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UNIVERSITY OF MUMBAI
RAYAT SHIKSHAN SANSTHA’S
KARMAVEER BHAURAO PATIL COLLEGE
VASHI, NAVI MUMBAI
COLLEGE CODE – 33
PROJECT REPORT
ON
COMPARATIVE STUDY OF FINANCIAL RATIO OF STATE BANK OF
INDIA AND BANK OF BARODA
SUBMITTED BY
AARTI LAXMAN BANGAR
ROLL NO : 8371
PROJECT GUIDE
Dr. Megha Lh!"a
IN PARTIAL FULFILLMENT FOR THE COURSE OF
MASTER OF COMMERCE
M.COM.PART – II (SEMESTER IV)
ACADEMIC YEAR 2015-16
RAYAT SHIKSHAN SANSTHA’S
1
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KARMAVEER HA!RAO PATIL COLLEGE
VASHI, NAVI MUMBAI 400 703.
CERTI"ICATE
T!" !" #$ %&'#!() #*# A#$%& L#'# #*#$ , "#+&-# $(
M.C$.P*'#/II S&&"#&' III *" %$& &' '$2&%# $-COMPARATIVE STUDY OF FINANCIAL RATIO OF STATE BANK OF INDIA &
BANK OF BARODA & *" "+!##& * "*#!"(*%#$') '&$'# +-&' #&
+!*-%& $( D$. M+*,# L,&# !- #& *'#!* (+5&-# $( M.C$.
C$+'"& $( U-!6&'"!#) $( M+*! !- #& *%*&!% )&*' 2015-2016
P'$2&%# +!& C$$'!-*#$'
P'!-%!*
U-!6&'"!#) E*!-&'
8
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DECLARATION
I , A#$%& L#'# #*#$ "#+&-# $( KARMAVEER HA!RAO
PATIL COLLEGE, "#+)!- !- M.C.P#$%-II. (S++/%+$ IV)
&'&) &%*'& #*# I *6& %$& #!" '$2&%# '&$'# $-
COMPARATIVE STUDY OF FINANCIAL RATIO OF STATE BANK OF INDIA &
BANK OF BARODA A- *" -$# &&- "+!##& #$ *-) $#&'
U-!6&'"!#) $' I-"#!#+#& ($' #& *9*' $( *-) &'&&, !$* %.
T& !-($'*#!$- !" "+!##& #$ & !" #'+& *- $'!!-* #$ #& &"#
$( ) :-$9&&.
D*#& ;;;;.. A#$%& L#'# #*#$
P*%& ? V*"!, N*6! M+*!.
3
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INDEX
Sr. No. Content Pg. No. Remark/
Sign
1. Research Methodology:
a) Obecti!e o" St#dy
b) $ntrod#ction o" Ratio
c)Classi"ication o" Ratio
%
2. $ntrod#ction o" ank '
3. $ntrod#ction o" Ratio (
4. Ratio nalysis o":
a) State ank o" $ndia
b) ank o" aroda
( to 1(
*+ to *,
5. -inancial Comarati!e nalysis:
a) /S o" S$ & O
b) P/ Statement o" S$ & O *, to 0(
6. Concl#sion
+
7. Re"erence/ ibliograhy 1
4
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RESEARC METODOLO!Y
"TE COMPARATIVE STUDY OF FINANCIAL RATIO OF STATE BANK OF INDIA
AND BANK OF BARODA.#
OB#ECTIVE O$ THE %TUD&:'
1. To know the strength and weakness of State Bank Of India and Bank Of Baroda
through Ratio analysis.2. To evaluate the performance of the companies.. To understand the li!uidity" profita#ility and efficiency positions of the companies.$. To make comparison #etween the ratios during different periods.
INTRODUCTION:
$!(a()!a* Ma(age+e(, is the specific area of finance dealing with the financial
decision corporations make" and the tools and analysis used to make the decisions. The
@
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discipline as a whole may #e divided #etween long%term and short%term decisions and
techni!ues. Both share the same goal of enhancing firm value #y ensuring that return
on capital e&ceeds cost of capital" without taking e&cessive financial risks.
Ca-!,a* !(e/,+e(, 0e)!/!(/ comprise the long%term choices a#out which pro'ects
receive investment" whether to finance that investment with e!uity or de#t" and when or
whether to pay dividends to shareholders.
Short%term corporate finance decisions are called working capital management and deal
with #alance of current assets and current lia#ilities #y managing cash" inventories" and
short%term #orrowings and lending (e.g." the credit terms e&tended to customers).
*orporate finance is closely related to managerial finance" which is slightly #roader in
scope" descri#ing the financial techni!ues availa#le to all forms of #usiness enterprise"
corporate or not.
RE%EARCH METHODOLOG&
The )()*/!e re/ear)h !/ 2e!(g /e0 , /,0" ,he )+-ar!/( ,he
)+-a(!e/.
Da,a )**e),!(:
%e)(0ar" 0a,a !/ 2e!(g ,a4e(5e2/!,e/
O,)+e/ ,he /,0":
1. 5!,h ,h!/ a(a*"/!/ 6e )+e , 4(6 a2, ,he strength and weakness of
State Bank Of India and Bank Of Baroda through Ratio analysis.2. To evaluate the performance of the companies.. To understand the li!uidity" profita#ility and efficiency positions of the companies.$. To make comparison #etween the ratios during different periods.+.
INTRODUCTION
DE$INITION O$ BANK
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Banking ,eans -ccepting /eposits for the purpose of lending or Investment of
deposits of money from the pu#lic" repaya#le on demand or otherwise and withdraw
#y che!ue" draft or otherwise.-
% Ba(4!(g C+-a(!e/ Reg*a,!( A),91;
ORIGIN O$ THE 5ORD
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%TATE BANK O$ INDIA
%,a,e Ba(4 I(0!a I(0/,r" :Ba(4/ ' P2*!) %e),r
Incorporation 6ear 17++%mail gm.sn#8s#i.co.in
3e#site http9::www.s#i.co.in 4ace ;alue (Rs) 1<
It is the largest Indian #anking and financial services company (#y turnover and total
assets) with its head!uarters in ,um#ai" India. It is state%owned. The #ank traces its
ancestry to British India" through the Imperial Bank of India" to the founding in 1= of
the Bank of *alcutta" making it the oldest commercial #ank in the Indian Su#continent.
Bank of ,adras merged into the other two presidency #anks" Bank of *alcutta and
Bank of Bom#ay to form Imperial Bank of India" which in turn #ecame State Bank of
India. The government of India nationalied the Imperial Bank of India in 17++" with the
Reserve Bank of India taking a >
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CURRENT RATIO:
n indication of a company5s a#ility to meet short%term de#t o#ligationsE the
higher the ratio" the more li!uid the company is. *urrent ratio is e!ual to current assets
divided #y current lia#ilities. If the current assets of a company are more than twice the
current lia#ilities" then that company is generally considered to have good short%term
financial strength. If current lia#ilities e&ceed current assets" then the company may
have pro#lems meeting its short%term o#ligations.
CURRENT RATIO * CURRENT ASSETS CURRENT LIABILITY
c#rrent ratio
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year *++'2*+11
year Ratio
*++' +.+%
*++3 +.+'
*++( +.+
*+1+ +.+
*+11 +.+
LI=UID RATIO:
Ai!uid ratio is also known as >=!)4? r >A)!0 Te/, >Ra,!. Ai!uid assets refer to
assets which are !uickly converti#le into cash. *urrent ssets other stock and prepaid
e&penses
are considered as !uick assets.
=!)4 Ra,! @ T,a* =!)4 A//e,/
T,a* Crre(, L!a2!*!,!e/
10
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=!)4 A//e,/ @ T,a* Crre(, A//e,/ I(e(,r"
4ear Ratio
*++' ,.%*
*++3 ,.1%
*++( %.'*+1+ (.+'
*+11 3.%+
1 8 3 4 @
0
1
8
3
4
@
7
10
@.74
.07 .@
& $#%&
+!%: '*#!$
EARNING PER %HARE:
In order to avoid confusion on account of the varied meanings of the term capital
employed" the overall profita#ility can also #e 'udged #y calculating earning per share
with the help of the following formula9
Ear(!(g Per E!," %hare @ Ne, Pr!, a,er Ta Preere()e D!!0e(0
N. E!," /hare/
The earning per share of the company helps in determining the market price of the
e!uity shares of the company. comparison of earning per share of the company with
another will also help in deciding whether the e!uity share capital is #eing effectively
11
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used or not. It also helps in estimating the companyFs capacity to pay dividend to its
e!uity shareholders.
4ear Ratio
*++' 3,.*(
*++3 1+,.%,
*++( 10.,'
*+1+ 1.0'
*+11 11,.+'
1 8 3 4 @
0
80
40
0
0
100
180
14010
.8
10.@
143.7 144.37
11.07
E#$&* P+$ S,#$+ R#%&
R*#!$
DIVIDEND PER %HARE :
It is e&pressed #y dividing dividend paid to e!uity shareholders #y no. of e!uity shares.
this shows the per share dividend given to e!uity shareholders. It is very helpful for
potential investors to know the dividend paying capacity of the company. It affects the
market value of the company.
18
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D!!0e(0 Per %hare @ D!!0e(0 Pa!0 T E!," %hareh*0er/
N. O E!," %hare/
di!idend er
share
*++' 1
year *++3 *1.%
*++( *(
*+1+ 0+
*+11 0+
0
@
10
1@
80
8@
30
3@
14
81.@
830 30
4&&4+4 +$
/,#$+
NET PRO$IT RATIO:
This ratio indicates the @et margin on a sale of Rs.1
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This ratio helps in determining the efficiency with which affairs of the #usiness are #eing
managed. n increase in the ratio over the previous period indicates improvement in the
operational efficiency of the #usiness. The ratio is thus on effective measure to check
the profita#ility of #usiness.
net ro"it
ratio
*++' 1+.1*
year *++3 11.,%
*++( 1*.+0
*+1+ 1+.%
*+11 3.%%
0
8
4
10
18
14
10.18
10.@4
.@@
- '$5# '*#!$
RETURN ON NET 5ORTH:
It measures the profita#ility of the #usiness in view of the shareholders. It 'udges the
earning capacity of the company and the ade!uacy of return on proprietorFs funds.
Shareholders and potential investors are interested in this ratio. It is calculated as
#elow9
14
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Re,r( O( Ne, 5r,h @ Ne, Pr!, A,er I(,ere/, A(0 Ta 1
%hareh*0er?/ $(0/
ret#rn onshareholder5
s
*++' 1.%
year *++3 10.'*
*++( 1%.'
*+1+ 10.3(
*+11 1*.'1
0
8
4
10
18
14
1
1
13.
18.71
'+'- $-
"*'&$&'"
DEBT' E=UIT& RATIO:
The /e#t%!uity ratio is calculated to find out the long%term financial position of the firm.
This ratio indicates the relationship #etween long%term de#ts and shareholderFs funds.
The soundness of long%term financial policies of a firm can #e determined with the help
of this ratio. It helps to assess the soundness of long%term financial policies of a
#usiness. It also helps to determine the relative stakes of outsiders and shareholders.
1@
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Aong%term creditors can assess the security of their funds in a #usiness. It indicates to
what e&tent a firm depends upon lenders to meet its long%term financial re!uirements.
low /e#t%!uity ratio is considered #etter from the point of view of creditors.
6otal7ebt to
O8ners
-#nd
*++' 10.(*
year *++3 1+.(,
*++( 1*.31
*+1+ 1*.1(
*+11 1.0'
0
8
4
10
18
14
113.8
10.
18.118.1
14.37
T%#7 D+8% % O9+$/ "4
T$#* D&# #$ O9-&'"
F+-
$IXED A%%ET% TURNOVER RATIO:
It is also called as Sales to 4i&ed ssets Ratio. It measures the efficient use of fi&ed
assets. This ratio is a measure of efficient use of fi&ed assets. it is calculated as9
$!e0 A//e,/ Tr(er Ra,! @ C/, g0/ /*0 r %a*e/
Ne, $!e0 A//e,/
1
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It measures the efficiency and profit earning capacity of the #usiness. igher the ratio"
greater is the intensive utiliation of fi&ed assets and a lower ratio shows under
utiliation of the fi&ed assets. This ratio has a special importance for manufacturing
concerns where investment in fi&ed assets" is very high and the profita#ility is
significantly dependent on the utiliation of these assets.
assetst#rno!er ratio
*++' %.
year *++3 ,.0*
*++( '.*
*+1+ '.*,
*+11 '.*
0
1
8
3
4
@
7
@.44
.38
7.8 7.8 7.84
*""" #+'-$6&' '*#!$
CAPITAL TURNOVER RATIO
$ncome / caital emloyed
CP$6
69RNO;
R R6$O
*++' 3.,
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4;R *++3 3.(,
*++( 3.((
*+1+ 3.,*
*+11 3.3
.1.8
.3
.4
.@
.
.7
.
.
.1
.4
..
.8
.4
CAPITAL TURNOVER
RATIO
To%1' 1,,$%, %ro8$r r1%0o:
total
assets
t#rno!er ratio
*++' +.+3
year *++3 +.+(
*++( +.+(
*+1+ +.+(
*+11 +.+3
1
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0.07
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0 0.0 0.0
0.0
#$#* *""" #+'-$6&'
'*#!$
PRICE9 EARNIN! RATIO
Price earning ratio < market rice er share/ earning er share
Price
;arning =P/;)
*++' 11.30
4ear *++3 1%.03
*++( '.,0
*+1+ 1.'3*+11 *1.(*
1
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0
@
10
1@
80
8@
11.3
7.3
14.7
81.8
P'!%& E*'-!-
BANK O$ BARODA
# : #$4# !" #& #!' *'&"# *-:!- I-!*, *(#&' #& S#*#& B*-: $( I-!* *- #& P+-2* N*#!$-* B*-: *- *&* $(ICICI B*-:.3 B$B !" '*-:& 73 !- F$'&" G$* 8000 !"#. B$B *" #$#* *""" !-
&%&"" $( R". 3.@ *: %'$'&", $' R". 3,@3 !!$-, * -$': $( $6&' 3,40 '*-%&"
*- $%&", *- *$+# 1,@7 ATM". I# *-" #$ $&- 400 -&9 '*-%&" !- #& %$!-
)&*'. I# $&'" * 9!& '*-& $( *-:!- '$+%#" *- 5-*-%!* "&'6!%&" #$ %$'$'*#&
*- '*! %+"#$&'" #'$+ * 6*'!) $( &!6&') %*--&" *- #'$+ !#"
"&%!*!& "+"!!*'!&" *- *!*#&" !- #& *'&*" $( !-6&"#&-# *-:!-, %'&!#
%*'" *- *"" *-*&&-#. I#" #$#* +"!-&"" 9*" R". @,4@8 !!$- *" $( J+-& 30.4
s o" #g#st *+1+> the bank has '3 branches abroad and by the end o" -411 this n#mber sho#ldclimb to (+. $n *+1+> O oened a branch in #ckland> Ne8 ?ealand> and its tenth branch in
the 9nited @ingdom. 6he bank also lans to oen "i!e branches in "rica. esides branches>
o lans to oen three o#tlets in the Persian A#l" region that 8ill consist o" 6Ms 8ith a
co#le o" eole.
6he Maharaah o" aroda> Sir Sayairao Aaek8ad $$$> "o#nded the bank on *+ B#ly 1(+3 in the
rincely state o" aroda> in A#arat. 6he bank> along 8ith 10 other maor commercial banks o"
$ndia> 8as nationalied on 1( B#ly 1(,(> by the go!ernment o" $ndia.
RATIO ANALYSIS OF BANK OF BARODA
Crre(, ra,!:
C9RR;N6 SS;6S/ C9RR;N6 $$$6$;S
80
http://en.wikipedia.org/wiki/Bombay_Stock_Exchangehttp://www.bseindia.com/bseplus/StockReach/AdvanceStockReach.aspx?scripcode=532134http://en.wikipedia.org/wiki/Hindi_languagehttp://en.wikipedia.org/wiki/State_Bank_of_Indiahttp://en.wikipedia.org/wiki/Punjab_National_Bankhttp://en.wikipedia.org/wiki/ICICI_Bankhttp://en.wikipedia.org/wiki/Bank_of_Baroda#cite_note-2http://en.wikipedia.org/wiki/Forbes_Global_2000http://en.wikipedia.org/wiki/Lakhhttp://en.wikipedia.org/wiki/Croreshttp://en.wikipedia.org/wiki/Bank_of_Baroda#cite_note-3http://en.wikipedia.org/wiki/Sayajirao_Gaekwad_IIIhttp://en.wikipedia.org/wiki/Princely_statehttp://en.wikipedia.org/wiki/Baroda_Statehttp://en.wikipedia.org/wiki/Gujarathttp://en.wikipedia.org/wiki/Government_of_Indiahttp://en.wikipedia.org/wiki/Bombay_Stock_Exchangehttp://www.bseindia.com/bseplus/StockReach/AdvanceStockReach.aspx?scripcode=532134http://en.wikipedia.org/wiki/Hindi_languagehttp://en.wikipedia.org/wiki/State_Bank_of_Indiahttp://en.wikipedia.org/wiki/Punjab_National_Bankhttp://en.wikipedia.org/wiki/ICICI_Bankhttp://en.wikipedia.org/wiki/Bank_of_Baroda#cite_note-2http://en.wikipedia.org/wiki/Forbes_Global_2000http://en.wikipedia.org/wiki/Lakhhttp://en.wikipedia.org/wiki/Croreshttp://en.wikipedia.org/wiki/Bank_of_Baroda#cite_note-3http://en.wikipedia.org/wiki/Sayajirao_Gaekwad_IIIhttp://en.wikipedia.org/wiki/Princely_statehttp://en.wikipedia.org/wiki/Baroda_Statehttp://en.wikipedia.org/wiki/Gujarathttp://en.wikipedia.org/wiki/Government_of_India
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C#rrentRatio
*++' +.+
year *++3 +.+0
*++( +.+*
*+1+ +.+*
*+11 +.+*
0
0.01
0.01
0.08
0.08
0.03
0.03
0.04
0.04
0.03
0.08 0.08 0.08
C$$+% R#%&
C+''&-# R*#!$
:UICK RATIO
D#ickRatio
*++' 11.*(
year *++3 (.%,
*++( (.,*
*+1+ *1.33
*+11 *,.03
81
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0
@
10
1@
80
8@
30
11.8.@ .8
81.
8.3
;& R#%&
+!%: R*#!$
EPS
;arnings PerShare
*++' *3.13
year *++3 0(.1
*++( ,1.1
*+1+ 30.(,
*+11 1+3.00
0
80
40
0
0
100
180
8.1
3.41
1.14
3.
10.33
E#$&*/ P+$ S,#$+
E*'-!-" P&' S*'&
A,,$%, Tro8$r R1%0o
88
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0.0
0.07
0.07
0.07
0.070.07
0.0
0.0
0.0
0.0
0.07
0.0 0.0 0.0 0.0
T%#7 A//+%/ T$+$ R#%&/
T$#* A""" T+'-$6&'
R*#!$"
6otal $ncome /Caital;mloyed=E)
*++' '.30
year *++3 3.%'
*++( 3.%1
*+1+ '.3,
*+11 '.'%
7.8
7.4
7.A
7.B
B
B.8
B.4
B.A
B.B
7.B3
B.@7B.@1
7.BA7.7@
T-%#7 I2-+ < C#6&%#7 E67-.+4(=)
T$#* I-%$& F C*0!#*
E0$)&,
84
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Net Pro"it /6otal -#nds
*++' +.3
year *++3 +.3(
*++( 1.+(
*+1+ 1.*1
*+11 1.00
0
0.8
0.4
0.
0.
1
1.8
1.4
0.0.
1.0
1.81
1.33
N+% P$>% < T%#7 "4/
N P'$5# T$#* F+-"
7i!idend Per
Share
*++' ,
4ear *++3 3
*++( (
*+1+ 1%
*+11 1,.%
8@
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0
8
4
10
18
14
1
1
1@
1.@
D&&4+4 P+$ S,#$+
D!6!&- P&' S*'&
PRICE9 EARNIN! RATIO
Price earnings ratio < market rice er share/ earnings er share
PR$C;2
;RN$N
A
*++' '.(0
4;R *++3 '.(
*++( 0.(%
*+1+ '.3'
*+11 (.1%
8
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0
1
8
3
4
@
7
10
7.37.4
3.@
7.7
.1@
PRICE/ EARNING
87
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and earn profits. The efficiency with which assets are managed directly
effect the volume of sales. ctivity ratios measure the efficiency (or)
effectiveness with which a firm manages its resources (or) assets. These
ratios are also called LTurn over ratiosM #ecause they indicate the speed with which
assets are converted or turned over into sales.
3orking capital turnover ratio
4i&ed assets turnover ratio
*apital turnover ratio
*urrent assets to fi&ed assets ratio
a 5ORKING CAPITAL TURNOVER RATIO
3orking capital of a concern is directly related to sales.
5r4!(g )a-!,a*@ )rre(, a//e,/ )rre(, *!a2!*!,!e/
It indicates the velocity of the utiliation of net working capital.
This indicates the no. of times the working capital is turned over in the
course of a year. higher ratio indicates efficient utiliation of working
capital and a lower ratio indicates inefficient utiliation.
3orking capital turnover ratioKcost of goods sold:workingcapital.
*omponents of working capital9
*urrent assets *urrent lia#ilities
*ash in hand Outstanding or accrued e&penses
*ash at #ank Bank overdraft
Bills receiva#le Bills paya#le
Grepaid e&penses Short term advances
Short term investments Sundry creditors
Inventories /ividend paya#le
3ork in progress Income ta& paya#le
,arketa#le securities
31
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Sundry de#tors
2 $IXED A%%ET% TURNOVER RATIO
It is also known as sales to fi&ed assets ratio. This ratio measures the efficiency and
profit earning capacity of the firm. igher the
ratio" greater is the intensive utiliation of fi&ed assets. Aower ratio means
under%utiliation of fi&ed assets.
$!e0 a//e,/ ,r(er ra,! @ C/, %a*e/ Ne, !e0 a//e,/
C/, %a*e/ @ I()+e r+ %er!)e/
Ne, $!e0 A//e,/ @ $!e0 A//e,/ ' De-re)!a,!(
) CAPITAL TURNOVER RATIO%
Sometimes the efficiency and effectiveness of the operations
are 'udged #y comparing the cost of sales or sales with amount of capital
invested in the #usiness and not with assets held in the #usiness" though in
#oth cases the same result is e&pected. *apital invested in the #usiness may #e
classified as long%term and short%term capital or as fi&ed capital and working capital or
Owned *apital and Aoaned *apital. ll *apital
Turnovers are calculated to study the uses of various types of capital.
Ca-!,a* ,r(er ra,!@ )/, g0/ /*0)a-!,a* e+-*"e0
Ca-!,a* e+-*"e0 @ )a-!,a* re/ere/ /r-*/
C/, g0/ /*0 @ !()+e r+ /er!)e/
0 CURRENT A%%ET% TO $IXED A%%ET% RATIO
This ratio differs from industry to industry. The increase in the
ratio means that trading is slack or mechaniation has #een used. decline in the ratio
means that de#tors and stocks are increased too much or fi&ed assets are moreintensively used. If current assets increase with the corresponding increase in profit" it
will show that the #usiness is e&panding.
*urrent assets to fi&ed assets ratioK current assets: fi&ed assets
*urrent assets 4i&ed assets
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*ash in hand Glant
*ash at #ank ,achinery
Bills receiva#les Aand
Short term investment Building
Inventories ;ehicles
Sundry de#tors
3ork in progress
,arketa#le securities
3. PRO$ITABILIT& RATIO%
The primary o#'ectives of #usiness undertaking are to earn profits. Because profit is the
engine" that drives the #usiness enterprise.
@et profit ratio
Return on total assets
Reserves and surplus to capital ratio
arnings per share
Operating profit ratio
Grice N earning ratio
Return on investments
a NET PRO$IT RATIO
@et profit ratio esta#lishes a relationship #etween net profit (after ta&) and sales and
indicates the efficiency of the management in manufacturing" selling administrative and
other activities of the firm.
Ne, -r!, a,er ,a @ (e, -r!,' 0e-re)!a,!( !(,ere/, !()+e ,a
@et sales K income from services
Ne, -r!, ra,! @ (e, -r!, a,er ,a (e, /a*e/
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It also indicates the firmFs capacity to face adverse economic
conditions such as price competitors" low demand etc. O#viously higher the
ratio" the #etter is the profita#ility.
2 RETURN ON TOTAL A%%ET%
Grofita#ility can #e measured in terms of relationship #etween
net profit and assets. This ratio is also known as profit%to%assets ratio. It
measures the profita#ility of investments. The overall profita#ility can #e
known.
Returns on assets K net profit : total assets
@et profit K earnings #efore interest and ta&
Total assets K current assets fi&ed assets
) RE%ERVE% AND %URPLU% TO CAPITAL RATIO
It reveals the policy pursued #y the company with regard to
growth shares. very high ratio indicates a conservative dividend policy
and increased ploughing #ack to profit. igher the ratio #etter will #e the
position.
ReservesH surplus to capital ratio K reservesH surplus:capital
0 EARNING% PER %HARE
arnings per share is a small verification of return of e!uity and
is calculated #y dividing the net profits earned #y the company and those
profits after ta&es and preference dividend #y total no. of e!uity shares.
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arning per share K net profit after ta&: no. of e!uity shares
The arnings per share is a good measure of profita#ility when
compared with GS of similar other components (or) companies" it gives a
view of the comparative earnings of a firm.
e OPERATING PRO$IT RATIOOperating ratio esta#lishes the relationship #etween cost of goods sold and other
operating e&penses on the one hand and the sales on
the other.
Operating ratio K operating cost : net sales
owever C+ to =+? may #e considered to #e a good ratio in case of a manufacturing
under taking.
Operating profit ratio is calculated #y dividing operating profit
#y sales.
Operating profit K net sales N operating cost
Operating profit ratio K operating profit : sales
PRICE ' EARNING RATIO
Grice earning ratio is the ratio #etween market price per e!uity
share and earnings per share. The ratio is calculated to make an estimate of
appreciation in the value of a share of a company and is widely used #y
investors to decide whether (or) not to #uy shares in a particular company.
0enerally" higher the price%earning ratio" the #etter it is. If the
price earning ratio falls" the management should look into the causes that
have resulted into the fall of the ratio.
Pr!)e ear(!(g ra,! @ +ar4e, -r!)e -er /hare ear(!(g -er /hare
3@
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Mar4e, -r!)e -er /hare @ )a-!,a* re/ere/ /r-*/ (. e!," /hare/
Ear(!(g -er /hare @ ear(!(g/ 2ere !(,ere/, a(0 ,a (. e!," /hare/
g RETURN ON INVE%TMENT%
Return on share holderFs investment" popularly known as Return on investments (or)
return on share holders or proprietorFs funds is
the relationship #etween net profit (after interest and ta&) and the
proprietorFs funds.
Re,r( ( /hareh*0er?/ !(e/,+e(, @ (e, -r!, a,er !(,ere/, a(0 ,a
/hareh*0er?/ (0
The ratio is generally calculated as percentages #y multiplying
the a#ove with 1
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liabilities and ro!isions
) )
TOTAL
CAPITAL
AND
LIABILITIE
S
1%(,1.+,
*'.0% **(+%.''
00.,, 33(31.,% (.**, 1'+0**.'
1,.1,
*++'2+3 *++32+( *++(21+ *+1+211
bsol#techange Echange bsol#techange Echange bsol#techange Echange bsol#techange Echang
e
A,,$%,
$n!estments +0%*.0( *'.+%% 3,%*.,( %.,* (30,.11 0.%, (31+.% 0.0
d!ances '(01.'1 *0.% 1*%'0% 0+.1, 3(1+.(% 1,.3 1*3+%.0 1(.'%
-iGed assets =01.**) =+.+'+
)
=%0.0*) =+.10) %0.0* +.1% 01.** +.+',
Caital Hork
$n Progress
=0'.+%) =+.11) =01.') =+.1+'
)
01.' +.1*+ 0'.+% +.1*%%
C#rrent assets =3,,%.+() =+.1() *,*+.%1 +.+' =*,*+.%1) =+.+,(
)
3,,%.+( +.*
TOTAL
ASSETS
1%(,1.+
,
*'.0% **(+%.'
'
00.,, 33(31.,% (.**, 1'+0**.
'
1,.1,
$nterretation :
6he caital o" bank increased by 1(.(3Ein +'2+3> +.++%E in +32+(> +.+13E in 1+211.
6here is no change in caital o" the bank in the year +(21+
6here is a h#ge "l#ct#ation in the rate o" increasing in reser!es& s#rl#s .
6he bank is #tiliing its reser!es &s#rl#s in an e""ecti!e manner.
$n +'2+3 deosits increase by *0.0(E> +32+( it increase by 03.+3E> 3.0,E in +(21+>1,.1E in
1+211.
6here is a h#ge "l#ct#ating rate o" increase . in +32+( it had "l#ct#ate to 0.30E.
6he in!estment in 1+211 has increased 8ith a lo8 rate as comared to the receding years .
*'.%%E in +'2+3>%.,*E in +32+(>0.%,E in +(21+>0.0E in 1+211.
6he ad!ances rose by *0.%E in +'2+3>0+.1,E in +32+(>1,.3E in +(21+> 1(.'%E in 1+211.
6here has been a consistent decline in "iGed assets in +'2+3 and +32+( +.+'+E >+.10Eresecti!ely. $ncreased by +.1%E in +(21+> +.+',E in 1+211.
6here is a "all o" c#rrent assets +.1(E in +'2+3 mainly d#e to the reayment o" deosits.+.+'E
in +32+(> s#bseI#ent "all o" c#rrent assets +.+,(E in +(21+> and increase o" +.*E in 1+211.
PROFIT AND LOSS OF STATE BANK OF INDIA FOR TE YEAR ENDIN! ON
MARC 2;;792;
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Partic#lars *++'2+3 *++32+( *++(21+ *+1+211
absol#te
change
E
change
absol#te
change
E
change
absol#te
change E change absol#te change
$NCOM;:
oerating income 111+.(% +.* 13101.+ +.01 (3*.*( +.1* 1+0,'.03
;JP;N7$69R;
:
interest eGended 3(*.*, +.0, 1+(3,.*1 +.13 +'.1( +.1+ 1%%.3
oerating
eGenses 10%'.'' +.1+
0%1.11
+.* ,31'.0% +.0' ,3(.3'
total eGenses
(**0.1
+.*1 1%'03.(0 +.0+ (0'.' +.1 1*1,0.1
ro!ision andcontingencies 2,*,.3( 2+.1+ 1*03.,1 +.* 21'3'.+' +.1 1*1,0.1
net ro"it o" the
year *13'.31 +.3 *0(*.11 +.0% .3* +.++(1 21'(%.,3
eGtraordinary
items + + + + + + +
ro"it bro#ght
"or8ard + + + + + + +
total ro"it/=loss): *13'.31 +.3 *0(*.11 +.0% .3* +.++(1 21'(%.,3
INTERPRETATION
N$% Pro0% O T=$ Y$1r it sho8s a "l#ct#ating trend i.e.> increased by 3E in*++'2+3>0%E in
*++32+(>+.(E in *++(21+ and decline by 1(E in *+1+211d#e to increased taG liability.
I%$r$,% E/$$ it increases "rom 0,E in *++'2+3>13E in *++32+(> 1+E in *++(21+ and
0.*+E in *+1+211.
BALANCE SEET OF BANK OF BARODA FOR TE YEAR ENDIN! ON MARC
2;;792;
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oerating eGenses %(3.3* *1.,1E '.0( 1.+3E 3,,.%' **.%E (%3.,% *+.0%E
other ro!isions andcontingencies 2*1*.(+ 21%.%E ,%*.1% %,.0,E 230*.(*
2,.+E '*0.,+ '.1*E
total eGenses *>3,1.+ *(.(+E 0>1(0.+ *%.,(E 3*.0 %.*3E >++'.1 *.0,E
$% /ro0% o %=$ $1r +(.+, 0(.3%E '(1.,3 %%.1%E 301.10 0'.0*E 1>130.0% 03.,(E
eGtra ordinary items + +.++E + +.++E + +.++E + +.++E
ro"it bro#ght "or8ard + +.++E + +.++E + +.++E + +.++E
total +(.+, 0(.3%E '(1.,3 %%.1%E 301.10 0'.0*E 1>130.0% 03.,(E
INTERPRETATION
6he net ro"it o" the year sho8s a "l#ct#ating trend i.e.> 0(.3%E in *++'2+3>%%.1%E in*++32
+(>0'.0*E in *++(21+and 03.,(E in *+1+211.
6he interest eGended sho8s a "l#ct#ating trend in *++'2+3 to *+1+211
*++'2+32%.,1E>*++32*++(2*,.%1E >
CONCLUSIONS
1. State ank O" $ndia has o!erall better e""iciency and has er"ormed better in the banking
instit#tion as comared to ank O" aroda.
*. ;PS nd 7PS O" State ank O" $ndia is increasing d#e to increase in the #se o" debt
rather than the #se o" imro!ed oerations.0. 6he P/; Ratio O" State ank O" $ndia is high as comared to its ind#stry and ank O"
aroda 8hich means that S$ is #sing its "#nds in a better manner and it is "#ndamentally
so#nd in nat#re.
. eta O" State ank O" $ndia nd ank O" aroda is less than the market beta 8hich
means that both banks are gi!ing less ret#rns b#t they are less risky and in!estors can
in!est in these shares.
%. 6he !erage S#stainable ;arnings O" State ank O" $ndia is high and the standard
de!iation is lo8 so the bank has its earnings is s#stain and more rob#st in nat#re as
comared to ank o" aroda.
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,. 6he Credit 7eosit O" State ank O" $ndia nd ank O" aroda is close b#t the ratio is
high 8hich means that State ank O" $ndia has o!erall good e""iciency and better
er"ormance> i.e.> the bank has high credit deosit ratio.
REFERENCES
=%%/$.0)0/$01.or+0)0S%1%$B1)oI01
=%%/$.0)0/$01.or+0)0B1)oB1ro1
=%%/.@o$(o%ro'.(o@01(01',,%1%$ 1) o I011'1($9,=$$%SBI
=%%/.@o$(o%ro'.(o@01(01',1)o1ro11'1($9,=$$%BOB
=%%/.@o$(o%ro'.(o@01(01',1)o1ro1/ro0%&'o,,BOB
=%%/.@o$(o%ro'.(o@01(01',1)o1ro1/ro0%&'o,,SBI
888.google.com
888.caitaline.com
41
http://en.wikipedia.org/wiki/State_Bank_of_Indiahttp://en.wikipedia.org/wiki/Bank_of_Barodahttp://en.wikipedia.org/wiki/Bank_of_Barodahttp://www.moneycontrol.com/financials/statehttp://www.moneycontrol.com/financials/bankofbaroda/balance-sheet/BOBhttp://www.moneycontrol.com/financials/bankofbaroda/profit&loss/BOBhttp://www.moneycontrol.com/financials/bankofbaroda/profit&loss/SBIhttp://www.google.com/http://www.capitaline.com/http://en.wikipedia.org/wiki/State_Bank_of_Indiahttp://en.wikipedia.org/wiki/Bank_of_Barodahttp://www.moneycontrol.com/financials/statehttp://www.moneycontrol.com/financials/bankofbaroda/balance-sheet/BOBhttp://www.moneycontrol.com/financials/bankofbaroda/profit&loss/BOBhttp://www.moneycontrol.com/financials/bankofbaroda/profit&loss/SBIhttp://www.google.com/http://www.capitaline.com/
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888.sbi.com
888.in!estoedia.com
http://www.sbi.com/http://www.investopedia.com/http://www.sbi.com/http://www.investopedia.com/