ACKNOWLEDGEMENT No task is single mans effort. Any job in this world however trivial or t o u g h c a n n o t b e a c c o m p l i s h e d w i t h o u t t h e a s s i s t a n c e o f o t h e r s .

A n assignment puts the knowledge and experience of an individual to litmustest. There is always a sense of gratitude that one likes it express towards the p e r s o n s who helped to change an effort in a success. The opportunity t o express my indebtedness to people who have helped me to accomplish thistask.I deem it a proud privilege to extend my greatest sense of gratitude tom y g u i d e MISS SONIA MITTAL (ASSISTANT MANAGER, HDFCBANK KURUKSHETR A) f o r t h e k e e n i n t e r e s t , i n s p i r i n g g u i d a n c e , continuous encouragement, valuable suggestions and constructive criticismthroughout the pursuance of this report.M y s i n c e r e t h a n k s a r e d u e t o m y MR. GOURAV SHARMA(BRANCH MANAGER) for their valuable support in helping me to gain this opportunity of being associated with an organization of such esteem.I am thankful to director sir DR. VIKAS DARYAL, MS. DEEPIKAKOHLI FACULTY TIMT (HOD), f o r g r a n t i n g m e t h e p e r m i s s i o n t o un d e r t a k e t h e s t u d y. I w o u l d l i k e t o convey thanks to MISS RASHMIKANSAL FACULTY TIMT f o r r e a d y a s s i s t a n c e , k e e n i n t e r e s t a n d valuable suggestions.Last but not least it would be unfair if I dont extend my indebtednessto my parents and all my friends for their active cooperation which was of great help during the course of my training project.

PREFACE Using a new pattern based on proper integration of formal teachinga n d a c t u a l p r a c t i c e t h e M . B . A . p r o g r a m o f K u r u k s h e t r a U n i v e r s i t y , Kurukshetra has it course for six weeks industrial training, after the seconds e m e s t e r , s o a s t h e s t u d e n t s c o u l d b e gi n t o h a v e t h e f e e l i n g o f b u s i n e s s environment right in the beginning. Practical training constitutes an integral part of management studies. Training gives an opportunity to the students toexpose themselves to the industrial environment, which is quite differentfrom the classroom teaching. The practical knowledge is an important suffixt o t h e t h e o r e t i c a l k n o w l e d g e . O n e c a n n o t r e l y m e r e l y u p o n t h e o r e t i c a l k n o w l e d g e . Is h a s t o b e c o u p l e d w i t h p r a c t i c a l f o r i t t o b e f r u i t f u l . Thet r a i n i n g a l s o e n a b l e s t h e m a n a g e m e n t s t u d e n t s t o t h e m s e l v e s s e e t h e working conditions under which they have to work in the future.After Liberalization of Indian economy sense is changed because of Multi National Companies continuously coming with their technical expertise andimproved management concepts. Industrial activity in India has become athing to watch and I really wanted to be a part of it and it is essential for me being a finance student.I consider myself lucky to get my summer training in HDFC BANK KURUKSHETRA. I underwent six weeks of training. It really helped me toget a practical insight into the actual business environment and provide mean opportunity to make my Financial Management concepts more clear. Theadvantage of this sort of integration which promotes guided adjustment to

corporate culture, functional, social and other nor ms with formal teachingare: To bridge the gap between theory and practice To install feeling of belongingness and acceptance To cultivate proper temperament & to generate much morale To help students identify their strong & weak points in the following& appreciating organization activities To acquaints students with job performance standards I believe that t h i s k n o w l e d g e a b l e e n d e a v o r o f m i n e h a s p r e p a r e d m e s l o w l y b u t surely for taking up new challenging opportunities in future. 5 EXECUTIVE SUMMARY Undertake something is difficult,It will do you good,Unless you try to do somethingBeyond what you have already masteredYou will never grow.RONALDE. OSBORN I did my training in HDFC BANK KURUKSHETRA.The concept of this project is to check whether HDFC BANK is performingw e l l ye a r a f t e r ye a r o r l a c k i n g i n p e r f o r m a n c e . T h e p e r f o r m a n c e c a n b e evaluated by doing Financial Analysis of Financial Statements of Bank. The purpose of this project is to evaluate the performance of HDFC BANK. It p r i m a r i l y a i m s a t l e a r n i n g t h e v a r i o u s f a c t o r s t h a t c a n h e l p I e v a l u a t i o n process. I have tried to find out the reasons or ground where it is lacking. Ihave also tried to find out the areas of improvement.I n o r d e r t o d o f i n a n c i a l a n a l y s i s o f c o . t h e v a r i o u s t o o l s l i ke RATIOA N A L Y S I S , C O M P A R A T I V E F I N A N C I A L S T A T E M E N T A N D T REND PERCENTAGES have been used. In statistical tools, Ive used CORRELATION, TIME SERIES ANALSIS (TREND VALUES) .InH yp o t h e s i s t e s t i n g , I v e u s e d A N O V A T E S T . T h e p r o j e c t a l s o i n c l u d e s o b j e c t i v e o f s t u d y, R e s e a r c h M e t h o d o l o g y, A n a l ys i s a n d In t e r p r e t a t i o n , findings recommendations limitation of study conclusion bibliography andannexure. 6

WEAKNESS :

*Account opening and delivery of cheque book take c o m p a r a t i v e l y more time.* L a c k o f a v a i l a b i l i t y o f d i f f e r e n t c r e d i t p r o d u c t s l i k e C C L i m i t , B i l l discounting facilities. OPPORTUNITY : * B r a n c h e x p a n s i o n * D o o r s t e p s e r v i c e s *Greater liberalization i n f o r e i g n o w n e r s h i p v i a F D I i n I n d i a n P v t . Sector Banks.* C C / O F F a c i l i t i e s . *Infrastructure improvements & better systems for trading & settlementin the govt. securities & foreign exchange markets. THREATS: * T h e b a n k h a s s t a r t e d f a c i n g c o m p e t i t i o n f r o m p l a ye r s l i k e S B I, P N B Bank in the finance market itself. This reduce the profit margins in thefuture.* S o m e P v t . B a n k s h a v e 7 d a ys b a n k i n g. 30

JUSTIFICATIONOFTHESTUDY F i n a n c i a l S t a t e m e n t s a r e p r e p a r e d p r i m a r i l y f o r d e c i s i o n - m a k i n g . They play a dominant role in setting the framework of managerial decisions.But the information in the financial statement is not an end in itself as no meaningful can be drawn from these statements alone.The information provided in the financial statement is of immense usei n m a k i n g d e c i s i o n s t h r o u g h a n a l y s i s a n d i n t e r p r e t a t i o n o f f i n a n c i a l statements. The financial analysis is the process of identifying the financials t r e n g t h a n d w e a k n e s s o f t h e f i r m b y p r o p e r l y e s t a b l i s h i n g r e l a t i o n s h i p between the items of the balance sheet and P&L A/C.There are various methods or techniques used in analyzing financials t a t e m e n t s u c h a s c o m p a r a t i v e s t a t e m e n t , t r e n d a n a l ys i s , c o m m o n s i z e statement, schedule of changes in working capital, fund flow and cash flowanalysis, cost volume profit analysis and RATIO ANALYSIS.Ratio analysis is one of the most powerful tool of financial analysis. Itis a process of establishing and interpreting various ratios that the financials t a t e m e n t s c a n b e a n a l ys e d m o r e c l e a r l y a n d d e c i s i o n s m a d e f r o m s u c h analysis.J u s t l i k e a D O C T O R e x a m i n e s h i s p a t i e n t b y r e c o r d i n g h i s b o d ytemperature, blood pressure etc before making his conclusion regarding the 31

P.E Ratio = Market price per share / Earning per share Interpretation : T h i s r a t i o s h o w s h o w m u c h i s t o b e i n v e s t e d i n t h e m a r k e t i n t h i s companys shares to get each rupee of earning on its shares. The ratio is usedto measure whether the market price of a share is high or low. 69

P.E Ratio(%)27.7426.2928.802525.52626.52727.52828.5292 7 2 0 0 8 Years P. E R a t i o ( % ) P.E Ratio(%)

STATISTICALTOOLS Introduction: An educated citizen needs an understanding of basicstatistical tools to function in a world that is becoming increasinglydependent on quantitative information. Statistics means numerical description to most people In fact the term statistics is generally used to mean numerical factsand figures such as agricultural production during a year, rate of inflationand so on. However as a subject of study, statistics refers to the body of principles and procedures developed for collection, classification,summarization and interpretation of numerical data and for the use of suchdata. Meaning : Broadly speaking the term statistics has been generally used intwo senses: Singular Sense Plural sense The term statistics in its PLURAL SENSE

, refers to the numerical dataor statistical data. In its SINGULAR SENSE , the term refers to a sciencein which we deal with the techniques or methods of collecting, classifying, presenting, analyzing and interpreting the data. In other words, the conceptin its singular sense, refers to statistical methods. Purpose Without the assistance of statistical methods an organization would find itimpossible to make a sense of huge data.The purpose of statistics is to--Manipulate-Summarize-InvestigateThe data so that useful making information results could be found out. Infact every business manager needs a sound background of statistics. 70

Operating profit ratio= (Operating profit / Income) * 100 Interpretation : Operating Ratio and Operating Profit Ratio are inter-related andt o t a l o f b o t h t h e s e R a t i o i s 1 0 0 . B o t h R a t i o s i n d i c a t e d t h e profitabilit y of firm. 124 Operatingprofit ratio(%)40.9838.5737.2235363738394041422 0 0 5 - 0 6 2 0 0 6 - 0 7 2 0 0 7 - 0 8 Years O P R Operatingprofit ratio(%)

Return on net capital employed = (Net profit / Net capitalemployed) * 100 Net capital employed = Total assets- Current liability Interpretation :

This Ratio indicates how well the Capital employed is beinguse in business. Even the performance of two Dissimilar firmsmay be compared with the help of this Ratio. 125

DECISION At the level of significance Alpha=0.050 the decision is to reject the nullhypothesis of absence of correlation.In other words, the correlationis significant. Interpretation: 3.There is a high degree of correlation between sales & profit of NLL.4.There is a positive correlation between sales & profit of NLL. This shows that as the sales of NLL increases profit also moves in the samedirection. TREND ANALYSIS TREND ANALYSIS OF NET PROFIT AFTER TAX OF NLL YEAR PROFIT(MN) YDEVIATIONF R O M 2 0 0 5 X X Y X 2 0 0 4 1 3 7 1 1 3 7 1 2 0 0 5 1 4 9 2 2 9 8 4 2 0 0 6 2 8 0 3 8 4 0 9 2 0 0 7 3 5 8 4 1 4 3 2 1 6 T O A T L 9 2 4 1 0 2 7 0 7 3 0 The equation of the straight line isY = a + bXSince Y = Na + bXXY = aX + bXSubstituting tha values, wwe get 134

a = 65/5 = 13, b = 859/10 = 85.9Thus the straight line trend isY = 13+85.9, Origin = 2003, X unit = 1 year Y E A R A C T U A L V A L U E T R E N D V A L U E 2 0 0 4 1 3 7 1 3 5 . 7 2 0 0 5 1 4 9 1 9 3 . 3 2 0 0 6 2 8 0 2 5 0 . 9 2 0 0 7 3 5 8 3 0 8 . 5 2 0 0 8 3 6 6 . 1 TREND ANALYSIS 0501001502002503003504002 0 0 4 2 0 0 5 2 0 0 6 2 0 0 7 2 0 0 8 135

Interpretation: 1.The projection of profit for the year 2007 -08 is 366.1 mn.2.In the year 2003-04 and 2004-05, company was not able to achieve itsexpected profits.3.In the year after 2005, company was able to achieve more than its expected profits.4.The profits of the company show an increasing trend.