State bank of India Financial Analysis Ratio analysis STATE AN! "F IN#IA State ank of India Industry $anks % Public Sector Incorporation Year 1955 Chairman Pratip Chaudhuri Managing Director Hemant G Contractor Company Secretary - Auditor B M Chatrath Co! "a#yani$a#a Mi%try &egi%tered '((ice State Ban) Bha*an +th ,#oor- Madame Cama &oad .ariman Point- Mum/ai- 011121- Mahara%htra 3e#ephone 91-22-22++4+++!2212256+ ,a7 91-22-22+5540+ 8-mai# gm9%n/:%/i9co9in ;e/%ite http<!!$$$9%/i9co9in ,ace =a#ue >&%? 11 BS8 Code 511112 BS8 Group A .S8 Code SBI. B#oom/erg SBI. I. &euter% SBI9B' ISI. Demat I.8152A11112 Mar)et @ot 1 @i%ting Ahmeda/ad-Chennai-De#hi-"o#)ata-@ondon-Mum/ai- .S8 ,inancia# Year 8nd 14 Boo) C#o%ure Month May AGM Month Aun &egi%trarB% .ame Addre%% Datamatic% ,inancia# Ser*ice%- P#ot.o-A-15-16 PartB- Cro%% @ane MIDC- Maro# Andheri >8a%t?- Mum/ai - 011 1949 91-22-2+2144+4!91!55 91-22-2+45901+
It i% the #arge%t Indian /an)ing and (inancia# %er*ice% company >/y turno*er and tota# a%%et%? $ith it% headCuarter% in Mum/ai- India9 It i% %tate-o$ned9 3he /an) trace% it% ance%try to Briti%h India- through the Imperia# Ban) o( India- to the (ounding in 1+15 o( the Ban) o( Ca#cutta- ma)ing it the o#de%t commercia# /an) in the Indian Su/continent9 Ban) o( Madra% merged into the other t$o pre%idency /an)%- Ban) o( Ca#cutta and Ban) o( Bom/ay to (orm Imperia# Ban) o( India- $hich in turn /ecame State Ban) o( India9 3he go*ernment o( India nationa#iDed the Imperia# Ban) o( India in 1955- $ith the &e%er*e Ban) o( India ta)ing a 51E %ta)e- and renamed it the State Ban) o( India9 In 211+- the go*ernment too) o*er the %ta)e he#d /y the &e%er*e Ban) o( India9 SBI pro*ide% a range o( /an)ing product% through it% *a%t net$or) o( /ranche% in India and o*er%ea%- inc#uding product% aimed at non-re%ident Indian% >.&I%?9 3he State Ban) Group- $ith o*er 15-111 /ranche%- ha% the #arge%t /an)ing /ranch net$or) in India9 SBI ha% 10 @oca# Head '((ice% and 56 Fona# '((ice% that are #ocated at important citie% throughout the country9 It a#%o ha% around 141 /ranche% o*er%ea%9 ;ith an a%%et /a%e o( G452 /i##ion and G2+5 /i##ion in depo%it%- SBI i% a regiona# /an)ing /ehemoth and i% one o( the #arge%t (inancia# in%titution% in the $or#d9 It ha% a mar)et %hare among Indian commercia# /an)% o( a/out 21E in depo%it% and #oan%9 3 3he State Ban) o( India i% the 29th mo%t reputed company in the $or#d according to Forbes9 A#%o SBI i% the on#y /an) (eatured in the co*eted Htop 11 /rand% o( IndiaH #i%t in an annua# %ur*ey conducted /y Brand ,inance and The Economic Times in 21119 3he State Ban) o( India i% the #arge%t o( the Big ,our /an)% o( India- a#ong $ith ICICI Ban)- PunIa/ .ationa# Ban) and HD,C Ban)Jit% main competitor%9 &istory of state bank of India$ State Ban) o( India i% the #arge%t %tate-o$ned /an)ing and (inancia# %er*ice% company in India9 3he Ban) pro*ide% /an)ing %er*ice% to the cu%tomer9 In addition to the /an)ing %er*ice%- the Ban) through their %u/%idiarie%- pro*ide% a range o( (inancia# %er*ice%- $hich inc#ude #i(e in%urance- merchant /an)ing- mutua# (und%- credit card- (actoring- %ecurity trading- pen%ion (und management and primary dea#er%hip in the money mar)et9 3he Ban) operate% in (our /u%ine%% %egment%- name#y 3rea%ury- Corporate! ;ho#e%a#e Ban)ing- &etai# Ban)ing and 'ther Ban)ing Bu%ine%%9 3he 3rea%ury %egment inc#ude% the in*e%tment port(o#io and trading in (oreign e7change contract% and deri*ati*e contract%9 3he Corporate! ;ho#e%a#e Ban)ing %egment compri%e% the #ending acti*itie% o( Corporate Account% Group- Mid Corporate Account% Group and Stre%%ed A%%et% Management Group9 3he &etai# Ban)ing %egment con%i%t% o( /ranche% in .ationa# Ban)ing Group- $hich primari#y inc#ude% per%ona# /an)ing acti*itie%- inc#uding #ending acti*itie% to corporate cu%tomer% ha*ing /an)ing re#ation% $ith /ranche% in the .ationa# Ban)ing Group9 SBI pro*ide% a range o( /an)ing product% through their *a%t net$or) o( /ranche% in India and o*er%ea%- inc#uding product% aimed at .&I%9 3he State Ban) Group- $ith o*er 15-111 /ranche%- ha% the #arge%t /an)ing /ranch net$or) in India9 3he State /an) o( India i% the 11th mo%t reputed company in the $or#d according to ,or/e%9 3he /an) ha% 155 o*er%ea% o((ice% %pread o*er 42 countrie%9 3hey ha*e /ranche% o( the parent in Co#om/o- Dha)a- ,ran)(urt- Hong "ong- Aohanne%/urg- @ondon and en*iron%- @o% Ange#e%- Ma#e in the Ma#di*e%- Mu%cat- .e$ Yor)- '%a)a- Sydney- and 3o)yo9 3hey ha*e o((%hore /an)ing unit% in the Bahama%- Bahrain- and Singapore- and repre%entati*e o((ice% in Bhutan and Cape 3o$n9 State Ban) o( India $a% incorporated in the year 19559 3he Ban) trace% their ance%try to Briti%h India- through the Imperia# Ban) o( India- to the (ounding in 1+15 o( the Ban) o( Ca#cutta- ma)ing them the o#de%t commercia# /an) in the Indian Su/-continent9 3he Go*ernment o( India nationa#iDed the Imperia# Ban) o( India in the year 1955- $ith the &e%er*e Ban) o( India ta)ing a 51E %ta)e- and name $a% changed to State Ban) o( India9 In the year 2111- the SBI @i(e In%urance Company $a% %tarted /y the Ban)9 3hey are the on#y Ban) that ha*e /een permitted 60E %ta)e in the in%urance /u%ine%%9 3he Ban)B% in%urance %u/%idiary BSBI @i(e In%urance CompanyB i% a Ioint *enture $ith Cardi( S9A in $hich Cardi( ho#d% 25E o( the %ta)e9 During the year 2115-15- the /an) introduced BSBI e-ta7B an on#ine ta7 payment% (aci#ity (or direct and indirect ta7 payment9 3hey a#%o #aunched the centra#iDed pen%ion proce%%ing9 3he Ban) made a partner%hip $ith 3ata Con%u#tancy Ser*ice% (or %etup C-8dg 3echno#ogie% and con%u#ting %er*ice% to the /an)ing- (inancia# %er*ice% and in%urance indu%try9 3he /an) $a% noted a% B3he mo%t pre(erred /an)B in a %ur*ey /y 3= 1+ in a%%ociation $ith AC .ie#%en-'&G Marg9 A#%o- the Ban) $a% *oted a% B3he mo%t pre(erred hou%ing #oan pro*iderB in A;AAF con%umer a$ard% (or the year 21159 In the cu%tomer #oya#ty %ur*ey 2115-16 conducted /y BBu%ine%% ;or#dB- the Ban) $a% ran)ed num/er one in a## parameter% o( cu%tomer %ati%(action- %er*ice orientation- cu%tomer care! ca## center- cu%tomer #oya#ty and home #oan%9 SBI ,und% $a% Iudged BMutua# (und o( the yearB /y C.BC!3=- 1+!C&IS@9 3he Ban) introduced ne$ product% and %er*ice% %uch a% $e/-/a%ed remittance- in%tant (und tran%(er- on#ine-trading and comprehen%i*e ca%h management9 During the year 2116-1+- the Ban) #aunched 955 /ranche% a## o*er the country9 3hey inaugurated a ne$ %tate-o(-the art Dea#ing &oom $ith on#ine connecti*ity to a## acti*e (ore7 inten%i*e Branche% at Corporate Centre in Mum/ai9 3hey #aunched a ne$ product- Con%truction 8Cuipment @oan to cater to con%truction Companie%9 A#%o- they introduced ne$ product% %uch a% SBI &e*er%e Mortgage @oan and SBI Home P#u% in the area% o( Home @oan%9 During the year- the &BI tran%(erred their entire %hareho#ding in the Ban) repre%enting 59964E o( the i%%ued capita# o( the Ban) to the Go*ernment o( India9 3he Ban) acCuired 92914E o( eCuity o( G#o/a# 3rade ,inance @td9 Con%eCuent#y- G3,@ /ecame a %u/%idiary o( the Ban)9 3hey %igned an MoK $ith the Indian rai#$ay% (or in%ta##ing A3M% at 5+2 rai#$ay %tation%9 In March 211+- the Ban) opened their 11-111th /ranch and /ecame on#y the %econd /an) in the $or#d to ha*e more than 11-111 /ranche% a(ter ChinaB% ICBC9 During the year 211+-19- the company #aunched Import (actoring- a ne$ product in a%%ociation $ith SBI ,actor% Commercia# Ser*ice% @td9 3hey increa%ed the num/er o( /ranche% (or retai# %a#e o( go#d coin% (rom 251 to 51+9 A#%o- they re-#aunched Go#d Depo%it Scheme at 51 /ranche% to mo/i#iDe go#d (rom dome%tic mar)et (or dep#oyment a% meta# #oan% to Ie$e##er%9
During the year- the Ban) opened their 11-111th Branch at Sonapur >"amrup Di%trict? in A%%am9 3hey introduced three ne$ product% *iD9- SBI Specia# Home @oan- SBI Happy Home @oan and SBI @i(e%ty#e in re%pon%e to the %timu#u% pac)age announced /y the Go*ernment o( India9 A#%o- they entered into an e7c#u%i*e arrangement $ith 3A3A Motor% (or hand#ing the /oo)ing proce%% o( 3A3A B.anoB car%9 During the year- the Ban) #aunched on their $e/-%ite an on-#ine app#ication (orm (or regi%tering Auto @oan enCuirie% and e7peditiou%#y monitoring and con*erting the%e #ead% into Auto @oan%9 A#%o- they #aunched Be-in*e%tB (or the ASBA >app#ication% %upported /y /#oc)ed account%? to aid in*e%tor% (or their eCuity %u/%cription%- IP' and &ight% app#ication%9 During the year- the Ban) %et up a cu%todia# %er*ice% company name#y SBI Cu%todia# Ser*ice% P*t9 @td9- in Ioint *enture $ith Societe Genera#e- ,rance9 3hey %igned #etter o( intent (or %etting up o( Ioint *enture company (or underta)ing Genera# In%urance Bu%ine%%9 A#%o- they di*e%ted 11E eCuity %ta)e in it% $ho##y o$ned %u/%idiary SBI Pen%ion ,und P*t9 @td at co%t in (a*our o( it% %u/%idiarie%9 In 'cto/er 211+- the Ban) %igned an MoK $ith State Genera# &e%er*e ,und >SG&,? o( 'man- (or a genera# purpo%e pri*ate eCuity (und9 During the year- State Ban) o( Saura%htra >SBS?- a $ho##y o$ned %u/%idiary o( the Ban)- ama#gamated $ith the Ban) $ith e((ect (rom Augu%t 14- 211+9 3hey %igned a Ioint *enture agreement $ith In%urance Au%tra#ia Group (or underta)ing Genera# In%urance /u%ine%%9 A#%o- they %igned a Ioint *enture agreement $ith MacCuarie Capita# Group- Au%tra#ia and I,C- ;a%hington (or %etting up an In(ra%tructure (und o( KSD 4 /i##ion (or in*e%ting in *ariou% in(ra%tructure proIect% in India9 During the year 2119-11- the Ban) opened 1-109 /ranche%- out o( $hich /ranche% $ere opened in metro and ur/an area% $ith a *ie$ to increa%e the Ban)B% reach and /e more acce%%i/#e to cu%tomer%9 In Au#y 2119- SBI introduced BSBI @oan to A((#uent Pen%ioner%B ena/#ing the go*ernment pen%ioner% to a*ai# per%ona# #oan% upto &% 4 #a)h9 During the year- the Ban) de%igned a %pecia# pac)age- the De(ence Sa#ary Pac)age- (or per%onne# o( the three Armed ,orce% i9e9 the Army- .a*y and Air ,orce $ho maintain their Sa#ary account% $ith them9 A% o( March 2111- the Ban) had 12-095 /ranche% and 21-0+5 Group A3M%9 In Aune 2119- the company increa%ed their %hareho#ding in .epa# SBI Ban) @td to 55912E and thu% .epa# SBI Ban) @td /ecame a %u/%idiary o( the Ban) $ith e((ect (rom Aune 10- 21199 In May 2111- the Ban) %e#ected con%ortium o( 8#a*on Incorporation- KSA and =i%a Internationa#- KSA a% their Ioint *enture >A=? partner (or Merchant AcCuiring Bu%ine%%9 3hey %et up a $ho##y o$ned %u/%idiary- name#y SBI Payment Ser*ice% P*t @td (or conducting Merchant AcCuiring Bu%ine%%9 In Augu%t 2111- State Ban) o( Indore $a% ama#gamated $ith the Ban) a% per the %cheme o( ama#gamation appro*ed /y the Centra# Board9 During the year 2111-11- the Ban) introduced 2 ne$ product%- name#y BPu%hpa K##a%B and BArthia% P#u%B on pi#ot /a%i%9 3hey made %u/%tantia# progre%% in e%ta/#i%hing it%e#( a% a #eading P8 (und p#ayer o( the country9 A#%o- they a#%o %igned a Aoint =enture agreement $ith State Genera# &e%er*e ,und >SG&,? o( Su#tanate o( 'man- a %o*ereign entity- to %et up a genera# purpo%e pri*ate eCuity (und $ith an initia# corpu% o( KSD 111 mn- e7panda/#e (urther to KSD 195 /n9 During the year- the Ban) opened 565 ne$ /ranche% /e%ide% merger o( 061 /ranche% o( er%t$hi#e State Ban) o( Indore9 A#%o- they opened 10 (oreign o((ice% during the year- ta)ing the tota# to 1559 In Au#y 1- 2111- the Ban) #aunched their BGreen Channe# CounterB at %e#ect /ranche% acro%% the country9 In Genera# In%urance /u%ine%%- the Ban) #aunched #imited operation% in Apri# 2111 (or the Corporate and Mid Corporate cu%tomer% /a%ed at Mum/ai- and it $a% e7panded to %i7 other maIor #ocation% in Au#y 21119 In the &etai# %egment- the Ban) #aunched their @ong 3erm Home In%urance /u%ine%% at Mum/ai in 'cto/er 2111- $hich $a% gradua##y e7tended to co*er 55 &ACPC% and &ASM8CC%9 Genera# In%urance SM8 /u%ine%% $a% #aunched on a pi#ot /a%i% in Mum/ai and Chennai in ,e/ruary 21119 During the (ir%t Cuarter o( the (inancia# year 2111-12- the Go*ernment o( India i%%ued the BAcCui%ition o( State Ban) o( India Commercia# Internationa# Ban) @td9 *ide noti(ication dated Au#y 29- 21119 Con%eCuent to the %aid noti(ication- the underta)ing o( State Ban) o( India Commercia# Internationa# %tand% tran%(erred to and *e%t in State Ban) o( India $ith e((ect (rom Au#y 29- 21119 'I(EST"NE "F STATE AN! "F IN#IA )**+ -SBI un*ei#% ne$ /ranch in ManIeri -Ban) a$arded %pecia# priDe (or #ending to %e#( he#p group run /y $omen
-SBI un*ei#% (#oating A3M
-State Ban) o( India appointed %i7 ne$ Deputy Managing Director% on ,e/ruary 11- 21109 3he ne$ DMD% are< Mr 39S9 Bhattacharya- CGM- Product De*e#opment and Mar)eting- Mr M9M9@atee(- Managing Director- SBI Gi#t%- Mr Yoge%h Agar$a#- CGM- Chandigarh- Mr "ri%hnamurthy- CGM- Madra% @H' and Mr &9&amanathan- CGM- 3echno#ogy and Mr =iIay Anand- CGM- Corporate Account group9 3he%e top #e*e# appointment% (o##o$ the appointment o( the ne$ Managing Director (or the /an)- Mr Chandan Bhattacharya- in Decem/er9
-State Ban) o( India- >SBI? $ith a *ie$ to e7pand the am/it o( it% educationa# #oan %cheme%- ha% un*ei#ed a uniCue educationa# #oan %cheme- chri%tened .ur%ing P#u%- (or the nur%ing %tudent% o( the country
a*erage o( adIu%ted .et Pro(it 2119-2111 and 2111 ++55952444
rounding o(( ++56
Standard de*iation < 510944 &ounding o(( 510 CRAR; )*.- )*.) )*.. CRAR9;: Year 8nd 211114 211114 211914 C&A& - 3ier I >E? 6966 9905 994+ C&A& - 3ier II >E? 0921 4990 09+6 3ota# C&A& >E? 1199+ 14949 10925
3ota# C&A& >E? 2114 10925 year 2112 14949 2111 1199+ RATI" ANA(<SIS$ C7RRENT RATI"$ An indication o( a companyB% a/i#ity to meet %hort-term de/t o/#igation%M the higher the ratio- the more #iCuid the company i%9 Current ratio i% eCua# to current a%%et% di*ided /y current #ia/i#itie%9 I( the current a%%et% o( a company are more than t$ice the current #ia/i#itie%- then that company i% genera##y con%idered to ha*e good %hort-term (inancia# %trength9 I( current #ia/i#itie% e7ceed current a%%et%- then the company may ha*e pro/#em% meeting it% %hort-term o/#igation%9 C7RRENT RATI" 4 C7RRENT ASSETS = C7RRENT (IAI(IT< current ratio year 2111-2114 year &atio 2116 1915 211+ 1916 2119 1910 2111 1910 2111 1910 (I>7I# RATI"$ @iCuid ratio i% a#%o )no$n a% ?>uick@ or ?Acid Test ?Ratio9 @iCuid a%%et% re(er to a%%et% $hich are Cuic)#y con*erti/#e into ca%h9 Current A%%et% other %toc) and prepaid e7pen%e% are con%idered a% Cuic) a%%et%9 >uick Ratio 4 Total >uick Assets Total Current (iabilities >uick Assets 4 Total Current Assets 5 InAentory Year &atio 2116 5952 211+ 5915 2119 5960 2111 9916 2111 +951 EARNIN8 PER S&ARE$ In order to a*oid con(u%ion on account o( the *aried meaning% o( the term capita# emp#oyed- the o*era## pro(ita/i#ity can a#%o /e Iudged /y ca#cu#ating earning per %hare $ith the he#p o( the (o##o$ing (ormu#a< Earning Per EBuity Share 4 Net Profit after Ta6 5Preference #iAidend No. of EBuity shares 3he earning per %hare o( the company he#p% in determining the mar)et price o( the eCuity %hare% o( the company9 A compari%on o( earning per %hare o( the company $ith another $i## a#%o he#p in deciding $hether the eCuity %hare capita# i% /eing e((ecti*e#y u%ed or not9 It a#%o he#p% in e%timating the companyN% capacity to pay di*idend to it% eCuity %hareho#der%9 Year &atio 2111 +5929 2111 115955 2112 104956 2114 100946 #ICI#EN# PER S&ARE $ It i% e7pre%%ed /y di*iding di*idend paid to eCuity %hareho#der% /y no9 o( eCuity %hare%9 thi% %ho$% the per %hare di*idend gi*en to eCuity %hareho#der%9 It i% *ery he#p(u# (or potentia# in*e%tor% to )no$ the di*idend paying capacity o( the company9 It a((ect% the mar)et *a#ue o( the company9 #iAidend Per Share 4 #iAidend Paid To EBuity Shareholders No. "f EBuity Shares di*idend per %hare
2111 10 year 2111 2195 2112 29 2114 41 NET PR"FIT RATI"$ 3hi% ratio indicate% the .et margin on a %a#e o( &%91119 It i% ca#cu#ated a% (o##o$%< Net Profit Ratio 4 Net Profit D .** Net Sales 3hi% ratio he#p% in determining the e((iciency $ith $hich a((air% o( the /u%ine%% are /eing managed9 An increa%e in the ratio o*er the pre*iou% period indicate% impro*ement in the operationa# e((iciency o( the /u%ine%%9 3he ratio i% thu% on e((ecti*e mea%ure to chec) the pro(ita/i#ity o( /u%ine%%9
net pro(it ratio
2111 11912 year 2111 11955 2112 12914 2114 11950 RET7RN "N NET E"RT&$ It mea%ure% the pro(ita/i#ity o( the /u%ine%% in *ie$ o( the %hareho#der%9 It Iudge% the earning capacity o( the company and the adeCuacy o( return on proprietorN% (und%9 Shareho#der% and potentia# in*e%tor% are intere%ted in thi% ratio9 It i% ca#cu#ated a% /e#o$< Return "n Net Eorth 4 Net Profit After Interest And Ta6 6 .** Shareholder@s Funds
return on %hareho#derB%
2111 1095 year 2111 14962 2112 15960 2114 149+9 #ET% E>7IT< RATI"$ 3he De/t-8Cuity ratio i% ca#cu#ated to (ind out the #ong-term (inancia# po%ition o( the (irm9 3hi% ratio indicate% the re#ation%hip /et$een #ong-term de/t% and %hareho#derN% (und%9 3he %oundne%% o( #ong- term (inancia# po#icie% o( a (irm can /e determined $ith the he#p o( thi% ratio9 It he#p% to a%%e%% the %oundne%% o( #ong-term (inancia# po#icie% o( a /u%ine%%9 It a#%o he#p% to determine the re#ati*e %ta)e% o( out%ider% and %hareho#der%9 @ong-term creditor% can a%%e%% the %ecurity o( their (und% in a /u%ine%%9 It indicate% to $hat e7tent a (irm depend% upon #ender% to meet it% #ong-term (inancia# reCuirement%9 A #o$ De/t-8Cuity ratio i% con%idered /etter (rom the point o( *ie$ o( creditor%9
3ota# De/t to '$ner% ,und
2111 14992 year 2111 11995 2112 129+1 2114 12919 FIDE# ASSETS T7RN"CER RATI"$ It i% a#%o ca##ed a% Sa#e% to ,i7ed A%%et% &atio9 It mea%ure% the e((icient u%e o( (i7ed a%%et%9 3hi% ratio i% a mea%ure o( e((icient u%e o( (i7ed a%%et%9 it i% ca#cu#ated a%< Fi6ed Assets TurnoAer Ratio 4 Cost of goods sold or Sales Net Fi6ed Assets It mea%ure% the e((iciency and pro(it earning capacity o( the /u%ine%%9 Higher the ratio- greater i% the inten%i*e uti#iDation o( (i7ed a%%et% and a #o$er ratio %ho$% under uti#iDation o( the (i7ed a%%et%9 3hi% ratio ha% a %pecia# importance (or manu(acturing concern% $here in*e%tment in (i7ed a%%et%- i% *ery high and the pro(ita/i#ity i% %igni(icant#y dependent on the uti#iDation o( the%e a%%et%9
a%%et% turno*er ratio
2111 5900 year 2111 5942 2112 692 2114 6925 CRE#IT%#EP"SIT RATI"$ 3hi% ratio i% *ery important to a%%e%% the credit per(ormance o( the /an)9 3he ratio %ho$% the re#ation%hip /et$een the amount o( depo%it generated /y the /an) a% $e## a% their dep#oyment to$ard% di%/ur%ement o( #oan and ad*ance%9 Higher credit depo%it ratio %ho$% o*era## good e((iciency and per(ormance o( any /an)ing in%titution9 111 = Deposits Credits Ratio Deposit Credit Credit Feans disburseFent of adAances #eposit Fean suF of fi6ed depositG SaAing deposit and current deposit.