Slide 1

Indian Banking Structure

Introduction To HDFC Bank

FINANCIAL ANALYSIS ON HDFC BANK

Current RatioCurrent ratio may be defined as the relationship between current assets and current liabilities.Current ratio = Current assets/current liabilities

Interception :- If the C.R. is less than 2 : 1, it indicates lack of liquidity and shortage of working capital. But a much higher ratio, even though it is beneficial to the short-term creditors, is not necessarily good for the company. A much higher ratio than 2 : 1 may indicate the poor investment policies of the management. So liquidity of Bank is satisfactory.

Operating ratio= (Operating cost / Net income )*100

Interpretation :- Operating Ratio is a measurement of the efficiency and profitability of the business enterprise. The ratio indicate the extent of sales that is absorbed by the cost of goods sold and operating expenses. Lower the operating ratio, the better it is, because it will leave higher margin of profit on sales.

2010 2011 2012

Return on gross capital employed=(Net profit / Gross capital employed) * 100 Gross capital employed= fixed assets + current assets

Interpretation :- Since profit is the overall objective of a business enterprise, this ratio is a barometer of the overall performance of the enterprise. It measures how efficiently the capital employed in the business is being used.

Return on shareholders =(Net profit / Shareholders funds) *100

Interpretation :- This Ratio indicates what amount of return has been given to the Share holders of the firm which help in building the good will firm.

2010 2011 2012

Net profit ratio = (Net profit / Net income) * 100

Interpretation :- This Ratio measures the rate of net profit earned on sales. It helps in determining the overall efficiency of the business operations. An increase in the ratio over the previous year shows improvement in the overall efficiency and profitability of the business.

Return on net capital employed = (Net profit / Net capital employed) * 100

Net capital employed = Total assets- Current liability

Interpretation :- This Ratio indicates how well the Capital employed is being use in business. Even the performance of two Dissimilar firms may be compared with the help of this Ratio.

2010 2011 2012

EPS = Net profit after interest, tax & preference dividend / No. of equity shares

Interpretation :- This ratio is helpful in the determination of the market price of the equity share of the company. The ratio is also helpful in estimating the capacity of the company to declare dividends on equity shares.

DPS = Dividend paid to equity shareholders / No. of equity shares

Interpretation :- This Ratio indicates how much profit has been given in hand to the equity share holders. This represents higher the ratio more is the good will of the firm.

Open686.00Vol1932753High687.5052 Week727.30Low675.7552 Week528.00Prev. Close686.50

STOCK PRICE ANALYSIS

Open686.00Vol1932753High687.5052 Week727.30Low675.7552 Week528.00Prev. Close686.50BidOfferPrice676.00676.10Quantity49828

IS IT THE RIGHT TIME TO INVEST IN HDFC BANK ??? Vaibhav Agrawal of Angel broking told CNBC-TV18 " Given the current environment HDFC bank still remains one of the better stock to hold. This kind of earnings growth is hard to match in such a large cap".

Ashish of Fortune Equity Broker told CNBC-TV18 "overall banking looks very strong particularly HDFC Bank and Kotak Mahindra Bank. Seeing the current scenario and the position HDFC Bank is in there is a possibility that HDFC Bank will cross it's all time high. Ankit Vora of D.P.Vora Securities told CNBC-TV18 "Then investors can hold on to HDFC Bank. It's performance will be better than the general banking sector performance of India." Ajay Bhodke of Prabhudas Liladhar told CNBC-TV18 "I would bank on HDFC Bank on open interest basis and the way it has performed in the current scenario."