Industry profile : Banking industry is different from other industries. No other industries come into directly contact with general public. Banking is the business where the Raw material and Final product is Same. Money. The assets in banking is far different from other businesses. No other business is as important as banking in Economy. That is why they called equivalent of economy. Many times the health of economy is analyse from health of Banking. As Banking is come into contact with general public and Industrial customer, it is important for Govt also. No other businesses hold this level of importance. Naturally it attracts highest amount of regulation.
Banking is a Good industry where you can earn money. But for that you need to do right things. The reason is Banking is not Manufacturing where you buy Raw material and process it and then manufacture something else. Banking is simply the process to earn money from the money you have. If you do it right, you are winner. The most important thing in this is pretty simple. Make successful Formula and keep repeating it until you succeed. In the language of Saurabh Mukherjee, Ambit Capital, The word that is repeatedly mentioned in the context of HDFC BANK is execution. For Axis Bank, you may realize that it is Consumer satisfaction and Technology.
As India is emerging economy, the healthy banking is more and more important for Indian economy.
Running a bank is as difficult as analysing BANK and its Fundamentals. Many Small, Check and Uncheck, many small thing, Many parameters to check. But there is reason for that as Bank business come into contact with Public money which makes it important role player in Country’s economy. If handled by wrong person, you are inviting disaster. For running the Bank, Management and the way they run it is important. The parent Institution is also important for bank as it’s possible for them it’s possible to use brand name or develop one. If they are strong, the bank will eventually follow it.
Company Profile : Indian bank, Based in Chennai, Govt owned banking company is one of the leading Public sector bank. Like other banks, Indian bank offer service of Loans and deposits. The bank offer services from retail customers to large Corporate Clients, small and medium-sized enterprise (SME), cards, education, Non-Resident Indian (NRI), property and technology. The bank has two subsidiary companies – Indbank Merchant Banking Services Ltd and IndBank Housing Ltd. It has 227 Overseas Correspondent banks in 75 countries.
Shareholding Pattern : Government of India holds 82.10% as Promoter. Mutual funds hold 5.15%. 2.74% held by insurance companies and Financial Institutions. 6.17% held By foreign investors ( Really?). Remaining 3.08% held by General Public.
Financials and Ratio :
2010 - 11 2011 - 12 2012 - 13 2013 - 14 2014 - 15 2015 - 16 2016 - 17
Loan Book 75,249.91 90,323.60 105,642.55 122,208.99 125,863.55 129,049.08 127,699.28
ROE 21.62 18.91 15.14 10.04 8.00 5.27 9.72
ROA 1.40 1.23 0.97 0.61 0.52 0.34 0.64
EPS 38.79 39.57 35.80 26.07 21.62 14.81 29.27
Book Value 184.44 214.94 242.89 248.16 261.46 280.63 301.10
Efficiency 33.23% 28.99% 27.87% 27.51% 27.99% 30.60% 32.61%
Net NPA to loan Book 1% 1% 2% 2% 3% 4% 4%
Tiar 1 Capial 11% 11% 11% 11% 11% 12% 12%
Dividend per share 7.50 7.50 6.6 4.7 4.2 1.5 6
CASA Information Not Given By bank 29.68% 31.94% 37.65%
Future Prospectus : Just like any other Public Sector Bank, Indian Bank is also facing large NPA issue. But here Fire is not that Much large. Only 7.21% of GNPA ( If you believe on Management.). State Bank of India (SBI) accounted for the largest share of about 22.7 per cent (or ₹1,88,068 crore) in the total NPAs of 38 banks (aggregating ₹8,29,338 crore) as of June-end 2017. SBI, Punjab National Bank, Bank of India, IDBI Bank, and Bank of Baroda accounted for 47.4 per cent (totalling ₹3,93,154 crore) in the total NPAs as of June-end 2017. In such time Having such low NPA is large Breather.
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