Financial Statement Analysis Project Report

A PROJECT REPORT
ON
FINANCIAL STATEMENT
ANALYSIS
IN
SUBMITTED IN THE PARTIAL FULFILLMENT OF THE REQUIREMENTS OF THE

AWARD OF DEGREE OF MASTER OF BUSINESS ADMINISTRATION (MBA)
SUBMITTED TO:- SUBMITTED BY:-

Mr. Yatin Goyal Priyanka Chugh
Astt. Professor Mba-4th Sem.
Roll No-229
VAISH INSTITUTE OF MANAGEMENT &TECHNOLOGY (VIMT)

DECLARATION
I, Priyanka Chugh Roll No -229 MBA(4th Sem) the student of Vaish Institute Of Management & Technology
(VIMT) has undergone Project Report in AXIS BANK,and have submitted a project on the title “A PROJECT
REPORT OF FINANCIAL STATEMENT ANALYSIS , for partial fulfillment of Degree of Master of
Business Administration (M.B.A.) to M.D.U. I solemnly declared that the work done by me is original and no
copy of it has been submitted to any other Universities for award of any other degree .
Countersigned Signature of Student
Director of the institute

ACKNOWLEDGEMENT
For the successful completion of this project, the guidance and inputs of Mr. J P ANEJA
MANAGER – ROHTAK BRANCH.
I would like to thank Mr. Lokesh Singhal, Branch Head, for providing me the opportunity
to undertake my Desertation Report in this prestigious bank.
I also express my gratitude towards other staff members of AXIS BANK Ltd., ROHTAK
BRANCH, who helped me to polish my skills, enhance my knowledge, provide practical
knowledge which would help me in my future course of professional carrier.
I am also thankful to my all teachers and mentor for providing me supportive and
cooperative environment, and guiding me towards the completion of the project. Without the help
and guidance of all the above this project would not have been possible.
PRIYANKA CHUGH
TABLE OF CONTENTS
DECLARTION
ACKNOWLEDGEMENT
CHAPTER 1
• INTRODUCTION OF BANKING
• POST-INDEPENDENCE
• NATIONALISATION
• LIBERALISATION
• CONCEPTUALIZATION
• OBJECTIVES OF THE STUDY
• LIMITATIONS OF THE STUDY
CHAPTER 2
• AXIS BANK INTRODUCTION

• BANK PROFILE
• REBRANDING
CHAPTER 3
• REVIEW OF LITERATURE
• RESEARCH METHODOLOGY
CHAPTER 4
• COMPARATIVE BALANCE SHEET

• RATIO ANALYSIS
• CASH FLOW STATEMENT
CHAPTER 5
• RECOMMENDATION
• CONCLUSION
BIBLOGRAPHY
INTRODUCTION OF BANKING
MEANING AND DEFINITION:
Bank is an institution that deals in money and its substitutes and provides crucial financial
services. The principal type of baking in the modern industrial world is commercial banking &
central banking.
1. Banking Means "Accepting Deposits for the purpose of lending or Investment of deposits
of money from the public, repayable on demand or otherwise and withdraw by cheque,
draft or otherwise."
-Banking Companies (Regulation) Act,1949
2. The concise oxford dictionary has defined a bank as "Establishment for custody of money
which it pays out on customers order." Infect this is the function which the bank performed
when banking originated.
3. "Banking in the most general sense, is meant the business of receiving, conserving &
utilizing the funds of community or of any special section of it."
-By H.Wills & J. Bogan
4. "A banker of bank is a person, a firm, or a company having a place of business where
credits are opened by deposits or collection of money or currency or where money is
advanced and waned.
-By Findlay Sheras
Thus
A Bank :
• Accept deposits of money from public,

• Pays interest on money deposited with it.
• Lends or invests money
• Repays the amount on demand
• Allow the money deposited to be with drawn by cheque or draft.
ORIGIN OF WORD “BANK”
The origin of the word bank is shrouded in mystery. According to one view point the Italian
business house carrying on crude from of banking were called banchi bancheri. According to
another viewpoint banking is derived from German word "Branck" which mean heap or mound.
In England, the issue of paper money by the government was referred to as a raising a bank.
ORIGIN OF BANKING:
Its origin in the simplest form can be traced to the origin of authentic history. After
recognizing the benefit of money as a medium of exchange, the importance of banking was
developed as it provides the safer place to store the money. This safe place ultimately evolved in
to financial institutions that accepts deposits and make loans i.e., modern commercial banks.
Banking in India
Without a sound and effective banking system in India it cannot have a healthy economy.
The banking system of India should not only be hassle free but it should be able to meet new
challenges posed by the technology and any other external and internal factors.
For the past three decades, India's banking system has several outstanding achievements to
its credit. The most striking is its extensive reach. It is no longer confined to only metropolitans
or cosmopolitans in India. In fact, Indian banking system has reached even to the remote corners
of the country. This is one of the main reasons of India's growth process.
The government's regular policy for Indian bank since 1969 has paid rich dividends with
the nationalisation of 14 major private banks of India.
Not long ago, an account holder had to wait for hours at the bank counters for getting a
draft or for withdrawing his own money. Today, he has a choice. Gone are days when the most
efficient bank transferred money from one branch to other in two days. Now it is as simple as
instant messaging or dials a pizza. Money has become the order of the day.
Currently, India has 194 scheduled commercial banks (SCBs) - 27 public sector banks (that
is with the Government of India holding a stake), 31 private banks (these do not have government
stake; they may be publicly listed and traded on stock exchanges) and 38 foreign banks. They
have a combined network of over 53,000 branches and 17,000 ATMs. According to a report by
ICRA Limited, a rating agency, the public sector banks hold over 75 percent of total assets of the
banking industry, with the private and foreign banks holding 18.2% and 6.5% respectively
• 1 Early history
• 2 From World War I to
Independence
• 3 Post-independence
• 4 Nationalisation
• 5 Liberalisation
Early history
Banking in India originated in the last decades of the 18th century. The first banks were
The General Bank of India, which started in 1786, and the Bank of Hindustan, both of which are
now defunct. The oldest bank in existence in India is the State Bank of India, which originated in
the Bank of Calcutta in June 1809, which almost immediately became the Bank of Bengal. This
was one of the three presidency banks, the other two being the Bank of Bombay and the Bank of
Madras, all three of which were established under charters from the British East India Company.
For many years the Presidency banks acted as quasi-central banks, as did their successors. The
three banks merged in 1925 to form the Imperial Bank of India, which, upon India's
independence, became the State Bank of India.
Indian merchants in Calcutta established the Union Bank in 1839, but it failed in 1848 as a
consequence of the economic crisis of 1848-49. The Allahabad Bank, established in 1865 and
still functioning today, is the oldest Joint Stock bank in India. It was not the first though. That
honor belongs to the Bank of Upper India, which was established in 1863, and which survived
until 1913, when it failed, with some of its assets and liabilities being transferred to the Alliance
Bank of Simla.
When the American Civil War stopped the supply of cotton to Lancashire from the
Confederate States, promoters opened banks to finance trading in Indian cotton. With large
exposure to speculative ventures, most of the banks opened in India during that period failed. The
depositors lost money and lost interest in keeping deposits with banks. Subsequently, banking in
India remained the exclusive domain of Europeans for next several decades until the beginning of
the 20th century.
Foreign banks too started to arrive, particularly in Calcutta, in the 1860s. The Comptoire
d'Escompte de Paris opened a branch in Calcutta in 1860, and another in Bombay in 1862;
branches in Madras and Pondichery, then a French colony, followed. Calcutta was the most
active trading port in India, mainly due to the trade of the British Empire, and so became a
banking center.
The Bank of Bengal, which later became the State Bank of India.
 The first entirely Indian joint stock bank was the Oudh Commercial Bank, established in
1881 in Faizabad. It failed in 1958. The next was the Punjab National Bank, established in
Lahore in 1895, which has survived to the present and is now one of the largest banks in
India.
 Around the turn of the 20th Century, the Indian economy was passing through a relative
period of stability. Around five decades had elapsed since the Indian Mutiny, and the
social, industrial and other infrastructure had improved. Indians had established small
banks, most of which served particular ethnic and religious communities.
 The presidency banks dominated banking in India but there were also some exchange
banks and a number of Indian joint stock banks. All these banks operated in different
segments of the economy. The exchange banks, mostly owned by Europeans, concentrated
on financing foreign trade. Indian joint stock banks were generally under capitalized and
lacked the experience and maturity to compete with the presidency and exchange banks.
This segmentation let Lord Curzon to observe; "In respect of banking it seems we are
behind the times. We are like some old fashioned sailing ship, divided by solid
wooden bulkheads into separate and cumbersome compartments."
 The period between 1906 and 1911, saw the establishment of banks inspired by the
Swadeshi movement. The Swadeshi movement inspired local businesspersons and political
figures to found banks of and for the Indian community. A number of banks established
then have survived to the present such as Bank of India, Corporation Bank, Indian Bank,
Bank of Baroda, Canara Bank and Central Bank of India.
 The fervour of Swadeshi movement lead to establishing of many private banks in Dakshina
Kannada and Udupi district which were unified earlier and known by the name South
Canara ( South Kanara ) district. Four nationalised banks started in this district and a
leading private sector bank. Hence, undivided Dakshina Kannada district is known as
"Cradle of Indian Banking".
From World War I to Independence
The period during the First World War (1914-1918) through the end of the Second World
War (1939-1945), and two years thereafter until the independence of India were challenging for
Indian banking. The years of the First World War were turbulent, and it took its toll with banks
simply collapsing despite the Indian economy gaining indirect boost due to war-related economic
activities. At least 94 banks in India failed between 1913 and 1918 as indicated in the following
table:
Number of banks Authorised capital Paid-up Capital

Years
that failed (Rs. Lakhs) (Rs. Lakhs)
1913 12 274 35
1914 42 710 109
1915 11 56 5
1916 13 231 4
1917 9 76 25
1918 7 209 1
Post-independence;
The partition of India in 1947 adversely affected the economies of Punjab and West
Bengal, paralyzing banking activities for months. India's independence marked the end of a
regime of the Laissez-faire for the Indian banking. The Government of India initiated measures to
play an active role in the economic life of the nation, and the Industrial Policy Resolution adopted
by the government in 1948 envisaged a mixed economy. This resulted into greater involvement
of the state in different segments of the economy including banking and finance. The major steps
to regulate banking included:
• In 1948, the Reserve Bank of India, India's central banking authority, was nationalized, and
it became an institution owned by the Government of India.
• In 1949, the Banking Regulation Act was enacted which empowered the Reserve Bank of
India (RBI) "to regulate, control, and inspect the banks in India."
• Befor the steps of nationalisation of Indian banks, only State Bank of India (SBI) was
nationalised. It took place in July 1955 under the SBI Act of 1955. Nationalisation of
Seven State Banks of India (formed subsidiary) took place on 19th July, 1960.
• The Banking Regulation Act also provided that no new bank or branch of an existing bank
could be opened without a license from the RBI, and no two banks could have common
directors.
However, despite these provisions, control and regulations, banks in India except the State
Bank of India, continued to be owned and operated by private persons. This changed with the
nationalisation of major banks in India on 19 July 1969.
Nationalization;
By the 1960s, the Indian banking industry has become an important tool to facilitate the
development of the Indian economy. At the same time, it has emerged as a large employer, and a
debate has ensued about the possibility to nationalise the banking industry. Indira Gandhi, the-
then Prime Minister of India expressed the intention of the Government of India (GOI) in the
annual conference of the All India Congress Meeting in a paper entitled "Stray thoughts on Bank
Nationalization." The paper was received with positive enthusiasm. Thereafter, her move was
swift and sudden, and the GOI issued an ordinance and nationalized the 14 largest commercial
banks with effect from the midnight of July 19, 1969. Jayaprakash Narayan, a national leader of
India, described the step as a "masterstroke of political sagacity." Within two weeks of the issue
of the ordinance, the Parliament passed the Banking Companies (Acquisition and Transfer of
Undertaking) Bill, and it received the presidential approval on 9 August 1969.
The second phase of nationalisation of Indian banks took place in the year 1980. Seven
more banks were nationalised with deposits over 200 crores. Until this year, approximately 80%
of the banking segment in India was under Government ownership.With the second dose of
nationalization, the GOI controlled around 91% of the banking business of India.
Later on, in the year 1993, the government merged New Bank of India with Punjab
National Bank. It was the only merger between nationalized banks and resulted in the reduction
of the number of nationalised banks from 20 to 19. After this, until the 1990s, the nationalised
banks grew at a pace of around 4%, closer to the average growth rate of the Indian economy.The
nationalized banks were credited by some, including Home minister P. Chidambaram, to have
helped the Indian economy withstand the global financial crisis of 2007-2009.
The banks in India that were nationalized.
Central Bank of India

Bank of Maharashtra
Dena Bank
Punjab National Bank
Syndicate Bank
Canara Bank
Indian Bank
Indian Overseas Bank
Bank of Baroda
Union Bank
Allahabad Bank
UCO Bank
Bank of India
The State Bank of India is India's largest commercial bank and is ranked one of the top five
banks worldwide. It serves 90 million customers through a network of 9,000 branches and it
offers -- either directly or through subsidiaries -- a wide range of banking services.
After the nationalisation of banks in India, the branches of the public sector banks rose to
approximately 800% in deposits and advances took a huge jump by 11,000%.
• 1955 : Nationalisation of State Bank of India.
• 1959 : Nationalisation of SBI subsidiaries.
• 1969 : Nationalisation of 14 major banks.
• 1980 : Nationalisation of seven banks with deposits over 200 crores.
Liberalization
In the early 1990s, the then Narsimha Rao government embarked on a policy of
liberalization, licensing a small number of private banks. These came to be known as New
Generation tech-savvy banks, and included Global Trust Bank (the first of such new generation
banks to be set up), which later amalgamated with Oriental Bank of Commerce, Axis
Bank(earlier as UTI Bank), ICICI Bank and HDFC Bank. This move, along with the rapid
growth in the economy of India, revitalized the banking sector in India, which has seen rapid
growth with strong contribution from all the three sectors of banks, namely, government banks,
private banks and foreign banks.
The next stage for the Indian banking has been setup with the proposed relaxation in the norms
for Foreign Direct Investment, where all Foreign Investors in banks may be given voting rights
which could exceed the present cap of 10%,at present it has gone up to 49% with some
restrictions.
The new policy shook the Banking sector in India completely. Bankers, till this time, were used
to the 4-6-4 method (Borrow at 4%;Lend at 6%;Go home at 4) of functioning. The new wave
ushered in a modern outlook and tech-savvy methods of working for traditional banks.All this led
to the retail boom in India. People not just demanded more from their banks but also received
more.
Currently (2009), banking in India is generally fairly mature in terms of supply, product range
and reach-even though reach in rural India still remains a challenge for the private sector and
foreign banks. In terms of quality of assets and capital adequacy, Indian banks are considered to
have clean, strong and transparent balance sheets relative to other banks in comparable
economies in its region. The Reserve Bank of India is an autonomous body, with minimal
pressure from the government. The stated policy of the Bank on the Indian Rupee is to manage
volatility but without any fixed exchange rate-and this has mostly been true.
With the growth in the Indian economy expected to be strong for quite some time-especially in its
services sector-the demand for banking services, especially retail banking, mortgages and
investment services are expected to be strong. One may also expect M&As, takeovers, and asset
sales.
In March 2006, the Reserve Bank of India allowed Warburg Pincus to increase its stake in Kotak
Mahindra Bank (a private sector bank) to 10%. This is the first time an investor has been allowed
to hold more than 5% in a private sector bank since the RBI announced norms in 2005 that any
stake exceeding 5% in the private sector banks would need to be vetted by them.
In recent years critics have charged that the non-government owned banks are too aggressive in
their loan recovery efforts in connection with housing, vehicle and personal loans. There are press
reports that the banks' loan recovery efforts have driven defaulting borrowers to suicide.
INDIAN BANKING SYSTEM

Indian Banking System can be classified as follows:
Reserve Bank of India

Reserve Bank of India came in 1935. Nationalized in 1949 .
Definition: RBI is an apex institution which acts as a guide, regulator, controller, promoter pf the
financial system.26
a) Reserve Bank of India was vested with extensive powers for the supervision of banking
in India.
b) It acts as currency authority, Banker’s to government.
c) Banker’s bank
d) Controller of money supply and credit
e) Foreign Exchange management
FUNCTIONS OF BANKS
PRIMARY FUNCTIONS
 Acceptance of Deposits
 Making loans & advances
 Loans
 Overdraft
 Cash Credit
 Discounting of bills of exchange
SECONDARY FUNCTIONS
• Agency functions
• Collection of cheques & Bills etc.
• Collection of interest and dividends.
• Making payment on behalf of customers
• Purchase & sale of securities
• Facility of transfer of funds
• To act as trustee & executor.
UTILITY FUNCTIONS:
• Safe custody of customer’s valuable articles & securities.

• Underwriting facility
• Issuing of traveler’s cheque letter of credit.
• Facility of foreign exchanges
• Providing trade information
• Provide information regarding credit worthiness of their customer
CONCEPTUALIZATION:
ACCOUNTS AND DEPOSITS
Banking should be effortless. With AXIS Bank, the efforts are rewarding. No matter what a
customer's need and occupational status, we have a range of solutions that are second to none.
Whether customer employed in a company and need a simple Savings account or run your own
business and requires a robust banking partner, AXIS Bank not only has the perfect solution for
you, but also can recommend products that can augment planning for the future.
Savings Accounts
These accounts are primarily meant to inculcate a sense of saving for the future, accumulating
funds over a period of time. Whatever occupation, bank is confident that customer will find the
perfect banking solution. Features offered for Trust/Associations/Government Bodies/NGO’s:
• Saving Account with no minimum balance requirement.

• At Par Cheque Facility.
• Free anywhere banking.
• Free Collections of Cheques.
• Free Demat Account.
Current Accounts
Now, with an AXIS Bank Current Account, experience the freedom of multi-city banking! Users
can have the power of multi-location access to their account from any of our 835 branches in
228 cities. Not only that, they can do most of their banking transactions from the comfort of
their office or home without stepping out.
Fixed Deposits
Long-term investments form the chunk of everybody's future plans. An alternative to simply
applying for loans, fixed deposits allow you to borrow from your own funds for a limited period,
thus fulfilling your needs as well as keeping your savings secure.
LOANS:
Personal Loans brings customer one step closer to their dreams
 Retail Loan
 Personal Loan
 Vehicle Loan
 Consumer Loan
 Loan against Property
 Loan against Deposit
 Education Loan
 Corporate Loan
Credit Facility:
Credit Facility is broadly classified into two categories:
Types of Credit Facilities
Non Fund Based Credit Facilites

Fund Based Credit Facilites
Cash Credit
Bank
Guarantee
Term Loan
Letter Of
Bill Finance Credit
FUND BASED CREDIT FACILITY

• Cash Credit Or Overdraft:
A cash credit or overdraft is an arrangement by which a banker allows his customer to borrow
up to a certain limit. This is the most popular made of borrowing by large commercial and
industrial concerns in India, on account of the advantage that a customer need not borrow at once,
the whole of the amount he is likely to require, but can draw such amount as and when require.
• Term Loan:
Term loans are granted to customers generally for meeting capital expenditure needs of the
business. Term loans are granted in one lump sum and are allowed to be repaid over a period of
time in installments.
• Bill Finance:
Bill Finance is also one of the important facets of lending by banks. Generally the bill finance
is conducted through discounting of bills of exchange drawn by the borrower or third persons on
the borrower
NON FUND BASED CREIDT FACILITY
• Guarantee facility:
Banker in his business of lending extends various facilities to its constituents. Under this
facility the bank undertakes to discharge the liability of borrower to third parties.
• Letter of Credit Facility
Letter of credit facility is another Non Fund Based facility extended by bankers to their
constituents. Under this facility banker undertakes to pay on presentation of documents of title of
goods.
HISTORY
Axis Bank began its operations as UTI Bank in 1994, after the Government of India
allowed private companies to enter banking sector. The Bank was promoted jointly by the
Administrator of the specified undertaking of the Unit Trust of India (UTI - I), Life Insurance
Corporation of India (LIC) and General Insurance Corporation of India (GIC) and other four PSU
insurance companies, i.e. National Insurance Company Ltd., The New India Assurance Company
Ltd., The Oriental Insurance Company Ltd. and United India Insurance Company Ltd.[8]
The Bank's Registered Office is at Ahmedabad and its Central Office is located at
Mumbai. The Bank has strengths in both retail and corporate banking. The Bank has five
international offices – branches at Singapore, Hong Kong and Dubai (at the DIFC) and
Representative Offices in Shanghai and Duba
REBRANDING
In July 2007, UTI Bank was renamed Axis Bank. The Bank decided to shed the name of its
original promoter and build a new brand, after UTI AMC protested to the government about the
bank’s plan to float an asset management firm for private equity. UTI AMC was granted
exclusive rights to the UTI brand name after January 2008 according to an agreement signed in
2003 between the government and the four sponsors.[10]
Post its rebranding exercise in 2007 the bank has continued to do well and the change in
name has not affected the bank’s business. In fact in FY2008 it saw its customer acquisition grow
at a robust rate of 67% over the last year to over 9.9 million customer accounts.
BUSINESS FOCUS27
AXIS bank's mission is to be a world-class Indian bank. The bank has aim to build sound
customer franchises across district business so as to be the prefer provider of banking services in
the segment that the bank operates in and to achieve healthy growth in profitability, consistent
with the bank's risk appetite. The bank is committed to maintain the highest level of ethical
standards, professional integrity and regulatory compliance.
Bank’s Mission & Values

AXIS bank's business philosophy is based on four core values:
1. Operational Excellence
2. Customer Focus
3. Product Leadership
4. People.
5. Customer Satisfaction through Providing quality service effectively and
efficiently“Smile, it enhances your face value” is a service quality stressed on
6. Periodic Customer Service Audits
7. Maximization of Stakeholder value
8. Success through Teamwork, Integrity and People
Mission
• Customer services & Product Innovation tuned to diverse needs of individual and corporate
clients
• Continuous technology up gradation while maintaining human values
• Progressive globalization & achieving international standards
• Efficiency and effectiveness built on ethical pratice
SWOT ANALYSIS OF AXIS BANK

STRENGT
• Sport of various promoters

• Higher level of services
• Knowledge of Indian market
Weaknesses
• Not having good image

• Market capitalization rate is low
• Not been fully able to position itself correctly
Opportunities
• Growing Indian market

• People are becoming more service oriented
• opportunities in global market
Threats
• Threats from various competitors like foreign banks & Govt. banks
• Future market trends
OBJECTIVE OF THE STUDY
PRIMARY OBJECTIVES:
• To analyze the financial position of the bank and to compare with the previous years.
SECONDARY OBJECTIVES:
• To determine the changes in financial conditions of business.
• To spot out strength and weakness of company.
• To make expectation of sale and profits.
• To know the relationship between profits sales.
To give new suggestions for the improvement of existing system so that it could be
implemented effectively with minimum cost and time.
LIMITATIONS OF THE STUDY
However I have tried my best in collecting the relevant information yet there are always
present some limitations under which research has to work. Financial analysis is a powerful
mechanism to determining financial strength and weakness of a firm. But, the analysis is based
on the information available in the financial statements. Thus, the financial analysis suffers from
serious inherent limitations of financial statements, changes in accounting policies of the firm,
accounting concepts & conventions and personal judgment etc. Here following are some
limitations under which I had to work as show below:
• Sample Size: The sample size analyzed was limited over three year, which may not be
fully represented of the universe. A large sample size could not be taken due to time & cost
constraints.
• Time and Resource Constraints: I had a limited time for conducting this analysis report,
which was of 6 weeks only so some short falls may be present. Along with the resource
constraint also create limitation in study.
• Lack of Experience: The lack of experience may have caused some errors in
administration of this research.
• Non-coverage of certain aspects: Due to confidential nature of some documents the same
were not available for the study.
• Only Interim Report: Financial statements do not give a final picture of the concern the
data given in these statements in only approximately the actual position can only be
determined when the business is solid or liquidated.
• Do Not give exact position: The financial statement is expressed in monetary values so
that they appear to give final and accurate position. The value of fixed assets in the balance
sheet neither represent the value for which the fixed assets are shown at cost less
depreciation. So there statement does not provide exact position.
• Lack of proper response: Getting the information’s from the employees is also a tedious
task. As there are many employees that are not in a position to tell us correct information
about the project or study and also sometimes they do not show any interest.
• Lack of adequate standards: There are not accepted standards or rules of thumb for all
ratios , which can be accepted as norms. It renders interpretation of the financial
statements difficult.
• Window dressing: Financial statements can easily window dressed to present a better
picture of its financial profitability position to outsiders. Hence, one has to be very careful
in making a decision from such financial statements. However, it is very difficult for me to
know about the window dressing made by company.
AXIS BANK
INTRODUCTION
Axis Bank Ltd. is the third largest lender among private banks in India. Over the last
decade, the Bank has gradually improved its assets quality, built a strong IT platform, controlled
costs, and expanded its network.
The Bank has posted over 30% y-o-y growth in Net Profit in 35 of the last 37 quarters and
over 60% Net Profit growth in each of the last 7 quarters by focusing on corporate and improving
its distribution and liabilities franchisee. The Bank’s Net Profit for FY2009 grew more than 69%
Compared to FY 2008 Net NPAs as a proportion of net customer assets stood at a mere 0.35% at
the end of March 2009. The Bank’s Non-Performing Assets (NPAs) are among the lowest in the
industry
Axis Bank has business of Rs.1,02,000.00 crore with a market capitalization of

Rs.21,817.00Crore making it the fifth largest Bank in India. It has 60 lakh customers and
communicating to them the name change would be the prime exercise for the bank.
It has more than 574 branch offices and Extension Counters in the country with over 2428 Axis
Bank ATM proving to be one of the largest ATM networks in the country. It commits to adopt
the best industry practices internationally to achieve excellence. It has strengths in retail as well
as corporate
The bank continues to record an impressive year-on-year performance, earning a net profit
of Rs. 1,81,5.36 crores for the financial year 2008-09 against Rs. 1,071.03 crores in the previous
year.
Rising Profitability ( in crores)
2000 1815
1800
1600
1400
1200 1071
1000
800 659
600 485
335
400
200
0
2004-05 2005-06 2006-07 2007-08 2008-09
Net Profit
Few milestones of the Axis bank:
Mar '07 : Axis Bank joins hands with IIFCL to provide leverage for
infrastructural projects in the country.
Mar '07 : AXIS Bank comes up with full license bank branch in Hong Kong.
Feb '07 : Finance minister Shri P. Chidambaram introduces Shriram – AXIS
Bank Co - Branded Credit Card especially for Small Road Transport
Operators (SRTOS).
AXIS Bank holds the position of being the first Indian Bank to
Aug'06 : successfully issue Foreign Currency Hybrid Capital in the International
Market.
Aug '06 : AXIS Bank launches the beneficial scheme of issuance of "Senior
Citizen ID Card" in collaboration with Dignity Foundation.
Dec '05 : AXIS Bank adds International Financing Review (IFR) Asia 'India
Bond House' award for the year 2005 in its appreciation record.
Jul '05 : AXIS Bank and Visa International launch Mobile Refill facility -
Anytime, Anywhere Pre-Paid Mobile Refill for all Visa Cardholders in
India.
Mar '05 : AXIS Bank gets counted on the London Stock Exchange, raises US$
239.30 million through Global.
BOARD OF DIRECTORS
Shikha Sharma Chairman &chief Executive Officer

Surendra Singh Director
N. C. Singhal Director
A. T. Pannir Selvam Director
J. R. Varma Director
R. H. Patil Director
Rama Bijapurkar Director
R. B. L. Vaish Director
M. V. Subbiah Director
Ramesh Ramanathan Director
K. N. Prithviraj Director
P. J. Oza Company Secretary
THE CORE MANAGEMENT TEAM
R. Asok Kumar Executive Director - Corporate Strategy

M. M. Agrawal Executive Director - Corporate Banking
V. K. Ramani Executive Director – Technology & Business
Process
S. K. Chakrabarti President – Credit
Hemant Kaul President - Retail Banking
Somnath Sengupta President - Finance & Accounts
S. S. Bajaj President & Chief Compliance Officer
Snehomoy Bhattacharya President - Human Resources
P. Mukherjee President – Treasury
Vinod George President - International Banking
M. V. Subramanian CEO and Executive Trustee, Axis Bank Foundation
Rajagopal Srivatsa President - Business Banking
S. K. Nandi President - West Zone
R. K. Bammi President - North Zone
S. K. Mitra President - East Zone
C. P. Rangarajan President - South Zone
M/s. S. R. Batliboi & Co. Auditors Chartered Accountants
M/s. Karvy Computer share Private Limited
Registrar and Share Transfer Agent
MARKET OBJECTIVES OF AXIS BANK BY 2011
1. To get market capitalization Rs.500 crore

2. To get Rs 200 crore retail investments
3. To get Rs 125 crore corporate investment
4. To get Rs 175 crore capital investment
5. At present the bank is ranked at 6th position by its market share & capitalization and 3rd in
private bank category .It want to get 3rd position in overall Indian banking market
In addition, the alternative banking channels of the Bank, which comprise the ATM
network, internet banking, mobile banking and phone banking, have been growing. As on March
31, 2009, the Bank had 835 Branches and Extension Counters and 3,595 ATMs across 515 cities
and towns. The Bank’s consolidated Net Interest Income (NII) grew 42.4% during FY2009 to Rs.
36.80 billion. The Bank had total Deposits of Rs.1, 173.74 billion and Net Advances of
Rs.815.57 billion as on March 31, 2009. The Net Interest Margin (NIM) of the Bank fell by14bps
to3.33percentage in FY2009 from 3.47% in FY2008 due to a rise in the cost of funds to 6.50%.
Axis Bank’s Capital Adequacy Ratio (CAR) as on March 31, 2009 was at 13.69%, compared to
13.73% at the end of March 2008.
In March 2008, Axis Bank launched Platinum Credit Card, India's first EMV chip based
card. In November 2008, CARE assigned AAA rating to Axis Bank’s Subordinated Tier II
Bonds. The Bank was ranked No.1 Debt Arranger by Prime Database for the 9 months ended
December’08. Also, it was ranked No. 1, in the Bloomberg league table for ‘India Domestic
Bonds’ for the quarter ended March’09
INTRODUCTION OF THE TOPIC14
MEANING OF FINANCIAL STATEMENTS:-
Financial statements refer to such statements which contains financial information about an
enterprise. They report profitability and the financial position of the business at the end of
accounting period. The team financial statement includes at least two statements which the
accountant prepares at the end of an accounting period. The two statements are: -
1. The Balance Sheet
2. Profit And Loss Account
They provide some extremely useful information to the extent that balance Sheet mirrors
the financial position on a particular date in terms of the structure of assets, liabilities and owners
equity, and so on and the Profit And Loss account shows the results of operations during a certain
period of time in terms of the revenues obtained and the cost incurred during the year. Thus the
financial statement provides a summarized view of financial positions and operations of a firm
MEANING OF FINANCIAL ANALYSIS

The first task of financial analysis is to select the information relevant to the decision under
consideration to the total information contained ion the financial statement. The second step is to
arrange the information in a way to highlight significant relationship. The final step is
interpretation and drawing of inference and conclusions. Financial statement is the process of
selection, relation and evaluation
Features of Financial Analysis
• To present a complex data contained in the financial statement in simple and

understandable form.
• To classify the items contained in the financial statement in convenient and rational
groups.
• To make comparison between various groups to draw various conclusions.
Purpose of Analysis of financial statements14
1. To know the earning capacity or profitability.

2. To know the solvency.
3. To know the financial strengths.
4. To know the capability of payment of interest & dividends.
5. To make comparative study with other firms.
6. To know the trend of business.
7. To know the efficiency of mgt.
8. To provide useful information to mgt
TYPES OF FINANCIAL ANALYSIS14
• Classification on the basis of natural used
 External Analysis
Outsiders, who don’t have access to the detailed internal accounting records of the business
firm, do this analysis. These outsiders parties are potential investor, creditors, government
agencies, credit agencies & general public.
 Internal Analysis:
The analysis conducted by person who has access to the internal accounting records of a
business firm is known as internal analysis.
On the basis of modus operand:
 Horizontal Analysis:
Horizontal analysis refers to the comparison of financial data of a company for several
years. The figures of this type of analysis are presented horizontally over a no. of columns. This
type of analysis is also called “Dynamic Analysis”.
 Vertical Analysis:
This analysis refers to the study of relationship of the various items in the financial
statements, of one accounting period. It is also known as “Static analysis”.
METHODS OF FINANCIAL ANALYSIS13

A number of methods can be used for the purpose of analysis of financial statements.
These are also termed as techniques or tools of financial analysis. Out of these, and enterprise can
choose those techniques which are suitable to its requirements. The principal techniques of
financial analysis are:
A) Comparative Financial Statements.
B) Ratio analysis
C) Cash Flow Statement

JUSTIFICATION OF STUDY 15
In order to win a war, proper armoury is required. Similarly in order to run a business
successfully proper and adequate finance is required. Finance is defined as the provision of
money at the time when it is required. Every enterprises whether big or small need finance to
carry on and expand its operations.
Financial Statements are prepared primarily for decision-making. They play a dominant role
is setting the framework of managerial decisions. But the information is the financial statement is
not an end in itself as no meaningful can be drawn from theses statements alone.
The information provided in the financial statement is of immense use in making decisions
through analysis and interpretation of financial statements. The financial analysis is the process
of identifying the financial strength and weaknesses of the firm by properly establishing
relationship between the items of the balance sheet and P/L a/c.
The purpose of financial analysis is to diagnose the information contained the financial
statements so as to judge the profitability and financial soundness of the firm. The analysis and
interpretation of financial statements is essential to bring out the mystery behind the figures in
financial statements.
Financial statement analysis is an attempt to determine the significance and meaning of

financial statement date so that forecast may be made of the future earning ability to pay interest
and debt maturities and profitability of a sound dividend policy.
LITERATURE REVIEW
1. Bitta, Loudon Della, Consumer Behavior and concepts and applications, “Defining Consumer
BehaviourKothari C.R. , Research Methodology Methods and Techniques, “Research, Methodology
and Sampling”2
2. Nair, Suja R., Consumer Behavior in Indian Perspectives, (“Factors affecting Consumer decision” is
studied to know about various factors and concept)3
3. Schiffman, Leon G. and Lesli Lazar Kanauk, Consumer Behavior, “Meaning of Customer Satisfaction”4
4. Kotler Philip, Principles of Marketing, “Holistic Marketing Concept”5
5. Jain, T.R. and Aggarwal, Dr. S.C., Statistics For M.B.A,. “Chi Square Test is studied to use in the study
and hypothesis testing”6
6. Kapoor C.S., Gupta K.V., Fundamentals of Applied Statistics, “Research Designs”7
7. Boyd W. Harper, Westfall Ralph, Stasch F. Stanley, Marketing Research-Text and cases
“Questionnaire Construction Procedure”8

8. Donald R. Cooper & Sciendler Pomela S., Business Research Methodology “Sample size, Sample area,
Sampling technique”9
9. Hair, Anderson, Tatham, Black, Multivariate Data Analysis “Application of statistical tools such as
Multi Dimensional Scaling, Principal component analysis, Multiple correspondence analysis”10
10. Tull Donald S. & Hawkins Dell, Marketing Research Measurement and Methods, “Methods of Data
Collection & Survey Method”11
11. Gupta S.P & Gupta P.M, Business Statistics, “Use of Multiple Regression and its interpretation”12
12. Advertising Express, Jun 2007, From this magazine I took for my study “Customer Buying Behavior”13
13. Indian Journal of Marketing, March 2007, this journal provided me information regarding
“Relationship Marketing Benefits”14
14. Indian Journal of Marketing, From this magazine I took for my study “Brand Marketing through
Customer relations”15
15. Indian Journal of Marketing, May 2008, this journal provided me information regarding “ customer
satisfaction”16
16. Journal of Marketing, International, April 2007, this journal provided me information regarding
“Neglected outcomes of customer satisfaction”17
17. Journal of Marketing, International, July 2008, From this journal I took for my study “Customer
Relationship”18
18. ICFAI Journal of Consumer Behavior, June 2008, From this magazine I took for my study “Post sales
services to satisfy customer”19

19. Business world, Nov 2004, this magazine provided me information regarding “Awards grabbed by
HDFC Bank Ltd.”20
20. Business world, Nov 2007, From this magazine I took for my study “ Increase in product and services by
HDFC Bank Ltd. to increase customer base”21
21. Business world, March 2008, this magazine provided me information regarding “Merger of HDFC Bank
Ltd. And Centurion Bank of Punjab”22
22. India Today, Feb 2008, this magazine provided me information regarding “HDFC Bank Ltd. As India’s
Best Bank ”23
23. Business Today, March 2008, this magazine provided me information regarding “Merger of HDFC
Bank Ltd. And Centurion Bank of Punjab”24
24. Marketing Mastermind, August 2008, this magazine provided me information regarding “Meaning of
Relationship Marketing and customer’s expectations”25
RESEARCH METHODOLOGY
The procedure adopted for conducting the research requires a lot of attention as it has direct
bearing on accuracy, reliability and adequacy of results obtained. It is due to this reason that
research methodology, which we used at the time of conducting the research, needs to be
elaborated upon. Research Methodology is a way to systematically study and solve the research
problems. If a researcher wants to claim his study as a good study, he must clearly state the
methodology adapted in conducting the research the research so that it way be judged by the
reader whether the methodology of work done is sound or not.
The Research Methodology here includes.

a) Meaning of Research.
b) Research Problem.
c) Research Design.
d) Sampling Design.
e) Data Collection method.
f) Analysis and interpretation of Data.
Meaning Research:
Research is defined as “a scientific and systematic search for pertinent information on a

specific topic”. Research is an art of scientific investigation. Research is a systematized effort to
gain now knowledge. It is a careful investigation or inquiry especially through search for new
facts in any branch of knowledge. Research is an academic activity and this term should be used
in a technical sense. Research comprises defining and redefining problems, formulating
hypothesis or suggested solutions. Making deductions and reaching conclusions to determine
whether they if the formulating hypothesis. Research is thus, an original contribution to the
existing stock of knowledge making for its advancement. The search for knowledge through
objective and systematic method of finding solutions to a problem is research
Research Problem
The first step while conducting research is careful definition of Research Problem. “To
ERR IS THE HUMAN” is a proverb which indicates that no one is perfect in this world. Every
researcher has to face many problems which conducting any research that’s why problem
statement is defined to know which type of problems a researcher has to face while conducting
any study. It is said that,
“Problem well defined is problem half solved.”
A problem statement refers to some difficulty, which researcher experiences in the context of
either a theoretical or a practical situation and wants to obtain the solution for the same.
The problem statement here is:
“To make a Comparative Financial Analysis of Financial statements of AXIS Bank Ltd. for
different years.”
Research Design
A research designs is the arrangement of conditions for collection and analysis of data in a
manner that aims to combine relevance to the research purpose with economy in procedure.
Research Design is the conceptual structure with in which research in conducted. It constitutes
the blueprint for the collection measurement and analysis of data. Research Design includes and
outline of what the researcher will do form writing the hypothesis and it operational implication
to the final analysis of data. A research design is a framework for the study and is used as guide
in collection and analyzing the data. It is a strategy specifying which approach will be used for
gathering and analyzing the data. It also include the time and cost budget since most studies are
done under these two cost budget since most studies are done under theses tow constraints.
The design is such studies must be rigid and not flexible and most focus attention on the
following.
 What is the study about?

 Why is the study being made?
 Where will the study be carried out?
 What type of data is required
 Where can be required data be found?
 What period of time will the study include?
 What will be sample design?
 What techniques of data collection will be used?
 How will the data be analyzed?
 In what style will the report be prepared?
TYPES OF RESEARCH DESIGN:2
 EXPERIMENTAL RESEARCH DESIGN

 EXPLORATORY RESEARCH DESIGN
 DESCRIPTIVE& DIAGNOSTIC RESEARCH
Exploratory Research Design - This research design is preferred when researcher has a
vague idea about the problem the researcher has to explore the subject.
Experimental Research Design – The research design is used to provide a strong basis for the
existence of casual relationship between two or more variables.
Descriptive Research Design – It seeks to determine the answers to who, what, where,
when and how questions. It is based on some previous understanding of the matter.
Diagnostic Research Design -It determines the frequency with which something occurs or its
association with something else.
Research Design Used in this Project2
Research Design chosen for this study is Descriptive Research Design. Descriptive study is
based on some previous understanding of the topic. Research has got a very specific objective
and clear cut data requirements.
Sampling Design2
Sampling is necessary because it is almost impossible to examine the entire parent

population (i.e. the entire universe) various factors such as time available cost, purpose of study
etc. make it necessary for the researchers to choose a sample. It should neither be too small nor
too big. It should be manageable. THE sample size of past 3 years is taken for present study due
to time limitation.
DATA COLLECTIONS3
The process of data collection begins after a research problem has been defined and
research design ahs been chalked out. There are two types of data –
METHODS OF PRIMARY DATA
• OBSERVATION METHOD
• INTERVIEW METHODS
• QUESTIONAIRE METHOD
• SCHEDULE METHOD
PRIMARY DATA –
It is first hand data, which is collected by researcher itself. Primary data is collected by
various approaches so as to get a precise, accurate, realistic and relevant data. The main tool in
gathering primary data was investigation and observation. It was achieved by a direct approach
and observation from the officials of the company.
SECONDARY DATA –
It is the data which is already collected by someone else. Researcher has to analyze the
data and interprets the results. It has always been important for the completion of any report. It
provides reliable, suitable, adequate and specific knowledge.
I took data comprise annual reports and past records. Bank has provided me annual reports
from 2005-06 to 2008-09 by help of which, I prepared my report.
The valuable cooperation extended by staff members contributed a lot to fulfill the
requirements in the collection of data in order to complete the project. Various statistical tools are
applied depending on the research problem. In this study ratio analysis, comparative financial
statements analysis, common size statements and Trend Analysis has been used for analyzing and
interpreting the result.
ANALYSIS & INTERPRETATAION
1) COMPARATIVE FINANCIAL STATEMENTS13
When financial statements figures for two or mote years are placed side-side to facilitate
comparison, these are called ‘comparative Financial Statements’. Such statements not only show
the absolute figures of various years but also provide for columns to indicate to increase ort
decrease in these figures from one year to another. In addition, these statements may also show
the change from one year to another on percentage form. Such cooperative statements are of great
value in forming the opinion regarding the progress of the enterprise.
PURPOSE OR UTILITY OF COMPARATIVE STATEMENTS13

1) To make the Data simpler and more understandable
2) To indicate the Trend
3) To indicate the strong points weak points of the concern
4) To compare the firms performance with the average performance of the industry
5) To help in forecasting
FORMS OF PRESENTING COMPARATIVE STATEMENTS13
 To show only the absolute data of various items or in other words to show only rupee
amounts of various items.
 To show the increases and decreases in data in terms of money values
 To show the increases and decreases in data in terms of percentages
 Comparison expressed in ratios
 Use of cumulative figures and averages
COMPARATIVE BALANCE SHEET13
The Comparative Balance Sheet as on two or more different dates can be prepared to show
the increase or decrease in various assets, liabilities and capital. Such a comparative Balance
Sheet is very useful in studying the trends in a business enterprise.
ADVANTAGES OF COMPARATIVE BALANCE SHEET13
• Helpful for comparison.

• Helpful in knowing changing in the size of items.
• Helpful in knowing trends.
• Link between income statement and Balance sheet
COMPARATIVE PROFIT & LOSS ACCOUNT13
Profit and loss account shows the net profit or net loss of a particular year whereas
comparative profit and loss account for a number of years provides the following information
1. Rate of increase or decrease in profits.

2. Rate of increase or decrease in cost of sales
3. Rate of increase or decrease in sales
(THE PREVIOUS YEAR HAS BEEN TAKEN AS BASE YEAR)
COMPARATIVE BALANCE SHEET OF AXIS BANK FOR YEAR 2005 & 2006
(In Million of Rupees)
Particulars 2005 2006 Increase or %age Increase or

2005-03-31 2006-03-31 Decrease over Decrease
(Amount) (Amount) 2005 (Amount)
Current Assets;
Cash & Due from Banks 34,487.4 24,294.0 (10193.4) 29.55
Other Earning Assets 161,022.0 227,398.0 66376 41.22
Net Loans 156,029.0 223,142.0 67113 43.01
Property/Plant/Equipment, 7,804.2 9,278.1 1473.9 18.88
Total – Gross
Accumulated (2,619.8) (3,601.0) 981.2 37,45
Depreciation, Total
Total – Net
Long Term Investments 24215.4 28856.1 4640.7 19.16
Other Assets, 20,713.8 16,799.8 (3914) (18.89)
Total Assets 401652 526167 124515 31.00
Accounts Payable 4,870.9 11,352.9 6482 133.08
Accrued Expenses 478.0 645.2 167.2 34,98
Total Deposits 317,120.0 401,135.0 84015 26.49
Other Bearing Liabilities, 17,814.1 26,809.3 8995.2 50.49
Total
Other Current liabilities, 874.2 1,112.2 238 27.23
Total
Long Term Debt 7,886.0 17,886.0 10000 126.81

Other Liabilities, 4,177.7 9,514.0 5336.3 127.74
Total Liabilities 353,221.0 468,455.0 115234 32.62
Common Stock, 2,738.0 2,786.9 48.9 1.78
Additional Paid-In Capital 13,446.3 14,416.1 969.8 7.21
Retained Earnings 5,103.6 11,652.6 6549 128.32
(Accumulated Deficit)
Unrealized Gain (Loss) 2928.1 0.0 (2928.1)
0.0 0.0
Total Equity 24,216.0 28,856.3 4640.3 19.16
Total Liabilities & 401652 526167 124515 31
Shareholders' Equity
COMPARATIVR PROFIT &LOSS ACCOUNT 2005-06

Income
Interest Earned 1,924.16 2,888.79 964.63 50.13
Other Income 403.51 713.71 310.2 76.87
Total Income 2,327.67 3,602.50 1274.83 54.77
Expenditure
Interest expended 1,192.98 1,810.56 617.58 51.77
Employee Cost 176.85 240.20 63.35 35.82
Selling and Admin 199.02 96.09
207.10 406.12
Expenses
Depreciation 81.58 92.19 10.61 130.05
Miscellaneous 222.97 64.55
345.38 568.35
Expenses
Preoperative Exp
0.00 0.00
Capitalised
Operating Expenses 572.11 925.19 353.08 61.71
Provisions & 142.86 59.82
238.80 381.67
Contingencies
Total Expenses 2,003.89 3,117.42 1113.53 55.57
Net Profit for the 161.3 49.82
323.78 485.08
Year
COMPARATIVE BALANCE SHEET AND OF AXIS BANK FOR YEAR 2006 & 2007
Particulars 2006 2007 Increase or % Increase or

Current Assets;
Cash & Due from Banks 24,294.0 46,610.3 22316.3 91.86
Net Loans 223,142.0 368,765.0 145623 65.26
Total – Gross
Accumulated (3,601.0) (4,507.0) 906 25.16
Depreciation, Total
Total – Net
Long Term Investments 28856.1 17750.1 11106 38.48
Other Assets, 16,799.8 18,962.2 2162.4 12.87
Total Assets 526167 750310 224143 42.60
Accounts Payable 11,352.9 13,095.2 1742.3 15.35
Accrued Expenses 645.2 1,772.8 1127.6 174.76
Total Deposits 401,135.0 587,850.0 186715 46.54
Total
Other Current liabilities, 1,112.2 1,482.7 370.5 33.31
Total
Long Term Debt 17,886.0 35,014.1 17128.1 95.76
Total Liabilities 468,455.0 698,586.0 230131 49.12
Common Stock, 2,786.9 2,816.3 29.4 1.05
Additional Paid-In Capital 14,416.1 14,929.6 3.56
Retained Earnings 11,652.6 4580.2 39.30
16,232.8
Unrealized Gain (Loss) 0.0 0.0 0.0
Other Equity, Total 0.6 4.4 3.8 633.33
Total Equity 28,856.3 33,974.3 5118 17.74
Total Liabilities & 526167 750310 224143 42.60
PROFIT & LOSS ACCOUNT 2006-07.

Income
Interest Earned 2,888.79 4,560.40 1671.51 57.86
Other Income 713.71 986.49 272.78 38.22
Total Income 3,602.50 5,546.89 1944.39 53.97
Expenditure
Employee Cost 240.20 381.35 141.15 37.01
406.12 589.31
Expenses
Depreciation 92.19 111.86 19.67 21.33
Miscellaneous 568.35 812.03 243.68 42.87
Expenses
Preoperative Exp 0.00 0.00
0.00 0.00
Capitalised
Operating Expenses 925.19 1,387.06 461.87 49.92
381.67 507.49
Contingencies
Total Expenses 3,117.42 4,887.87 1770.45 56.79
485.08 659.03
Year
COMPARATIVE BALANCE SHEET AND PROFIT & LOSS ACCOUNT OF AXIS BANK
FOR YEAR 2007 & 2008 (In Million of Rupees)
Particulars 2007 2008 Increase or %age Increase

2007-03-31 2008-03-31 Decrease over or Decrease
Current Assets
Cash & Due from Banks 46,610.3 73,056.6 26445.7 56.74
Other Earning Assets 291,444.0 390,650.0 34.04
Net Loans 368,765.0 594,760.0 226004 61,28
Property/Plant/Equipment, 11,285.3 3956 35.05
15,241.3
Total – Gross
Accumulated (4,507.0) 1409.6 31.27
(5,916.6)
Depreciation, Total
Property/Plant/Equipment, 6,778.4 2546.3 37.56
9,324.7
Total – Net
Other Assets, 18,962.2 27,873.1 8910.9 46.99
Total Assets 750310 1183205 432895 57.69
Accrued Expenses 1,772.8 1,777.6 4.8 .27
Total Deposits 587,850.0 876,193.0 288343 49.05
Total
Total
Long Term Debt 35,014.1 34,293.3 720.8 2.06
Other Liabilities, 7,414.5 16,085.5 8671 116.95
Total Liabilities 698,586.0 1,008,124.1 309638 44.31
Common Stock, 2,816.3 3,577.1
(Accumulated Deficit) 16,232.8
Unrealized Gain (Loss) 0.0 0.00 0.00
Other Equity, Total 4.4 17.8 304.54
Total Equity 33,974.3 87,540.2 53565.9 157.66
Total Liabilities & 750310 1183205 432895 57.69
COMPARATIVE PROFIT &LOSS ACCOUNT 2007-08

Income
Interest Earned 4,560.40 7,005.32 2444.92 53.61
Other Income 986.49 1,750.59 764.1 77.45
Total Income 5,546.89 8,755.91 3109.02 57.85
Expenditure
Employee Cost 381.35 670.25 288.9 75.76
589.31 952.61
Expenses
Depreciation 111.86 158.11 46.25 41.34
Miscellaneous 812.03 1,483.94 671.91 82.74
Expenses
0.00 0.00
Capitalised
Operating Expenses 1,387.06 2,454.03 1066.97 76.92
507.49 810.88
Contingencies
Total Expenses 4,887.87 7,684.87 2797 57.22
Net Profit for the 412 62.51
659.03 1,071.03
Year
COMPARATIVE BALANCE SHEET AND OF AXIS BANK FOR YEAR 2008 & 2009
Particulars 2008 2009 Increase or %age Increase

2008-03-31 2009-03-31 Decrease over or Decrease
Current Assets
Cash & Due from Banks 73,056.6 94,192.1 21135 28.93
Net Loans 594,760.0 815,568.0 220808 37.12
Property/Plant/Equipment, 2875 18.87
15,241.3 18,116.9
Total – Gross
Accumulated 1376.5 23.26
(5,916.6) (7,293.1)
Depreciation, Total
Total – Net
Other Assets, 27,873.1 37,668.6 9795.5 35.14
Total Assets 750310.0 1578932 828622 110.44
Accrued Expenses 1,777.6 2,385.8 608.2 34.21
Total Deposits 876,193.0 1,173,580.0 297387 33.94
Total
Total
Long Term Debt 34,293.3 53,343.9 19050.6 55.55
Total Liabilities 1,008,123.0 1,375,018.0 366895 36.39
Common Stock, 3,577.1 3,590.1 13 0.36
36,495.7
Unrealized Gain (Loss) 0.0 0.6
Other Equity, Total 17.8 124.4 106.6 598.87
Total Equity 87,540.2 101,957.0 14416.8 16.47
Total Liabilities & 750310.0 1578932 828622 110.44
COMPARATIVE PROFIT &LOSS ACCOUNT 2008-09

Decrease Decrease
2008-03-31 2009-03-31
(Amount)
(Amount) (Amount)
Income
Interest Earned 7,005.32 10,835.49 3830.17 54.67
Other Income 1,750.59 2,896.88 1146.29 65.48
Total Income 8,755.91 13,732.37 4976.46 56.83
Expenditure
Employee Cost 670.25 997.66 327.41 48.85
952.61 1,562.11
Expenses
Depreciation 158.11 188.67 30.56 19.33
Miscellaneous 535.35 36.07
1,483.94 2,019.29
Expenses
0.00 0.00
Capitalised
Operating Expenses 2,454.03 3,590.42 1136.4 46.31
810.88 1,177.31
Contingencies
Total Expenses 7,684.87 11,917.00 4232.13 55.07
1,071.03 1,815.36
Year
3) RATIO ANALYSIS12
MEANING
Absolute figures expressed in financial statements by themselves are meaningfulness.

These figures often do not convey much meaning unless expressed in relation to other figures.
Thus, it can be said that the relationship between two figures, expressed in arithmetical terms is
called a ratio.
“According to R.N. Anthony.”

“A ration is simply one number expressed in terms of another. It is found by dividing
one number into the other.”
TYPES OF RATIOS
1. Proportion or Pure Ratio or Simple ratio.

2. Rate or so many Times.
3. Percentage
4. Fraction.
OBJECTS AND ADVANTAGES OR USES OF RATIO ANALYSIS
 Helpful in analysis of financial statements.

 Simplification of accounting data.
 Helpful in comparative study.
 Helpful in locating the weak spots of the business.
 Helpful in forecasting
 Estimate about the trend of the business
 Fixation of ideal standards
 Effective control
LIMITATION OF RATIO ANALYSIS
• False accounting data gives false ratios

• Comparisons not possible of different firms adopt different accounting policies.
• Ratio analysis becomes less effective due to price level
• Ratios may be misleading in the absence of absolute data.
• Limited use of a single Ratio.
• Window-Dressing
• Lack of proper standards.
• Ratio alone are not adequate for proper conclusions
• Effect of persona ability and bias of the analyst.
FUNCTIONAL CLASSIFICATION IN VIEW OF FINANCIAL
MANAGEMENT OR CLASSIFICATION
ACCORDING TO TESTS
Profitability Leverage Management Profit And Balance Debt Cash Flow Investment
Ratios Ratios Efficiency Loss Account Sheet Ratios Coverage Indicator Valuation
Ratios Ratios Ratios Ratios Ratios
Return on Current Ratio Interest Interest Capital Total Debt to Dividend Dividend Per
Long Term Income / Total Expended / Adequacy Owners Fund Payout Ratio Share
Fund Quick Ratio Funds Interest Earned Ratio Net Profit
Financial Operating
Return on Net Net Interest Other Income / Advances / Charges Earning Profit Per
Worth Income / Total Total Income Loans Funds Coverage Retention Share
Funds Ratio Ratio
Interest Operating Net Operating
Spread Non Interest Expense / Financial Cash Earning Profit Per
Income / Total Total Income Charges Retention Share
Funds Coverage Ratio
Ratio Post Free Reserves
Selling Tax
Interest Per Share
Expended / Distribution
Total Funds Cost
Composition
Operating
Expense /
Total Funds
Profit Before
Provisions /
Total Funds
Net Profit /
Total Funds
VARIOUS CALCULATED RATIOS OF AXIS BANK
• Current Ratio
Current ratio may be defined as the relationship between current assets and current liabilities.
Current ratio = Current assets/current liabilities

Year 2005 2006 2007 2008 2009
Current ratio 2.60 2.04 1.99 2.50 2.87
Interpritation:
Current ratio of Axis Bank for all five years fulfills the criteria of ideal ratio i.e. 2:1. This shows
that company is able to pay its current liabilities on time. It is an indication of sound financial
position.
QUICK RATIO
Quick ratio: Liquid Ratio defines the relationship between liquid assets and liquid liabilities.
Quick Ratio = Quick assets/quick liabilities
Liquid assets = current assets – prepaid expenditure
Year 2005 2006 2007 2008 2009

Quick ratio 1.05 1.22 1.39 1.67 1.59
Interpritation:
For the entire three years, liquidity ratio fulfills the criteria of ideal ratio i/e. 1:1. it increases over
every year. It shows that sound short-term financial position of company.
• DEBT EQUITY RATIO:
This ratio indicates the extent to which debt is covered by shareholders funds. It reflects the
relative position of the equity holders and lenders and indicates the company’s policy on the mix
of capital funds. The debt to equity ratio is calculated as follows
Debt equity ratio = external equity/internal equity

Year 2005 2006 2007 2008 2009
Debt Equity 1.31 1.79 1.27 1.99 1.49
ratio
Interpretation:
For the entire three years debt equity ratio fulfills the criteria of ideal ratio i.e. 2:1. Lower the
ratio better it is. So indicates the sound long term position of company. It is better for lenders
because they are more secure
• INTREST TO TOTAL FUND RATIO
This ratio indicates the relationship between total funds invested in the firm &interest earned in
relation to this
Interest to total fund ratio: Interset income /Total fund
Year 2005 2006 2007 2008 2009

Interest to total 7.43 8.22 8.88 9.57 10.53
fund ratio
Interpritation
The interest to total fund ratio is on rise & indicate the higher interest earning capacity of the
Bank
• NET INTEREST INCOME TO TOTAL FUND RATIO
Net interest income to total fund ratio= (Interset income-Interest paid) /Total fund
This ratio indicates the relationship between total funds invested in the firm &interest
earned in relation to this after deduction of interest payment
Year 2005 2006 2007 2008 2009

Net interest 3.57 4.08 4.01 4.74 4.98
income to total
fund ratio
Interpritation
The Interest income after deduction of interest payment is on rise which indicate sound financial
position of the Bank
• NON-INTEREST INCOME TO TOTAL FUND RATIO
This ratio indicates the relationship between total funds invested in the firm & income other than interest income
earned in relation to this
Non interest income to total fund ratio=Income other than interest /total fund
Year 2005 2006 2007 2008 2009

Non interest 0.11 .01 .03 0.02 .06
income to total
fund ratio
Interpritation
The Non interest income of the bank is on fall which indicate that interest income is higher than
the non interest income
• INTEREST EXPENDED TO TOTAL FUND RATIO
This ratio indicates the relationship between total funds invested in the firm & interest paid for
them
Interest Expended to total fund ratio= Interest Expended /outside funds

Year 2005 2006 2007 2008 2009
Interest
Expended /total 3.85 4.14 4.87 4.83 5.56
fund ratio
Interpritation
The interest payment of the bank is on rise year after year, which indicates the sound financial
position of the bank & more interest earning capacity.
• OPERATING EXPENCES TO TOTAL FUND RATIO
This ratio indicates the relationship between total funds invested in the Bank & operating
expenses done by the bank
Operating Expenses to total fund ratio= Operating Expevses /Total fund
Year 2005 2006 2007 2008 2009

Operating Expense /
Total Funds 1.59 1.90 2.07 2.51 2.64
Interpritation
The operating expenses of the bank are on rise, which indicate more expense doing capacity of
the bank.
• PROFIT BEFORE PROVISION TO TOTAL FUND RATIO
This ratio indicates the relationship between total funds invested in the Bank & profit (EBIT (1-
T)) before taking any type of provision into account.
Profit before Provisions to Total Funds= Net Profit /Total fund

Year 2005 2006 2007 2008 2009
Profit Before
Provisions / 1.84 1.98 1.79 2.07 2.25
Total Funds
Interpritation
The Net Profit to Total fund is on rise. It is least for the year 2007 but has a good financial
position & is near to 2%
• NET PROFIT TO TOTAL FUND RATIO
This ratio indicates the relationship between net profits after transferring to various types of
provitions & Total funds employed.
Net Profit to Total Funds =Profit trabsfered to Balance Sheet/ Total Fund
Year 2005 2006 2007 2008 2009

Net Profit / Total
1.05 1.11 1.07 1.17 1.41
Funds
Interpritation
The net profit of the Bank has increased year after year & Bank has good Profit after transferring
to various types of provitions
• INTEREST EXPENDED TO INTEREST EARNED
This ratio indicates the relationship between Interests expended in relation to Interest earned
Interest Expended to Interest Earned = Interest Expended / Interest Earned

Year 2005 2006 2007 2008 2009
Interest
Expended / 62.00 62.68 65.64 63.09 65.98
Interest Earned
Interpritation
The interest expenses are less than the interest income which indicate sound earning capacity of
the bank but it has increased 6.41%
• OTHER INCOME TO TOTAL INCOME RATIO
This ratio indicates the relationship between Incomes other than interest Income in relation to
total income.
Other Income to Total Income = Other Income / Total Income
Year 2005 2006 2007 2008 2009

Other Income / Total
1.48 0.18 0.39 0.16 0.60
Income
Interpritation
The income other than interest income is less than interest except for the year 2005 & for all
other yesrs it is less than 60%.
• OPERATING EXPENSES TO TOTOAL INCOME RATIO
This ratio indicates the relationship between the Total income of the bank & operating expenses
done by it.
Operating Expense to Total Income = Operating Expense / Total Income

Year 2005 2006 2007 2008 2009
Operating
Expense / Total 21.02 23.13 23.26 26.20 24.95
Income
Interpritation
The operating expenses to total income thas increased by 18.69% but it is less than 25% except
for year 2008
• FINANCIAL CHARSES COVERAGE RATIO
This ratio indicates that how many times the income can cover the financial expenses. Higher the
ratio better is the position of the firm.
Financial Charges Coverage Ratio = Financial Charges / Profits
Year 2005 2006 2007 2008 2009

Financial 1.43 1.46 1.41 1.53 1.56
Charges
Coverage Ratio
Interpritation
Financial charses have been fairly covered by the bank & it is just one and half percentage of the
profit & indicates sound financial position.
• FINANCIAL CHARSES COVERAGE RATIO POST TAX
This ratio indicates that how many times the income after tax can cover the financial expenses.
Higher the ratio better is the position of the firm.
Financial Charges Coverage Ratio Post Tax = Financial charses /Net Profit
Year 2005 2006 2007 2008 2009
Financial
Charges
1.35 1.32 1.26 1.28 1.28
Coverage Ratio
Post Tax
Interpritation
The financial charses has been decreased in year 2009 as compared to 2005 which indicates
rising profits
• DIVIDEND PAYOUT NET PROFIT RATIO
This ratio indicates the relationship between the net profits & Dividend paid in relation to this.
Dividend Payout Net Profit ratio = Dividend Payout / Net Profit
Year 2005 2006 2007 2008 2009

Dividend Payout
26.22 23.20 22.57 23.49 23.16
Ratio Net Profit
Interpritation
Dividend Payout Ratio to Net Profit indicates that how much profits has been distributed as
Dividends & it is a high portion of net profit which undicates sound financial position of the
Bank
• EARNING RETENTION RATIO
This ratio indicates that part of earnings that has not been distributed as dividend but retained in
the firm as retained earnings
. Earning Retention Ratio = Earning Retained / Total earning

Year 2005 2006 2007 2008 2009
Earning
73.10 76.88 77.53 76.84 76.94
Retention Ratio
Interpritation
The retention ratio of Axis Bank has increased on year on year basis which indicates that Bank
has sound Investing opportunities.
• CASH EARNING RETENTION RATIO
This ratio indicates that part of cash earnings that has been retained by the bank
Cash Earning Retention Ratio = Cash Earning Retained /Total cash earning
Year 2005 2006 2007 2008 2009

Cash Earning
78.48 80.57 80.78 79.78 79.11
Retention Ratio
Interpritation
Higher this ratio indicates higher investment opportunities of the Bank & this is more than 75%
of the Bank for all the five years
• DIVIDEND PER SHARE
This ratio indicates dividend that is distributed on each share
Dividend Per Share = Dividend distributed /total no.of Shares

Year 2005 2006 2007 2008 2009
Dividend Per
2.80 3.50 4.50 6.00 10.00
Share
Interpritation
The Dividend per share has been increased to Rs.10 in 2009 from Rs.2.80 in 2005 which
indicates higher value of Shares of Axis Bank & Strong Financisl position.
• OPERATING PROFIT PER SHARE
This ratio indicates operating profit that has been earned by the firm on each share
Operating Profit per Share = Operating Profit / Total No. of shares
Year 2005 2006 2007 2008 2009

Operating Profit
22.49 34.12 42.36 56.88 83.56
Per Share (Rs)
Interpritation
The operating profit is on rise year after year. It was Rs. 22.49 in year 2005 & has increased to
Rs. 83.56 in year 2009which indicates sound Financial position.
• FREE RESERVES PER SHARE
This indicates the reserves that have been distributed on each share.
Free Reserves per Share = Free Reserves / Total No. of shares

Year 2005 2006 2007 2008 2009
Free Reserves
54.08 75.38 86.60 208.03 230.47
Per Share (Rs)
Interpritation
The free reserves per share has increased to Rs.230.47 in year 2009 from Rs.54.08 in year 2005.It
is a increase of more than 400%
• RETURN ON LONG TERM FUNDS
This indicates the return earned on long term funds of the firm
Return on Long term funds = EBIT/Long term funds.
Year 2005 2006 2007 2008 2009

Return on Long
70.55 88.56 119.74 71.15 97.33
Term Fund (%)
• RETURN ON NET WORTH
This ratio indicates return on net worth of the Bank
Year 2005 2006 2007 2008 2009

Return on Net
18.19 18.28 19.37 12.21 17.77
Worth (%)
Annual Cash Flow Statement
Cash Flow Statement -2005

(In Millions of Rupee)
PARTICULARS AMOUNT (Rs)

Net Income/Starting Line 5,037.0
Depreciation/Depletion 815.8
Non-Cash Items 635.2
Changes in Working Capital 36,854.0
Cash from Operating Activities 43,341.9
Capital Expenditures (1,701.6)
Other Investing Cash Flow Items, Total (51,096.4)
Cash from Investing Activities (52,798.0)
Total Cash Dividends Paid (656.5)
Issuance (Retirement) of Stock, Net 10,238.8
Issuance (Retirement) of Debt, Net 1,500.0
Cash from Financing Activities 11,082.2
Foreign Exchange Effects --
Net Change in Cash 1,626.2

Depreciation/Depletion 921.9
Changes in Working Capital (6,789.0)
Total Cash Dividends Paid (887.4)
Issuance (Retirement) of Stock, Net 849.5
Foreign Exchange Effects --
Net Change in Cash (8,610.9)


Depreciation/Depletion 1,120.1
Non-Cash Items 1,043.7
Financing Cash Flow Items 13,735.1
Total Cash Dividends Paid (1,117.4)
Foreign Exchange Effects (5.0)

Non-Cash Items 1,886.6
Financing Cash Flow Items 1,734.2
Issuance (Retirement) of Stock, Net 45,466.8
Issuance (Retirement) of Debt, Net (2,455.0)
Foreign Exchange Effects 22.1


Financing Cash Flow Items --
Foreign Exchange Effects 106.6
CONCLUSION
AXIS bank is a leading bank in the private sector. It has a large no. of branches in various cities
and has a large no of potential customers. In my training period I observed that bank is facing a
much stiffer competitive environment that just temporary aberration of recession. They have to
face situation like a rapid erosion of technology advantage, disappearance of natural boundaries,
aggressive competition, uncertain consumer behavior fragmentation of media, individualization
of taste and move relating specifically to different categories.
From my study of Financial Statement Analysis, I learnt various methods of analyzing Financial
Statements of Bank. Financial Statements gives information about credibility of organization,
about various types of Assets & Liabilities. Based on Financial Statement Analysis various ratios
can be calculated. Different ratios show financial position of an organization. Therefore,
Financial Statement Analysis helps bank to know about financial position & credit worthiness of
the Bank
Finally, We can say that on overall basis the project taken provides deep knowledge and practical
aspects.
After all study of the project of COMPARATIVE FINANCIAL ANALYSIS in Axis Bank
limited, the result, which I found in this study, are as follow:
The Axis Bank has satisfactory liquidity position. Bank’s operating expenses are also
satisfactory. Rate of growth of Bank is more than other private banks. Bank is following stable
dividend policy. Bank is more focusing on retention of profits rather than distributing them as
dividend. Profits and sales of Axis Bank shows as increasing trend.
Finally, we can say that on overall basis the project taken provides deep knowledge and
practical aspects.
BIBLIOGRAPHY
Books:
1. Kothari C.R., “Quantitative Techniques”, ed 2005, Vikas publishing house Pvt. Ltd., New
Delhi
2. Pandy, I.M. “Financial Management”, 3rd edition, Vikas Publication House Pvt. Ltd., New
Delhi
3. Maheshwari, S.N. “Advanced Accounting”, ed -2004, Sultan Chand & Sons Publication,
New Delhi
4. Mittal. R.K. “Management Accounting & Financial Management”. V.K. (India)
Enterprises, New Delhi
5. Ciaran Walsh, “Key Management Ratios”, ed 1999, Macmillan India Ltd., New Delhi
WEBSITES:
1. www.moneycontrol.com/financials/axisbank/profit.
2. www.moneycontrol.com/financials/axisbank/ratios/
3. money.rediff.com/companies/axis-bank-ltd/.../profit-and-loss
4. www.wikinvest.com/stock/Axis_Bank
OTHERS:
1. Annual Report of Axis Bank for the year 2005-2006, 2006-07,2007-08 and 2008-09
2. Auditors Report of NLL for the year 2005-06, 2006-07,2007-08 and 2008-09

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A PROJECT REPORT

SUBMITTED IN THE PARTIAL FULFILLMENT OF THE REQUIREMENTS OF THE

SUBMITTED TO:- SUBMITTED BY:-

VAISH INSTITUTE OF MANAGEMENT &TECHNOLOGY (VIMT)

Countersigned Signature of Student

Director of the institute

• AXIS BANK INTRODUCTION

• COMPARATIVE BALANCE SHEET

MEANING AND DEFINITION:

-Banking Companies (Regulation) Act,1949

-By H.Wills & J. Bogan

-By Findlay Sheras

• Accept deposits of money from public,

From World War I to Independence

Number of banks Authorised capital Paid-up Capital

1914 42 710 109

The banks in India that were nationalized.

Central Bank of India

INDIAN BANKING SYSTEM

Reserve Bank of India

• Safe custody of customer’s valuable articles & securities.

• Saving Account with no minimum balance requirement.

Personal Loans brings customer one step closer to their dreams

Types of Credit Facilities

Non Fund Based Credit Facilites

FUND BASED CREDIT FACILITY

NON FUND BASED CREIDT FACILITY

• Letter of Credit Facility

Bank’s Mission & Values

SWOT ANALYSIS OF AXIS BANK

• Sport of various promoters

• Not having good image

• Growing Indian market

Axis Bank has business of Rs.1,02,000.00 crore with a market capitalization of

Few milestones of the Axis bank:

Shikha Sharma Chairman &chief Executive Officer

THE CORE MANAGEMENT TEAM

R. Asok Kumar Executive Director - Corporate Strategy

MARKET OBJECTIVES OF AXIS BANK BY 2011

1. To get market capitalization Rs.500 crore

MEANING OF FINANCIAL STATEMENTS:-

1. The Balance Sheet

2. Profit And Loss Account

MEANING OF FINANCIAL ANALYSIS

Features of Financial Analysis

• To present a complex data contained in the financial statement in simple and

Purpose of Analysis of financial statements14

1. To know the earning capacity or profitability.

TYPES OF FINANCIAL ANALYSIS14

• Classification on the basis of natural used

On the basis of modus operand:

METHODS OF FINANCIAL ANALYSIS13

A) Comparative Financial Statements.

C) Cash Flow Statement

Financial statement analysis is an attempt to determine the significance and meaning of

BehaviourKothari C.R. , Research Methodology Methods and Techniques, “Research, Methodology

studied to know about various factors and concept)3

4. Kotler Philip, Principles of Marketing, “Holistic Marketing Concept”5

and hypothesis testing”6

6. Kapoor C.S., Gupta K.V., Fundamentals of Applied Statistics, “Research Designs”7

“Questionnaire Construction Procedure”8

Multi Dimensional Scaling, Principal component analysis, Multiple correspondence analysis”10