study period. In the year 2016-17 Fixed assets was increased by

19.62 . Current assets was 28.97. and the current liabilities was 35.17.

CHART NO.17

75
 45000
40000
35000
30000
25000
20000
15000
10000
5000
0

TABLE – 4.18

Comparative Statement for the year

76
 2017-18 to 2018-19

(in crores)

2017-18 2018-19 Absolute % of

Particulars change change

Assets: 1291 1839 348 26.95

Fixed Asset
Current asset 21963 27705 6642 31.53
Total 22354 29344 6990 31.26
Liabilities : 20898 18576 4678 39.31

Current Liabilities
Others 2522 3244 722 28.62
Total 16420 20820 5400 37.44

Sources : Secondary Data

Interpretation

In the year comparative statement from the 2017-18 to 2018-19. The fixed

assets was increased by 26.95 while the Current assets was increased by

31.53 and current liabilities by 39.31.

CHART NO.18

77
 60000

50000

40000

30000

20000

10000

TABLE – 4.19 Comparative Statement for the year

2018-2019 to 2019-2020

78
 Particulars 2018-19 2019-20 Absolute % of

change change
Assets: 1839 2627 988 60.28

Fixed Asset
Current 27705 36901 9206 33.20

asset
Total 29344 39528 19204 34.70
Liabilities : 18576 23357 6781 40.90

Current

Liabilities
Others 3244 4976 1932 53.39
Total 20820 28333 8515 42.95

In the year comparative statement from the 2018-2019 to 2019-2020.

The above table clearly reveals that the was tremendous increase in the fixed

asset to 60.28. In the same year current asset was increased by 33.20 and the

current liabilities was by 40.90.

CHART NO.19

79
90000
80000
70000
60000
50000
40000
30000
20000
10000
0

80
 CHAPTER-V
FINDINGS, SUGGESTIONS
AND
CONCLUSIONS

81
FINDINGS

82
Current ratio shows a document trend indicating the company not able to fulfill

current obligations furthers this also indicate that liquidity position of the company

is less satisfactory.

In all the five years the current ratio is less than the ideals of 2. Creditors

term over ratio shows an upward trend and indicates better credit management.

In all the five years the liquid ratio is higher than the ideal ratio of 1 Common size

financial statements clearly shoes the firm allocates half of the total current assets to

debtor.

The firm’s debt collection period have more than 200days it increased the debt

collection period year by year. It shows firms liberal debt collection policy.

1. Fixed assets turnover was 20% in the year 2019-20.

2. Capital turnover ratio was 2.18 in the year 2019-20.

3. Return on total assets that decreased from 17.18 in the year 2018-2019 to 12.26

in the 2019-2020.

4. Operating ration has increased from 79.1 in the year 16-17 to 82.5 in the year

2019-20

5. Asset turnover ratio was 1.4 in the year 2019-20.

6. Gross profit ratio has come down from 21% in year 2018-2019 to 19% in 2019-

20.

7. Sales shows the increasing trend at the rate in every year.

83
SUGGESTIONS

1. Company may look into increasing various forms of currents assets and

decreasing current liabilities to effective manage working capital requirement.

2. Company may maintain gross profit in and around 98% as seen in 2016-17 in

the coming financial years.

3. The company has to lookout new joint ventures and assignments.

4. To meet the short term requirements the company has to raise short term as

well as long term loans.

5. To attract to the new customers the company has to adapt new procedures

and new technology.

84
CONCLUSION

Even though company is utilizing its own funds there is very need that

company should improve its liquidity position, debtors collection period. Utilization

of proper management of its current assets and current liabilities.

The external debt of the company decreased gradually. This is mainly due to

repayment of a portion of term loans. The another reason for decrease in external

debt is due to increase in reserves and surplus.

The year was 425.67 Crs this indicates there is possible growth of the company in

the market. During 2015-2020 ICICI BANK LIMITED has under taken research

program, modernization and technology up gradation, for the above said expansion

programs it has made use of surplus funds only and did not go for outsider’s debts,

which is one of the good long-term financial policy of ICICI BANK LIMITED.

85
 BIBLIOGRAPHY

1. Khan, M Y and P K Jain, Financial Management,

Tata McGraw-Hill Publishing Co., New Delhi, 2007.

2. I M Pandey, Essentials of Financial Management, Vikas

Publishing House Pvt Ltd, New Delhi, 2095.

3. Ramesh, S and A Gupta, Venture Capital and the Indian

Financial Sector, Oxford university press, New Delhi, 2095.

www.googlefinance.com
www.hdfcbank.com

www.workingcapitalmanagement.com
www.icicibank.com
www.autoindia.com

86