FINANCIAL ANALYSIS

(OF HDFC LIFE)

A Major Project Report

Submitted In Partial Fulfillment Of The Requirements For MBA Semester II Programme Of G.G.S Indraprastha University, Delhi.

Submitted By (AMIT ) (Course M.B.A Semester II) Enrl.No:

DELHI INSTITUTE OF ADVANCE STUDIES ROHINI SECTOR 25, DELHI

DECLARATION I hereby declare that the major project report , entitled FINANCIAL

ANALYSIS, is based on my original study and has not been submitted earlier for award of any degree or diploma to any institute or university.

The work of other authors(s), wherever used, has not been acknowledged at appropriate place(s).

Place: New Delhi Date:

Candidate signature Name: Amit Enrl.no: 01112303911

Countersigned

Name: MRS RUCHI GUPTA

Name: S.N MAHESHWARI Director

Delhi institute of advanced studies

Delhi Institute Of advance studies

PREFACE
Management of financial analysis plays a significant role in the organization as the blood plays its role in the human body .It not only provides energy to the business but simultaneously it is essential for the success of any business organization management of working capital has close implication with the two important factors that judge the overall success of the business profitability and solvency. Nowa-days, the major problem faced by every business organization is of finance because of drastic changes in the size and scale of business and increased competition, which results in the increase in credit business and shortage of financial brackets. In such an environment, the working capital management has occupied one of the key position in the business management. In our study, our main objective is to reflect our attention on the position of FINANCE MANAGEMENT in HDFC LIFE LTD. And discuss various aspects of Finance analysis in the company. The HDFC LIFE LTD Is leading company in the field of INSURANCE SECTOR. Our study is grouped under chapters where we Discusses various aspects of the FINANCE MANAGEMENT and effects there of on ultimate performance of the company. It gives me great pleasure to acknowledge my in deftness to all those who have helped me completing this project and bringing it out in its present form. I am very grateful to my supervisor under whose kind supervision and able guidance, this work has completed. It gives me immense pleasure to present this project report on FINANCE MANAGEMENT carried out at HDFC LIFE LTD In partial fulfillment of Post graduation course IN M.B.A.

No work can be carried out without the help and guidance of various persons. I am happy to take this opportunity to express my gratitude to those who have been helpful to me in completing this project report.

I would be failing in my duty if I do not express my deep sense of gratitude to MRS. RUCHI GUPTA without her guidance it wouldnt have been possible for me to complete this project work. Lastly I would like to thank my parents, friends and well wishers who encouraged me to do this research work and all those who contributed directly or indirectly in completing this project to whom I am obligated to.

AMIT M.B.A (G)

CONTENTS 01.
INTRODUCTION
PURPOSE OF THE STUDY AIM OF THE STUDY OBJECTIVE OF THE STUDY

02.

Organization Information A .About HDFCSLIC B .company profile C. what is insurance? D .scope of insurance E .objective F .Award and accolade G .product of HDFCSL H .About ULIP Descriptive work A. Factsheet B. Profiling of prospects C. Mode of contacting prospects D. Total number of people contacted
FINANCE DEPARTMENT OF HDFC LIFE

03.

04.

05.

A .Conclusion B. RECOMMENDATION AND SUGGESTION

ANNEXURE BIBLOGRAPHY

06. 07.

Purpose of study
During my summer training in the Housing Development finance corporation standard life insurance company limited (HDFCSL). I have gotten the work of Analyzing financial need and manage the funds of the policies. The main focus area of the company is to manage and focus of customer profit which gets through managing the funds of the policy. Indeed the work of financial analyst is very significant and gives more and more customer assistance to the customer so company can earn customer base and through strong customer base gets more and more policies distribution and company can sell the policies. The main motive of this project is analysis of financials of HDFC LIFE. HDFCSL is one of Indias leading private insurance companies. It offers both individual and group insurance solution. It is a joint venture between HDFC and a group of company of Standard Life. I have chosen insurance sector as the place for summer training because in these days this sector is in boom and it will never go down. All people invest their money in insurance and get more benefited. In the sector the work of Finance is more challenging then the other sector because there is 17 insurance companies in the market who are giving competition to each other and the work of convince people for investment in respective company is a challenging work and success in the sector proves that the respective person is a good finan ce adv isor . Today insurance sector India is on boom because all people want to invest. Those who dont know about investment in share market and dont want to invest in mutual funds they invest in insurance sector. Insurance sector gives them investment plus risk cover. Those who dont want to take risk in the investment go to insurance sector. It also gives income tax benefits to the peoples. Insurance company are now launching ULIP plan and gives chance to the investor to choose their investment pattern according to their fund investment table. This fund investment tells us that how much the investor want to take risk. Generally in the ULIP plan, the thesis is that The more you risk the more you have profit.

AIM OF STUDY During the summer training I have done my work through telephone calling, natural market, and contact person having gone to their home. In the entire work I have contacted person who is policy holder of the company or willing customer and prospect customers of the company I found that most of person can earn as well as get insured t h r o u g h insurance company and save taxes, life assurance with little effort, which will give him back support as a HEAD of the family in the diverse situation. This project will help to understand the current market scenario and marketing in stiff competition. Being a student of management I can draw the relevant conclusion from the financial analyze and give the appropriate suggestion to the organization. The company can take decision according to the suggestions and it will provide better experience to the students for their bright carrier. My project will provide help in these matters which are thus:-

Analyze the people perception about HDFC Study financial markets and analyze the financials of the company To find out the competitive edge of the company over the competitors.

OBJECTIVE OF THE STUDY

The project was an attempt to explore the Analyzing financial need and manage the funds of the policies in HDFC LIFE. The project was started on 10th June, after knowing all the relevant information about the company insurance product and policies and its competitors insurance products in accordance with the prescribed schedule mentioned by management of HDFC LIFE. The project started in Janakpuri branch where covering all the investors whom funds are down and bearing loss. In this process I meet 90 policy holders who facing loss .I have tried to convince them to continue with company and remain with the company. During my work I found the perception of the people about insurance, what they desire from it, and if they su ff er loss than wh at th e y think . What the organization should do for the policyholder who suffering from loss. Many of the customer is not aware about the share market and if they suffer loss than they blame either company or agent/sales manager. So I have to manage the customers to remain with us and provide them the best financial solution to them As I can say this project gives the abstract of my work at HDFC LIFE as financial analyst

Chapter: - 1

INTRODUCTION OF HDFC LIFE

INRODUCTION OF HDFC LIFE
Risk is found everywhere. It cannot be eliminated together, only it can be minimized. Human life is full of risk. There is a risk when a man walks on the road, travels in a bus, train or an aero plane and when he is engaged in trade, profession or business. Also there is a risk when property is destroyed by fire, flood, earthquakes, etc. Thus, the involvement of risk is inescapable.

Risk Drought Earthquakes Floods Storms

Percentage 4% 20% 35% 41%

Risk
4% 41% 20% Drought Earthquakes 35% Floods Storms

Insurance is a method by which we can spread over the risk. It is a way of reducing uncertainty of occurrence of an event. Insurance is entirely a method of co-operative endeavor where in the loss caused by a particular risk is spread over among a large section of persons. Insurance is a process in which a large number of persons collect their small contributions, called the premium, in a pool and out of this losses are paid to the suffering persons. The Business of insurance is related to the protection of the economic values of assets. Every asset has a value. The asset would have been created through the efforts of the owner. The asset is valuable to the owner, because he expects to get some benefits from it. It is a benefit because it meets some of a factory or a cow, the product generated by it is sold and income is generated. In the case of a motor car, it provides comfort and convenience in transportation. There is no direct income. Both are assets and provide benefits.

INTRODUCTION OF THE COMPANY

HDFC Life Insurance Company Limited. is one of India's leading private insurance companies, which offers a range of individual and group insurance solutions. It is a joint venture between Housing Development Finance Corporation Limited (HDFC Limited), India's leading housing finance institution and a Group Company of the Standard Life Plc, UK. As on February 28, 2009 HDFC Ltd. holds 72.43% and Standard Life (Mauritius Holding) 2006, Ltd. holds 26.00% of equity in the joint venture, while the rest is held by others.

HDFC Life believes that establishing a strong and ethical foundation is an essential prerequisite for long-term sustainable growth. To ensure this, we have concentrated our focus on expansion of branch network, organizing an efficient and well trained sales force, and setting up appropriate systems and processes with optimum use of technology. As all these areas form the basic infrastructure for establishing the highest possible customer service standards. Our core values are drilled down to all levels of employees, as these are inviolable. We continue to promote high integrity in business practices and shun short cuts and unethical practices, as we wish to be perceived as an institution with high moral standing. Since our inception in 2000, when the Indian insurance space was opened for private participation, we have consistently focused on setting benchmarks in all aspect on insurance business. Beingthe first private player to be registered with the IRDA and the first to issue a policy on December 12, 2000, The HDFC was established in 1977, for the purpose of providing the home loan for long term HDFC is rated as (AAA) by the CRISIL and ICRA. In the year 2004, it was awarded DREAM HOME AWARD. It has got 3rd rank in the investment management, in year 2006. One of the largest financial institution of India with more then 2 million satisfied customer base.

HDFC HAS FOLLOWING GROUP COMPANIES

HDFC Ltd. HDFC Standard life HDFC Mutual fund HDFC Securities HDFC Bank HDFC realty.com HDFC CIBIL HDFC Chubb General Insurance Co. Ltd. HDFC Centre For Housing Finance HDFC Distribution HDFC Intel net HDFC Securitization HDFC Deposits HDFC Home Loans

OUT STANDARD LIFE (U.K)

Founded in 1825, and is now one of the largest life Insurance companies in the world. Strong reputation build over 182 years Currently over 5 mn. policyholders benefiting from the services offered Europes largest mutual life insurer

Values

1.Integrity Honest and Truthful in every action Transparency Stick to principles irrespective of outcome Be just and fair to everyone. 2.Innovation Building a store house of treasures through experiences. Looking at every product and process through fresh eyes everyday. 3.Customer Centric Understand customer expectations by keeping him as the centre point. Listen actively Understand customer needs and deliver solutions. Customer interest always supreme. 4.People Care Genuinely understanding the people we work with. Guiding their development through training and support. Helping them develop requisite skills to reach their true potential. Know them on a personal front. Create an environment of trust and Respect for the time of others. 5.Team Work Whole team takes the ownership of the deliverables. Consult all involved, understand and arrive at a company Co-operate and
support across departmental boundaries.

Identify strengths and weaknesses according allocate responsibility to achieve

common objectives.

6.Joy and Simplicity Environment that fosters fun in the form of celebration of individual and team
success.

To encourage work as fun that contributed to personal and organizational

development.

Joy is also derived through simple processes and forms.

VISION STATEMENTS
The most successful and admired life
insurance

Company, which means that we are the most trusted Company, the easiest to deal with, offer the best value for money, and set the standards in the industry. In short, The most obvious choice for all

DIFFERENT PLANS OF HDFC SLIC

Plans
90 80 70 60 50 40 30 20 10 0 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
East West

Traditional
Traditional

ULIP
North

Traditional plan is a life insurance solution that provides the client only
guaranteed return.

ULIP (Unit Linked Insurance Plan)

Unit Linked insurance plan is a life insurance solution that provides the client
with the benefits of protection & flexibility in investment .It is solution which provides for life insurance where the policy value at any time varies according to the value of the underlying assets at the time.

CHAPTER-2 DISCRIPTIVE WORK

LIFE INSURANCE SECTOR: India is emerging a some of the two of the largest markets in the world for life insurance products, the other being China. In the case of India, the three key drivers of growth are a large insurable population, a high savings rate, roughly at about 25 percent and a low penetration, at a mere 2.3 percent. In the 11 months of fiscal year 2004-05, life insurance companies collected premium worth Rs172 billion and the market grew by a whopping 32.4 per cent during the year. Of this, the public sector Life Insurance Corporation (LIC) had the lion's share of the market with premium totaling Rs134 billion. Private sector players recorded a spectacular growth of 129 percent over the last year, compared to LIC's growth of 18 percent. India's GDP growth rate of 6 percent per annum holds great potential for the sector. According to one estimate real life premium are expected to grow at a compounded annual rate of 15 per cent over the next ten years. How does India's life insurance market compare with China's? While India's market is currently the fifth largest, China's is the third largest in Asia after Japan and Korea. Low penetration rate of insurance products is common to IndiaandChina-atjustabout2.3 percent. In China, the savings rate is at 35 percent while for India it is a little lower at 25 percent. A large part of the growth of the life insurance market in China was driven by the conversion of bank deposits into endowment products. Demographically China's population is ageing faster than India's FDI in Insurance Sector. The government of India is planning to increase the equity limit for foreign direct investment from the current 26 percent to 49 percent in the insurance sector. Liberalizations of the FDI policy, including the Budget proposals for raising the sector al caps in insurance is one of the main factors for the higher FDI inflows during the current year. In 2003-04 the total FDI inflows in the country touched $3.4 billion. Indian insurance companies have been pushing for the FDI limit to be raised. The current paid-up requirement of Rs1 billion for general insurance and Rs2 billion for life insurance have become difficult targets to achieve for the companies. The companies feel that injection of additional foreign equity would reduce the costs. The sector was liberalized for private players towards the end of 1999. Currently, there are 14 insurance companies, including the key public sector company Life Insurance Corporation, in the life insurance sector and 13 general insurance companies.

Changing Demographics
In1999, according to KSA-Techno park, savings and investments comprised 14 percent of an Indian consumers expenditure. The other items included grocery (44 percent), personal care items (6 percent), consumer durables (6.6 per cent), clothing and books and music (5 percent each), eating out (8 per cent), movies (1 percent). By 2003, expenditure on savings and investments had declined to just 4.1 percent. The other items included grocery (41percent) , personal care items (7.6 percent), consumer durables (6.6percent), clothing (6.9 percent), eating out (10.8 percent), movies and theatres (4.6percent), books and music (7.6 percent), vacations (3.9 per cent). Clearly, the increased spending on other items have had a huge impact on the amount people are spending on savings and investment products. (Source: Business Worlds Marketing White book 2005).

Composition of Household Financial Savings

1991

1996-97 2002-0

Currency Deposits Of which Deposits with non banking companies Share sand debentures Small savings (central govt. schemes) Life insurance Provident and pension funds Source: RBI Annual Reports.

10.6% 33.3% 2.2% 14.3% 13.2% 9.5% 16.9%

8.6% 48.2% 16.4% 6.6% 7% 10.1% 19.1%

8.5% 41.5% 1.6% 2.7% 14.3% 15.5% 14.3%

Key Players in the Indian Market

While the public sector LIC dominates the Indian life insurance market with nearly 80 percent of the market share. It has 248 branches, 115,000 employees and over 1 million agents. It has also been improving internal processes and systems, upgrading skills of its agency force and managers And developing innovative products. LIC sold 1.69 corers policies during the year compared to 18 lakh policies sold by all the private players. ICICI Prudential is the leader among the private players with a market share of 6.69 percent after its premium collection totaled Rs11.54 billion. Bajaj Allianz with sales of Rs 4.9 billion had a market share of 2.86 percent. Birla Sun Life with sales of Rs 4.8 billion had a market share of 2.81 percent and SBI Life with premium collection of Rs 3.9 billion, a market share of 2.29 percent. With its combination of aggressive marketing through an agency force and the use of the banking channel, ICICI has emerged as a key player. Initially, the company drove new business by opening branches in new locations. The focus has now shifted to penetrating the locations for increasing market share. The company is also trying to get higher penetration in the High Net Worth segment. The company has seven bank assurance partners and this is the largest contributor to non-agency business. It also has 15 key non-bank partners and 800 financial sales consultants. As of September 2004, it had 90 branches in 60+ locations. It took the initiative in launching non- traditional products such as life-stage products, retirement solutions and child plans. It also focused on Unit Linked Plans (ULIPs) to target new consumer segments. It has a presence in 15 states through partnership arrangements and as of 200304, it sold64, 764 policies in rural areas. HDFC Standard Life has established its branches in 110 locations and is targeting non-metro towns. It is hoping to leverage its pedigree/parentage to gain more customer acceptance. As a result, it is focusing on quality not
39

Just volume growth. It has developed some innovative products like the Loan Cover Term Assurance Plan which provides a lump sum in case of death of the assured life during the term plan. Aimed at the growing segment of home loan takers, the plan helps the family to repay the outstanding loan. Given that HDFC has a huge database of home-loan customers; it can easily tap into this resource to acquire new business. The company is leveraging Its large customer database of home loan and banking clients to cross-sell insurance products.

Birla Sun Life

Birla Sun Life was the first to offer ULIPs in the Indian insurance market. And this has been the primary driver of its growth over the last one year. The company has been investing in customer education and feels that as a result customers don't view ULIPs as mutual funds but long term insurance. As of 2004, the company had 33 branches, 10,274 agents, 79 corporate relationships and 10 bank assurance partners. Bajaj Allianz has been focusing on second tier towns and cities which are yet to witness the entry of other life insurance players apart from LIC. It is using first mover advantage by opening an office in the most prominent location in a non-metro town. It hires local people who are trained. Its mantra is to develop only the indispensable infrastructure so that it can match the pricing of LIC. Apart from that it claims that it is the only private player to provide policy servicing at the branch level .Standard Chartered is currently its biggest partner followed by Syndicate Bank and Centurion Bank. The biggest challenge that the company faces is the weak infrastructure particularly transport and communications in the smaller cities. It is also facing a challenge in terms of banking channels, particularly for customers who bank with cooperative banks, where delays in clearing Cheques are in evitable. Tied agencies comprise the biggest channel (68%) of new business acquisitions for Bajaj Allianz. Bank insurance (27%) is the other significant channel of growth for the company.

Product Preferences among Consumers Pension policies are becoming popular as people prefer to opt for solutions that can offer them a regular income after retirement rather than a lump sum on retirement. Measurable policies for a bulk sum are being bought only for limited single use such as purchase of a house, childrens higher education, marriage, etc. This consumer trend is likely to help companies that offer pension schemes. Term policies are finding favor with
40

Youngsters. Term insurance policies are also finding more and more takers among the younger generation of consumers. Because the offer protection at extremely low costs. It is assumed that life insurance is purchased only to avail of tax-breaks. But the fact remains that while the tax paying population in the country is just about 20 million, there is a huge population that has not been tapped. Only the urban salaried class who fall in the tax net has been targeted for life insurance policies for tax-saving purposes. The other income-earning classes such as businessmen, professionals, farmers, provide a great opportunity for life insurance marketers. There is a need to tap these customer segments effectively. Currently all their disposable income is going into purchase of consumer durables such as washing machines, TV, refrigerators and mobile phones(as is evident from the fact that spending on savings/investment products has declined from 14 percent to 4 percent in the past decade). Mutual Funds (MF) have benefited the most during the last two years. Take the example of the Systematic Investment Plans (SIP) of mutual funds. In just one quarter ICICI PRU MF sold 20,000 SIPs and it has the potential of selling about 100,000 new SIPs in a year. There are 33 Mutual Fund companies in the country and based on this trend one could say that the estimated fund in flow in MFs through this route alone could touch the Rs20 billion per month. Due to the good performance of MF during the past 2 years, life insurance companies have lost out to mutual funds.

PROFILING PROSPECT
For the Providing assistance of financial management there are certain criteria for the selection of policy holder. These criteria differ from different insurance company. We can divide the profiling prospect of HDFCSLIC in two ways. Which are thus:1.H.N.I (HIGHLY NET WORTH INDIVIDUALS) Highly net worth individuals are those persons who having yearly income more than 20 lacs and they are specially treated as H.N.I clients and they have provided relationship manager who watching and manage their funds and provided financial advices and updating all information of policies

2.LOYAL CUSTOMERS FUND VALUE AND HAVING DOWN Every Company Want more and more business and market share and we all know that the work in insurance sector is totally based upon the customer base. The more you have customer the more you earn business. So HDFCSL provide the facility to customers that they can contact with financial assistant in the company and manage their funds which is in loss or customer is not aware about their policies and managing funds also.

TOTAL NO. CONTACTED

OF

PEOPLE

During the work of financial Assistance I have contacted 100 people including phone calling, meetings, and the other efforts. In these 100 people I have gotten appointment of 65people. In the 65 person I have assisted 39 people. The percentage of converting the profits at 9%. During the meeting time with the customer these questions are generally asked by them which are thus:Which type of this policy in which I m getting loss! Our premium will charge by your company or premium is invested or not? How your policy is working? How can I believe on you and your company? Mostly person have still faith in LIC so I have to convince them against the LIC.

RESEARCH METHODOLOGY

ABSTRACT OF MARKET RESEARCH Marketing Research provides information that assists and organization to define opportunities for product development and market strategy. It works by assessing whether marketing strategies are accurately targeted, and by identifying market opportunities or changes that are required by customers. Market research tends to confirm issues that are well-known in a market initially, but if planned well and effectively it will also identify new opportunities, market niches, or ways by which to improve sales, marketing and communications activities. WHY MARKET RESEARCH STUDY The role of market research, therefore, is to reduce uncertainty in decision making, to monitor the effects of decisions taken, and identify the performance of a company or a product in the market. During internship my market survey was related with the distribution enhancement of the insurance policies of HDFCSL. To be more specific, we can list five key uses for market research, namely to: a. Identify the size, shape, and nature of a market, so as to understand the market and marketing opportunities. b. Test out strategic and product ideas which help to define the most effective customer-led strategies. c. Monitor the effectiveness of strategies d. It will define when marketing expenditure, promotions and targeting need to be adjusted or improved. The variety of purposes listed above makes it clear that market research is not simply a first check.It is useful ahead of any action, but it also provide same answer of checking and refining views as operations proceed. Companies, especially those for which budget seem tight, who have selected one of these uses for market research are always concerned to make the research a worthwhile investment. Best results come when their marketing and sales planning is influenced by the results of research. In other words, when research pays for itself by providing a basis for change and improvement in operational matters.

RESEARCH METHODOLOGY

Research methodology is a way to systematically solve the research problem. It may be understood as a science of studying now research is done systematically. In that various steps, those are generally adopted by a researcher in studying his problem along with the logic behind them. It is important for research to know not only the research method but also know methodology. The procedures by which researcher go about their work of describing, explaining and predicting phenomenon are called methodology. Methods comprise the procedures used for generating, collecting and evaluating data. All this means that it is necessary for the researcher to design his methodology for his problem as the same may differ from problem to problem. Data collection is important step in any project and success of any project will be largely depend upon now much accurate you will be able to collect and how much time, money and effort will be required to collect that necessary data, this is also important step. Data collection plays an important role in research work. Without proper data available for analysis you cannot do the research work accurately.

OBJECTIVE OF PROJECT
My project is being undertaken in HDFCSL in which finance management program and distribution enhancement of insurance policies of HDFCSL has been implemented as a marketing strategy. HDFCSL tied up with world class insurance product. Primary Objective The primary objective of my project is to p r o v i d e Financial assistance and to increase market share of HDFCSL. In the insurance sector the main work is done by the financial planning manager who brings selling for the organization as well providing the best solution for policies which is not in profit. It improves the services of the organization. Secondary Objective In this point we can conclude the company objective which is to increase the market share in the insurance sector and this will happens it becomes more beneficiary and reliable to the customer. Customer should have faith on it. It is trying to do it. Today it comes under top 5 insurance companies. It wants to reach on the top.

Working Procedure In my summer training I have targeted Delhi. I have collected my data some parts of Delhi. Here I have to approach various detail of insurance product of HDFCSL and the other competitor of it, suggestions, its marketing strategy and its advertisement. As a part of marketing research I also have collect the data in order to find out market share of HDFCSL from our sample space. During the period I was in continuous touch with my senior and sales manager and I have to submit daily report of my work and full information about phone calls and questioners. Questionnaire consisting of open ended questions was used for collecting the information. Sample Area My working area was Delhi. As we know that those person will invest in insurance sector who are salaried or professional. I have targeted those person whos age is equal or more than 25.

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31

Instrument Used I have collected my data form LIFE ASIA and through phone calling. Life asia is the software which used by every insurance company and this software help me to know the customer details and customer policy information which help me providing best solution through discussion with my seniors. Types of data collection There are two types of data collection methods available. 1. Primary data collection 2. Secondary data collection

1) Primary data The primary data is that data which is collected fresh or first hand, and for first time which is original in nature. Primary data can collect through personal interview, questionnaire etc. to support the secondary data.

2) Secondary data collection method The secondary data are those which have already collected and stored. Secondary data easily get those secondary data from records, journals, annual reports of the company etc. It will save the time, money and efforts to collect the data. Secondary data also made available through trade magazines, balance sheets, books etc. This project is based on primary data collected through personal interview of head of account department, head of SQC department and other concerned staff member of finance department. But primary data collection had limitations such as matter confidential information thus project is based on secondary information collected through five years annual report of the company, supported by various books and internet sides. The data collection was aimed at study of working capital management of the company

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We used both methodology i.e. primary and secondary We take the sample size of 100 POLICY HOLDERS Sample location is Delhi This is stratified sampling

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LIMITATIONS OF THE STUDY

Limitations of the study Following limitations were encountered while preparing this project: 1) Limited data:This project has completed with annual reports; it just constitutes one part of data collection i.e. secondary. There were limitations for primary data collection because of confidentiality. 2) Limited period:This project is based on five year annual reports. Conclusions and recommendations are based on such limited data. The trend of last five year may or may not reflect the real working capital position of the company 3) Limited area:Also it was difficult to collect the data regarding the competitors and their financial information. Industry figures were also difficult to get.

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FINANCE DEPARTMENT

35

INTRODUCTION
Financial management means procurement of funds at minimum costs and effective utilization in order to maximize the wealth of shareholders.

The term of financial management refers to its relationship with the closelyrelated fields of economics and accounting, its functions, scope and objectives. Financial management, as an academic discipline, has undergone fundamental changes in its scope and coverage. In the early years of its evolution it was treated synonymously with the raising of funds. In the current literature

pertaining to financial management, a broader scope so as to include, in addition to procurement of funds, efficient use of resources is universally recognized.

Financial management, as an integral part of overall management, is not a totally, independent area. It draws heavily on related disciplines and fields of study, such as economics, accounting, marketing, production and quantitative methods. A part from economics and accounting, finance also draws for its key day to day decisions on supportive disciplines such as marketing, production and quantitative methods, for instance, financial managers should consider the impact of new product

development and promotion plans made in the marketing area since their plans will require capital outlays and have an impact on the projected cash flows.

Finally, the tools of analysis developed in the quantitative methods area are helpful in analyzing complex financial management problem. Organization makes their planning for the financial sources which are very helpful in the future course of action. Taking a commercial business as the most common organizational structure, the key

objectives of financial management would be to: Create wealth for the business Generate cash, and

36

Provide and adequate return on investment bearing in mind the risks that the business is taking and the resources invested.

CONCEPT OF FINACING
1. Financial Planning

Management needs to ensure that enough funding is available at the right time to meet the needs of the business. In the short term, funding may be

needed to invest in equipment, pay employees and fund sales made on credit. In the medium and long term, funding may be required for significant additions to the productive capacity of the business or to make acquisitions.

2.

Financial Control

Financial control is a critically important activity to help the business ensure that the business is meeting its objectives.

3. Financial Decision-Making

A key financing decision is whether profits earned by the business should be retained rather than distributed to shareholders via dividends. If dividends are too high, the business may be starved of funding to reinvest in growing revenues and profits further.

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FINANCIAL DECISIONS

Financial management consists of four major decisions or functions which are as discussed as below.

1.

Investment decision

Investment decision is the long term, strategic policies of an organization. Investment decisions have a long term effect on the working of an organization. Thus an enterprise should invest in proposals which maximize share value.

2.

Financing decision

There are various sources of capital like equity, preference shares, borrowed funds, and retained profits. The finance manager has to select a proper mix of owned at the minimum cost. A financing decision adds to the value to the value of shareholders.

3.

Dividend decision

Profits

can either

be

distributed

or

reinvested

into

the

business.

The

proportion of profits that needs to be distributed and that needs to be retained is a crucial decision. It is the job of finance manager to satisfy the shareholders as well as claw back into the business. This division of profit when done in an optimum manner maximizes shareholder value.

4.

Liquidity decision

An enterprise needs finance for the day today activities for the smooth functioning. The brand of FM that deals with investments in current assets &

38

liabilities, in other words investment is the net working capital comprises of the liquidity decisions.

DEPRECIATION POLICY IN HDFC LIFE

Depreciation is charged as per the below mentioned rates

Asset Rate as per Companies Act Rate as per Income Tax (Written Down Value method) Act (Written Down Value WDV Buildings Residential Units 1.63 % Office Premises 1.63 % (Straight SLM) Computers Air Conditioners Refrigerator Furniture & Fixtures Office Equipment Electrical Installations Vehicles (Motor Cars) 18.10 % 13.91 % 13.91 % 25.89 % 10 % 15 % 15 % 15 % 25 % (SLM) & 13.91 % 60 % 15 % Line Method method) WDV Residential units 5 % Office Premises 10 %

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40

Companies Act
1. The rate 13.91 % is applicable to Plant and Machinery (applicable to A/C, Office Equipment and Electrical Installations). 2. The Depreciation under Companies Act for Computers is 16.21 % (SLM). However, the rate adopted by us is 25 % SLM. 3. Except Computers, all the rates are as per Companies Act. 4. No depreciation is charged in the year of sale. 5. Depreciation is charged for the full year in the year of purchase.

Income Tax Act

1. Machinery and Plant other than the specified 15 % (applicable to A/C, Office Equipment and Electrical Installations). 2. Rates of premises, computers, vehicles and furniture specified. 3. If the asset is put to use for 180 days or more in a year, 100 % depreciation is provided during the financial year. If the period is less than 180 days ---50 % depreciation is provided for tax purposes.

41

FINACIAL STATEMENT FOR THE YEAR 2009-10 1.Cash flow

Particular Operating activities Amount received form policy holder Amount received to reinsurance Amount paid to policy holder Amount paid as commission Payment of employee and suppliers Deposited with RBI Income tax paid Net cash flow from operating activities Investing activities Purchases of fix assets Sales of fix assets Investment Interest income Dividend income Net cash flow from investing activities Financing activities Issue of share Net cash flow from financing activities Net increase in cash and cash equivalents 1,720,000 1,720,000 -1,282,298 5,250,000 5,250,000 -384,578 4,493,238 70,817,804 -312,168 -12,053,422 -5,417,619 -13,207,483 0 -309,142 39,821,183 155,217,800 -217,752 5,444 -48,767,468 48,17,558 1,338,737 -42,823,481 54,747,190 -384,636 -5,414,218 -4,136,736 -15,583,363 100,00 -230,833 29,453,152 68,782,936 -581,822 3,159 -39,057,231 3,805,029 745,975 -35,081,730 2010 2009

Cash and cash equivalent as at beginning of the 4,108,660 year Cash and cash equivalent as at end of the year 2,826,362

42

Particular Liability Share capital Reserve fund Credit change a/c Credit change a/c policy liabilities insurance reserve Provision for link liabilities Add: Fair value change total provision Funds funds for provision Surplus Profit and loss Total Assets Share holder policy holder Assets held to cover link liabilities Loans Fix assets Cash and bank Advance Current asset Provision Net working capital Miscellaneous expense Other Asset

2010

2009

19,680,000 552,892 184,435 205,087 37,666,908 0127,701,636 27,516,164 155,217,800 1,490,013 1,064,831 0 6,95,56,324 216,061,966

17,958,180 552,892 -77,610 -296,885 29,092,419 0 84,085,083 -15,302,147 68,782,936 586,395 531,970 0 5,51,83,763 117,130,297

6,304,757 43,415,382 155,217,800 40,366 1,143,777 2,826,362 4,917,758 12,28,585 187,617 4,725,082 14,664,966 0

4,291,597 30,152,727 68,782,936 30,248 1,451,346 4,108,660 5,428,699 8,820,225 208,813 508,321 11,913,122 0

2. BALANCE SHEET
Total 216,610,966 117,130,297

43

3. RATIO ANALYSIS
(A) CURRENT RATIO

CURRENT ASSETS:

Cash and bank balances: 2,826,362

Advances and Other Assets: 4,917,758

CURRENT LIABILITIES: 12,281,585

CURRENT RATIO=

2009-10 =

=0.63:1

2008-09=

=1.08:1

44

1.2 1 0.8 0.6 0.4 0.2 0 2009-2010 2008-2009 Column1

Comment

Current ratio of HDFC LIFE insurance, has 0.63:1, it means it is less than 1 that indicates firms ability to meet current obligations & greater the safety of funds of short-term creditors. It also indicates the sound solvency of the company is lover.

45

(B) LIQUID RATIO

LIQUID RATIO: =

2009-10=

= 0.60:1

2008-09=

= 0.57:1

0.605 0.6 0.595 0.59 0.585 0.58 0.575 0.57 0.565 0.56 0.555 2009-2010 2008-2009 LiQuid Ratio

Comment
The liquid ratio of HDFC life in 2009 was 0.57 and in 2010 is .60 so increasing the liquid ratio and company have a good liquid position over the year.

46

(C)Gross profit ratio

GROSS PROFIT RATIO =

2009-10 =

= 30.25 %

2008-09=

= 21.76%

35 30 25 20 15 10 5 0 2009-2010 2009-2010 Column1

Comment:The gross profit ratio of HDFC LIFE in 2009 was 21.76% and in 2010 is 30.25% so increasing the gross profit of HDFE LIFE over the year and company become a strong in his financial performance.

47

(D) NET PROFIT RATIO

NET PROFIT RATIO=

2009-10=

= 22.09%

2008-09 =

= 21.58%

22.1 22 21.9 21.8 21.7 21.6 21.5 21.4 21.3 2009-2010 2008-2009

Series 3

Comment:The net profit ratio of HDFC LIFE in 2009 was 21.58% and in 2010 is 22.09% therefore the net profit is increasing. The company have good profit margin. The company should more and more profit for the future.

48

(E)Net retention ratio

NET RETENTION RATIO=

2009-10 =

= 99.29 %

2008-09=

=99.17%

99.3 99.28 99.26 99.24 99.22 99.2 99.18 99.16 99.14 99.12 99.1 2009-2010 2008-2009 Series 3

Comment:The net retention ratio of HDFC LIFE in 2009 was 99.17% and in 2010 is 99.29% therefore increasing the net retention ratio of the HDFE LIFE. So company become successful for maintain the premium level over the year.

49

(F)RATIO OF EXPENSES OF MANAGEMENT

RATIO OF EXPENSES OF MANAGEMENT

2009-10

= 29.04 %

2008-09 =

=39.38%

40 35 30 25 20 15 10 5 0 2009-2010 2008-2009 Series 3

Comment:The ratio of expense of management of HDFC LIFE in 2009 was 39.38% and in 2010 is 29.07% so decreasing the management expenses over the year

50

(G)COMMISSION RATIO

COMMISSION RATIO =

2009-10 =

= 7.50 %

2008-09 =

=7.64%

7.65

7.6

7.55

7.5

7.45

7.4 2009-2010 2008-2009

51

(H)RATIO

OF

POLICY

HOLDERS

LIABILITIES

TO

SHAREHOLDERS FUNDS:
RATIO OF POLICY HOLDERS LIABILITIES TO SHAREHOLDERS FUNDS :

2009-10 =

= 597.44 %

2008-09=

= 677.89%

680 660 640 620 600 580 560 540 2009-2010 2008-2009 Series 3

52

(I)RETURN ON INVESTMENT

RETURN ON INVESTMENT =

2009-10 =

= 24.86%

2008-09 =

=13.60%

25 20 15 Series 3 10 5 0 2009-2010 2008-2009

Comment:The return on investment ratio of HDFC LIFE in 2009 was 13.60% and in 2010 is 24.86% there increasing the return on investment over the year so company become a profitable over the year.

53

(J) DEBT-EQUITY RATIO

DEBT-EQUITY RATIO =

* 100

2009-10 =

=1.58%

2008-09

=1.25%

1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2009-2010 2008-2009 Series 3

Comment:
The debt-equity ratio of HDFC LIFE in 2009 was 1.25% and in 2010 is 1.58% there increasing the level of equity against long term debt.

54

TREND ANALYSES
Asset
Asset 2009-2010 2010-2011 2009-2010(%) 20102011(%)

Share holder policy holder

6,304,757 43,415,382

4,291,597 30,152,727 68,782,936

100% 100%

68% 69%

Assets held to cover 155,217,800 link liabilities Loans Fix assets Cash and bank Advance Current Asset Provision Net working capital 40,366 1,143,777 2,826,362 4,917,758 12,28,585 187,617 4,725,082

100%

44%

30,248 1,451,346 4,108,660 5,428,699 8,820,225 208,813 508,321 11,913,122 0 117,130,297

100% 100% 100% 100% 100% 100% 100% 100% 100% 100%

73% 126% 145% 110% 717% 111% 10% 81%

Miscellaneous expense 14,664,966 Other Asset Total 0 2,16,610,966

5%

55

Liability

Liability

2009-2010

2010-2011

20092010(%)

20102011(%)
91% 100% 142% 42% 77% 100% 0

Share capital Reserve fund Credit change a/c Credit change a/c policy liabilities insurance reserve Provision liabilities Add: Fair value change total provision Funds funds for provision Surplus Profit and loss Conclusion:for

19,680,000 552,892 184,435 205,087 37,666,908 0link 127,701,636

17,958,180 552,892 -77,610 -296,885 29,092,419 0 84,085,083

100% 100% 100% 100% 100% 100% 100%

27,516,164 155,217,800 1,490,013 1,064,831 0 6,95,56,324

-15,302,147 68,782,936 586,395 531,970 0 5,51,83,763

100% 100% 100% 100% 100% 100% 44% 39% 49% 100% 79%

According to trend analysis the hdfc life doing improvement in 2010-2011 compare to 2009-2010 so company is growing in following way 1). The liquid position of the company improving around 145 % 2).The increase in fixed asset is financed by issue of debenture 3).Higher improvement in current asset the compare the two year 717% are improvement in 2010-2011

56

COMMON SIZE STATEMENTS

Asset
Share holder policy holder

2010
4,291,597 30,152,727

2010 (%) 3.66 25.74 58.72 0.025 1.24 3.5 4.63 7.53 0.18 4.34 10.17 100

Assets held to cover 68,782,936 link liabilities Loans Fix assets Cash and bank Advance Current Asset Provision Net working capital 30,248 1,451,346 4,108,660 5,428,699 8,820,225 208,813 508,321

Miscellaneous expense 11,913,122 Total 117130297

57

TREND ANALYSES
Share Capital
share capital PARTICULAR Authorised Capital Issued Capital Subscribed Capital Called-up Capital 2009-10 30,000,000 19,680,000 19,680,000 19,680,000 2008-09 30,000,000 17,960,000 17,960,000 17,960,000 incre/decre 0 17,20,000 17,20,000 17,20,000 % 0 9.57 9.57 9.57

share capital %

10

0 0 17,20,000 17,20,000 17,20,000 share capital % 30,000,000 17,960,000 17,960,000 17,960,000 30,000,000 19,680,000 19,680,000 19,680,000 Authorised Capital Capital Issued Subscribed Capital Called-up Capital

CONCLUSION:
in the year 2008-09 the Authorized share capital was 30,000,000 and at current year the Authorized share capital are same there are no changes arise in Authorized share capital between two year and Called-up Capital, Subscribed Capital , Issued Capital were 17,960,000 and in current year increase by 17,20,000 so as compare to the previous year increase by 9.57 %

58

RESERVES AND SURPLUS

PARTICULAR Revaluation Reserve

2009-10 552,892

2008-09 552,892

incre/decre 0

% 0

Revaluation Reserve
100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%

Revaluation Reserve

CONCLUSION:

in the year 2008-09 the Revaluation Reserve are 5,52,892 and at current year are same there are no changes arise in the current year,

59

Investments Shareholders
PARTICULAR Government Securities Equity Debentures / Bonds Investment Properties Infrastructure Other Investments 2009-10 2,471,702 457,377 208,675 757,540 1,108,284 145,085 2008-09 2,180,149 233,783 100,531 757,540 386,899 64,797 incre/decre 291,553 223,594 108,144 0 721,385 80,288 % 13.373077 95.641685 107.57279 0 186.45305 123.90697

5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 0

% incre/decre 2008-09 2009-10

CONCLUSION

in the year 2008-09 the investment in Government Securities was 2180149 and at current year are having 2471702 so increase by 291,553 and so 13.37 % are increase as compare to previous. And Equity, Debentures / Bonds, Investment Properties, Infrastructure, Other Investments, are increase by respectively 95.64%, 107%,0%, 186% 123%.

60

Working Capital
current assets Cash Deposit Accounts Current Accounts 2009-10 279,148 1,340,581 1,206,633 2008-09 668,726 1,751,354 1,653,161 incre/decre -389,578 -410,773 -446,528 % -58.25674 -23.4546 -27.01056

current liabilities Agents Balances Premiums advance Security Deposits Sundry creditors Claims Outstanding Unallocated Premium received

2009-10 422,567 in 296,400

2008-09 525,903 278,748

incre/decre -103,336 17,652

% -19.64925 6.3326015

21,441 5,078,198 433,935 232,117

21,441 3,894,536 198,361 274,095

0 1,183,662 235,574 -41,978

0 30.392889 118.76024 -15.31513

100% 80% 60% 40% 20% 0% -20%

% -58.25674491 -23.4545957 -27.01055735 % incre/decre -389,578 410,773 -446,528 incre/decre 2008-09 668,726 1,751,354 1,653,161 2008-09 2009-10 279,148 1,340,581 1,206,633 2009-10

CONCLUSION:
As compared to previous year, Current Accounts are decrease by as compare to the previous year respectively,-58%, -19%, 6.33%,0%, 30.39%, in the year 2008-09 the current asset of cash, Deposit Accounts -23%, -27%,. And current liabilities of Agents Balances, Premiums received in advance, Security Deposits, Sundry creditors are decrease or increase

61

Comparison of funds for year 2010:

Fund Growth fund Balance manage fund Equity fund Liquid fund manage 28 31 manage 34 62 32 48 2009 38 2010 73

80 70 60 50 40 30 20 10 0 Growth fund Balance Equity Liquid manage manage fund manage fund fund

2009 2010

In above diagram comparison of funds performance for year 2010.

The above diagram represents the comparison of various funds. The growth fund in 2009 was 38% and at present in 2010 are 73% so increased by 35%. And second fund is balance manage fund there was 32%in 2009 and at present jn 2010 is 48% so increase by 16%. And third fund is equity manage fund there was in 2009 was 34% and at present in 2010 are 62% so increase by 28%. And forth fund are liquid fund there was in 2009 was 28% and present in 2010 are 31% so increase by 4%.

62

Equity markets

INDICES

31-5-12

30-4-2012

1month rate 1year of return

rate

of return -12.35 -11.44

BSE Sensex S&P Nifty BSE 100 BSE Cap BSE Cap

16,219

17,319 5,248

-6.35 -6.17

CNX 4,924

4,942 Mid 5,908

5,268 6,316

-6.19 -6.46

-12.34 -14.50

Small 6,271

6,765

7.30

-23.86

63

6.Processes
The process should be customer friendly in insurance industry. The speed and accuracy of payment is of great importance. The processing method should be easy and convenient to the customers. Installment schemes should be streamlined to cater to the ever growing demands of the customers. IT & Data Warehousing will smoothen the process flow. IT will help in servicing large no. of customers efficiently and bring down overheads. Technology can either complement or supplement the channels of distribution cost effectively. It can also help to improve customer service levels. The use of data warehousing management and mining will help to find out the profitability and potential of various customers product segments.

What is Welcome Calling to the customer?

Welcome Calling is a call made to all our new customers to ensure that the policy chosen by them is as per requirement.

What is the objective of Welcome Calling?

Welcome Calling serves mainly 2 objectives:

First, to contact the customer as per the given contact details thereby ensuring contact ability. Second, to verify if the customer has fully understood the important features the insurance plan chosen and whether it suits the customer's requirement, thereby avoiding mis-sale occurrences.

64

The process of customer Welcome Calling of customer

A welcome call is made to the customer after the application for insurance policy has been accepted by the company. Before disclosing any policy related information, our Customer Service Associate (CSA) will do a mandatory verification by asking few questions. If the policy holder is not available, information can be shared with a third party who takes care of the policy holder's finances, post confirmation from the third party that all the discussed details will be shared with the Policy Holder. Once the verification is done, the CSA will inform the customer on all the Key features of the insurance plan.

Once all the key features have been communicated, the CSA can also make a note of any query, request or complaint by the customer. If the customer is not contactable despite multiple attempts, we will send a Welcome Calling Letter to the communication address of the customer.

Physical Distributions

Distribution is a key determinant of success for all insurance companies. Today, the nationalized insurers have a large reach and presence in India. Building a distribution network is very expensive and time consuming. Technology will not replace a distribution network though it will offer advantages like better customer service. Finance companies and banks can emerge as an attractive distribution channel for insurance in India. In Netherlands, financial services firms provide an entire range of products including bank accounts, motor, home and life insurance and pensions. In France, half of the life insurance sales are made through banks. In India also, banks hope to maximize expensive existing networks by selling a range of products. The physical evidences include signage, reports, punch lines, other tangibles, employees dress code etc.

65

A. Tangibles: banks give pens, writing pads to the internal customers. Even the passbooks,chequebooks, etc reduce the inherent intangibility of services.

B. Punch lines: punch lines or the corporate statement depict the philosophy and attitude ofthe bank. Banks have influential punch lines to attract the customers.

SOME CHANNEL OF DISTRIBUTIONS IN HDFC LIFE

1. Direct Sales
2. Sales Development
Managers Induction

Direct Sales Manager Individual Sales ( Door to Door Marketing ) Business through Financial Consultants

3. Alternative Induction 4. Corporate Induction

Bank Relation ( HDFC,SBI,BOB,Andra Bank,AXIS Bank etc...) Group Selling Collabration with other Companies

66

conclusion

67

CONCLUSION

Introduction
1. It has got 3rd rank in the investment management, in year 2006One of the largest financial institution of 2. India with more then 2 million satisfied customer base. 3. The most successful and admired life insurance Company, which means that we are the most trusted Company, the easiest to deal with, offer the best value for money, and set the standards in the industry. In short, The most obvious choice for all

Financial analysis is important aspect of financial management. The study of financial managementat HDFC LIFE LTD. has revealed that the current ratio was as per the standard industrial practice but the liquidity position of the company showed an increasing trend.

68

Finance department
1. The proprietary ratios shows efficient capital structure. Considering the turnover ratios, the management having effective collection system and low investment in stocks. 2. The Depreciation under Companies Act for Computers is 16.21 % (SLM). However, the rate adopted by us is 25 % SLM. 3. Machinery and Plant other than the specified 15 % (applicable to A/C, Office Equipment and Electrical Installations). 4. Current ratio of HDFC LIFE insurance, has 0.63:1 It also indicates the sound solvency of the company is higher. 5. The net profit ratio in 2009 was 21.58% and in 2010 is 22.09% therefore the net profit is increasing. The company have good profit margin. The company should more and more profit for the future. 6. Issued Capital were 17,960,000 and in current year increase by 17,20,000 so as compare to the previous year increase by 9.57 %

69

RECOMMENDATION AND SUGGSTION

70

RECOMMENDATIONS
The HDFC company should now try to identify the gap between current level of customer service and customer expectations. Some of the strategies being recommended are as follows: Brand Building: HDFC is a very huge Brand in US in Insurance but in India it is not known as a Insurance brand. So HDFC need to focus on Brand building Activities which can be done through Advertising, Road shows, Knops, Sponsoring Events in rural & Urban Areas. Educating the Consumers: HDFC should take initiative to educate the consumers regarding all these aspects & take competitive Advantage on this front as its Allocation charges are minimum in the whole Indian Insurance Industry. Need to Increase Market Presence: It should make more channel partners & do business tie ups with more broking houses & should hire marketing agencies for aggressive marketing purpose. It can also increase its Business Units.

Concentration More On Rural Areas : HDFC need to concentrate more towards the rural areas as 60-70% of India population is living in rural areas and most of the people in rural areas are not insured so there is a huge potential in the rural sector.

Product Differentiation: Offering a product that is distinctly different from other products available in the market by other insurance players.

More Guaranteed Plans to be Introduced:

71

As we know today the stock market is giving very less return even in last year the return comes Negative so the company need to introduce some more granted plans so that customer can invest in them and have assured return on them which ultimately is an edge in competition in insurance sector.

Need to commence Medical claim Products and General Insurance : There are very less which are having Medical claim products and also very less companies providing General Insurance with Life Insurance for example ICICI , Reliance and Bajaj Allianz so HDFC also need to come in General Insurance business so that they can compete with these players. Flexibility: The companies should make their products flexible for the convenience of their customer. Hassle Free Service: All bureaucracy in customer interactions should be eliminated. Proper Policy Documentation: Wrong interpretations/ non-awareness of policy document by the customer may have serious implications in the long term and the possibility of the same should be alleviated by the company which leads to.

72

Recommendation can be use by the firm for the betterment increased of the firm after study and analysis of project report on study and analysis of working capital. I would like to recommend. 1. Company should raise funds through short term sources for short term requirement of funds, which comparatively economical as compare to long term funds. 2. Company should take control on debtors collection period which is major part of current assets. 3. Company has to take control on cash balance because cash is non earning assets and increasing cost of funds. 4. Company should reduce the inventory holding period with use of zero inventory concepts. Over all company has good liquidity position and sufficient funds to repayment of liabilities. Company has accepted conservative financial policy and thus maintaining more current assets balance. Company is increasing sales volume per year which supported to company for sustain 2nd position in the world and number one position in Asia.

73

SUGGESTIONS:
The company should try to increase his financial performance in the future.

The company should try to increased his product cycle.

Stable Managed fund & Secure Managed Fund provide low return. but less risk in Stable Managed fund & Secure Managed Fund.
Most of the people are not aware about HDFC STANDARD LIFE INSURANCE CO.LTD so they have to advertise their company and their product.

HDFC LIFE INSURANCE CO.LTD focuses on the urban area so now they have to focus on rural area also.

HDFC LIFE INSURANCE CO.LTD should try to increase awareness of their UNIT LINK PLAN

The company should increase their distribution network.

74

ANNEXURE

75

QUESTIONNAIRE
PERSONAL DETAILS: Name: Mobile Number: Adress:____________________________________________ ___________ __________________________________________________ ___________ __________________________________________________ ___________ __________________________________________________ ___________ _______________________________ Occupation: _____________________ Age: ____________________________

1. Of the following what at present are your investment needs?

a. To build a corpus for retirement

76

b. To save for children education/ marriage c. To provide for medical emergencies d. To provide for family financial security e. To create wealth f. All of the above

2. Which of the following you think as investment for tax- saving?

a. Mutual funds b. Fixed deposit c. Insurance d. Ppf e. All of the above

3. Have you ever been invested in mutual funds?

a. Yes

b. No

4. Have you ever been invested in ulip insurance plans?

a. Yes

b. No

77

5. If you had Rs 1000/- where you prefer to invest

a. Mutual fund b. Fixed deposit c. Direct equity d. Life insurance e. Postal office deposit

6. Out of the following in which Mutual Fund you have invested?

a) HDFC b) Tata Mutual Fund . c) Franklin Templeton . d) Reliance . e) ICICI Prudential . f) SBI .

g) Other If any ,Please Specify

7. Out of the following company which company ulip plans you have invested?

a) HDFC LIFE. b) Tata AIG .

c) BAJAJ ALLIANZE . d) Reliance . e) ICICI Prudential . f) SBI LIFE.

g) Other If any ,Please Specify

78

8. To how much extent are you satisfied with the services offered by HDFC LIFE regardingULIP INVESTMENT PLANS? a) Exteremly satisfied. b) Satisfied to the lesser extent d) Dissatisfied to lesser extent e) Extremely dissatisfied.

9. Do you prefer GROWTH FUND OR DIVERSIFY YOUR MONEY in various fund? a) growth fund b) diversify funds

c) Depends upon the risk bearing condition

79

BIBLOGRAPHY

Books Referred

1. Maheshwari, S.N.; Financial Managemen, Principles and Practice, Sultan Chand & sons, 9th Edition 2004. 2. Maheshwari, S.N.; Elements of Financial Management, Sultan Chand & Sons, 2003 7th Edition. 3. Pandey, I.M.; Financial Management, Vikas Publishing House, 8th Edition, 2001. 4. .Author:Evertt.E.AdamProduction and opration management prentice hall 5th edition

Websites References
www.hdfclife.com/

www.bimadeals.com Life Insurance Life Insurance Companies www.myinsuranceclub.com Life Insurance Companies

www.indiancustomers.in/company/hdfc-standard-life

www.hdfclife.com/Children'sPlans/child-insurance-plans.

www.hdfclife.com/savingsplans/WholeLife