Presented By Group 6

Banking industry is growing at 18% pa

The banking index has grown at a CAGR of over 51 per cent since
April 2001 as compared to a 27 per cent growth in the market
index for the same period

The total assets size has increased more than five times between
March 2000 and March 2010, from US $ 250 billion to more than $
1.4 trillion

Capital adequacy ratio, has also improved from 11.4% in 2000-01

to 14.6% in 2009-10

Deposit of SCBs as of March 26, 2010 was Rs.4492825 crore while

Bank Credit stood at Rs.3244788 crore

800 Of 1200 million people unbanked

Global expansion opportunities
Business opportunities for locals
Technology up gradation

Source: BCG

Economic Factors
GDP
55.3

Banking Sector Contribution to GDP

60

Year

50
40

28.6

30
16.1
20
10
0

Services (Includes
Banking 6%)

Industry

Agriculture

Year 2011

Source: www.Business.mapsofindia.com/india-gdp/sectorwise

GDP

2003

4.3

2004

8.3

2005

6.2

2006

8.4

2007

9.2

2008

2009

7.4

2010

7.4

2011

8.3

 Inflation
Inflation Rate
16
14

13.725

Particulars

Rates %

CRR

SLR

24

Repo rate

8.25

Reverse Repo

7.25

MSF

9.25

12
10

9.286

7.692

7.269
6

9.78
Inflation Rate

5.691
4.158 4.412

3.394

3.32
3.018

0
2000

2002

2004

2006

Source: Trading Economics

RBI measures
Government measures

2008

2010

2012

Allowing banks to issue infra mutual funds

New banking licenses

Savings rate deregulation

RBI planning to make mandatory for foreign

branches to covert into subsidiary

Lending to MFIs doesnt include in priority

sector lending.

Public Vs Private

Higher Slippages
Higher Retail %
NPL Risk
Private Vs Public
Profitability (ROA)
CASA Deposits
Restructured Assets

Public & Other Loan Book Break

Share holding pattern
Composition Of Retail Assets
14%
1315
Consistent net profit growth

1200
1400

PersonalFEE
Loan Based Composition
1020
Incorporated in
the
year
1993
as
UTI
Bank
Ltd
14%
1000
1200
Cards
Retail
Non
Promoter
2%
First private
banks to have begun891operations
20%
1033 in
800

1000 Holding
Corp
873
1994
742
6%

800
Non -Schematic

600

600

Promoter
854 765
37%

735
740

FY06

Listed on NSE, BSE and London Stock exchange

The Bank operates in four segments:
Agri & Mfi
12%
1. Treasury
Large Corporates
53%
2. Retail banking
3. Corporate/wholesale banking
Institution
4. Other
banking
business.
43%
SME
656

5%

562

582

548

532

400

200

93

FY11FY09

307

Auto Loan
11%

175

121 Large & Mid

Corporate credit

Quarter 1

361

226 243

330

501
388
374

FY10FY08

403

400

200

FY07

50

228

185

142
Treasury
109

15%

Agi & SME

Quarter 2

132
Busieness
Banking

Quarter 3

FY10

70

Housing212
Loan
68%
152

Capital Market

Retail Business

Quarter 4

FY11

Financial Highlights
Total Deposit

2006-2007

2007-2008

2008-2009

2009-2010

2010-2011

CAGR(5 Years)

58785.6

87626.22

117374.1

141300.2

189237.8

36.38%

Saving Bank Deposit

12125.88

19982.41

25822.12

33861.8

40850.31

38.33%

Current Account Deposit

11304.31

20044.58

24821.61

32167.74

36917.09

35.88%

Total Advances

36876.48

59661.14

81556.77

104341

142407.8

44.87%

Total Investment

26897.16

33705.1

46330.35

55974.82

71991.62

27.31%

Net Interest Income

1468.33

2585.35

3686.21

5004.49

6562.99

43.51%

Other Income

1010.11

1795.49

2896.88

3945.78

4632.13

44.72%

Operating Profit

1263.85

2225.92

3724.88

5240.55

6415.69

45.21%

659.03

1071.03

1815.36

2514.53

3388.49

47.52%

Net Profit

Banks

No. of Branches

No. of ATM

ATM to Branches- X

Axis Bank

1281

6270

4.9x

HDFC Bank

2000

6369

3.2 x

ICICI Bank

2533

6810

2.7 x

Union Bank

3015

2634

0.87 x

PNB

5161

5050

0.97 x

BOB

3469

1561

0.44 x

Column1

Axis

HDFC

ICICI

Union Bank

PNB

BOB

Market Cap

45,479.88

1,10,449.72

1,03,342.75

15,238.14

30,623.06

29,914.45

Market Price

1,103.30

473.25

896.8

240

966

761

Assets

2,42,713.00

406223

277352

235984

378385

358397

NII

15,154

25294

19928

16432

26986

21885

ROA

1.6

1.57

1.34

0.97

1.31

1.33

RoE

20.3

15.47

9.35

20.9

22.13

20.2

CAR

12.65

16.22

19.5

12.95

12.42

14.52

Book value

460.93

108.75

478

176.14

632.48

534.43

EPS

82.95

17.8

44.73

32.77

139.94

107.98

P- Bv

2.39

4.35

1.88

1.36

1.52

1.43

PE

13.30

26.59

20.05

7.32

6.90

7.05

NET NPA

0.3

0.2

1.1

0.6

0.8

0.3

Well balanced loan book

Strong Casa

Strong Financial health and assest quality

Strong fees based income

Enam acquisition strong strategic fit

Pan India Presence with superior service level

P/L Account

Balance Sheet

FY10
FY11

FY10

Equity Share Capital

Net Interest income
Reserves & Surplus
YOY growth % Networth

50045
35.80%

Non Interest Income

Deposit
YOY growth
Total Net Income

39458

Borrowing

35.80%

Other Liabilities & Provision

89503

Total Liabilities
Cash & Bank Balance
Total Operating Expenses
Investments
YOY growth
Loans
Employee Expenses
Fixed Assets
Other Operating Expense
Other Assests
Pre- Provision Profit
Total Assets
Provision & Contingencies
Loan Growth
Profit Before Tax Net Interest Income %

37054.2

30%
12561.39
24492.9
52406.0
13888

FY11FY12e
FY12e FY13e FY13e
FY14eFY14e
4052
4106
4120
4120
4120
65630
81040.13
104628.65
128073.35
156393
185883
220549
265640
321405
31.14
23.48
29.11
22.41
160445
189989
224669
269759
325524
1413002
46321 1892378
56728.09
2342234 70877.48
2927792

86759.37
3659740

171695
362496
416870
17.39 262679 22.47315214
24.94
22.41
61337
82089
123124
145117
159119
111951
137768.21
175506.13
214832.71
1806479
2427135
3005240
3705164
4561253
152064
47803.1 214087
59515.87229351
559748
719916
921240
29.01
24.50
1043431
1424078
1780098
16157.44
20116.36
12224
22732
25914
31645.6
39399.50
39010
46321
48637
64157.0 2427135
78252.34
1806478
3005240

38517

12800
27.90%
51357
3

Taxes

Non Interest Income

13372

2.40%
17472

Net profit

Loan /Deposit

25145

73.80%
33885

15743.00
36.50%
62509.34
3.1

251767 95600.56
347662
77398.20
1149996
1349996
30.05
23.52
2225122
2781402
26160.59
32312.99
27210
28571
51237.61
63287.57
51069
53622
98107.93
3705164 119232.16
4561253

3 78303.93 3.1

24755.00
25%
94477.163.1

2.20%
21253.18 2.10% 26623.332.10%

2.10%
32122.23

75.30%
41256.17

25%

19804.00

25%

76% 51680.59 76%

62354.92
76%

Valuation Method

Valuation ratio

FY10

BV

395.96 462.71

P/BV

2.75

FY11

2.35

FY12e

545.35

2.00

FY13e

654.80

1.66

FY14e

790.17

1.38

EPS

62.06

82.53

100.14

125.45

151.36

P/E

17.55

13.20

10.87

8.68

7.19

Weights

Target Price

P/BV (2.5xFy12e)

40

1362.5

PE

20

1400

DCF

20

1311

EV/EBIDTA

20

1344

(14x FY12e)

Weighted Average

1356

Cmp

1089

Upside(%)

24.5

By using weighted valuation of P/BV , PE , DCF and EV/EBIDTA method we arrive at at

target price of RS 1356 (upside of 24.5% from CMP).