Project Report - Deekshith A M (19MG503158)

A COMPARATIVE STUDY ON RISK AND
RETUREN ON EQUITY AMONG THE OLD

GENERATION AND NEW GENERATION
PRIVATE BANKS IN INDIA
Project report submitted in partial fulfilment of the requirements for

The award of the degree of
MASTER OF BUSINESS ADMINISTRATION

Of
BENGALURU NORTH UNIVERSITY
By
DEEKSHITH A M
Reg No. 19MG503158
School of Management
KRISTU JAYANTI COLLEGE, AUTONOMOUS
Bengaluru – 560077
2019-2020
SCHOOL OF MANAGEMENT
CERTIFICATE OF ORIGINALITY
This is to certify that the project titled A COMPARATIVE STUDY ON RISK AND
RETUREN ON EQUITY AMONG THE OLD GENERATION AND NEW
GENERATION PRIVATE BANKS IN INDIA is an original study carried out by
DEEKSHITH A M (19MG503158) and is being submitted in partial fulfilment

of the requirements for the award of the Master's Degree in Business
Administration of Bengaluru North University and approved by AICTE. The
Report has not been submitted earlier either to this University / Institution or
any other body for the fulfilment of the requirement of a course of study.
Dr Joseph Charles Dr. M K Baby Rev Dr.Augustine
Guide School of Management George

Principal
Bengaluru
Date:
CERTIFICATE OF PLAGIARISM CHECK
1 Name of the Student Deekshith A M
2 Programme MBA
3 Register Number 19MG503158
4 Title of the Project Report Comparative study on risk and return on

equity among the old generation and new
generation private banks in India
5 Name of the Guide Dr Joseph Charles
6 Department School of Management
7 Acceptable Maximum Similarity 25%
8 Similarity of Content Observed 11%
9 Software Plagiarism Checker X
10 Date of Plagiarism Check 04-12-2020
Verified by
Signature of the System Administrator
Signature of the Student Signature of the Guide

DECLARATION
I, DEEKSHITH A M (19MG503158), hereby declare that the project work

entitled “A COMPARATIVE STUDY ON RISK AND RETUREN ON EQUITY
AMONG THE OLD GENERATION AND NEW GENERATION PRIVATE BANKS
IN INDIA” is an original study carried out by me, under the guidance of Prof.
Dr Joseph Charles. This project report has not been submitted earlier either
to this University / Institution or any other body for the fulfilment of the
requirement of a course of study.
Signature
DEEKSHITH A M
Bengaluru
Date:
ACKNOWLEDGEMENT
First of all, I thank God Almighty for all the uncountable blessings and strength
he had given for the completion of this work.
I am highly intended and thankful to Fr. Rev Dr.Augustine George ,

Principal, Kristu Jayanti College for providing me an opportunity to do this
project, as part of the curriculum. I would like to express my sincere thanks to
Dr. Aloysius Edward, Dean, Commerce and Management, and Dr. M.K. Baby,
Head School of Management for their valuable guidance and their sincere
interest which involved me all through this venture. Also, in successful bring
out this research study, I am immensely grateful to Prof. Dr Joseph Charles ,
Internal Guide for his help, constant guidance and encouragement during the
course of this research study. Without his earnest supervision, expert advice and
appreciation this work would not have happened in its present form.
I would also like to thank Mr. SHARATH Senior operational manager and
External Guide .for his constant support, co-operation and timely direction. I
express my sincere thanks to my fellow colleague, for being a great support in
providing the necessary information and guidance.
Last but not least, I would like to thank my parents as well as my friend from
the bottom of my heart for their continuous help and encouragement.
DEEKSHIH A M
19MG503158
ABSTRACT
The fundamental intention of an investor is to obtain great return on assets. The

Equity market is taken into consideration to be one of the most rewarding
avenues, among the numerous schemes of funding, even though it involves
extra risk. Since the hazard is excessive in equity investment, the buyers need to
make equity evaluation that helps them to understand approximately the risk-
return characteristics of those equity shares and those industries in which they
wish to park the savings.
In this outlook, a study has been undertaken to analyse the equity shares of
firms within the Banking industry of Indian stock market. Indian Banking
industry is considered to be one of the fastest developing sectors. In order to
take care of the developing demand, many customers have started out to put
money into this Banks.
So, the study on equity analysis of this industry will help the potential investors
in taking adequate investment decision. This study is conducted for a period of
60 months from 01st of January 2015 to 31st of December 2019 on monthly
basis. Nifty 50 was considered to collect the date for the stocks market. 12
Banks were selected for the study.
Keywords: Risk, Return, Banking sector, Investment, equity

TABLE OF CONTENTS
Chapter Particulars Page No.

No.
1 1.1 Introduction: 1-3
3-5
1.2 Meaning And Concepts Of Banking
1.3 Role Of Reserve Bank Of India 5-7
1.4 Private Sector Banks 7-9
1.5 Future Opportunities In India For Commercial Banks 10-12
1.6 Challenges Faced By Old Private Sector Banks From New 13-14
generation Private Banks
1 .7 Major Reforms In Banking Sector 14-16
1 .8 Need For The Study 16-20
2 2. Review Of Literature 21- 40
2.1 Introduction 22
2. 2 review of literature 22-34
2.3 Statement Of The Problem 34-35
.2.4 Objectives: 35
2.5 Hypothesis 36
2.6 Methodology 36
2.7 Scope Of The Study: 36- 37
2.8 Operational Definition : 37-38
2.9 Limitation Of The Study: 38- 39
2.10 Chapter Scheme 39- 40

3 Organization Study 41-
3.1organization Profile 41- 43
3.2 .Nature Of Business: 43-46
3.3 Product/ Service Policy 46-50
3.4 Service 50-55
3.5 Area Of Operation: 55-58
3.6 Swot Analysis 58-60
4.7 Learning Experience: 60- 62
4 Results, Analysis And Discussions 63-90
5 Summary Of Findings, Conclusions And 91- 100

Suggestions
5.1 Findings 92-98
5.2 Suggestions 99-100
5.2 Conclusion 100
Bibliography, Annexure 101-108

LIST OF TABLES
Table No. Title Page No.
4.1 Yearly Return Of Dhanalakshmi Bank 64
4.2 Yearly Return Of City Union Bank 65
4.3 Yearly Return Of Federal Bank 67
4.4 Yearly Return Of Karnataka Bank 68
4.5 Yearly Return Of South India Bank 70
4.6 Yearly Return Of Jammu Kashmir Bank 71
4.7 Yearly Return Of Axis Bank 73
4.8 Yearly Return Of ICICI Bank 74
4.9 Yearly Return Of HDFC Bank 76
4.10 Yearly Return Of Indusind Bank 77
4.11 Yearly Return Of Kotak Mahindra Bank 79
4.12 Yearly Return Of Yes Bank 80
4.13 OGPB Average Return 82
4.14 NGPB Average Bank 82
4.15 Beta Value Of OGPB 84
4.16 Beta Value Of NGPB 85
4.17 Descriptive Statistics Of OGPB 87
4.18 Descriptive Statistics Of NGPB 88

LIST OF FIGURES
Fig No Title Page No
1.1 Structure Of Banking In India 22
3.1 Products 46-50
3.2 Swot analysis 56
4.1 :Showing average return analysis of selected equity 64

shares of dhanalaxmi bank
4.2 Showing average return analysis of selected equity 66
shares of city union bank
shares of federal bank
shares of Karnataka bank
shares of south India bank
shares of Jammu Kashmir bank
shares of axis bank
shares of ICICI bank
shares of HDFC bank
shares of INDUSIND bank
shares of KOTAK MAHINDRA bank
shares of YES BANK
Chapter-1
INTRODUCTION
1|Page
1.1 INTRODUCTION:
A committee was created by the Government to observe the
structure and operation of the new Indian Financial System Framework. The government has,
on the basis of the committee report, Permitted persons, companies, and non-resident foreign
Indians .To free up India's private banks. India's Reserve Bank has explicit rules for the
establishment were published on 22 January 1993 Explicit laws relating to the establishment
of the country's emerging private banks. This is in appreciation of the Greater competition
must be initiated, which will lead to greater competition. In the banking system,
competitiveness and performance. These banks, these banks, After March, 1995, they came
into being and are named New Private Sector Banks (NPSB) or New Generation Common
Banks (NGB) banks
The new banks in the private sector are the strongest. India’s developing market.
Performance and competitiveness of these many banks have changed. The evaluation of this
sector is not a basic responsibility. Behind the mechanism of nationalisation of banks in 1969,
the number of banks in the private sector grew. And additionally, Due to the presence of new
banks in the private sector and international banks, Banks have made the market viable and
the quality has also risen. Services in India over the last two decades. The banks have these in
the new and latest framework and standard, they have built with superior service quality and
outstanding performance,
THE AXIS Banks are the leading new private
sector banks founded in 1994, 1994 HDFC Bank, 1996 ICICI Bank, Growth 1995 Credit
Bank, 1994 Induced Bank, Kodak Mahindra Bank in 2003 and Yes Bank in 2005[1],
respectively. The quality of Private Sector Banks of the New Generation were assessed in
India Through the consideration of variables, viz. Deposit of credit, Net profit, Deposit Real
2|Page
assets, deposits to fixed assets, total assets to fixed Assets, Investments to move forward,
Equity return, Interests Expenses, Asset Return, Profit Margin, Multiplier Equity, Utilization
of properties, loan loss allowance, non-interest expenditures, Non-interest profits and
dividends from interest.
So, the goal is to evaluate New Age
performance measurement of India’s Private Sector Banks
1.2 MEANING AND CONCEPTS OF BANKING
Banks accept deposits from both corporate organisations and the general public. The savings
can be invested in a bank if one saves money for the future. Banks are Giving Two
Depositors' guarantees, security of deposit and withdrawal of deposit anytime required.
Banks offer interest on deposits, which is applied to the initial deposit. On the Deposit banks
offer loans and advances to individuals and business organisations on a deposit basis.
Banks charge loan interest that is higher than deposit interest. Banks as well Fees are paid for
different services: remittances, transfers, supplies and organisation services .Rendered to
agencies of the public and sector.
1.2.1 THE ORIGIN AND USE OF BANKS
The word an ’ is derived fro the Italian word an o’ signifying a ench which was
erected in the market-price, where it was customary to exchange money. The Lombard Jews
where the first to practice this exchange business, the first bench having been established in
Italy A.D.808. Some authorities assert that the Lombard merchants commenced the business
3|Page
of money-dealing, employing bills of exchange as remittances, about the beginning of the
thirteen century, About the middle of the twelfth century it becomes evident, as the advantage
of coined money was gradually acknowledge, that there must be some controlling power,
some corporation which would undertake to keep the coins that were to bear the royal stamp
up to a certain standards of value; as independency of the sweating’ which invention ay
place to the credit of the ingenuity of the Lombard merchants –all the coins will, by wear or
abrasion, become thinner, and but for the easier regulation of commercial transaction, that the
metallic currency be kept as nearly as possible up to the legal standards. Much unnecessary
trouble and annoyance has been caused formerly by negligence in this respect. The gradual
merging of the business of banks a goldsmith into a bank appears to have been the way in
which banking, as we now understand the term, was introduced
into England; and it was not until long after the establishment of banks in other countries- for
state purpose, the regulation of the coinage, etc. that any large or similar institution was
introduced into England. It is only within the last twenty years that printed cheques have been
in use in that establishment. First commercial bank was bank Venice which was
establishment in 1157 in Italy.
1.2.2 ROLE OF BANKS IN ECONOMIC DEVELOPMENT
The Bank promotes people's saving practises and makes funds available for Productive
usage. It serves as a financial intermediary between individuals with money and many who
need cash for different personal needs and business purposes. This facilitates Company
transactions by way of receipts and payments system management. Bank's Bank It offers
business loans and advances for short-term and long-term purposes. Bank's Bank Facilitates
transactions for import and export. The bank promotes economic growth by supporting
providing loans to ordinary citizens, small and medium-sized businesses, producers and
4|Page
Groups of self-employment. Banks enable the economy to work effectively by means of their
Services such as deposit acceptance, lending, saving and other related activities Economic
activities such as output, distribution and consumption are encouraged. It is therefore
necessary for banks to have better productivity in their own businesses. Phase of
intermediation of deposits and borrowings into loans, advances, investments and fixed assets
for stronger growth in the economy. The Indian banking sector has shown strong evidence of
strong Progress over the last two decades and economic development has been
supported(R&D&C). (2016, Mathew).
ROLE OF BANKS IN INDIA
This segment deals with the previous positions of banks in India. Days of Formation.
1.3 ROLE OF RESERVE BANK OF INDIA
Different steps were introduced by the Reserve Bank of India, the Central Bank of India,
from ensuring interest and exchange rate stability to preserving liquidity in the Sectors that
are productive. To allow growth, RBI monitors credit flow to desired sectors.
The RBI acts as the country's monetary authority. The RBI performs essential Functions such
as inflation control and ensuring sufficient production liquidity Sectors. Financial bodies and
markets.
i. Supervision of Financial System- RBI oversees banks and other financial institutions
by facilitating best practises in corporate governance and risk management,
organisations Management to strengthen public goodwill towards the financial sector
in The India.
5|Page
ii. Indian Currency Issue- Maintains currency quality and quantity in by mopping up
notes and coins unfit for circulation, the nation. It also has a advises the government
on the safety characteristics and design of the currency.
iii. Management of Foreign Exchange- RBI encourages external trade, payments in India
and abroad, and international investment. Often it tracks forex Markets' Growth
iv. The Banker-RBI is responsible for managing the accounts of the government. Funds
from the local and central government. It also serves as the bank of merchants for the
govt. overlooking the functioning of the market for government securities cash
management and advising the government.
v. Bank for Bankers-Through its role in sustaining the liquidity of a bank regular basis
with. Bank and serving as the lender of the last bank RBI, the resort, serves as the
banker's bank.
vi. Position in economic growth- RBI has a crucial role to play in setting up robust, safe
and effective payment and settlement processes in the Uh, nation. In addition, RBI has
set up institutions to expand the organised the financial sector to India's rural parts.
vii. Analysis role-RBI serves as the primary source of knowledge on research the Indian
economy and financial system. RBI still maintains a data kit Warehouse to make
better decision-making possible. It also analyses issues the challenges facing the
Indian economy and working towards solutions with academia's suppor
Pre Nationalisation of Private Commercial Banks
6|Page
After the bank collapse in the early 1960s, RBI came up with the scheme of a merger of weak
banks and major banks. Then many of the old tiny private banks ceased to exist. In the Indian
banking system,
1.4 Private Sector Banks
These banks are the private banks that are scheduled, which are the main drivers of Banking
Sector Development in India. The banking sector experienced independence prior to the
phenomenal growth of India's private sector banks. Banks of the private sector”role in 1955
and thereafter, the establishment of the State Bank of India began to decline .Nationalization
of banks (14 main banks) in July 1969 and (6 banks) in April 1980.
1.4.1 Nationalisation of Private Banks in India
To have more influence over the banks by the Government of India, 19 July In 1969, 14
major private sector commercial banks whose capital assets were nationalised more than
50Crore. This was the biggest historical occurrence in the past of Crore. Banking in India,
which has contributed to the large-scale opening of industrial and industrial branches
unbanked areas for the provision of rural, small-scale industries, and banking facilities
Additional focus areas of the economy.
The following were those nationalised banks:
1. Central Bank of India
2. Bank of India
7|Page
3. Punjab National Bank
4. CanaraBank
5. United Commercial Bank
6. Bank of Baroda
7. United Bank of India
8. Union Bank of India
9. Dena Bank
10. Allahabad Bank
11. Indian Bank
12. Indian Overseas Bank
13. Bank of Maharashtra
14. Syndicate Bank
1.4.2 Second Nationalization of Private Banks in India
On April 15, after a decade of initial nationalisation, the Government of India IN 1980, the 6
private sector banks whose capital reserves surpassed those of 1980 were nationalised
200Crore. The banks' list is as follows:
1. Andhra Bank
2. Punjab and Sind Bank
3. New Bank of India
4. Vijaya Bank
5. Corporation Bank
6. Oriental Bank of Commerce
8|Page
It was very remarkable to benefit from nationalisation. Following the nationalisation of
Private Banks, India's branch network of banks, which on 19 July 1969 was 8262, by 1990,
the total number of people served per bank had been extended to 60,000. Out of over 60,000
individuals per branch during the time, the branch went down to 11,000.
1.4.3 Old Private Sector Banks
The oldest private banks in India are private sector banks of the old generation.
Before bank nationalisation, all the commercial banks in India were present.
It began as private banks and the Government of India later nationalised a few. In Most of the
stakes in private sector banks are owned by private, corporate and private individuals
Institutions. Private sector banks have two classes, namely the latest generation, Banks that
opened after 1994, and banks of the old century, which are the oldest banks, Private Banks in
India that existed prior to bank and banking sector nationalisation India's reforms.
1.4.4 New Private Sector Banks
Banks of the new generation are those private sector banks that have been opened after
Reforms to the banking sector in India in 1991. Nine banks, post banking sector reforms In
India, the private sector has been developed, including some through financial growth.
Institutions. Among them, ICICI Bank, HDFC Bank and Axis Bank are prominent. Over a
period of time, these new private sector banks have grown large, but old banks The Indian
banking sector has expanded at a slow pace and has continued to be smaller in scale. At
These banks are probably the best performers in India's banking sector.
9|Page
1.5 FUTURE OPPORTUNITIES IN INDIA FOR COMMERCIAL
BANKS
Kapoor(2015) foresees the Indian economy's potential development over the next two
decades. In ten main areas, Indian banking:
I. Technology: In the future, technology will characterise banking. This will make it big
data, cloud computing, smart phones, etc. are included.
II. Creative disruption: For better and for better, banks need to focus on creativity.
Cheaper treatment for clients. Banks are going to outsource services from various
consumer authentication departments, fraud checking, transaction verification, and
Care and KYC retrieval.
III. Cashless banking: Total physical currency value in India constitutes 11.5 present of
GDP will be revolutionised by digital banking. Processing banking transactions with
increased performance and Banking Sector Transparency.
IV. Branchless Banking: Branchless banking may contribute to the achievement of in
banking activities, economies of scale.
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V. Innovation in ATMs: the cost of transactions for Indian Banks is Rs.48 per transaction
per Rs.25 for mobile banking, Rs.18 for ATMs and Rs.4 for online banking. Via
purchases.
VI. Infrastructure Financing: India has 5% of the global infrastructure share. By 2025, it
is projected to rise to 9-10 per cent.
VII. MSMEs: The micro-small and medium-sized market accounts for 8 per cent to 8 per
cent. The GDP of the world. Cluster-based funding, guarantee scheme of credit In the
future, start-up units will play an important role.
VIII. Competition and consolidation: the will of competition and consolidation making the
banking sector more diverse and vibrant.
IX. Risk Management: Early Warning Signal Complex Risk Management It is important
to reinforce the tremendous rise in the amount of transactions.
X. Expansionary rules: In the future, it will be simpler for restructuring in banking
industry to attain size.
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STRUCTURE OF BANKING IN INDIA
Figure 1.1 structure of banking in India
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1.6 CHALLENGES FACED BY OLD PRIVATE SECTOR BANKS
FROM NEWGENERATION PRIVATE BANKS
Old traditional commercial banks from traditional business banks face tough competition.
Violent banks of the new generation. It is difficult to maintain current workers because of
new Banks of output are not in IBA wage level settlement and give performance Cantered on
wages, which in old generation banks is much higher than wages. Selling directly The
Agency (DSA) route helps banks of the new generation to outsource workers for Marketing
and selling of low-paid goods.
It is very difficult to keep current borrower customers from old banks since new Banks that
source cheap funds from domestic and international routes are able to generate to quote the
new borrower customers with better terms to attract them. This means that it means new
Private Banks have greater muscle power than old conventional banks, and they have greater
muscle power than old traditional banks. Funds can be issued at low interest rates on loans
and advances.
The cost of technology is low due to the high volume of new generation transactions. Banks,
but conventional old banks, are not leveraged aggressively on technology to minimise Easy
Cost.
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The next major challenge for commercial enterprise is Basel standards and risk management.
Banks in India benefit from new-generation banks because they can easily source Funds from
the domestic stock market or overseas to raise the capital base.
Company banking, bank insurance, mutual funds, and modern pension scheme
The key competence of new-generation banks to acquire more fee-based banks (NPS) is DSA
(Direct sale agents) sales across the vertical.
1 .7 MAJOR REFORMS IN BANKING SECTOR
1. Removal of Controls:
In a staggered process, the regulatory liquidity ratio and cash balance ratio are
substantially reduced. A means to ensure that banks have more funds available for
their activities. Interest rates are deregulated for loans and deposits. Banks are allowed
to do so. Para-banking services including insurance, mutual fund and Lease Company.
2. Risk Management:
In the Indian banking sector, Basel risk management principles are applied in the
Basel guideline sequences, Indian Banks are sufficiently large to satisfy significant
requirements. Financial surprises, internal or external.
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3. Risk Mitigation:
Several organisations, such as CIBIL, credit rating agencies, DRT, wealth recovery,
Companies are set up to restore credit and to securitise stressed properties. RBI- New
guidelines have been released for the identification of profits, classification of
properties and Provision on a prudential basis for bad loans in order to represent the
real debt of banks Health in banking.
4. Technology:
Implementing the Core Banking System (CBS) in banks enables banks to start
Alternate platforms for distribution, such as ATM and automated banking. CBS has
assured that every Where in India, finance, and any time banking.
5. Bank Consolidation:
The phase of bank restructuring of public sector banks has begun. State recently
India has Bank combined all five affiliated banks with itself. Ultimate consolidation
the private banking business is a combination between Kodak Mahindra Bank and
Vysya Bank. Most individuals more mergers are in the works, both in the public
sector and the private sector, to make the India's banking system is bigger and
healthier.
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6. Privatisation:
Entry is allowed for private Indian banks and international banks as of the year in 1993.
New banks in the private sector are allowed to launch banking operations. Five brand-new
ones since 1994, banks have begun operations.
7. Financial Inclusion:
Government Financial Integration Initiative for the purpose of inclusion Rise of all
individuals, including individuals living in rural and backward regions of the In India,
countries are implemented by banks.
Banking reforms launched in 1991 have led to a vibrant and growing for the last 25
years in India, the banking industry.
Reforms in the financial sector in India have contributed to creativity and the diversification
of Company Banks' Business. Banks began working in non-traditional industries and Para
Market credit, credit cards, merchant banking, online and telephone banking fields banking,
leasing, mutual funds and insurance. Banks also started merchant branches. Banking, mutual
funds and leasing.
1 .8 NEED FOR THE STUDY
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The main foundation of the financial economy is the banking system. The financial system
integrates financial institutions, economies and tools in the path of growth Economics. Banks
provide life blood for enterprise and manufacturing. Changes in the financial sector The
Indian banking sector has been robust in India for the last 25 years. Reforms the financial
system has been improved by rising production and competitiveness by the use of
Technology and inculcating consistency in the sector and openness.
The risk control system for commercial banks in Basel has influenced the profitability status
of banks because it is important to catch more and more risks and extra additional risks
For elevated threats, money to be retained. Global, Indian macroeconomics and the economic
condition reveals vulnerabilities that impact the viability of the economy. Financial banks in
India are noticeable through the recent rise of non-commercial banks in India. In the financial
system, performing reserves (NPA) and strained assets. In India, banks the infrastructure and
operational system have undergone a substantial change from Self-guided and system-driven
environment driven manual. This calls for major Capital spending badly impacts the
performance of banks. During this timeframe Competition in the financial industry has
intensified and profit demand has begun to increase. Margin thinning, i.e. the gap between the
advance yield and the cost of Deposit. The viability of banks in India has been a serious
issue.
Analysing the benefit, profitability and efficiency of commercial banks it is so important to
examine the blending and texture of profitability determinants. It is possible to take action to
resolve the determinants that describe profitability. More to strengthen the banks' bottom line.
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Private sector banks, amid the above adverse internal and external factors the new private
sector banks, in particular, have done very well. Therefore a survey on the profitability
determinants of private sector banks is felt to be appropriate to indicate the Ways to
strengthen the sustainability of India's banks.
1.8.1 FOCUS OF THE STUDY
The report focuses on private sector commercial banks. Goal of analysis deep into peer
groups in new and old private sector groups of Indian commercial banks. The study analyses
the profitability determinants of bank segments, including the private sector. Banks, New
Private Sector Banks and Banks from the Existing Private Sector. This survey, this study
Identifies key profitability determinant variables that enable banks to enhance their
profitability and the model of profitability prediction for strategic planning. The research
includes 5 Years and eight preferred banks of the private sector that lead the respective
classes (Private Sector, Modern Private Sector and Old Private Sector) with reserves of more
than 50 present the accompanying party.
1.8.2 Risk and return of equities
Risk and return are pretty correlated in investing. Increased potential returns on funding
commonly cross hand-in-hand with increased risk. Different types of risks encompass
project-specific danger, industry-specific chance, competitive threat, international threat, and
marketplace hazard. Return refers to either profits or losses crafted from buying and selling a
security. The return on a funding is expressed as a percentage and considered a random
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variable that takes any value within a given range. Several factors have an effect on the sort
of returns that investors can anticipate from trading in the markets.
Diversification allows investors to reduce the overall risk associated with their portfolio but
may limit potential returns. Making investments in only one market sector may, if that sector
significantly outperforms the overall market, generate greater returns, but should the sector
decline then lower returns may be experienced than could have been achieved with a broadly
diversified portfolio. The tools and techniques used inside the risk and return evaluation of
equities in banking sectors are:
1) BETA
Beta coefficient of an investment is a degree of the risk arising from exposure to general
market movements in preference to idiosyncratic factors. The market portfolio of all
investable assets has a beta of exactly 1. A beta under 1 can suggest either a funding with
lower volatility than the market, or a volatile funding whose rate movements aren't pretty
correlated with the market. A beta more than 1 normally means that the asset is risky and
tends to move up and down with the marketplace. Negative betas are possible for investments
that have a tendency to head down when the marketplace is going up, and vice versa.
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( ) ( )( )
Beta = ( )
N=Number of days
∑=Total
x=Market return
y=Stock return
2) Stock return:
Return on stocks is the percentage gain or loss on a stock over a particular
period.
Stock return= (close price-open price)/open price
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CHAPTER - 2
. REVIEW OF LITERATURE
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2. REVIEW OF LITERATURE
2.1 INTRODUCTION:
This chapter is a study of empirical papers on the viability of Company banks. The purpose
of this chapter is to absorb the key areas of focus, Themes, models and topics of different
research projects in India and abroad. Analysis of The literature describes void areas for the
current research on profitability determinants. The perspective, effects and recommendations
of Different researchers on factors, processes, review of commercial research studies The
guidance and basis of the current study is established by banks and their generalisation.
2. 2 review of literature
Commercial banks for the private sector in India.
Using Syndicate Bank as a case study, Zacharias (1997) studies the performance
effectiveness of nationalised banks. The study found that Syndicate Bank ranked 15th among
the nationalised banks in capital adequacy and asset quality, 15th in profitability, 14th in
social status, 8th in growth, seventh in productivity, and 15th in customer service.
Das (1999) attempts to make every effort during the reforms to compare the interbank
performance of public sector banks: time. The study found that short-term convergence
occurred during the study year in the performance of public sector banks.
Kerker and Kerker (2008) analysed the efficiency of Indian profitability. In order to analyse
the influence of banking during the post-liberalization period, banks Profitability reforms for
individual banks. Research used analysis of data envelopment Method, bank-specific data
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analysing. The analysis revealed that bank efficiency Ownership is calculated and not based
on deposits.
Lahiri &mokashi (2000) stressed the adequacy of capital for a strong banking system,
implying that they fulfil normal capital requirements, this is not a replacement for banking
having to determine their economic capital, and all banks essentially need to arrive on Earth
and comply with their economic capital lives if they surpass the amount of regulatory capital.
Jain (2000) suggests that technological advances, the growth of human capital, corporate
governance reforms, the reform of the legal system and rural finance would help make the
banking system strong.
Kaveri (2001) indicates that stock inspection is a technique to avoid NPAs. Analysis of
transactions of ledger books, the security of periodicals and discussions with boors and co-
bankers
Salma (2002) suggested the view that the non-performing assets in the banking industry
cannot be completely eliminated but can only be decreased. To prevent NPAs, it is often
prudent to pursue the correct policy evaluation, overseeing follow-up of development. While
there is a greater need for political and successful threat and enactment of legislation to
recover NPAs, for the reduction of NPAs. The bank can also benefit from debt restructuring
tribunals, Look Adulate, state government regulations and a one-time settlement scheme.
Chhimpa(2002) suggested the view that other financial instruments and non-banks are
intruding into bank credit itself. Bank leadership positions need appropriate and trustworthy
knowledge architecture in these competitive Times to monitor the credit process and help
shape future views on the operation and lending consideration. Rates of interest. Cash flow
etc.
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Ram (2003) attempted to compare the three groups of banks-public, private and foreign-using
physical input and output quantities and compare the efficiency of the an ’s revenue
maximisation during 1992-2000.
Gujral(2003) discussed this landmark securitization act with enactment, while a major leap
forward has been made, but there is still a long way to go. It is a tool to shoot the defaulters
and not a weapon in the bank 's hand. It is an enabling clause, an additional privilege, which
will be used very sparingly by bankers, and as a last resort to the hardware defaulters.
Gupta and Kumar (2004) discuss how the redeeming future of the reform of the banking
sector involves a decline in gross and net non-performing assets as a percentage of total
assets for all bank classes except private sector banks.
Vashisht(2004) analysed recent global changes that have changed the world in which
commercial banks function, and the analysis found that globalisation has substantially
increased countries ' economic interdependence and interaction.
Bodla(2006) discovered the secret The profitability determinants of Indian public sector
banks are as follows: non-interest profits, Operating costs, provisions & contingencies and
delivery. The research showed that they have an essential connection with the bank's net
profit.
Singla(2008) analysed how financial management plays a crucial role in banking
development, the study reveals that when compared with the previous year, the profitability
position was rational during the study period.
Kheechee(2011)analyzed profitability determinants in commercial bank groups in India and
found that in the case of India, the return on funds and the return on advance are strong Both
24 | P a g e
the private sector and international banks and in the case of the public sector, very limited
Banks. Study found that in the case of old private sector and old private sector cost operations
are high Bank for the public sector. Deposit and borrowing rates in the case of private sector
banks. They are really strong.
PWC(2011) measured the profitability and profitability of Indian commercial banks.
Recognized, rapidly evolving customer tastes, growing rivalry and profitability Pressure on
the commercial banking sector in India. Research has shown that banks show High interest in
prudent capital management, sustainable growth, product portfolio, In terms of profitability,
financial metrics need to be linked with operational drivers. Analysis also found that That in
the last decade the banks in India have undergone a transformation, with Oh, globalisation.
Rentability-based calculation of bank efficiency reveals more Powerful and systematic means
of operating productivity and diversified earnings Through operations for non-interest
income.
Studied by Bhatia, Mahajan and Chander (2012), The relationship between the ROA measure
of profitability and the determinants of profitability Of select banks of the private sector in
India. The study showed that Spread, Provision and Provision Contingencies, non-interest
income, investments and deposits, operating expenses, The significant variables affecting
non-performing assets and profit per employee are Private sector banks' profitability in India.
Saini(2014)analysed the profitability determinants of Indian commercial banks. It concluded
that both net interest income and efficiency ratios have an important role to play. Profitability
determination in the Indian banking sector.
Kapoor(2012) examined the profitability of major banks in India, such as the National Punjab
Bank, Indian State Bank, ICICI Bank, and the Federal Bank. The study showed that ICICI
The bank has the highest overall profitability, and the smallest is the Federal Bank.
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Mirza and Mirza Zarafat (2012) analysed the determinants of profitability and found that
among the Real gross domestic product growth, inflation, and real macroeconomic
determinants, The actual Gross Domestic Product (GDP) has large and optimistic interest
rates and A partnership with commercial banks' profitability.
Nagaraju(2014) has discovered Indian In terms of marketability and profitability, public and
private banks underperformed. Profitability is a comparatively better result than
marketability. Revealed by research Banks' inefficiency is explained more by ownership than
by scale.
Ayyappen, Ramachandran and Saktivel (2011) studied Between profitability and
profitability determinants, the study found that There is an important and negative
relationship between non-performing assets and profitability of Indian private and public
sector banks. Non-performing assets affect profitability and profitability. Banks' bottom-line.
NPA is affected by GDP and macroeconomic variables With inflation. NPA is positively
affected by GDP and inflation is negatively affected.
Dani(2014) on development as the most important determinant variable It helps to create
more sales for the banks. Term deposit ratio to term liabilities The overall costs and employee
costs are defined as main determinants. Capitals Adequacy ratio, net profit growth, cash to
deposit, debt to equity are not important to Profitableness.
Pandya(2014) made an effort to recognise significant determinants of Profitability of India's
select nationalised banks. The research used factor analysis and factor analysis to Five factors
affecting banks' profitability in India have been identified. The report revealed That the
profitability determinants differ among the banks selected over the period Subject to analysis.
5 major nationalised banks and their output were selected for the analysis The period from
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2001-02 to 2010-11 has been studied. The bank wise study is conducted using Analysis of
correlations, multiple regressions and factor analysis.
Priya(2014) Profitability ratios in India of various private sector banks and disclosed that
there are No important relationship between the spread of interest, the net profit margin and
the return on interest Net worth, private sector banks' adjusted cash margin in India. The
report concluded There is an important relationship between long-term returns and returns on
funds. The assets of India's private sector banks.
Garg and Kumari(2015) evaluated the performance of banks in the private sector in India and
revealed that India's private banks performed well and HDFC Bank Out of five banks in
India, she remains an outperformer among private sector banks. Selected for research
Ganesan (2001) disclosed the benefit determination Interest rates, interest profits, deposits
per branch, total asset credit, Significant determinants of priority sector advances and interest
income are the proportion of Indian public sector banks' revenues and profitability.
The influence of geographic expansion on banks was evaluated by Berger and Young
(2001)Efficiency by using for the period 1993-1998 the expense and benefit efficiency of US
banks.Geographical extension implies the expansion of financial entities to other locations
within Their home region to another region, some of their home country to another host
nation That may be a big distance away. A bivariate analysis, an analysis of regression and
The data was analysed using individual organisational analysis. They discovered that both
positive Negative relations between geographical reach and productivity in banks. The
outcomes indicated that In order to export their superior abilities, strategies and procedures to
successful parent organisations, Any detrimental effects of distance come from their affiliates
and over.
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Anjana et al. (2002) investigated the growth of the total factor productivity (TFP) of Indian
Commercial banks in the public sector use 23 year long panel results. The author used a
number of Trans log cost device performance, expanded to satisfy both heteroskcdasticity
and car auto production Correlation in the presence of quasi-fixed variables to calculate TFP
growth. Growth of TFP Three components were further broken down, i.e. technical
transition, size, Economies and the effects of incomplete quasi-fixed-factor changes. The
results of The study showed that banks produced an annual TFP growth of 2 percent on
average. In the age of pre-deregulation.
The main drivers were described by Rao (2002) as a) Company Driver, (b) Regulator Driver,
(c) the driver of the environment, (d) the driver of technology and (5) the driver of human
capital. The study claimed that the bank's success depends on the attention paid by the bank.
To these main drivers, banks.
Ruchi and Soni (2003) found that the importance of measuring efficacy was important. In the
new world of finance, banking has become more of a need than a pleasure. Financial services
as it helps those banks who performed well to be segregated from those banks The ones who
have done badly. The current thesis attempted to evaluate the performance of operations The
public sector banking industry in India, and its association with profitability. Study of the link
between community rank and technological effectiveness has shown that 1) Banks belonging
to the SBI group were more effective than nationalised banks, and 1) Banks belonging to the
SBI group were more efficient than nationalised banks. 2) There was a statistically important
gap in the productivity ratios of these two groups.
Kapil et al. (2003) analysed the financial performance of India's banking industry.
Classification of banks on the basis of their financial attributes. A total of 19 public sector
employees For study, banks were considered, and the Basic Regression Model was used to
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estimate The financial effect of wealth management, operating performance, and bank scale
Performance. The analysis found that banks with higher overall capital have greater capital,
Deposits and Total assets do not necessarily mean they perform well financially. The research
It showed that during the study period, public sector banks performed surprisingly well. The
general regression research indicated that the financial performance of the banking sector
Industry is deeply and positively impacted by the productivity of processes, properties,
Admin, and size of interest profits.
Rameshwari (2003) observed that the essential parameters were monetary instruments. Of the
banks' financial results. They had a poor or mild association, however with Other
considerations, such as bank credit, savings, liabilities and assets, were suggested and
suggested that The growth of these variables is often affected by other influences.
The link between performance benchmarking was examined by Avinandan et al. (2003).
Indian Commercial Banks' and financial homogeneity. The essay invented a strategy of
Benchmarking success using the reported financial results for Indian commercial banks
About details. Performance was described in the article as the use of a bank resource to
generate Company transactions were determined by a ratio that was then defined as the ratio
Effectiveness. The writers explained that the definition of efficacy was important from the
point of view of the Marketing perspective for banks. It must be used methodologically to
calculate cross-sectionality. Banks' success in a related corporate strategy. A frame work may
deliver these steps To act as a framework for long-term competitive orientation to succeed in
the target market. The study showed that public sector banks typically conduct the private as
well as the private sector. In the rapidly changing and liberalised period, international banks.
The findings of 58 banks consisting of 58 banks were compared by Ram and Ray (2004). The
revenue maximisation efficiency strategy for public, private and international banks is used
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for the 1992-2000 era. The report found that the Indian Banks did not have much liberty To
minimise the expense, in particular the cost of labour.
Milind Sathye (2005) noted that improving the production and quality of Public sector banks
have been the main target of all countries' economic reforms, including India. Yes. It was felt
that private equity helped to increase performance and efficacy Banks' results. The report
explored the influence of privatisation on banks. Output and productivity of the five year
cycle using banks' data in India From 1998-2002. The analysis found that the banks that were
partly privatised failed to demonstrate Improved consistency following privatisation.
Edirisuriya and Piyadasa (2005) studied the quality and competitiveness of the organisation.
For the period 1995-2002, a selection of Indian commercial banks. The research calculated
Quality using the form of data envelopment processing and improvement in productivity
using Productivity Index Malmquist. The findings showed that there was no substantial
Productivity growth over the survey era. When evaluated individually, the public shall
Business banks have revealed a small improvement in efficiency that seems to have been
achieved It's about technical progress. Private sector banks have shown little progress.
Prasad and Ghosh (2005) perceived competition in the Indian banking sector. It has risen
since the start of the reforms of the financial sector in 1992. On the paper Evaluated the
legitimacy of this argument in the Indian sense, using annual data on the scheduled
submission. Commercial banks for the period 1996-2004. Empirical research has revealed
that The Indian banking sector works under competitive pressures and receives revenue as if
Under monopoly rivalry.
Chowdari and Rao (2005) have shown that the financial reforms launched in the course of the
banking situation in the country shifted drastically in the early 1990s. As a result, These
reforms also encouraged new private sector banks to join the market. All of them These
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major private sector banks have taken with them state-of-the-art market technologies
Production and service delivery, besides being effective in catering to the customer.
Requirements. This paper tried to carry out a SWOT analysis and some important statistical
analysis. Techniques to rate 30 private sector banks based on financial data collected over the
years 2002, 2003 and 2004 respectively. The analysis used four parameters: performance,
financial power, Profitability, size and volume to rate the banks separately for each year.
Naganathi (2007) looked at patterns in performance, productivity and quality in the report.
Non-performing assets of SBI and its affiliated banks, taking into account interest, working
capital, Interest cost, operating benefit, spread of net profit, etc. Profitability has shown
Increased pattern, earnings per employee and per division metrics worked out shows The
productivity of the banks had improved for both banks, and the gross and net NPA had
increased. Rejected.
Mahesh and Rajeev (2007) looked at improvements in total factor efficiency (TFP) Indian
commercial banks for the period 1985-2004. The findings have shown that After
liberalisation across banking classes, the TFP increased dramatically. Foreign Banking The
TFP has seen the fastest growth in the overall study period. The findings are even Suggest
that on average, TFP development is more due to technological change than to technological
change. Shift in performance. This did not extend to all years, though. Growth was attributed
to TFP Efficiency change over a number of years, due to technological change over a number
of years and due For all of them over a few years. The report showed the experience of the
Indian banking sector Efficiency changes as well as technological changes.
Boaz and Kein (2008) examined the efficiency of commercial banks' profits Kenya after the
reforms of the financial sector. The primary goal of this empiric inquiry The goal was to
calculate the viability of the banking sector. The analysis was based on the Alternative
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Efficiency of Benefit (APE). The research has shown that the overall benefit performance of
The banks also deteriorated directly after the changes. Private banks have strong net income
Low efficiency service reported.
Suryachandra (2008) has provided a systemic study of the effects of the banking sector
Reform of the quality and sustainability of commercial banks, both in the public and in the
public sector. Private sector over a period of 11 years from the outset of the 1992-93 reform
measure. The study centred on evaluating the reaction of banks in both public and private
sectors. Industry separately and as a group to reform initiatives in the fields of productivity
and profitability Over the time of study. It also carried out a comparative analysis of public
and private results Sector banks as a group of metrics chosen for the areas of productivity and
Profitability of this. In addition to quantitative research, the report analysed consumer
expectations. Business Standard of Public and Private Sector Banks. The success of the
banking groups The research was performed in two ways: I Time-Series, and (ii) Period-wise,
using the main variable.Analytics.
Ravi (2008) has revealed that growing competition in retail banking is knowing. The
customer's understanding of service efficiency has been invaluable. The Research Compared
public sector banks and private sector banks to the understanding of their consumers Retail
banking facilities, please. Private sector banks have been positioning themselves in a very
tight market Public sector banks through their initiatives to satisfy consumer demands and
Having a cutting edge. This has been reflected in the rising market share and better
Profitability of private banks relative to those of public sector banks. Analysis of the It noted
that public sector banks have also responded to the challenges faced by the private sector.
Sector banks by deliberate efforts to increase their quality of operation.
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In the light of the viability of banks in India, Amarender (2009) investigated Policies for post-
liberalisation. The financial sector in India has changed significantly since the late 1990s Due
to technical advancement, financial liberalisation with the entrance of new private firms and
International banks and regulatory reforms to the private sector. Further liberalisation
Facilitated stock market growth in the financial sector; Financial Non-Banking Institutions
that absorb existing and prospective creditors and depositors from banks. Therewith, In both
raising capital and deploying them, banks can face competition. The research It indicated that
liberalisation and legalisation had to go hand in hand with a higher degree of Focus on
effectiveness, consolidation, efficiency of properties and profitability.
Debaprosanna (2010) researched the need for and importance of reforms in Indian banks,
Assessing the efficacy and profitability of Indian banks during the numerous reforms
Perspectives, to address, in the light of changes, different aspects of NPA management,
Measuring the output of the West Bengal banks during the reforms, Analyzing the function
Communication technology and its importance to Indian banks in the age of restructuring,
and Provide the requisite suggestions for enhancing Indian productivity and profitability
Markets. Banks. He concluded that the banks in India had to follow the planned reform
initiatives Continuously to please consumers and increase profitability.
Santosh and Drine (2011) were planned to evaluate the cost-effectiveness of the Indian
population The banking sector applying a stochastic boundary strategy. Using the
Lightweight Fourier Functional form and stochastic cost boundary methodologies, the
analysis showed, the public Sector banks have become the most productive banks led by the
domestic private sector and International banks, please. The conclusions of the report were
somewhat contradictory to international facts. There may be a variety of possible expiations
for this unconventional discovery. The first one is the Normal monopoly argument-Public
sector banks have the benefit as the first mover. And economies of scale, too. Second, the
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time span of the research was the time period of the study. Consolidation of international
banks and emerging private banks. That was that there were many Relevant banking reforms
as part of the restructuring of the financial system continued until the late 1990s.
Bhavesh and Menapara (2013) noted that businesses are going to avoid competition in order
to avoid competition. For mergers, and sometimes enjoy the monopoly. Liberalization and
technological progress The financial sector is gradually moving for greater globalisation, with
a view to improving The operational flexibility of banks, which is crucial to the competitive
environment The banks are operating in. This study was based on secondary data and was
designed to evaluate Financial performance; Ratio analysis, Standard deviation and acquit
evaluation were used as methods Analysis. The researcher observed that, overall, mergers
and acquisitions do not have an impact. The financial position of the banks except when a
weak and non-viable bank has been merged. Financially sound and profit generating the
bank. In that case, the profitability of the latter The bank is going to be affected.
2.3 STATEMENT OF THE PROBLEM
The use of finance is regarded as an organisation's most important role in the era of
globalisation. Companies face heavy competition from the entire industry, so the inflow and
outflow of funds will be well handled. One of the most significant elements of business
management is finance. A company is unlikely to be successful without adequate financial
planning. Analysis of financial performance is the technique of determining the company's
financial strengths and limitations by properly defining the relationship between the balance
sheet things and the profit and loss account. It also helps to recognise short-term and long-
term forecasting and development with the assistance of evaluating financial performance
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Over the past few decades, the Indian Banking Sector has been the backbone of the Indian
economy, enabling it to withstand numerous national and worldwide economic shocks and
meltdowns. It is one of the healthiest performers in the world banking industry, particularly in
recent years, with tremendous competitiveness, growth, productivity , profitability and
soundness. The Indian market is a bull market and one needs to pursue the current
opportunities well in order to keep succeeding. The banking sector is expected to grow at
between 2.5 and three times the GDP growth rate of the country. A lot will rely on their
underlying business strategy for individual banks. The performance and creativity of a bank
would be the differentiator.
How well it handles risk and, thus, a key aspect would also be profitability. The private
sector banks of the new generation have an important role to play in the economic growth of
a nation. Today they have a market share of deposits and advances of about 20 per cent. This
has been done in a rising market, suggesting that private banks have effectively capitalised on
the development of the Indian economy.
The private sector banks of the new generation are experiencing positive changes in their
work and efficiency. It is therefore appropriate to know that banks' output is very critical.
Therefore, the objective of the research is to evaluate the output of private sector banks of the
new generation in India
.2.4OBJECTIVES:
The study goals are listed below.
 Compare Equity returns among the old and new private sector banks
 To identify determinants of equity return of private sector banks in India.
 Perform an organization study on the life line feeds India pvt ltd
 Do a SWOC analysis on the life line feeds India pvt ltd
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2.5 HYPOTHESIS :
H1: There was no difference in equity return between the old and new Indian private sector
Banks.
H2: In contrast to the new private banks, the old private banks equity return will better.
2.6 METHODOLOGY :
The present study is based both on secondary qualitative and
quantitative data. We have 36 Indian private banks in India. We took 12 banks for the
purpose of this study solely because of data availability. 6 banks out of 20 banks are
relatively old and 6 new Indian private banks have been included in our research.
In order to compare the results of new and old private
banks, average equity return, average turnover in stock market, average market return
,opening price of the shares , closing price of the shares, the data source was the online data
source of RBI (www.rbi.org.in)To test this hypothesis, the data were calculated for the 5 year
period
For the research we use statistical tool is and excel
2.7 SCOPE OF THE STUDY:
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This study is being carried out to assess the financial performance of commercial banks of the
New Generation Private Sector in India. The research also compares the performance of old-
generation banks.
2.8 OPERATIONAL DEFINITION :
RETURN ON EQUITY
Is a measure of financial performance calculated by dividing the net income by the equity of
the shareholders. Because the equity of the shareholders is equal to the assets of the company
minus its debt, ROE is considered to be a return on net assets. ROE is considered to be a
measure of the profitability of a corporation in relation to the equity of the shareholder.
EARNING PER SHARE
Earnings per share (EPS) is calculated as the profit of a company divided by its common
stock's outstanding shares. The resulting number serves as an indicator of the profitability of
a business. EPS that is adjusted for extraordinary items and potential share dilution is
common for a company to report. The higher the EPS of a business, the more profitable it is
regarded to be.
INVESTMENT RISK
Investment risk is defined as the possibility or volatility of losses rather than the anticipated
investment benefit due to a decline in the fair price of securities such as bonds, shares, real
estate, etc. Each type of investment is subject to a certain degree of investment risk, such as
market risk, i.e. the reduction of the amount invested or the risk of default, i.e. the capital
invested is never returned to the investor.
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NON PERFORMING ASSETS
"Non-Performing Assets (NPA) refers to the designation in the accounts of a lender (usually
banks) of loans and advances in which no interest and principal payments have been issued
and are "past due". Debt has been listed as NPAs in most situations, where debt payments
have been pending for more than 90 days.
2.9 LIMITATION OF THE STUDY:
As all research work, there are also some drawbacks to this research work, which I
want to
Over here, focus. One of the features of good study is to show the limitations Frankly
speaking,
 Financial performance of banks is analysed on the basis of selected time
period
 For analysing financial performance only secondary data has been taken into
Consideration.
 Only quantitative aspect has been taken into consideration for analysing
financial performance of banks, while many a times qualitative aspect also
play a major role In terms of financial performance of banks.
 Some statistical tools were used for analysing and interpreting the collected
data. Therefore, the analysis is affected by the natural limitations of the
statistical tools.
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 Different experts have different opinions regarding the analysis of equity
shares therefore the view used in this study can’t e treated as the a solute
and perfect.
 The analysis was completely based on the secondary data collected from the
website of NSE, published literature, annual reports, etc., and so the findings
of the study entirely depend on the accuracy of such data.
 Only 12 Banks were selected to make the research. This sample size actually
does not represent the whole market.
2.10 CHAPTER SCHEME
Chapter 1 : introduction
In the first chapter, a concise introduction to the subject is explored in a wider chapter. Feel.
Sense. Relevant details is listed with respect to the selected subject. It even has a The
scientific aspects and statistics related to the subject are included.
Chapter 2 : review of Literature and Research Design
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The steps and procedures for conducting the research are covered in this section. Comprising
the literature review (ROL), goals, methodology, scope of the literature review (ROL),
Studying, and so forth.
Chapter3 : Organization study
A brief overview of the business is listed under this subsection, which Includes the wise
profile of the department, facilities available, job environment and Organizational process
and study of SWOC.
Chapter 4: Results, Analysis and Discussions
In this section of the chapter, the review of the thesis sample is done where Based on the
gathered data, mathematical tools are used. Graphs are also included in this chapter, Around
chairs, etc.
Chapter 5: Summary of Findings, Conclusion and Recommendations.
The results of the analysis were carried out. It also needs the suggestion of the Problems
found with respect to the subject to assist prospective researchers to upgrade the subject
Literature Review.
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Chapter -3
ORGANIZATION STUDY
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3.1ORGANIZATION PROFILE
Name of the company Life Line Feeds (India) Pvt. Ltd.
Managing director Mr. K Kishore Kumar Hegde
Constitution Pvt. Limited
Head Quarters Sri Mangunatha chambers, Rathanagiri Road,
Chikmagalur
Telephone 08262-233110/2372
E-mail lifeline@lifelinefeeds.com
Registered office Chikmagalur
Date of Establishment 23.10.1985
3.1.1 BACKGROUND
Keeping with the pace of local market the life line feeds (India) pvt ltd was commenced in
the year 1985 by k Kishore Kumar hedge. They started animal feed distribution and supplies
in the name of OM TRADERS AND Estate supplies
In 1986 Mr K Kishore Kumar Hegde who supported local farmers those who are running a
backward poultry farms in a very small number of birds for the purpose of trading.
In 1987 he established his own poultry farm with the number of 3000 birds in his own farm.
Till 1995 they progressed in their proprietary concern letter they found real changes in their
concern or industry. In 1996 they increased the number of bird's 3000 to 20000.
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In 1997 they changed their proprietary concern to life line feeds (India) pvt. Ltd. They give
the new rand na e" NANDAN FEEDS” for their feed. The co pany is located in a lust
green 24000 square feet of processing facility at chikmagalur city.
In 1999 they introduced breeding form.
In 2000 they started hatchery unit in the name of life line hatchery as proprietary concern.
The marketing of the broiler as commodity did not convince the company either in terms of
economy not for saw any future in the business. This was overcome by venturing into
processing and retailing of chicken and branding the product as life line's tender chicken in
2002. Processing unit with the production capacity of 200 birds per hour.
The experience of retailing in chikmagalur promoted them to venture into retailing at
Bangalore and opened 4 outlets in Bangalore in 2005.
In 2006 they started chicken slaughter unit in Karnataka State Industrial Estate at
Gowdanahallinear by Chikmagalur with the capacity of 1800 birds per hours.
In 2012, state of art feed mill unit -2 inaugurated.
In 2017, upgrade the Slaughtering facility, capacity 3500 birds per hour at chikmagalur.
In 2018, chicken export, 1000+ employee, 360 cores turnover.
3.1.2 NETWORK OF LIFE LINE FEEDS:
It is a constant endeavour to make products easily accessible in domestic market. They have
established almost more than 38+ outlets.
The head office and the main branch are at chikmagalur, and other marketing branches are at
Bangalore.
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3.2 .NATURE OF BUSINESS:
It's a constant endeavour to make product easily accessible in Karnataka in an effective
organization life line feeds(India) pvt ltd has set up a local network of dealers and supplies to
help customer access information on their product and prices
The head office and main branch are at chikmagalur and other Processing units and outlets
are at Bangalore. From the time a hatching egg enters the hatchery, it goes through many
hygienic and modern processes till it exits out facilities to be delivered to our customers as
quality poultry products
Commitment to a mission Hutch to Health ends beyond the end product. It is demonstrated in
our environment-friendly and by picnic scarves the slaughtering facility, the breeding farms,
hatchery feed mill and retail.
3.2.1 MISSION
Hatch to Health. To give our customers only the best quality poultry products
The success of life line feeds is the result of several concepts held together and given strength
by one important factor called Quality. It is the keystone of our heritage to give our customer
only the best quality products.
3.2.2 VISION
Each day we strive to improve even further not only the quality aspect but also the
ecologically and economically. This is how we make environment, us and our customers
happy.
To provide the highest customer value for all poultry products through a combination of
stringent quality-safety policies, industry best practices with global quality standards,
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advanced technology and people power that will enable us to be among one of the country's
fastest growing enterprises in the poultry industry.
3.2.3 QUALITY POLICY
We believe in integrity and discipline with effective management controls to manufacture
quality products consistently to achieve customer satisfaction. We are committed to
continuously improving product quality through effective implementation of a quality
management system that complies with statutory and regulatory requirements.
The quality policy shall be to design to manufacture to quality Product prices to the entire
satisfaction of the customer and to make leadership.
3.2.4The Quality Objectives of Life Line Company
1. To strive for excellence in quality of products in domestic market and to be recognized as a
leading player.
2. To develop necessary competencies at all levels of operations and improve products and
service continuously.
3. To encourage participation of employees at all levels of operation nod to Form motivated
teams where they treat each other with mutual trust and respect.
4. To shoulder responsibility by maintaining a safe, clean and hygienic environment
3.2.5 WORKFLOW MODEL
 Prepare internal work order
 Planning department -indent after checking with stores
 Purchase department-purchase order on raw material supplies
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 Goods receipt note at stores
 Incoming material inspection-ok, rework, reject
 Reject send back to supplies for replacement
 Ok, reworked, credit to stores
 Material requisition /job card
 Machine shop
 In process inspection
 Assembling
 Final testing / test certificate
 Packing/dispatch
 Transport from factory to outlets and depot
3.3 PRODUCT/ SERVICE POLICY
PRODUCT FEED
; Feed mill
As its own feed mill, life line products are defined and quality Soap Tonnes of poultry and
cattle feeds a year (30 tons productions per hour output). Continues research is done to gauge
the market and environment the needs of the market and environment, and the nutrient
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requirements change in response to it stringent quality control. World’s est vita ins and
organic minerals used for the production.
The sample of each ingredient is checked and analyse, before it is used for feed
manufacturing. The ingredients are mixed in right proportion with amino acids, vitamins, and
minerals under the supervision of the nutritionist, to suit the needs of the broiler. Before the
feed is dispatched to the broiler farm the laboratory confirms the meets the specifications.
HATCHING EGGS:
; Hatching eggs
At the hatchery, every year 20 million chicks are hatched in hygienic surroundings and
graded for the best survivable at the integration forms. Only nest box eggs are collected for
hatch. Last human handling from cold storage to hatch.
Before the eggs are placed in the incubator, they are rechecked for surfaced contamination
and cracks. For 21 days, the temperature and humidity is monitored every hour, so that the
embryo hatches into good quality chicks
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BROILER CHICKS:
Chicks
At the hatchery, every week, 125000 chicks are hatched in hygienic surroundings and graded
for the best survivable at the integration arms. The hatchery has a capacity to hatch 5 lack
chicks per month. Those chicks are shifted to their own breeding forms for their growth.
LIVE BIRDS:
; Birds
The life line breeding farm houses 1, 50,000 breeder flocks with 40,000 birds in lay
producing 24 million hatching eggs products per year, under good managerial practices.
600000 number of broiler birds can be produce in every month and they are shifted to their
own processing unit.
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DRESSED CHICKEN:
Fresh chilled and frozen chicken are marketed through our institution suppliers and retail
outlets in Karnataka and also frozen chicken meat is available for export.
WHOLE CHICKEN WITH SKIN WHOLE CHICKEN WITHOUT FILLET (BREAST
SKIN BONELESS)
MINCE (KHEEMA) WHOLE LEG WITH SKIN WHOLE LEG WITHOUT
SKIN
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DRUMSTICK TIKKA BONLESS LOLLIPOP
WINGLETS GIZZARD AND LIVER
3.4 SERVICE
a) Administrative office or registered office
b) Feed manufacturing unit(FMU)
c) Boiler breeding forms (BBF)
d) Integrating boiler farming (IBF)
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e) Life line hatchery unit (HAU)
f) Chicken slaughter unit (CSU)
g) Chilled chicken institutional supply
h) Retail outlets
a) Administrative office or registered office:
These departmental members are key organizational people who are conducting various
activities those are selection recruitment payroll compensation monthly remittance of ESI
(coming share of interest) provident and all labour departmental work Registration of
factories, renewal of certification all personal administrative activities and documentation of
insurance policies labour licence gratuity incentives etc.
b) Feed manufacturing unit (FMU)
Under the brand name NANDAN, Life line feeds manufactures and markets three types of
antibiotic-free and organic-rich animal feed products such as
 Breeder feed
 Broiler feed
 Cattle feed
In poultry feed industry first in India we used the technology of grain cleaning system for
best quality and consistent performance.
High quality feeds ensure that our chicken are getting food they need to stay healthy and we
are not adding antibiotics to their diet, sure it involves a little extra time, cost and dedication
on our part.
The facility that produces 30 tonnes per hour pellet feeds.
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c) Boiler breeding forms (BBF):
Each time the birds are harvested, the sheds are disinfected, and kept under complete rest for
30 days before the arrival of the next batch. Twenty four hour before the chicks arrive the
necessary temperature is maintained the chicks are then placed immediately in the broad area.
Company owned and rented basis having around 500 plus contract boiler breeding form,
breeder departments followed with the supervision of AGM breeder .its main process is
production of hatching eggs.
d) Integrating boiler forming (IBF):
Life Line Feeds partners with over 500 broiler integration farms where every month 12 lacks
chickens are reared through the All-In-All-Out (one farm has only one age group) system.
The farms are supplied with the chicks, feed and vaccines.
Throughout the contract farming stage, the birds are grown under strict supervision of our
experienced veterinarians and trained staff to enforce bio-security and birds good health.
The birds have access to feed, water and good ventilation throughout the growing period, so
that they grow healthy, by providing healthy nutritious feed and UV treated water marks our
birds healthier. UV treated water avoids water contamination to the birds.
At the end of each harvesting cycle, the sheds are disinfected and kept under complete rest
for a minimum 30 days before the arrival of the next batch.
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e) : Life line hatchery unit
Life line hatcheries produce annually between 20 million chicks. The hatching process
requires right level of the humidity and temperature. Therefore in the Hatchery the required
temperature is achieved by heating water using the traditional method of burning twigs and
not through the electric heater. The use of this eco-friendly source of energy makes life line
feeds the first poultry company in India to do so.
The chicks are graded for best survivability and kept in trays which are lined with shredded
paper for their comfort before they are shifted to the broiler farms in vehicles specially meant
for transportation of chicks.
f) Chicken slaughter unit (CSU):
A idst the ac drop of nature’s ounty of chi agalur our state of the art chic en
slaughtering facility, which has a capacity of 3500 birds per hour, is situated in the total land
of 8 acres. Each and every step is taken care at our facility.
Right from the time chicken is procured, till it reaches the market, it is transported and stored
at the right temperature to eliminate the possibility of any contamination. An expert HACCP
team samples the chicken at different stages to ensure it conforms to the best of quality and
industry standards and specifications.
Nothing leaves the plant, until the products meets the level of quality life line feeds expects
for themselves.
 Live birds transport
 Pre slaughter lair age
 Live bird receiving
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 Stunning and slaughtering process
 Scalding, DE feathering and Evisceration process
 Chilling and grading system
 Whole bird packing and specialty products
 Blast freezing and cold storage
 Cleaning and Disinfection activities
 Logistics services
 Quality control lab
g) Chilled chicken institutional supply:
With 26,000 sq.ft area of redistribution facility at Bangalore supported by 30+ transport
vehicles and the highly committed team makes life line products reach safety standards are
met till it reaches to our customer. Our in-house UV treated and RO water ice plant helped
us in product preserving through high quality ice packing in chilled boxes to maintain proper
cold chain.
600 plus delighted esteemed institutional customer across Karnataka includes star hotels,
flight kitchens, clubs, resorts, restaurants, corporate food courts, hostels, caterers, educational
centres hostels, home stays and food processing industries.
Life line feeds products meet all international standards supported with lab reports and over
85 SKUs to fulfil chef’s require ents our enriched chic en gives est coo ing yield.
Apart from Bangalore, our chicken is supplied to other district through our chikamagalur
facility.
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f) Retail outlets:
32+ Life Line’s Tender Chic en Co pany owned designer retail outlets in Karnata a offers
fresh chilled chicken to our customers in the most hygienic and customer friendly
atmosphere.
Wide range of wholesome chicken and cutups like fillets, chicken mince lollipops,
Drumsticks, whole leg and many more and further strengthened by the availability of masalas
and eggs.
Quality consistency with tag lines no offal-no- waste- only meat. Customer friendly staff and
machine cut pieces as per customer requirement makes you chicken buying and cooking
experience more joyful.
3.5 AREA OF OPERATION:
LLF industry td are well accepted in domestic market in paltry section and focusing more
clearly on the future to ensure long growth and leaping towards market leadership, and they
are focusing foreign market is future.
OWNERSHIP PATTERN:
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The company is private limited company, which is headed by
Mr K Kishore Kumar hedge - chairman and managing director
Mrs Sulekha k hedge - director
MAIN COMPETITORS FOR LLF INDUSTRY PVT LTD:
Venkateshwara hatchery Itd
Suguna - poultry FARM
Godrej-poultry FARM
Gilgila-poultry FARM
Souza -breeding FARM
Infrastructure:
Canteen: The personnel department administers the canteen. The main responsibilities are to
prepare and distribute the food stuff as per the scheduled timings to different counters
Meals: It will be maintained without charging to the employees
Tea:Two free cups of tea is served to each Employee while they are on duty
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Transport Facilities:
The employees are provided with bus facilities there are 2 buses and one maxi cabs there
which pickups the people scattered in the chikmagalur city and after duty hours they are
dropped back at same fixed points at the prescribed time.
ACHIEVEMENTS AND AWARDS
HACCP certification
CRISIL rating
WISE QMS:9001-2008
ISO 9001:2015
SGS ISO 22000
HALAL
Viii. Future growth and prospectus:
Innovation Reinvention and Diversification are the continuous process at LLF. Over the last
25 years LLF has been introducing new product on a regular basis, food ingredients and
medicines, to name a few. We are constant look for innovative products that complement the
LLF range.
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The company plans to have its own breeding farm, as the availability of hatching eggs from a
good source is questionable, secondly due to the present scenario, the constant availability of
hatching eggs/ chicks will not be possible from the market at a reasonable price throughout
the year. Hence the company plans to have breeder to a tune of 120000
3.6 SWOT Analysis of Life Line Feeds (India) Private Limited:
INRODUCTION: -
SWOT analysis is a fra ewor used to evaluate a co pany’s co petitive positions y
identifying its strengths, weakness, opportunities, and threats. Specifically, SWOT analysis is
a foundational assessment model that measures is an organization can & cannot do and its
potential opportunities and threats.
Figure -3.2 SWOT ANALYSIS
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ADVANTAGES OF SWOT ANALYSIS: -
A SWOT analysis is a great way to guide usiness strategy eetings. It’s powerful to have
everyone in the roo to discuss the co pany’s core strength & wea ness and then ove
from there to defining the opportunities and threats and finally to brainstorming ideas.
Oftentimes the SWOT analysis you envision before the session change throughout to reflect
factors you were unaware of & would never the captured if not for the groups input.
Strength:
 Close less to consumer-chicken
 Importance to quality
 Successful integration
 Revolution in chicken marketing.
 The plants are fully provided with latest production and testing equipment
 They have provided healthy environment to the employee
 They have a well-established sales and services network in domestic market.
Weakness:
 They do not have financial support and stability
 Cost of maintaining standard is more
 They have not computerized fully
 Man power shut pole and technical labour compliance
 Government obligation
 Small town
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Opportunity:
 There is no sales tax and excise duty on exports.
 There are many statutes still to be covered.
 Improved returns
 Consumer proffered product mix
 Create demand and value.
Threats:
 More competition
 Many poultry industries are entering in domestic market.
 Waste management
 Lack of quality material
 Raw material cost.
4.7 Learning Experience:
The In plant training has provided me an opportunity to witness the day to day working I
have got very valuable practical experience of management aspects of the plant It utilizes
human, financial raw material and technological resources fullest extent through sufficient
planning, organizing, Leading and control. The company is trying to maintain good and
strong relationship with the customer. As the customer relationship management is the
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process of creating and maintaining good relationship with customers. These existing
customers at the new customers for the company, where the company can save the cost of
targeting new customers. This concept of customer relationship management is the modem
concept and is being implemented in the LLF Company
The In plant training has given me a chance to witness actual production process The
measures are taken to minimize the wastage, the company tries to reduce cost production
focuses on controlling pollution and providing security to its worker so that there is increase
manpower productivity. The company also provides safety measure to the customers by
providing them demos, after sale service, and by providing instruction manuals
All together it was a good learning experience as we could see the theory which we study in
class is being put for practical use. The first few days were not good as we had to adjust to
their working conditions. Once we became familiar there was lot of corporation for them. I
have studied the various departments as mentioned in the circular. Some inflammation could
not be given by them as it was classified. On the whole it was a good experience. I think the
time allotted was not sufficient as we could to do in depth study.
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CONCLUSION
Life Line Group (INDIA) well organized firm having a very good management and having
very strong promoter the basic tree an organisation structure. They don't differentiate between
various levels of employees they work in a team. The company is implementing set
techniques to help them very much to improve their product quality. This organization has
potential opportunity in future of its growth.
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Chapter-4
RESULT AND ANALYSIS DISCUSSION
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RESULT AND ANALYSIS DISCUSSION
This portion of the study addresses the processing of data and perception in
terms of stock market return norm, beta, of The 12 selected Banks.
Table 4-1 DHANALAXMI BANK Yearly Return
Year average stock return average market return
2015 -1.142917848 -0.134921585
2016 -0.788202928 -0.170915243
2017 -1.183436619 -0.374993941
2018 0.049530709 -0.181227375
2019 -0.412235569 -0.132275483
Source: Secondary data
0.2
0
2015 2016 2017 2018 2019
-0.2
-0.4
Average stock
return
-0.6
-0.8
-1 Average
market return
-1.2
-1.4
GRAPH 4.1: Showing average return analysis of selected equity shares of dhanalaxmi bank
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INTERPRETATION
There is a high fluctuation between the graph and the table above, between the Average
return on a stock and average return on the market.
Then the company generated higher return during the year of 2018
(0.049530709) but the market return was comparatively lesser with a negative value of
(-0.181227375).
-Lesser and high negative return was generated during the year of2015 and 2017
(-1.142917848) (-1.183436619) with a negative market return during the same year as well
(-0.134921585) (-0.374993941)
CITY UNION BANK Yearly Return
Table -4.2
Year Average Stock Return Average Market Return
2015 -0.156412572 -0.11814
2016 -0.422063133 -0.17934
2017 -0.023268595 0.181785
2018 -0.183569996 -0.28084
2019 0.075602767 -0.20929
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0.3
0.2
0.1
0
2015 2016 2017 2018 2019 Average Stock
Return
-0.1
-0.2
Average Market
-0.3 Return
-0.4
-0.5
GRAPH 4.2: Showing average return analysis of selected equity shares of city union bank
INTERPRETATION
In this bank the year of 2019 has a slide positive changes in average return
(0.075602767) and the same year Average market return will negative that is (-0.20929)
And the lesser negative return was generated during the year of 2016 (-0.422063133) with a negative
market return during the same year as well(-0.17934)
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FEDERAL BANK Yearly Return
Table – 4.3
Average Stock Average Market
Year Return Return
2015 -0.522186971 -0.11814
-0.17934
2016 -0.066243562
2017 -0.585535793 -0.33042
2018 -0.53334339 -0.28084
2019 -0.34014996 -0.20929
0
2015 2016 2017 2018 2019
-0.1
-0.2
-0.3
Average
Stock
-0.4 Return
-0.5 Average
Market
Return
-0.6
-0.7
GRAPH 4.3: Showing average return analysis of selected equity shares of federal bank
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INTERPRETATION
The year 2016 was lesser negative return in the stock of federal bank that is ( -
0.066243562) and also the market return will lesser that is (-0.17934
) it is the one of the best return in all over past five years
And the lesser negative return was generated during the year of 2017(-0.585535793) with a negative
KARNATAKA BANK early Return
Table – 4.4
Average Stock
Year Return Average Market Return
2015 -0.534619076 -0.118144736
2016 -0.134302805 -0.179341099
2017 -0.827507046 -0.330419876
2018 -0.324428575 -0.280838886
2019 -0.235237745 -0.209292749
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0
2015 2016 2017 2018 2019
-0.1
-0.2
-0.3
-0.4
Average
Stock
-0.5
Return
-0.6
Average
-0.7 Market
Return
-0.8
-0.9
GRAPH 4.4.: Showing average return analysis of selected equity shares of Karnataka bank
INTERPRETATION
This bank also give a similar result as previous bank at same year return will
have changes
The year 2016 was lesser negative return in the stock of Karnataka bank that
is (-0.134302805) and also the market return will lesser that is (-0.179341099) it is the
one of the best return in all over past five years
And the lesser negative return was generated during the year of 2017(-0.827507046) with a negative
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SOUTH INDIA BANK Yearly Return
Table-4.5
Year Return Return
2015 -0.481742188 -0.118144736
2016 -0.306877551 -0.179341099
2017 -0.473853268 -0.330419876
2018 -0.649134476 -0.280838856
2019 -0.615387776 -0.209292749
0
2015 2016 2017 2018 2019
-0.1
-0.2
-0.3
Average Stock Return
Average Market Return
-0.4
-0.5
-0.6
-0.7
GRAPH 4.1: Showing average return analysis of selected equity shares of south India bank
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INTERPRETATION
In this bank the year of 2016 has a slide positive changes in average return (-
0.306877551) and the same year Average market return will negative that is (-0.179341099)
market return during the same year as well (-0.280838856)
So average stock return and average market return will keep on increase the negative side
and after 2018 middle of the year it will fall
JAMMU KASHMIR BANK Yearly Return
Table -4.6
Average Stock
Year Return Average Market Return
2015 -0.273798138 -0.118144736
2016 -0.349693839 -0.179341099
2017 -0.258906751 -0.330419876
2018 -0.865151146 -0.280838856
2019 -0.504467424 -0.209292749
Figure -4.6
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0
2015 2016 2017 2018 2019
-0.1
-0.2
-0.3
-0.4
Average Stock
-0.5
Return
-0.6
-0.7 Average
-0.8 Market
Return
-0.9
-1
GRAPH 4.6: Showing average return analysis of selected equity shares of Jammu Kashmir
bank
INTERPRETATION
In this chart has shown that in the year of 2017 comparatively better negative return will
happen that is (-0.258906751) and the same year average market return will (-0.330419876)
market return during the same year as well ((-0.280838856
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AXIS BANK Yearly Return
Table-4.7
Year Return Return
2015 -0.34301 -0.11814
2016 -0.48302 -0.17934
2017 -0.23741 -0.33042
2018 -0.09597 -0.28084
2019 -0.16595 -0.20929
0
2015 2016 2017 2018 2019
-0.1
-0.2
-0.3 Average Stock

Return
-0.4
Average Market
Return
-0.5
-0.6
GRAPH 4.7: Showing average return analysis of selected equity shares of axis bank
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In this chart says that in the year of 2019 has a negative return as well but comparatively
little bit of return will appear on equities that is(-0.16595) and the same year the Average
Market Return will be negative only that is (-0.20929)
market return during the same year as well (-0.17934
ICICI BANK Yearly Return
Table-4.8
Year Return Return
2015 -0.278490893 -0.118144736
2016 0.085007506 -0.179341099
2017 -0.33365987 -0.330419876
2018 0.092882363 -0.280838856
2019 -0.251782638 -0.209292749
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0.15
0.1
0.05
0
2015 2016 2017 2018 2019
-0.05
-0.1 Average
-0.15 Stock
Return
-0.2
-0.25 Average
Market
-0.3 Return
-0.35
-0.4
GRAPH 4.8: Showing average return analysis of selected equity shares of ICICI bank
INTERPRETATION
In this bank the year of 2018 has a slide positive changes in average return (0.092882363)
and the same year Average market return will negative that is (-0.280838856)
market return during the same year as well (-0.330419876
HDFC BANK Yearly Return
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Table-4.9
2015 -0.07581 -0.11814
2016 -0.17751 -0.17934
2017 -0.07299 -0.33042
2018 0.076155 -0.28084
2019 -0.14633 -0.20929
0.1
0.05
0
2015 2016 2017 2018 2019
-0.05
-0.1
-0.15 Average
Stock Return
-0.2
-0.25
Average
-0.3 Market
Return
-0.35
-0.4
GRAPH 4.9: Showing average return analysis of selected equity shares of HDFC bank
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In this bank the year of 2018 has a slide positive changes in average return (0.076155) and the
same year Average market return will negative that is (-0.28084)
INDUSIND BANK Yearly Return
Table-4.10
Year Return Return
2015 -0.15718 -0.11814
2016 0.016107 -0.17934
2017 -0.17768 -0.33042
2018 0.114737 -0.28084
2019 -0.3335 -0.20929
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0.15
0.1
0.05
0
2015 2016 2017 2018 2019
-0.05
-0.1 Average
Stock
-0.15 Return
-0.2
-0.25 Average
Market
-0.3 Return
-0.35
-0.4
GRAPH 4.10: Showing average return analysis of selected equity shares of INDUSIND bank
INTERPRETATION
In this bank the year of 2018 has a slide positive changes in average return (0.114737) and the
same year Average market return will negative that is (-0.28084)
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KOTAK MAHINDRA BANK Yearly Return
Table-4.11
Year Return Return
2015 0.027196521 -0.118144736
2016 -0.044426151 -0.179341099
2017 -0.365172468 -0.330419876
2018 0.124666007 -0.280838856
2019 -0.220730125 -0.209292749
0.2
0.1
0
2015 2016 2017 2018 2019
-0.1 Average Stock

Return
-0.2
Average Market
Return
-0.3
-0.4
GRAPH 4.1: Showing average return analysis of selected equity shares of KOTAK
MAHINDRA bank
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INTERPRETATION
In this bank the year of 2018 has a slide positive changes in average return (0.124666007) and
the same year Average market return will negative that is (-0.280838856)
YES BANK Yearly Return
Table-4.12
2015 -0.14628 -0.11814
2016 -0.35704 -0.17934
2017 -0.25492 -0.33042
2018 -0.39001 -0.28084
2019 -0.3751 -0.68425
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0
2015 2016 2017 2018 2019
-0.1
-0.2
-0.3
Average
-0.4 Stock
Return
-0.5
-0.6 Average
Market
-0.7 Return
-0.8
GRAPH 4.1: Showing average return analysis of selected equity shares of YES BANK
INTERPRETATION
In this chart in the year of 2015 has comparatively lesser negative return will given that is
(-0.14628) and tha same year average market return will be negative that is ( -0.11814)
COMPARISION BETWEEN THE NEW AND OLD GENARATION PRIVATE BANKS ON THE
BASIS OF THE RETURNE ON EQUITY
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Average return of old generation bank
Table- 4.13
OGB AVERAGE RETURN
YEAR Average Stock Return of OGB Average Market Return of OGB
2015 -0.52 -0.12
2016 -0.34 -0.18
2017 -0.56 -0.25
2018 -0.42 -0.26
2019 -0.34 -0.20
SUM= -2.18 -1.01
Average return of NEW generation bank
Table – 4.14
YEAR Return of NGB Return of NGB
2015 -0.16 -0.12
2016 -0.16 -0.18
2017 -0.24 -0.33
2018 -0.01 -0.28
2019 -0.25 -0.29
SUM= -0.82 -1.20
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When we comparatively new generation banks are performing better that means average
return of equity stocks are performing better (.0.82)
As average market return as equal as old generation banks return.
When comparing between the old generation and new generation private banks or similarly
and equally likely each other when we e comparing about the average stock return of old
generation Bank in the year of 2016 and 2018 the both year have a similar average return that
is (0.34) and average market return of old generation bank is (1.01) that’s why this is also
negative return so comparatively the average top return of all generation bank has less return
compared to to average market return
When we come to the new generation private banks the average stock return of new
generation banks the year 2018 has a best return the race (0.01) in the same to the market
return will the negative that is (.28) it seems comparatively average stock return of new
generation back in the year 2018 is the best comparatively the market written so the
performance of the bank is better
Warangal we are comparing with the old generation and new generation show some result
assess the average stock return of old generation Bank that is (-2.18) and average return of
new generation private banks is (0.82) so it says comparatively the new generation Bank
average rate of return will High so it says performance wise and equity return wise and it
seems new generation private banks in the year 2015 to 2019 performance was better
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And the average market return of old generation bank and average market return of new
generation bank as it is it is same and equivalent to each other and markets it and was not
improving in the year of 2015 to 2019 and it says market return on equity was low.
Beta value of old generation banks
Table 4.1
Average Stock Return Average Market Return Beta
DHANALAXMI
BANK -0.695 -0.199 1.81
CITY UNION BANK -0.142 -0.121 1.31
FEDERAL BANK -0.409 -0.224 1.54
KARNATAKA BANK -0.411 -0.224 1.96
SOUTH INDIA BANK -0.505 -0.224 0.98
JAMMU KASHMIR
BANK -0.450 -0.224 1.61
1.54
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Beta value of new generation banks
Table - 4.16
Average Stock Return Average Market Return Beta
AXIS BANK -0.265 -0.224 2
ICICI BANK -0.137 -0.224 1.5
HDFC BANK -0.079 -0.224 1.16
INDUSIND BANK -0.108 -0.224 1.7
KOTAK MAHINDRA -0.096 -0.224 1.13
YES BANK -0.305 -0.319 2.33
1.64
Table 4.15 was talk about the beta value of the whole generation banks that says the
Dhanalakshmi Bank beta value is 1.81 so it seems this bank has a more volatile and the
systematic risk was more welcome to the City union Bank the beta value was 1.31 so it
seems compared to Dhanalakshmi Bank the City union Bank beta value was less and is also
less risky compared to Dhanalakshmi bank and the federal bank has a 1.51 better value and
this Karnataka Bank having 1.96 better value so it is the highest better value of my
observation banks so it seems the more risky that means the Karnataka bank equity shares is
says the more risky compared to the other four banks and the next one is South Indian Bank
85 | P a g e
let is beta value is 0.98 so it is lesser than one so it seems the less risky and the less volatile
stocks and the next one is in Jammu Kashmir Bank that is the better value was 1.61 so it
seems the more volatile and the Risky so overall average old generation bank better value
was 1.54 it seems very high risky and the more volatile
when you come to the new generation bank better value in Axis bank has better value and it
says the more risky and the volatile stock and ICICI Bank have 1.5 beta value and HDFC
Bank have 1.16 and Indus bank beta version 2.7 and Kotak Mahindra Bank have 1.13 better
value and husband having the 2.33 so do the banks having a measure to my rescue volatile
stocks and historical Bank 12.33 Yes Bank it seems it is this bank was highest risky and have
a systematic risk was more in this back and the less I will bank Bank was Kotak Mahindra
Bank it has comparatively less risky in new generation Bank so oral average beta value of
new generation Bank that is 1.64
when we compare the beta value between the old generation and new generation beta value
was more in new generation Bank ok so it says that the new generation Bank having the high
risk and high return also
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Descriptive statistics of old generation bank
Table – 4.17
CITY SOUTH JAMMU
DHANALAXMI UNION FEDERAL KARNATAKA INDIA KASHMIR
BANK BANK BANK BANK BANK BANK
Mean 24.16 152.46 88.94 123.70 20.75 67.92 79.65
Standard
Error 1.01 5.70 3.34 3.13 0.76 3.02 2.83
Median 22.85 161.58 87.70 125.30 20.85 67.58 80.98
Mode 36.00 158.66 87.37 124.44 13.20 33.35 75.50
Standard
Deviation 7.84 44.15 25.84 24.24 5.90 23.42 21.90
Sample
Variance 61.45 1949.03 667.61 587.81 34.85 548.55 641.55
Kurtosis -0.97 -1.23 -0.27 -0.39 -0.82 1.62 -0.34
Skewness 0.41 -0.13 0.37 -0.31 0.01 0.76 0.18
Range 28.90 155.05 101.85 100.00 22.74 122.75 88.55
Minimum 11.10 79.45 45.95 72.00 10.11 29.90 41.42
Maximum 40.00 234.50 147.80 172.00 32.85 152.65 129.97
Sum 1449.58 9147.35 5336.55 7421.70 1244.95 4074.95 4779.18
Count 60.00 60.00 60.00 60.00 60.00 60.00
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Descriptive statistics of old generation bank
Table – 4.18
AXIS ICICI HDFC INDUSIND KOTAK YES
BANK BANK BANK BANK MAHINDRA BANK
Mean 568.72 318.01 1569.20 1354.75 1075.67 685.98 928.72
Standard
Error 13.08 9.03 60.03 44.37 39.65 65.29 38.58
Median 542.58 302.23 1415.75 1409.78 1036.58 707.83 902.45
Mode 553.87 277.00 1486.76 1345.47 1047.97 690.75 900.30
Standard
Deviation 101.32 69.96 464.99 343.71 307.11 505.77 298.81
Sample
Variance 10266.60 4894.59 216212.63 118135.07 94313.89 255804.17 116604.49
Kurtosis -0.02 1.27 -1.43 -1.19 -1.21 -0.88 -0.58
Skewness 0.77 1.14 0.32 0.01 0.19 0.51 0.49
Range 433.25 348.75 1473.85 1170.45 1054.25 1768.35 1041.48
Minimum 375.25 190.00 972.55 823.95 630.25 41.45 505.58
Maximum 808.50 538.75 2446.40 1994.40 1684.50 1809.80 1547.06
Sum 34123.40 19080.75 94151.80 81284.75 64540.40 41158.60 55723.28
Count 60 60 60 60 60 60
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In which table 4.17 has descriptive statistics of old generation Bank in this table was
described what is the mean price of of the old generation banks shares and also describe
standard deviation its like ok how much risk involved in the shara of old generation bank and
this descriptive statistics for involved standard error median nerve sample variance skewness
corporation skewness range minimum maximum so the minimum was explain what is the
share was sold in the year was minimum price and the maximum price of share value and
overall standard deviation is 21.9 zero it seems the risk of old generation Bank was low in
this all calculation and analysis was done by this 60 months of data in transaction of equity
shares
table number 4.18 was explain what is the descriptive statistics of the new generation private
banks so in this main was comparatively the whole generation bank and this all data was
collected only 6 banks in new generation and the new generation Bank standard deviation
was 298.81 and the sample variance was 116604.49 and maximum sure was sold the days
1547.06 and minimum was 505.58. this analysis was done by the count of 60 months.
comparison between the old generation and new generation banks descriptive statistic the
mean value old generation bank is 79.65 and mean value of the new generation Bank is
928.72 comparatively mean value high in new generation Bank so share value is High and
come to the standard error comparatively old generation Bank having the less standard or so
it seems old generation Bank was having the standard error and the median value new
generation Bank having the lead and mainly the standard deviation that describe how much
risk having the equity shares so the result was saying comparatively new generation bank and
old generation Bank the old generation Bank having the less variability in the share price but
new generation Bank having the more variance in share price so market was most fluctuating
in the new generation Bank so this result was helps to take a decision of new generation Bank
a risky and also profitable because there is the given the maximum shares was sold is high
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comparatively to generation Bank so it give a conclusion of the new generation Bank having
the higher risk with high return.
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Chapter – 5
SUMMARY OF FINDINGS CONCLUSIONS AND SUGGESTION
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5.1 FINDINGS
Investing in stock market is risky and the market is really uncertain. time as it seen in the
graphs and tables were showing the stock return and market return keep on fluctuating during
the period unfortunately over the past five years the banking sector in the private banks
written schemes on decreasing its actually not wise for an investor to invest in this sector
The stock returns and market return or not at all promising because the result shows negative
value in the all banks
Findings in result of analysis
For the first analysis was comparison between old generation and new generation private
sector banks in that 6 year old generation banks and 6 new generation Bank in corporate
sector banks are Dhanalakshmi Bank City union Bank scheduled bank Karnataka Bank South
India bank Jammu Kashmir Bank and new private sector banks are Axis Bank ICICI bank
HDFC bank interest bank Kotak Mahindra Bank Yes Bank
 When we come to the Dhanalakshmi Bank early return was 2018 having the best
return and comparatively all are negative average returns only and it seems
Dhanalakshmi Bank equity returns completely from the past 4 year in Ocean I will
take that are not it's fine the average stock return of Dhanalakshmi Bank was better in
2018
 When we come to the City union Bank the year of 2019 having the best equity return
that is 0.075 so send this by our generation private sector banks. From the past for the
equity returns showing negative 2019 onwards the City union bank equity returns will
be positive.
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 Federal Bank this Bank also comes under old generation private bank and the average
return wise federal Bank having the the past 5 years the only negative written in the
2016 having lesson negative return comparatively.
 South India bank this banks also comes under voltage generation private sector bank
and this is also having the negative return from the past 5 years so performance wise
it's slightly e negative and in my observation 2015 to 2019, 2016 was having lesser
negative return equity performance was not that much.
 Jammu Kashmir Bank comes under old generation private sector banks having
negative returned from the past five years compared equity returns among the 2017
year having some better written this is also negative.
 this about the content was related on the old generation private sector banks
comparatively the vole the six banks also having the majority of negative equity
returns only so performance was it is not good and when I observe Asian the with the
average market return average stock return will be more or less and these bags are not
showing that much of butter performance with equity and market was high volatile
and closing prices of the Equity stocks will my volatile.
 Comparison between these banks private sector bank the performance wise and
equity return wise Dhanalakshmi Bank having the the best equity return of 0.049 in
the year 2018 and City union Bank having a better return of 2019 that is 0.075 and
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poor performance and return in old generation private sector bank federal Bank
having most negative return and this is all returns are -0.50 in all detail 2015 to 2019
and Karnataka Bank having the list certain in 2017 that is 0.72 and the next tour 2018
on words the negative return will be decreasing and South India bank no correlation
between the stock return and average market return. And come to the Jammu Kashmir
Bank was wearing the 2018 negative return details 0.86 and overall analysing that
means 2015-2019 returns whether negative only in the Jammu Kashmir Bank.
 When we come to the new generation private sector banks Axis Bank having a
negative return from the 2015 to 2019 in that average stock return 2000 having the
less negative return that is 0.09 and when we compared with the average market
written the Axis Bank having the slightly correlated between the market return.
 The next Bank was ICICI Bank the bank was comes under the new generation private
sector banks in the year of 2016 and 2018 having the positive market return that
means average stock return of equity was more in 2016 average stock return was
0.085 and 2018 average stock return is 0.092 10 days you are having the performance
wise was better and Andrea of 2019 having more negative return in Axis Bank that is
0.16.
 And the next one is ICICI Bank in this Bank also comes under the new generation
private sector banks and performance wise 2018 was better in this year our stock
written was so more that is 0.092 and similarly the average market return also
negatively correlated and the worst performance of ICICI bank was the year of 2015
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that is -0.2 784 it seems 2015 onwards the bank performance was increased slightly
and equity return was also increases.
 HDFC Bank this banks also comes under the new generation private sector banks in
the year of 2018 having positive average stock return of equities 0.076 it is the year
was showing the better written in the the study comparatively 2015 to 2019 the year
of 2018 of performance was better and the comparison between the average market
return and having the negatively correlated and also the year of 2017 and 2016 was
having the negative returns that is 2016 is -0.177 and the year of 2019 was -0.146 it
shows the average return of equities was less.
 Indus IND Bank this Bank also having the positive return in 2018 that is 0.1 147 this
is the best written in the past 5 years the highly negative written was 2019 that is 0.33
average market return also correlated.
 Kodak Mahindra Bank this Bank also comes under the new generation private sector
banks and the comparative between the real return of equity is 2015 was having the
positive written and 2018 also having a positive return in 2015 the return is 0.047 and
2018 the return is 0.1 246 and the year of 2019 was having the negative return that is
-0. 22073
 the next one is Yes Bank Yes Bank also comes under the new generation private
sector bank the performance was the past five years that means 2015 to 2019 average
equity stock return was negative only the parallel e market return also negative .
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comparatively less negative return was -0.1 462 that is the year of 2015 and the during
the year of 2019 was having the highest negative return that is -0.375
 In comparative six new generation Bank ok in the year of 2015 to 2019 performance
wise and average equity return wise ICICI Bank having the best equity return and Yes
Bank having the low return from the past 5 years
 Next where comparing between the old generation Bank return and average return of
new generation private Banks. In the year of 2019 and 2016 having the better average
return from the old generation private banks and the year of 2015 and 2017 having
the high negative return was getting from the old generation private sector banks.
Now we locate average return of new generation private sector banks in the year of
2018 is the best year because in this year the average return of new generation Bank
having the the better and the year of 2019 and 2017 was highly negative written was
getting.When we compare between the old generation and new generation private
bank prove the average return of investment in this analysis was clearly mentioned the
old generation Bank average return will be from the past five years is -2.18 and the
average return of new generation private banks that is is minus 0.8 to so it's clearly e
mentioned that less negative return will be the more beneficiary so in the old
generation banks having the more written but these 5 years also in this 12 banks was
having the negative return only but comparatively the new generation banks having
performance was better and market have more onwards and technical side investors
for looking into the new generation banks equity and return also high.
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 Now we findings of risk mean which bank was having the high risk stocks the
analysis was clearly mentioned that the Karnataka and Dhanalakshmi Bank having
the high beta value that is Dhanalakshmi bank is 1.81 and Karnataka Bank having
1.96 beta value so in the the Karnataka Bank having the highest beta rate that means
the risk of Karnataka bank equity was more so so the the list beta value of old
generation Bank that is that is South India bank. South India bank having the less beta
value that is 0.98 so it clearly mentioned the less beta value of the stock was less
risky so more than one having the beta value of the stock is percentage ways so is
more risky so overall comparison of old generation banks beta value was average beta
value was 1.54 so that means 54% was more risky . When we come to the new
generation private sector bank the beta value of Yes bank and Axis Bank Was more
risky that means Axis Bank was having the beta value was to and Yes Bank was
having 2.33 of beta value so so these two banks was having the high risky stocks and
comparatively the HDFC Bank was having the less risky and Kotak Mahindra Bank
also less risky that means the HDFC Bank was having 1.16 % of data value and Kotak
Mahindra Bank was having 1.13 % of beta value so overall comparison of all six new
generation banks beta value the average is 1.6. when we compare between the old
generation and new generation banks beta value the beta value of old generation Bank
was less compared to the new generation private sector banks so it really mentioned
that the old generation private sector bank was having the less risky compared to the
new generation banks.
 and the next was standard deviation of old generation banks and standard error and
this descriptive statistics was displays the reality of the stock. so the standard
deviation of the old generation banks Dhanalakshmi bank and South India bank was
97 | P a g e
having less standard deviation that means Dhanalakshmi bank is 7.84 % and South
India bank was 5.90 of standard deviation that clearly mention these two stocks was
not risky and the City union Bank ok and federal Bank Karnataka Bank Jammu
Kashmir Bank was high standard deviation compared to the Dhanalakshmi bank and
South India bank show the overall standard deviation of the 6 old generation bank is
21.90 so it's variability of the share price was showing.
 When we come to the new generation private sector banks when we find the risk
factor the variability of the shares equity share the standard deviation was more
comparatively ICICI Bank standard deviation was less that is 60 9.96 in other than the
next five new generation banks that means Axis Bank HDFC Bank Indus IND Bank
Kotak Bank and Yes Bank was having the highest standard deviation and versatility
in the shares price and equity share was risk factor was more when the standard
deviation was high the risk also high so come to average of the standard deviation of
new generation banks that is 298.81
 overall comparison between the old generation and new generation private bank
standard deviation the new generation Banks standard deviation was high compared
to the old generation private sector banks so in this analysis was clarified that the
word generation bank equity was less risky compared to the new generation private
sector banks.
5.3 SUGGESTIONS
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 The role of banks of the young generation in India's economy is Nevertheless it is
unavoidable relative to public sector banks. He's going to walk a long way. Every new
century, thus, India's banks are framing their own approach and adopting modern and
new Innovative schemes for improved customer service.
 Kotak Mahindra bank, however, ranks fourth, so it should also Concentrate on rising
profit by increasing the rate of profit The whole Indian network.
 As Yes bank rank last, it should take more efforts to improve their operation to
overcome the difficulties.
 It is proposed that a new forum be developed among the new To their own dilemma
and challenges, generation banks.
 To raise the branch, all banks should take steps to A network of rural areas in India, in
particular.
 They should come forward in order to boost their money to achieve In the market
place, the contingencies.
 The Bank's stock yield and market return averages are negative. This means It isn't
that smart and very dangerous to invest in the banking sector. The lender is going to
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The Bank's output must be reviewed periodically because of the fluctuation of The
five banks are nearly identical.
 Then there is a difference in stock return (20-29 percent) that is clarified by Return
from the market. It implies that there are several other variables, like the consumer
return, Which affects the return on stock. On the graphs, it can also be shown that the
stock returns The five banks should not fluctuate exclusively on the basis of market
returns. Thus, the Prior analysis on the different variables affecting success should be
conducted by investors. Until making choices, in those businesses.
5.4 CONCLUSION
All two industry banks have managed to retain CRAR at a higher level than the
prescribed level. Nonetheless the Private Sector Bank has held its best level over the last
five years. It is a very positive indication for banks to thrive for years and to grow in the
future. In short, it can be argued that transparency and good governance are the key
considerations. Guiding control in the new situation.
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BIBLIOGRAPHY
101 | P a g e
References
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Ara an y Using the DuPont Syste of Financial Analysis” International
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Palestinian Co ercial an s” International Journal of Business and Social
Science, Vol.3,
 Amandeep Kaur Hundal and Moira Singh (2016) “Perfor ance Evaluation of
Pu lic and Private Sector an s in India: A Co parative Study” Indian Journal of
Research, Vol.5 (4),
 Amarender Reddy (2004) “ an ing Sector Liberalization and Efficiency of Indian
an s” The IUP Journal of Bank Management, Vol.3 (2),
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an s in India: A Study” Asian Journal of Research in Banking and Finance, Vol.4
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 Asror Nigmonov (2010) “ an Perfor ance and Efficiency in Uz e istan”
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Websites :
www.rbi.org.in
www.nseindia.com
www.bseindia.com
www.google.com
www.monycontrol.com/financials
www.wikipedia.com
104 | P a g e
ANNEXURE
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108 | P a g e

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A COMPARATIVE STUDY ON RISK AND

RETUREN ON EQUITY AMONG THE OLD

Project report submitted in partial fulfilment of the requirements for

MASTER OF BUSINESS ADMINISTRATION

DEEKSHITH A M (19MG503158) and is being submitted in partial fulfilment

Dr Joseph Charles Dr. M K Baby Rev Dr.Augustine

Guide School of Management George

1 Name of the Student Deekshith A M

3 Register Number 19MG503158

4 Title of the Project Report Comparative study on risk and return on

5 Name of the Guide Dr Joseph Charles

6 Department School of Management

7 Acceptable Maximum Similarity 25%

8 Similarity of Content Observed 11%

9 Software Plagiarism Checker X

10 Date of Plagiarism Check 04-12-2020

Signature of the Student Signature of the Guide

I, DEEKSHITH A M (19MG503158), hereby declare that the project work

I am highly intended and thankful to Fr. Rev Dr.Augustine George ,

The fundamental intention of an investor is to obtain great return on assets. The

Keywords: Risk, Return, Banking sector, Investment, equity

Chapter Particulars Page No.

1 1.1 Introduction: 1-3

1.4 Private Sector Banks 7-9

1.5 Future Opportunities In India For Commercial Banks 10-12

1 .7 Major Reforms In Banking Sector 14-16

1 .8 Need For The Study 16-20

2 2. Review Of Literature 21- 40

2. 2 review of literature 22-34

2.3 Statement Of The Problem 34-35

2.7 Scope Of The Study: 36- 37

2.8 Operational Definition : 37-38

2.9 Limitation Of The Study: 38- 39

2.10 Chapter Scheme 39- 40

3.1organization Profile 41- 43

3.2 .Nature Of Business: 43-46

3.3 Product/ Service Policy 46-50

3.4 Service 50-55

3.5 Area Of Operation: 55-58

3.6 Swot Analysis 58-60

4.7 Learning Experience: 60- 62

4 Results, Analysis And Discussions 63-90

5 Summary Of Findings, Conclusions And 91- 100

5.2 Suggestions 99-100

5.2 Conclusion 100

Bibliography, Annexure 101-108

Table No. Title Page No.

4.1 Yearly Return Of Dhanalakshmi Bank 64

4.2 Yearly Return Of City Union Bank 65

4.3 Yearly Return Of Federal Bank 67

4.4 Yearly Return Of Karnataka Bank 68

4.5 Yearly Return Of South India Bank 70

4.6 Yearly Return Of Jammu Kashmir Bank 71

4.7 Yearly Return Of Axis Bank 73

4.8 Yearly Return Of ICICI Bank 74

4.9 Yearly Return Of HDFC Bank 76

4.10 Yearly Return Of Indusind Bank 77

4.11 Yearly Return Of Kotak Mahindra Bank 79

4.12 Yearly Return Of Yes Bank 80