By: Kapil Sharma

INTRODUCTIONy HDFC Bank was incorporated in August 1994 y Among the first in new generation commercial banks y Registered office in Mumbai, India y IPO in India in 1995 y Listed in NSE, BSE, NYSE (ADR)

SWOTSTRENGTH y Superior customer service vs. competitors.y Good Brand Image y High degree of customer satisfaction.

y Lower response time with efficient and effective

service.

WEAKNESSES

y Customer service staff need training.

processes and systems, etc need to be streamlined. y . More lending to corporate sector as compared to individuals.

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OPPORTUNITIESy Profit margins will be good. y Could extend to overseas broadly.

y Increase in size of sector.

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THREATSy Legislation could impact profitability. y Very high competition prevailing in the industry. y Lack of infrastructure in rural areas could constrain

investment.

PEST ANALYSISPOLITICAL y Banking act 1949(code of conduct)y Rules of RBI-Indian Banking Association. y Restriction on mergers.

ECONOMIC y Money inflation and deflation y Industrial growth y Liberalization y Globalization y Capital market requirement y CRR and other rates.

SOCIAL y Banking habits of the people.y Income level is rising y Society and aspiration values.

TECHNICAL y Product innovationy Focus on increasing level of service by technical

advancement.

PORTER 5 FORCE MODELBARGAINING POWER OF SUPPLIER IS VERY LOW y Nature of suppliersy Suppliers are not concentrated.

BARRIERS TO ENTRY y Product differentiation very difficulty Licensing requirement

THREAT FROM COMPETITORS y Large no of banks y High market growth rate y Low switching costs y Undifferentiated services y High exit barriers

THREAT OF SUBSITUTUTES y Non banking financial sector increasing rapidlyy Micro finance y Stock Market

BARGAINING POWER OF CONSUMERS IS VERY HIGH. y Large no. of alternatives y Low switching costs y Undifferentiated services y Full information about the market

MARKETINGPRODUCT SCOPE y Accounts and deposits. y Loans. y Investments and Insurance. y Forex and payment services. y Cards. y Customer center

PRODUCT LIFE CYCLEGROWTH-Home Equity loans. MATURITY-Auto loans. Decline-variable rate loans.

4Ps for HDFCPRODUCTDifferent fixed deposit schemes. Fixed and variable rate loan schemes. Internet based banking. Merchant banking services.

PLACE Strong presence all over country. Starting to expand to villages. PRICE Depends on rates charged by RBI. Interest charged by competitors.

Organization structure of HDFCCEO-DEEPAK PAREKH y Managing Director Aditya puri y Chairman of the Board C. Vasudev y Director Rennu karnad y Director AshimDirector Keki mistry y Director Partho Datta Director A.Roy Director Pandit Palande Head, Treasury Head operations Head Wholesale Banking Head branch banking Head retail asset Head audit compliance Head merchant banking

y HR Country Head-Mandeep Maitra

Number of Employees-15000 approx. Function of HR Department. HDFC Human Resources perform the following functions:y Hiring y Promotions

y Salary determination y Performance appraisal review and processing y Personnel data entry and records maintenance y Work permitting immigration visa program y Workers compensation

Strategy followed by the Banky Increase market share in India s expanding banking

and financial services industry by following a disciplined growth . y Strategy focusing on quality and delivering high quality customer service. y Leverage our technology platform and open scalable systems to deliver more products to more customers and to control operating costs.

y Develop innovative products and services that

attract the Targeted customers and address inefficiencies in the Indian financial sector.y Continue to develop products and services that reduce

bank s cost of funds.y Focus on high earnings growth with low volatility.

FINANCERATIO GROSS PROFIT RATIO NET PROFIT MARGIN ASSET TURNOVER RATIO CURRENT RATIO ROCE 2008 12.82 12.82 1.2 0.04 11.05 2009 11.35 11.35 1.3 0.04 12.5

MARKET CAP109610.49cr.

y NET PROFIT RATIO

PAT/SALES The net profit margin stands at 11.35 because of heavy administration expenses which are more than 25% of sales as it is employing more than 15000 people .it quite close industry average ASSET TURNOVER RATIO

y NET INCOME/TOTAL ASSETS

Assets turnover ratio stands at 1.3 the reason for low asset turnover ratio is the value of denominator is very high as bank requires to hold with itself huge amount of reserves and funds.

CURRENT RATIO CURRENT ASSETS/CURRENT LIABILITIES Current ratio stands at 0.04.Current ratio tells us how many times current assets are of current liabilities low current asset ratio means company is lending most of the cash available with it. It is tradeoff the bank does between profitability and liquidity.

y ROCE

NET INCOME/CAPITAL EMPLOYED It determines how well company is able generate revenue from its capital base. It stands at 12.5% which is a healthy sign as it is more than cost of borrowing.