OVERALL MARKET SURVEY

OF HDFC BANK IN ROURKELA

FOR THE DEGREE OF

MASTER OF BUSINESS ADMINISTRATION
(M.B.A)

SUBMITTED TO

SUBMITTED BY: RISHIKESH GHOSH

Reg. no: 0606260143 (2006-2008)

UNDER THE GUIDENCE OF

COMPANY (HDFC BANK) FACULTY GUIDE

AMEYA KR. MOHANTY PROF. S.S. SASTRY

ACKNOWLEDGEMENT

The preparation of project report depends on the cooperation, coordination & combined effort of
several persons. I sincerely appreciate the effort of different respected persons for providing the support
that I required in preparing this report, without this help it could not have been possible. I express my

1
deep sense of gratitude to sri Ameya kumar Mohanty & Mr. Akhaya kumar Padhi (DSM) for giving
me an opportunity to do summer project in their esteemed organization.I wish to place sincere thanks to
S.S Sastry Sir, who has also been our project guide, for his immense help, cooperation, magnificent
guidance & valuable suggestions. In spite of being such a busy person he always gave me his valuable
time to guide me in my project. He has been a constant source of inspiration for me. We are also
thankful to Dr. K.K Patra(Dean Admn) Mr, P.s kar & all my respected Professors & other staffs of the
MBA Dept. of Rourkela Institute of Management Studies, for their kind support & guidance.
Last but not the least; I am grateful to all the staff-members of HDFC. I came across during my project
period, my loving parents & above all The Almighty, for helping me to proceed with the project &
overcome all hurdles.
RISHIKESH GHOSH
REGD. NO-0606260143
MBA (RIMS)

DECLARATION
I, Mr. Rishikesh Ghosh here by declare that summer project report written & submitted to Rourkela
Institute of Management Studies by me in my own & its copy has not been reproduced to any other
institution/university or published anywhere else.
I understand that such reproducing is liable for punishment in anyway the university deem fit.
Place: - Rourkela Rishikesh Ghosh
Date: - MBA (RIMS)

2
 CERTIFICATE

This is to certify that the project titled “OVERALL MARKET SURVEY OF HDFC
BANK IN ROURKELA” is an original work of Rishikesh Ghosh, student of Rourkela
Institute Management Studies, Rourkela and is being submitted in partial fulfillment for
the award of Master Of Business Administration degree of Biju Pattanaik University of
Technology, Rourkela. The report has not been submitted earlier either to this University
or any other University/Institution for the partial fulfillment of the requirement of a
course of study.

Rishikesh Ghosh

Name & Signature of the student

Date:
Regd. No. 0606260143
Session: 2006-08

Signature of the project guide

3
 PREFACE

The Summer Project Report is an essential feature of the 2-Year Full Time MBA
Programmed of the Rourkela Institutes of Management Studies, Rourkela. As such we
had to work for 2 months during the summer training period with HDFC at Bisra Chowk
Rourkela.The topic of the project is “OVERALL MARKET SURVEY OF HDFC
BANK IN ROURKELA”.

During the training, I gained lot of practical knowledge & valuable information from field study. I
came across & I learnt valuable things from several persons while doing survey in Rourkela area, where I
was posted. The time span was too short to explore & gather information’s & to prepare a detailed report.
Nevertheless I have tried to prepare only a brief report, which has increased my knowledge, concept &
experience.

Contents Page

CHAPTER-1 10-10
1) INTRODUCTION
2) MISSION 11-13
3) HISTORY 14-28
4) BOARD OF DIRECTORS 29-30
CHAPTER-2

1)PRODUCTS 31-38

2)MARKET AND COMPETITORS 40-41

3)MARKET SURVEY 42-43

4
 CHAPTER-3

1)SWOT ANALYSIS 46-47

2)RESEARCH METHODOLOGY 47-51

3)TECHNOLOGY IN BANKING 52-58

4)RECENT DEVELOPMENTS 58-59

5)SHARE HOLDING PATTERN OF HDFC 60-60

6)FINDINGS 61-61

7)SUGGESTIONS 61-62

8)CONCLUSION 62-63

9)BIBLIOGRAPHIE 64-64

10) APPENDIX 65-66

CHAPTER-1

1)INTRODUCTION

2)MISSION

3)HISTORY

5
 4)BOARD OF DIRECTORS

INTRODUCTION

HDFC Bank was incorporated in August 1994 in the name of 'HDFC Bank Limited', with its registered
office in Mumbai, India. The Bank commenced operations as a Scheduled Commercial Bank in
January 1995.
The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an
'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, as
part of the RBI's liberalization of the Indian BankingIndustryin1994.
Headquartered in Mumbai, HDFC Bank, has a network of over 531 branches spread over 228 cities
across India. All branches are linked on an online real-time basis. Customers in over 120 locations are
serviced through Telephone Banking. The Bank also has a network of about over 1054 networked
ATMs across these cities. HDFC Bank's ATM network can be accessed by all domestic and
international Visa / MasterCard, Visa Electron / Maestro, Plus / Cirrus and AmericanExpressCredit

6
Charge cardholders.

HDFC Bank has won many awards for its excellent service. Major among them are "Best Bank in
India" by Hong Kong-based Finance Asia magazine in 2005 and "Company of the Year" Award for
Corporate Excellence 2004-05.

MAN WITH A MISSION

An extract from the book 'A Tribute'

If ever there was a man with a mission it was Hasmukhbhai Parekh, our Founder and

Chairman-Eeritus, who leftm this earthly abode on November 18, 1994.

Born in a traditional banking family in Surat, Gujarat, Mr. Parekh started his financial
career at Harkisandass Lukhmidass – a leading stock broking firm. The firm closed down

7
in the late seventies, but, long before that, he went on to become a towering figure on the
Indian financial scene.

In 1956 he began his lifelong financial affair with the economic world, as General
Manager of the newly-formed Industrial Credit and Investment Corporation of India
(ICICI). He rose to become Chairman and continued so till his retirement in 1972.

At the ripe age of 60, Hasmukhbhai started his second dynamic life, even more illustrious
than his first. His vision for mortgage finance for housing, gave birth to the Housing
Development Finance Corporation – it was a trend-setter for housing finance in the whole
Asian continent.

He was a true development banker. His building up HDFC without any government
assistance, is itself a brilliant chapter in financial history. His wisdom and warmth drew
people from all walks of life to him, for advice, guidance and inspiration.

A soft spoken man of few words, Mr. Parekh nevertheless held strong and definite views
with a quiet conviction. He was always concerned with building bridges, improving and
encouraging communication between people.

He was also a writer in his own right. There are over 200 published articles by him, full
of incisive comments on finance and economics. In 1953 he brought out a volume called:
The Bombay Money Market. It detailed the intricate working of the Indian money
market. His works in Gujarati – Hirane Patro, Hirane Vadhu Patro – occupy pride of
place in Gujarati literature. In 1992, the Government of India honoured him with the
Padma Bhushan Award. The London School of Economics & Political Science conferred
on him an Honorary Fellowship.

But there was much more to the man than his financial genius. In his own unassuming
way, Hasmukhbhai devoted all his life to raising resources for philanthropic causes. He
was one of the Founder Members of the Centre for Advancement of Philanthropy, and its
Chairman till 1993. He took active interest in the Bombay Community Public Trust,
designed specifically to serve the needs of the city’s underprivileged citizens.

8
When Mr. Deepak Parekh took over as Chairman from Hasmukhbhai, he said: “Taking
over from H.T. Parekh is a formidable task; his vision… brought about not only an
institution, but an entire concept which has proved itself to be of lasting importance.”

In his last years, developments in the financial sector brought him some measure of
satisfaction. Says ICICI Chairman, N. Vaghul: “The most gratifying aspect about his life
is that values he cherished all his life, came into reality in the last years… opening up the
financial sector, and deregulation of lending rates were issues he stood for all his life, and
this happened before he passed away.”

Farewell dear Hasmukhbhai! All of us will miss not only H.T. Parekh the financial
wizard, but much more so, the man. The only and best tribute we can pay to such an
individual is to try and follow in his footsteps, keeping in mind his high ideals and
philanthropic outlook.

History

HDFC Bank was incorporated in August 1994 in the name of 'HDFC Bank
Limited', with its registered office in Mumbai, India. The Bank commenced
operations as a Scheduled Commercial Bank in January 1995.

9
1994

- The Bank was Incorporated on 30th August. A new private sector Bank promoted by
housing Development Corporation Ltd. (HDFC), a premier housing finance company.
The bank is the first of its kind to receive an in-principle approval from the RBI for
establishment of a bank in the private sector. Certificate of Commencement of Business
was received on 10th October 1994 from RBI.

- The Bank transacts both traditional commercial banking as well as investment banking.
HDFC, the promoter of the bank has entered into an agreement with National
Westminister Bank Pc. and its subsidiaries (Natwest Group) for subscribing 20% of the
banks issued capital and providing technical assistance in relation to the banks proposed
banking business.

1995

- 70 No. of equity shares issued to subscribers to the Memorandum & Articles of

Association on 30th August 1994. On the same date 500,00,000 equity shares were
allotted to HDFC promoters. 509,20,000 shares were allotted to HDFC Employees
Welfare Trust and HDFC Bank Employees Welfare Trust on 22nd December, 1994.

- On 16.1.1995, 90,79,930 No. of equity shares were allotted to Jarrington Pte. Ltd.
Another 400,00,000 equity shares were allotted on private placement basis to Natwest
Group on 9.5.1995. 500,00,000 shares were allotted to the public on 9.5.95 (all were
taken up).

- The Bank opened its first branch in Ramon House at Churchgate, Mumbai on January
16th.

- The Bank has created an efficient operating system using well tested state-of-the-art
software.

1996

10
- HDFC Bank has entered the banking consortia of over 50 corporates, including some
leading multinational companies, flagship companies of local business houses and strong
public sector companies.

- HDFC Bank has set up a state-of-the-art dealing room to handle all transactions possible
in Indian financial markets.

- The Certificates of Deposits were awarded a PP1+ rating which is the highest rating for
short term instruments indicating superior capacity for repayment.

1997

- The bank is one of the largest mobilisers of retail deposits through its network of 20
branches. Its credit deposits ratio was 53.8%.

- The bank has set up a ultra-modern hub at Powai in Mumbai where the bank's central
computer is housed. This hub housed in 35,000 square feet of space, houses data of all
the branches and facilitates the introduction of new products and services.

- HDFC has installed state-of-the-art systems to facilitate inter-connectivity between

branches and link up with on line system.

- The bank has also recently signed up as a depository participant, under the newly set up
NSDL, wherein the members clearing accounts settlement for dematerialised shares can
be done through the bank.

- HDFC Bank, one of the nine new-generation private sector banks, has planned to set up
an all-India on-line automated teller machine (ATM) network.

- HDFC Bank proposed to launch tele-banking for the first time in June in Mumbai at its
Chandiveli branch.

- HDFC Bank has drawn up plans to become a niche player in corporate banking by
sticking to top-rung corporates.

11
- HDFC Bank has become the first private sector bank to conclude a structured interest
rate option deal.

- HDFC Bank has launched its Versova branch, the 11th branch in Mumbai.

- HDFC Bank, as part of its expansion plans in the South, has opened another branch in
Chennai.

- HDFC Bank has entered into strategic alliances with 10 overseas banks to provide
customers with a wide range of derivatives including interest rate and foreign currency
swaps.

- HDFC Bank on October 14 introduced ATMs that converse in a regional language.

- HDFC Bank has introduced the Freedom Account for the average retail customer
located in the major metros as a means to wean away the middle-income market from
nationalised banks.

- HDFC Bank has launched an account in all its 28 branches across India that seeks to
free depositors from minimum balance requirement, for the first time in the country.

- HDFC has introduced a new loan product for the payment of betterment fees announced
by the Bangalore Mahanagar Palike. - HDFC Bank is all set to launch its debit card by
April 1998.

1998

- HDFC Bank has tied up with the Ahmedabad Stock Exchange (ASE) to act as its
clearing bank.

- HDFC Bank proposes to strengthen its branch network in Calcutta with the addition of
two new branches in the first quarter of the next fiscal.

12
- HDFC Bank has signed an agreement with the National Stock Exchange (NSE) which
will give it a second charge over the brokers deposit for providing loan against share
facility to NSE brokers.

- The bank has also entered into a similar understanding with the Bombay Stock
Exchange (BSE) whereby the bourse will provide support for recovery of money against
the card for loan against share facility.

- The bank has also entered into `Cirrus' arrangements by which all master card holders
across the globe will be able to transact at HDFC Bank in India.

- The bank will also provide phone-banking facility in Bangalore. HDFC has tied up with
Visa International to offer its Debit Card. - HDFC Bank Ltd has entered into a
memorandum of understanding for a strategic business collaboration with Chase
Manhattan Bank.

- HDFC Bank has become the first bank in India to link up its automated teller machine
(ATM) network with all the three major payment systems world-wide.

- HDFC Bank will be the first bank in the Asia-Pacific region to connect the American
Express (Amex) payment system.

- The HDFC Bank is expanding its ATM network to connect to American Express
Interchange based in Phoenix, Arizona, USA. With this connectivity, HDFC Bank has
become the first bank in the Asia-pacific region to connect to the Amex Interchange.

- HDFC Bank was the first to sign up with AMEX in December of 1998.

- The Bank has tied up with ITC Threadneedle Mutual Fund to provide its investors with
the High Interest Fund (HIF), a facility to encash their units through the bank's
Automated Teller Machines in addition to a cheque book facility also to be provided by
the bank.

13
- Sony India Ltd (SIL) has joined hands with HDFC Bank to work out an innovative car
finance package under which a sony car audio system would be installed to a new car for
no additional upfront cash outflow.

- The bank has decided to issue 1,33,10,000 equity shares of Rs. 10 each to HDFC and a
wholly-owned subsidiary of it at a price of Rs. 94 per share.

- The bank will also issue 13,70,000 equity shares to India Private Equity Fund and
51,20,000 shares to Indocean Financial Holding, the two equity funds controlled by
Chase Manhattan Bank.

- HDFC Bank, has tied up with BPL Ltd to offer Internet-enabled supply-chain
management and business-to-consumer (B2C) e-commerce services to corporates.

- Hutchison Max Telecom and HDFC Bank introduced the country's first-ever mobile-
banking services in the city.

2000

- HDFC Bank also signed a memorandum of understanding with Singapore Telecom's e-

commerce arm Sesami.Com Pvt Ltd. - The Bank latter also entered into a partnership
agreement with National Computer Systems, the e-commerce unit of Singtel.

- A new company called SESAMi.com (India) has been formed by a strategic alliance
between HDFC Bank and Singapore Telecom's e-commerce company SESAMi.com, to
offer e-commerce solutions for the Indian market.

- HDFC Bank has a tie-up with Maxtouch for giving the facility to the latter's customers
in Mumbai. This is the first and only service of this sort in the country, he said.

- HDFC Bank is also launching an online electronic banking solution called Enet which
will allow corporates to access their accounts over the net and carry out trade related
transactions and cash management functions.

14
- HDFC Bank entered into a tie-up with Telco by which the bank would provide
preferential financing options for Tata's range of passenger cars including the Indica,
Sumo, Safari, Estate and Sierra.

- HDFC Bank allotted 1.98 crore shares of Rs 10 each at an issue price of Rs 94 per share
to promoters and strategic investors on March 29.

- HDFC Bank is also set to become the first bank in the country to offer wireless
application protocol (WAP) services to customers.

- SkyCell Communications Ltd, one of the two cellular service providers in Chennai, has
launched `Sky Banking', for which the company has tied up with ICICI Bank and HDFC
Bank.

- The bank has tied up with 12 utility companies nationwide including BSES, MSEB,
BEST, Orange, BPL and MTNL.

- The Bank has tied up with financial portals, e-brokerages and the National Stock
Exchange to enable broker payments for e-broking ventures. - The Bank has set up 100
new electronic data capture (EDC) terminals in Mumbai. - HDFC Bank has launched its
first B2C payment gateway which allows Visa and MasterCard credit card-holders to do
transaction online and realtime. - CYBERITMALL.COM has joined hands with HDFC
Bank to provide VISA/MasterCard users with an online payment gateway solution to
enable them to have a secure eshopping experience. - HDFC Bank plans to extend its
mobilephone banking services introduced in select metros to mobilephone broking when
it introduces its Internet on-line trading in July. - HDFC Bank and portal
clickforsteel.com have signed a memorandum of understanding for offering online credit
and services to facilitate `post transaction' activities through the portal's `allied services
providers' programme. - Indianfoline.com signed an agreement with HDFC bank for the
use of payment gateway to enable online financial transactions.

15
- HDFC Bank, in association with cellular service provider Orange, has launched the
entire range of mobile banking services and mobile commerce services using wireless
application protocol (WAP) technology.

- The Company has introduced a new scheme whereby it will provide loans to individuals
for payment of self assessment tax on their properties in Bangalore.

- The Foreign Investment Promotion Board has cleared the proposal of the HDFC Group
to enter into a joint venture with Singapore Telecom's e-commerce company for
providing a comprehensive range of business-to-business e-commerce solutions to
companies in India.

- The Company proposes to pick up an equity stake in Softcell Trade and Technologies
Ltd., a Mumbai-based software company.

- BPL Mobile has tied up with HDFC Bank to offer Internet banking through the mobile
phone.

- HDFC Bank launched `eInstant Car Loans' a new scheme for offering customers a
range of net-enabled loan products.

- HDFC Bank launched depository services on the net.

- HDFC Bank tied up with NSE.IT, a wholly owned subsidiary of the National Stock
Exchange, for providing payment gateway services for the latter's Internet trading
operations.

- HDFC Bank has been identified as the best domestic commercial bank for the second
consecutive year by FinanceAsia.com, which provides a network for financial decision
makers.

- The Mumbai-based Geojit Securities Ltd. has tied up with HDFC Bank for Internet
trading of shares.

16
- Calcutta's cellular services provider Modi Telstra, and HDFC Bank have entered into a
collaboration to provide mobile commerce in Calcutta.

- HDFC Bank has got the Kerala-based Nedungadi Bank as its first customer for its new
joint venture company with I-Flex Solutions.

- HDFC Bank has set a target of attaining a business of over Rs 15,000 crore this fiscal
mainly through expansion and new product launches, including a credit card.

- HDFC Bank, in association with Tata Cellular, has launched Mobile Commerce
Service, for customers in Hyderabad and Vishakaptnam.

- HDFC Bank has tied up with about 25 equity brokerages for enabling third party
transfer of funds and securities through its business-to-business portal -- `e-Net'.

- The Bank has entered into an alliance with Deloitte Haskins and Sells, a member firm
of Deloitte and Touch, to offer banking services to its non-resident Indian customers.

- HDFC Bank has launched its 123rd outlet at Delhi Stock Exchange building at Asaf Ali
Road.

- The Bank proposes to acquire up to 24.5 per cent stake in the MIEL e-Security Pvt.
Ltd., which is engaged in the business of developing and marketing of security products
and services for a range of e-commerce and enterprises security applications.

- The Bank has tied up with Rajan Raheja-owned Hathway for providing banking at
home as part of the Net-over-cable initiative of the latter in Mumbai. - HDFC Bank
launched its on-line bill payment facility in alliance with the Maharashtra State
Electricity Board has also begun to offer bridge loans against fixed deposits of parent
Housing Development Finance Corporation the financial institution.

- HDFC Bank has tied up with portal brainvisa.com to retail education loans to students. -
The Gujarat Cellular operator Fascel, has signed up with the HDFC Bank to introduce
mobile commerce for the first time in the State.

17
- HDFC Bank has tied up with BPL Mobile for mobile commerce facility.

- CricketNext.com, a sports e-commerce site has tied up with HDFC Bank to provide an
on-line payment gateways and marketing opportunities for a wide range of cricket sports
gear on its on-line shop BatNext.

- Singapore-based Growasia.com has entered into an understanding with HDFC Bank and
credit rating agency Icra, for picking up equity in the company's Indian subsidiary
Gasia.com.

- The Bank has launched `Freedom - The e-Age Savings Account' for cellular phone
users.

- Spice Cell has tied up with Citibank N A, HDFC Bank and ICICI Bank for mobile bill
settlements.

- HDFC Bank and Cosmos Bank launched a co-branded ATM card.

- The Chatterjee Group-promoted Captech Online Ltd. has signed memorandum of

understanding with HDFC Bank and UTI Bank for setting up a payment gateway for its
debt negotiation platform, Riskxpress.com.

- HDFC Securities Ltd., promoted by the HDFC group with equity participation from the
Housing Development Finance Corporation Ltd., HDFC Bank and Chase Capital
Partners, has launched its brokerage services for retail investors in the Capital.

- The HDFC Bank and Airtel launched their mobile-banking service through WAP in
Delhi.

- HDFC Bank has launched wireless application protocol-based mobile-banking in

Coimbatore and Trichy in association with Aircel.

2001

- The Bank has opened its first branch in Aurangabad.

18
- HDFC Standard Life Insurance has entered into a memorandum of understanding with
the Chennai-based Indian Bank.

- The Bank has launched the international Maestro debit card in association with Master
Card.

- HDFC Bank will launch its credit card in June through link-ups with MasterCard and
Visa.

- LTtrade.com has entered into a strategic tie-up with HDFC Bank to provide Net
banking services to online investors.

- Standard Chartered Bank, HDFC Bank and Bharat Petroleum Corporation have joined
the eCash Forum which has been set up by the Smart Card Forum of India.

- HDFC Bank has launched a new campaign for its eage savings account.

- HDFC Bank entered into a strategic tie-up with Tally Solutions Pvt. Ltd. to offer online
real time accounting services to small and medium enterprises.

- The Bank has opened four ATMs outlets in Bangalore at Coles Road, RT Nagar, Rajaji
Nagar and Jaya Nagar on March 26.

- HDFC Standard Life Insurance has launched a `Development Insurance Plan' a low cost
life insurance product developed specifically to meet the needs of economically weaker
sections.

- Two Directors, Mr. S.S. Thakur and Mr. Amit Judge, have resigned from the board of
the bank effective from March 30.

- HDFC Bank files with US regulators to list more than 11 million American Depositary
Shares on the New York Stock Exchange.

2002

19
- HDFC Bank unveiled a new online account aggregation service `OneView'.

- HDFC launched 'One View' service to customers

- HDFC Bank launched its 9th branch in Karnataka.

- HDFC opens its branch in Mangalore.

- HDFC Bank unveils Silver card in Hyderabad.

- HDFC Bank opens first overseas representative office.

- HDFC Bank unveils gold card

- Mediclaim facilities to HDFC Bank gold cardholders.

- HDFC Bank Ltd has informed BSE that Mr Deepak Satwalekar has submitted his
resignation as Director of the Bank. The Board of Directors has accepted the same. The
Board of Directors has co-opted Mrs Renu Karnad as Additional Director of the Bank.

- Mrs. Renu Karnad has been co-opted as an Additional Director of the Bank. Mrs
Karnad shall represent the promoters of the bank i.e. HDFC Ltd. Also Mr. Deepak
Satwalekar, Managing Director of HDFC Standard Life Insurance Company Ltd, has
been on the Board of the Bank as nominee of HDFC Ltd since September 12, 1994 and
shall complete the period of 8 yrs before the next scheduled board meeting. In view of the
provisions of the Banking Regulation Act, 1949, Mr. Satwalekar has submitted his
resignation as Director of the Bank and the Board has accepted the same.

- HDFC Bank launched new products to its wealth management programme to increase
its customer base. The bank introduced a non-interactive product named "Financial
Planner", which would be available for all its customers for an annual fee starting from
Rs 10,000. The bank is offering fee based advisory programme to the "mass affluent"
segment, which was earlier offered to high net worth customers. The wealth management
programme would cater to individual needs taking into account various factors such as

20
customer's age, financial goals and risk profile, which includes equity, MFs and debt
instruments such as RBI Relief Bonds.

- Orange JV with HDFC Bank.

2003

- HDFC Bank unveils resident foreign currency account.

- HDFC Bank unveils co-branded credit card with e-Seva.

- The Board of Directors of HDFC Bank Ltd at their meeting held on January 15, 2003
approved the appointment of Mr. Arvind Pande as an Additional Director pursuant to
section 260 of the Companies Act, 1956.

- EPFO JV with HDFC Bank for its pension distribution.

- HDFC enters into agreement with HDFC Bank to source housing loans.

- HDFC Bank, IRCTC in tie up for online railway booking.

- HDFC Bank inks pact with ANB for remittance service

- HDFC Bank introduces 'HDFC Bank Health Plus Credit Card'.

- Uma Krishnan resigns HDFC Bank as country head.

- Escotel ties up with HDFC Bank for Global Debit Card.

- HDFC Bank launches India's first mobile payment solution.

- HDFC Bank's debt programme of Rs 400-crore has received triple A (ind) rating from
CREDIT rating agency FITCH.

-Mumbai - HDFC Bank in collaboration with Tally Solutions is planning to launch

electronic data interchange (EDI) system for small and medium enterprises (SMEs).

21
-Warburg Pincus sells 2% stake in HDFC for Rs 235 cr

- HDFC Bank began selling home loans of its promoter Housing Development Finance
Corporation (HDFC).

-Board approved to allot 4,16,400 equity shares to the employees of the Bank under the
Employee Stock Option Scheme

2004

-Mr Ranjan Kapur & Mr Bobby Parikh appointed as Additional Directors

-NMCE inks pact with HDFC Bank for warehouse receipts

- HDFC Bank has entered into an alliance with Clearing Corporation of India Ltd
(CCIL). The tie-up offers the latter's collateral borrowing and lending obligation (CBLO)
product to cooperative banks that are not direct members of the negotiated dealing system
(NDS).

-HDFC Bank repurchases HDFC loans worth Rs 208 cr

-Launches Quickremit, a unique online service that enables NRIs in the US to send
money to their relatives in India from the comfort of their homes.

-Andhra Bank has entered into an alliance with HDFC Bank for sharing its network of
automated teller machines (ATMs). On March 29, 2004

- HDFC Bank and Bahraini Saudi Bank (BSB) have announced an alliance to cater to
service the needs of the non-resident Indians (NRIs) in Bahrain.

- HDFC bank Ltd has informed that Dr (Mrs) Amla Samanta has ceased to be a director
of the Bank wef April 25, 2004.

- HDFC Bank launches new scheme for Maruti 800 buyers, providing 85 per cent finance
on the on-road price of the car for seven years.

22
-HDFC Bank wins Asiamoney award for Best Domestic Bank

-HDFC Bank managing director Aditya Puri has been awarded the management man of
the year by the Bombay Management Association (BMA)

-HDFC Bank has entered into an agreement with Shrachi Securities Ltd, the flagship
company of the Kolkata-based Rs 300-crore Shrachi Group, for financing of multi-utility
vehicles all over India

-HDFC Bank has launched an online bill payment facility for its customers who are also
subscribers to Tata Teleservices

-HDFC Bank join hands with NCR Corporation to offer managed ATM services

- IKF Finance Ltd has entered in to a Joint Lending Arrangement with HDFC Bank Ltd

2005

-TMB forges alliance with HDFC Bank

-HDFC Bank inaugurates first ATM in Hotel

- HDFC Bank ties up with the International Bank of Qatar (IBQ) to launch banking
services in Qatar.

- HDFC Bank launches loyalty rewards programme for its debit and credit cardholders
under the name InstaWonderz.

-HDFC Bank along with MasterCard International launched credit card targeted at small
and medium-sized enterprises

-HDFC Bank has tied up with US-based WL Ross and company LLC for investing in
corporate restructuring

-HDFC Bank unveils credit card for farmers

23
2006

-HDFC sets up two more branches in AP

2007

-HDFC Bank has signed an agreement with Tata Pipes to offer credit facilities to farmers
across the country.

-Hdfc Bank Ltd has appointed Mr. Pandit Palande as an additional Director of the Bank
at the Board Meeting

The Housing Development Finance Corporation Limited (HDFC) was amongst the first
to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a
bank in the private sector, as part of the RBI's liberalization of the Indian Banking
Industry in 1994.

Headquartered in Mumbai, HDFC Bank, has a network of over 531 branches spread over
228 cities across India. All branches are linked on an online real-time basis. Customers in
over 120 locations are serviced through Telephone Banking. The Bank also has a network
of about over 1054 networked ATMs across these cities. HDFC Bank's ATM network
can be accessed by all domestic and international Visa / MasterCard, Visa Electron /
Maestro, Plus / Cirrus and American Express Credit / Charge cardholders.

HDFC Bank has won many awards for its excellent service. Major among them are "Best
Bank in India" by Hong Kong-based Finance Asia magazine in 2005 and "Company of
the Year" Award for Corporate Excellence 2004-05.
27
.

Board of Directors

24
The Board of Directors comprises fourteen members, of which eleven are non-executive
directors. The three executive directors
Include the Chairman, the Managing Director and the Executive Director. Of the eleven
non-executive directors, nine are independent
Directors. The independent directors have confirmed that they satisfy the criteria laid for
independent director as stipulated in
Clause 49 (I) (A) (iii) of the listing agreements.
The directors bring to the board a wide range of experience and skills. Brief profiles of
the directors are set out elsewhere in the
annual report. The composition of the board is in conformity with the listing agreements.
Details of the Board of Directors in
terms of their directorships/ memberships in committees of public companies (excluding
HDFC) are as under:
Sr. No. Directors No. of No. of Committees
Directorships Member Chairperson
1 Mr. Deepak S. Parekh (Chairman)
2 Mr. Keshub Mahindra (Vice Chairman)
3 Mr. Shirish B. Patel
4 Mr. B. S. Mehta
5 Mr. D. M. Sukthankar
6 Mr. D. N. Ghosh
7 Dr. S. A. Dave
8 Mr. S. Venkitaramanan
9 Dr. Ram S. Tarneja
10 Mr. N. M. Munjee
11 Mr. D. M. Satwalekar
12 Dr. Vijay L. Kelkar
13 Ms. Renu Sud Karnad (Executive Director)
14 Mr. K. M. Mistry (Managing Director)

25
MAJOR PRODUCTS AND SERVICES
HDFC Bank caters to a wide range of banking services covering commercial and
investment banking on the wholesale side and transactional / branch banking on the
retail side. The bank has three key business areas:-

(a) WHOLE SALE BANKING SERVICES

The Bank's target market is primarily large, blue-chip manufacturing companies in
the Indian corporate sector and to a lesser extent, emerging mid-sized corporate. For
these corporate, the Bank provides a wide range of commercial and transactional
banking services, including working capital finance, trade services, transactional
services, cash management, etc. The bank is also a leading provider of structured
solutions which combine cash management services with vendor and distributor
finance for facilitating superior supply chain management for its corporate customers.
Based on its superior product delivery / service levels and strong customer
orientation, the Bank has made significant inroads into the banking consortia of a
number of leading Indian corporate including multinationals, companies from the
domestic business houses and prime Public Sector companies. It is recognised as a
leading provider of cash management and transactional banking solutions to corporate

26
customers, mutual funds, stock exchange members and banks.

(B) RETAIL BANKING SERVICES

The objective of the Retail Bank is to provide its target market customers a full range
of financial products and banking services, giving the customer a one-stop window
for all his/her banking requirements. The products are backed by world-class service
and delivered to the customers through the growing branch network, as well as
through alternative delivery channels like ATMs, Phone Banking, Net Banking and
Mobile Banking.

The HDFC Bank preferred program for high net worth individuals, the HDFC Bank
Plus and the Investment Advisory Services programs have been designed keeping in
mind needs of customers who seek distinct financial solutions, information and
advice on various investment avenues. The Bank also has a wide array of retail loan
products including Auto Loans, Loans against marketable securities, Personal Loans
and Loans for Two-wheelers. It is also a leading provider of Depository Services to
retail customers, offering customers the facility to hold their investments in electronic
form.

HDFC Bank was the first bank in India to launch an International Debit Card in association with
VISA (VISA Electron) and issues the MasterCard Maestro debit card as well. The debit card
allows the user to directly debit his account at the point of purchase at a merchant establishment, in
India and overseas. The Bank launched its credit card in association with VISA in November 2001.
The Bank is also one of the leading players in the "merchant acquiring" business with over 25,000
Point-of-Sale (POS) terminals for debit / credit cards acceptance at merchant establishments. The
Bank is well positioned as a leader in various net-based B2C opportunities including a wide range
of internet banking services for Fixed Deposits, Loans, Bill Payments.

(C) TREASURY OPERATION

27
 Within this business, the bank has three main product areas - Foreign Exchange and Derivatives,
Local Currency Money Market & Debt Securities, and Equities. With the liberalization of the
financial markets in India, corporates need more sophisticated risk management information,
advice and product structures. These and fine pricing on various treasury products are provided
through the bank's Treasury team. To comply with statutory reserve requirements, the bank is
required to hold 25% of its deposits in government securities. The Treasury business is responsible
for managing the returns and market risk on this investment portfolio.

Accounts and Deposits

Banking should be effortless. With HDFC Bank, the efforts are rewarding. No matter
what a customer's need and occupational status, we have a range of solutions that are
second to none.

Whether you're employed in a company and need a simple Savings account or run your
own business and require a robust banking partner, HDFC Bank not only has the perfect
solution for you, but also can recommend products that can augment your planning for
the future

Savings Accounts
These accounts are primarily meant to inculcate a sense of saving for the future,
accumulating funds over a period of time. Whatever your occupation, we are confident
that you will find the perfect banking solution. Open an account in your name or register
for one jointly with a family member today.
Regular
Salary
Savings Plus
Classic
Payroll
No Frills

28
Regular
Retail Trust
Premium
Kids Advantage
Defense
Pension Savings

Current Accounts

Now, with an HDFC Bank Current Account, experience the freedom of multi-city
banking! You can have the power of multi-location access to your account from any of
our 684 branches in 316 cities. Not only that, you can do most of your banking
transactions from the comfort of your office or home without stepping out.

We make it our business to help you with your business by offering you a Current
Account with all the benefits you need to stay ahead of your competition.

At HDFC Bank, we understand that running a business requires time and money, also
that your business needs are constantly evolving. That's where we come in. We provide
you with a choice of Current Account options to exclusively suit your business -
whatever the size or scope.

Open an HDFC Bank Current Account & control your business operations centrally.
Plus
Trade
Premium Regular
RFC Domestic
Choose the product most suitable for you:

Fixed Deposits

29
Long-term investments form the chunk of everybody's future plans. An alternative to
simply applying for loans, fixed deposits allow you to borrow from your own funds for a
limited period, thus fulfilling your needs as well as keeping your savings secure.
Regular Fixed Deposit
Super Saver
Sweep-In
5 Year Tax Saving Fixed Deposit

DEPOSIT PRODUCT

HDFC has instituted well-defined service standards for both depositors and deposit agents. HDFC has

been able to mobilise deposits from over 10 lac depositors. Outstanding deposits grew from Rs. 1,458

crores in March 1994 to Rs 8,741 crores in March 2006. Much of this success can be attributed to its

strong brand image, superior services, security and above all, the significant contribution made by

HDFC's deposit agents. HDFC has over 50,000 deposit agents and distributes all its retail savings

(deposit) products primarily through this channel.

HDFC has been awarded “AAA” rating for its deposits from both CRISIL and ICRA for the

TWELFTH consecutive year , representing highest safety as regards timely payment of principal and

interest.

Benefits of an HDFC Individual Deposit:

1.Highest Safety
2.Tax Benefits
3.Attractive Returns
4.Quick Loan Facility
5.Nomination Facility

30
6.Demand Draft Facility
7.High Service Standards
8. Electronic Clearing Service

HIGHEST SAFETY

'FAAA' and 'MAAA' rating affirmed for the twelfth consecutive year by CRISIL and ICRA

respectively.

Tax Benefits: TDS: No tax deduction at source on interest from deposits upto Rs. 5,000/- per branch

in a Financial Year.

Attractive Returns:

HDFC deposits are Available throughout the year and offer Attractive, Assured returns to investors.

Interest rates offered are higher than that offered by most of the commercial banks.

Quick Loan Facility:

Loan against deposit is available after 3 months from the date of deposit upto 75% of the deposit
amount subject to the other terms and conditions framed by HDFC. Interest on such loans will be 2%
above the deposit rate.

*This facility is not available for Easyway Savings and deposits from minors.

Nomination Facility:

31
Individual depositors, singly or jointly, can nominate under this facility. In case the deposit is placed in
the name of a minor the nomination can be made only by a person lawfully entitled to act on behalf of
the minor. Power of attorney holder or any person acting in representative capacity as holder of an
office or otherwise cannot nominate. The nominee shall have the right to receive the amount due in
respect of deposit on death of all the depositors and payment by HDFC to the nominee shall constitute
full discharge to HDFC of its liability in respect of the deposit.

Demand Draft Facility:

Outstation depositors can send demand drafts after deducting demand draft charges. This facility is not
available to investors under Easy way Savings. This facility is applicable for places where HDFC does
not have an office.

High Service Standards:

Depositors are offered across the counter services for new deposits, renewals, repayments and loan
against deposit facility. Further, all enquiries through email, post, telephone and in person are attended
to immediately.

Electronic Clearing Service:

This facility is provided to depsoitor's in select centres whereby the interest will be credited directly to

the depositors' bank account. The depositor would receive a credit entry "ECS HDFC" in his

passbook/bank statement. Intimation of interest credited would be sent on an annual basis. Your bank

will not levy any charge for this facility as per present RBI guidelines.

Presently this facility is being offered by us at the following centers -

ECS Centres : Ahmedabad, Bangalore, Bhubaneshwar, Kolkata, Chandigarh, Chennai, Hyderabad,
Jaipur, Kanpur, Mumbai, Nagpur, Nasik, New Delhi, Pune and Vadodara. Short-Term Bridging loan

32
makes you realise your dream of buying a bigger and better home and gives you time to sell your
existing property to pay off the loan.
This is a short term loan to help customers with the interim period between the sale of your old home
and the purchase of a new home. You can take the loan even if you are an existing customer of HDFC

Features

• Maximumloan

90% of cost of new property

• MaximumTerm

2 years

• Applicant and Co- Applicant to thloan

Home Loans can be applied for either individually or jointly. Proposed owners of the property,

will have to be co-applicants. However, the co-applicants need not be co-owners.

33
 CHAPTER-2

1) PRODUCT

2) MARKET AND COMPETITORS

3) MARKET SURVEY

4) OPERATIONAL HIGHLIGHTS

MARKETS& COMPETITORS

The advance estimates of GDP growth for the year 2006-07 is 8.1 % over the previous year. This places India firmly

amongst the fastest growing economies in the world during the current year. The buoyancy has been

spread across most sectors of the economy. The inflationary situation has been benign in 2006- 07.
On the commercial credit front, there have been some signs of pick-up in credit off-take in recent
months. The growth has been in non-food credit whilst food credit witnessed a fall of around 30%. The
growth in non-food credit is principally because of surge in retail lending, particularly in housing.

34
However, credit to industry declined despite the industrial recovery probably due to large internal
accruals and increasing Dis-intermediation. The growth in non-food credit has not led to a rise in
interest rates due to matching growth in bank deposits that has kept liquidity easy. Bank deposits have
grown over 15% this fiscal.
The financial markets continue to remain generally stable. The average call money rate moved
down by a little over 20 basis points. The yield on treasury bills of different maturities has declined,
while the yield on Government securities with 10-year residual maturity has marginally firmed up. In
fact, a slight steeping of the yield curve is noticeable with shifts in yield at the very long-end. By and
large, the behavior of the fixed income market has been in consonance with the monetary policy stance.
The uncertainties relating to the currency movements of major currencies have increased. Continuing
forex inflows both on the current and capital account has seen upward pressure on the rupee. The RBI
has kept a constant check on the appreciating rupee and continuously intervened by way of regular
dollar purchases. Notwithstanding the appreciation of the rupee against the US dollar, exports still grew
over 8 per cent over the last fiscal. This was achieved because while the rupee appreciated against the
US dollar, it depreciated against its competitor currencies, especially with that of Asian and Latin
American countries, giving India the relative advantage in merchandise exports.
All in all the Indian economy has demonstrated considerable resilience to exogenous shocks in
the last fiscal and is poised for growth. At present, there are 27 Public sector banks, 31 Private Banks
and 29 foreign banks operating in India. Some of the key players in banking sector are as follows:

Public Sector Banks: Bank of Baroda, Bank of India, Corporation Bank, Oriental Bank of Commerce,
State Bank of Hyderabad, State Bank of India, Dena Bank.

Private Sector Banks: Global Trust Bank, HDFC Bank, ICICI Bank, IDBI Bank, IndusInd Bank, Centurion Bank.

35
MARKET SURVEY OF EXISTING & NON EXISTING

CUSTOMER IN ROURKELA FOR HDFC BANK

1- TOTAL CUSTOMER WITH HDFC BANK IN A SAMPLE OF 100

80%

70%

60%

50%

40% Series1

30%

20%

10%

0%
HAVE SAVIN A/C DON’T HAVE

INTERPRETATION :

36
I have surveyed around 100 people of Rourkela in Udit nagar, Panpose, Sector area and found that
around 18% of the people having saving A/C in HDFC Bank and 72% of the people do not have their
A/C have in HDFC Bank and rest of the people do not want to divulge about their deposits.

2-PROBLEM FACED BY THE EXISTING A/C HOLDER

45%
40% 40%
35%
30% 30%
25% 25%
20%
15%
10%
5% 5%
0%
HEAVY HIDDEN TOO MANY PHONE CALL
DEPOSIT CHARGES SCHEME
AMMOUNT

Series1

INTERPRETATION

The above graph reveals that 25% of the people are having problem with heavy deposit
amount. 30% people facing problem due to hidden charges of the Bank. 40% people
claim about too many schemes in HDFC Bank. 5% People complained that their phone
calls are not entertained.

37
 CHAPTER -3

1)SWOT ANALYSIS

2)RESEARCH METHODOLOGY

38
 3)TECHNOLOGY IN BANKING

4)RECENT DEVELOPMENTS

5)SHARE HOLDING PATTERN OF HDFC

6)FINDINGS

7)SUGGESTIONS VS RECOMMENDATIONS

8)CONCLUSION

9)BIBLIOGRAPHIE

SWOT ANALYSIS

Strengths:

1) Enough reserves necessary for mergers. Achieving double benefits of risk management and consolidation.

2) One of the two Indian private banks which are listed in NYSE.

3) Parent company (HDFC) being the market leader in house loan area all over the world.

4) CAR (Capital Adequacy Ratio) well ahead of the regulated level.

5) Tie ups with different business houses like RELIANCE (mobile banking), TRAVELEX (currency

exchange), and TAIB (Online stock trading).

6) Inflow of funds through ADR route.

Opportunities:

39
 1) Large untapped market left out for venturing into specifically rural market.

2) Emerging new areas like mutual funds, insurance, asset liability management, corporate banking and

complete financial services.

3) Increase in FDI limit to 74%. This can bring in foreign investment

Threats:

1) New competitors entering into the market in the form of foreign banks in order to tap the Indian market.

2) Compliance with RBI and government regulations and norms.

3) Introduction of Basel -2 norms will bring in new supervisory and transparency hassles which banking

industry in general have to face.

Weakness

(1) :Rise in NPA in retail segment.

(2) Volatility of interest rates and interest risk attached with it

RESEARCH METHODOLOGY

TO TEST THE SIGNIFICANCE OF VARIOUS ACCOUNTS PLANN OF HDFC

BANK IN CUSTOMER SATISFACTION (CHI SQUIRE TEST)

In a feed back of customer of a HDFC BANK in a certain area, of Rourkela satisfactions are big issue in the holding

customer.

40
I did a survey on the hundred people in Rourkela who are account holding customer of the bank. And, I did survey

on two famous account of the bank these are SAVING ACCOUNTS and CURRENT ACCOUNTS .The result of

satisfaction level is given below.

Treatment Customer satisfied Not satisfied Total

CURRENT ACCOUNTS 29 21 50

SAVING ACCOUNTS 34 16 50

Total 63 37 100

Now, we will discuss the satisfaction of the customer in the selection of above accounts of the HDFC BANK.

H0 : Let us take the null hypothesis that selection of accounts is not issue in customer satisfaction view. Applying

CHI SQUARE test.

H1: and our alternative hypothesis is, accounts option does matter in customer satisfaction

S.N. OBSERVED EXPECTED 2 2

FREQUENCY Oi FREQENCY Ei (Oi – Ei) (Oi- Ei)/Ei

1 29 31.5 6.25 .19

2 34 31.5 6.25 .19

3 21 18.5 6.25 .33

41
4 16 18.5 6.25 .33

TOTAL 1.04

2
So, calculated value of CHI SQUARE = ∑ (Oi- Ei) /Ei = 1.04

And degree of freedom is 1. Calculated value is less than tabulated value. Tabulated value of CHI SQUARE is 3.84

at 5%level of significance and one degree of freedom. So the hypothesis is accepted.

INTERPRETATION -So the hypothesis is accepted .Hence customer is not completely satisfied by the various

plans. From above result we can conclude that HDFC SAVING ACCOUNTS gets much nod than HDFC

CURRENT ACCOUNTS.

TO TEST THE SIGNIFICANCE OF THE MEAN OF A RANDOM SAMPLE OF

AGE OF THE ACCOUNTS HOLDER IN HDFC BANK

(t –DISTRIBUTION)

In a survey of accounts holder of HDFC BANK in the certain area. I got surprised result those, who have account in

HDFC BANK there age is vary from 28 to 60 years.

I am doing a test on age of the customer,

My test is supposed that all 100 customer has average life is 38 years with a standard deviation of 10 years. A

random sample of 6 customers gave me the following values

SAMPLE S6 S8 S10 S17 S28 S37

AGE 55 39 40 50 45 30

42
Let us take the hypothesis that there is no significance difference in the mean life of customer in the sample and that

of the population. Applying t-test

(X -µ) _

t = --------- √n where X- The mean of the sample

S µ -The mean of the population

S - Standard deviation

CALCULATION OF X AND S.

_
X 2
(X- X)
X

55 11.7 136.89

39 - 4.3 18.49

40 -3.3 10.89

50 6.7 44.89

45 -1.7 2.89

30 -13.3 176.89

∑ X =260 2

∑ X = 390.94

So the mean of the sample = 43.3

And standard deviation = 9.83

Now we shall calculate the statistics t = 1.24

And degree of freedom is v = n-1 = 6-1 = 5

43
And tabulated value of t distribution is 4.032 at 1% level of significance and 5 degree of freedom.

The calculated value of t is less than the table value .the hypothesis is accepted .so there is the significance

difference in the age of customer of the HDFC BANK.

INTERPRETATION- From the above result we see that wide range in the age group has account in the HDFC. So

it is essential for the bank to provide feasible solution and beneficial plan for all age of group.

TECHNOLOGY IN BANKING

1-Network

Based on the bank's hub & spoke architecture for the network, the branches are distributed under different regions

and each major location has a regional hub. The branches falling under a location connect to the hub at the main

region. These hubs then connect to the central site (data center) using a combination of 2 Mbps and 64 Kbps pipes,

depending on the total volume of the transactions that pass through.

C.N. Ram, Head-Information Technology, HDFC Bank says, "Each branch is connected to their regional hub, as to

connect every branch directly to the data center involves huge costs. This kind of architecture helps save cost."

A highlight of HDFC Bank's network is the presence of two or more hubs in one location. "To balance the load and

reduce the dependency on a single line, the bank has two hub locations within a region to share the load. The

branches are split between the two hubs, so that one hub failure does not incapacitate all the branches in that

region," explained C.N. Ram.

A step ahead

44
In the coming years HDFC Bank plans to deploy connections, with built-in redundancy in the network. For

example, Madras could be connected to Bangalore and Kolkata, with all three of them being connected to

Chandivili. Therefore, if the Kolkata-Chandivili link fails, then Kolkata will use the Madras link to connect to the

Chandivili data center.

The bank is also considering alternate connectivity solutions as VSATs are relatively more expensive, and in remote

areas it is difficult to set up the required infrastructure.

The bank has tested CDMA and GSM solutions—specially for ATMs as they consume very small bandwidths.

The bank's servers have also undergone phases of development inline with the bank's expansion plans.

2- Servers

The bank started with applications on SCO-Unix boxes from Compaq almost eight years back. The software then

used was MicroBanker from i-flex Solutions (then called CITIL). The set-up supported about 10 branches initially.

"With an expansion in the number of branches the bank felt the need to consider Unix/RISC boxes rather than an

Intel/SCO Unix platform, and selected the Sun platform. Since then the bank has been running applications on a Sun

platform," said C.N. Ram.

With the growth in transaction volumes, number of branches and the number of users the hardware platform has

also been upgraded. Till recent times the database was operating on a direct attached storage (DAS), and from 1st

April 2003 the bank switched to storage attached network (SAN).

45
The bank's earliest server was a Sun Ultra 170; over time it moved to Sun Ultra 3500, 4500, and then Sun E10 K.

Now the applications run on Sun's Star Fire 15K Server.

3-Banking applications

The bank uses separate software for corporate and retail banking as there was no single package that met both their
business requirements.

On the corporate side HDFC Bank started with MicroBanker and then moved to Flexcube in 2002. They use
Flexcube UBS, which operates on a Compaq Alpha box-GS160. This database was also on DAS and was moved to
SAN over last year (December 2002). The bank uses SAN solutions from Hitachi Data Systems. On the retail side
the bank uses Finware from i-flex solutions.

The bank did not face any serious migration issues as they use upgraded products or new products usually from the
same vendors. The vendors have programs that enable the migration or upgrades.

"When HDFC Bank had acquired Times Bank in 2000 all the Times Bank customers were shifted from their
package (called Kapiti) to HDFC Bank's Finware and MicroBanker. We had the vendors develop the software
required to migrate the data from Kapiti to Finware so that the task for the operating departments was greatly
reduced and the conversion was done in a short space of three months with minimum disruption to customer
service," said C.N. Ram.

4-Storage

The bank currently deploys SAN but feels they will need to consider NAS sometime in the future. According to C.
N. Ram the bank's storage requirement is growing at a rate of four to five percent every month. With an increase in
data volume, the capacity of the hardware also needs to be updated. This calls for huge investments as all areas like
backup, disaster recovery and others need to be addressed. The bank has to store data for seven years as per the RBI
guidelines, and as it is not necessary to store the data on-line—the bank uses tapes for off-line storage. The bank
anticipates storage costs to come down, and bulk purchases would be economical.

Disaster Recovery setup

46
C.N. Ram says, "Our approach is that we need to protect our data first as the basis for a business continuity plan."

The bank has a disaster recovery (DR) site at Chennai. The data at the main center is replicated in real-time on-line
at the Chennai site. The data is stored on the servers at the DR site and the database is constantly replenished. If
some disaster was to occur, data (up to the last second) will be replicated, and be available. This gives both, the
bank and the customer a feeling of security.

Security at HDFC Bank

Pre-Internet banking

Security concerns during the pre-Internet period had more to do with the internal activities of a business. Right from

the early days technology solutions—like banking applications for mainframes, AS400 or Unix—had lot of security

built-in. Transactions that are directed from the branch to the main server are encrypted; there are individual

passwords, and numerous functions have two levels of authorization. Thus security in banking, to a large extent, is

built into the software or the application itself.

Internet banking

The moment a business opens up through a medium like Internet, external security becomes of prime importance.
One has to start considering protection tools like firewalls, IDS, and others. According to C.N. Ram, it is not enough
to take care of security from the hardware or software perspective, one needs to have security policies in place,
which will tell you how to review the logs.

Ram informs that HDFC Bank has a mechanism in place where a third-party is hired to manage their entire security.
This third-party is constantly onsite looking at logs, making the required changes, as there are patches and upgrades
being constantly released, and it is imperative to incorporate all of these.

"You are protecting the infrastructure, but you also have to keep a vigil on the logs to see who is trying to attack you
or hack into your system," says Ram. The bank also has safety measures in terms of who has access, or who is
authorized to access certain
kinds of data. "Much of the security deals with the classification of the information you have. Thus people who are

47
functionally responsible for a particular area are also responsible for the data they have. For example, a corporate
banking customer will not have access to retail banking data, and vice-versa. These are generally built-in the
banking packages systems," said C.N. Ram. Security is directly related to the business. The banking systems over
the years have been built with lots of security concern based on the kind of business they do.

He further added that security is not limited to hardware and soft-ware—premise security also plays an equally
important role. Physical access is combined with data access. One has to have swipe cards to access the area where
the data is. Thus there is lot of emphasis on access control mechanisms, which is in fact physical security Banking
through multi-channels Today banking is not limited to a branch. People have lesser time to spend on their banking
activities and would like to avail the banking services through other channels. In a competitive market where the
services offered command market share, banks are constantly vying for customers. Banking has become a process
of choice and convenience.

By offering different channels even the banks have been successful in diverting their operations from a branch to
other channels. The result of which has been a cut in the cost per transaction at the branch. An average transaction at
the branch costs around Rs.100; at an ATM it is about Rs.40, and on the Internet it's around Rs. 20.

"But unfortunately a very small percentage of the customers out there use the Internet. This is due to factors like low
PC penetration, and penetration of Internet itself is low. A large number of our customers use ATMs. Typically 55
percent of our transactions are on the ATM, 30 percent branch, 8 percent on telephone and 7 percent Internet."

Rolling out new branches

S.R. Balasubramanian, VP-IT, HDFC Bank explained the branch set-up procedure. The bank follows a standard
procedure and the entire process is well streamlined. From the selection of the location, physical set-up of the
branch, the infrastructure requirements, hardware, software, connectivity, is all documented to have standardized
branches across the country.

He further explained that they have some regular vendors for purchases. The bank follows the reverse auction
system, wherein all preferred vendors are called and a base price is quoted according to which the vendors quote
their prices.

"We have to reach to all areas of the country and wherever there is an opportunity we have to identify it, connect
and reach our customers. Earlier it took us around 14-15 days to open a new branch after the physical set-up was
ready, but now it takes just five days to set up a branch. The entire process is so well documented and streamlined
that it is easy to roll out a branch," said S.R. Bala
Some countries have a credit bureau that collects information from all banks in the country. It is mandatory for all

48
financial institutions to give data to this bureau. If this data is not exchanged, every bank is vulnerable to fraud. For
example, someone could defraud a particular bank, then go to another bank for a new account, and defraud them
too.

Thus this bureau plays an important role and all the banks contribute data to it, which enables them to screen their
new and existing customers and keep a tab on defaulters.

A similar kind of credit bureau is being setup in India and it will be called CIBIL (Credit Information Bureau of
India limited). It is a joint venture between Housing Development Finance Corporation Ltd. (HDFC), State Bank of
India (SBI), Dun & Bradstreet Information Services India Pvt. Ltd. (DB) and Trans Union International Inc. (TU).
This system will keep a check on defaulters—in case there is a defaulter with one bank, the chances of that person
getting into another bank are reduced.

Over a period of time all banks are expected to become members and share data with CIBIL.

7-Future of banking and technology

According to C.N. Ram, the future is integration as people will have less time for banking. People will want to
process more transactions on the Internet. There will be more activity in terms of applications and services on the
mobile. Geography will not be an inhibitor any more as everything is executable on the Net.
"Integration is the next real big thing. As a customer you will want a one-stop shop that will take care of all your
needs. For instance people will want to buy their mutual funds, redeem their mutual fund, buy insurance policies,
renew policies, buy cinema tickets, railway tickets, and numerous similar transactions through the bank. The ATM
will still serve as a cash dispensing medium, but the Internet and mobile will be very active," says C.N. Ram.
Cost of infrastructure is coming down considerably. Service providers are providing alternative routes to customers
and prices are coming down, as there is healthy competition in the market. Bulk purchases will result in affordable
prices.

SECURITY TRENDS

With the advent of convergence on mobiles and PDA's, there is going to be lot more security built-in on the
equipment and the applications running on them. "The kind of transactions that are allowed or executed on the
mobile phones are restricted only because we feel that customers are not confident about the security levels. That is
why we can not open up a lot more transactions even if we want to. People like to use a particular technology for
some time to get accustomed and be comfortable using it. Then they decide if they would continue to use it."

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There are many security features that can be incorporated in the mobile phones as technology improves. C.N. Ram
feels that if people start developing applications using standards then it will be easier to put security (encryption) on
the mobile itself. This will enable the communication between the mobile and the bank server to be secure.
Currently sms (short messaging system) on the mobile is in the clear. The messages go from the mobile to the
SMSC and from the SMSC they are sent to HDFC Bank. From the SMSC to the bank the message can be encrypted
but between the SMSC and the mobile it is in the clear. This leaves an opening for people to snoop. Thus a
password mechanism on the mobile—if it is transmitted in the clear—defeats the entire purpose of a password as it
is vulnerable and can be hacked. "Once security on these channels is taken care of we can offer more and more
applications to our customers," says C.N. Ram

Recent developments of HDFC Bank

HDFC Bank has opened 19 branches in a day in Delhi and the National Capital Region
(NCR), outdoing its own record of 14 branches in a day in October 2005. With the launch
of 19 branches on Saturday (June 2), the total number of branches in Delhi and NCR has
gone up to 116 and to 270 in North India. As on March 31, 2007 the bank had a network
of 684 branches and 1,605 ATMs in 316 towns and cities.

HDFC Bank has launched a branch dedicated to self-help groups at Thudiyalar village
near Coimbatore in Tamil Nadu. Coimbatore district has 27,000 SHG groups and 2,200
more groups are coming up. As of now, 18,000 groups are linked with credit outstanding
of about Rs. 54 crore, while 11,200 are in need of organised financial support, said a
press release by the bank. The branch, with around 14 executives, will also have an in-
house training facility for the SHGs.

HDFC Bank has signed a memorandum of understanding (MoU) with Tata Pipes to offer
credit facilities to farmers across the country. The credit is for purchase of pipes (from
Tata Pipes) for irrigation. HDFC Bank will use Tata Pipes' pan-India distributor network
under the agreement, said a joint release from the two partners. The arrangement would
help farmers overcome the problem of severe water shortage, the release added. "Our
bank's association with Tata Pipes takes our rural thrust one notch further up," said Ms
Neena Singh, Executive Vice-President and Business Head, (retail agri business), HDFC
Bank.

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 HDFC Bank has launched a service called `Instant Loan' to offer spot approval for
personal loans to the existing customers. "In the first phase, the programmed is being
offered in Mumbai, Delhi, Bangalore and Chennai and will soon be extended across the
country," said a bank release. Customers will also be able to access the facility through
Net banking and phone banking.

HDFC Bank has entered into an agreement with Godrej Aadhaar, the agri services and
retail initiative of Godrej Agrovet Ltd, to offer agri-credit facility in the rural areas.
"Aadhaar customers could avail themselves of banking services and loans on a
preferential interest rate from HDFC Bank.

The farmers, associated with Godrej Aadhaar, can now avail themselves of cash credit
and term loans post-assessment of their land holdings and cropping patterns. These
farmers could also get loan facility for their farm mechanisation needs such as tractors,
combine harvesters and other agri-related implements," said a press release by the bank.

SHARE HOLDING PATTERN OF HDFC

Share holding
Share holding pattern as on : 30/06/2007 31/03/2007 31/12/2006
Face value 10.00 10.00 10.00
No. Of Shares % Holding No. Of Shares % Holding No. Of Shares
Promoter's holding
Indian Promoters 82443000 24.74 68861000 21.56 68861000
Sub total 82443000 24.74 68861000 21.56 68861000
Non promoter's holding
Institutional investors
Banks Fin. Inst. and Insurance 8503405 2.55 8076842 2.53 8700824
FII's 88385137 26.53 103391032 32.37 103179646
Sub total 115036850 34.53 121253321 37.96 123988195

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Other investors
Private Corporate Bodies 27978900 8.40 25301000 7.92 23480874
NRI's/OCB's/Foreign Others 5922277 1.78 633576 0.20 571011
Govt 2158217 0.65 2513452 0.79 1283433
Others 59813247 17.95 60338247 18.89 60338247
Sub total 95872641 28.77 88786275 27.80 85673565
General public 39834517 11.96 40489012 12.68 36626648
Grand total 333187008 100.00 319389608 100.00 315149408

FINDINGS

 Large numbers of customers are already with HDFC.

 Many people are in process to join HDFC

 But many people in spite of there willingness cannot open account with HDFC because of its

high charges in opening of saving account..

 Company’s report and analysis indicates that the bank is booming and has bright prospects

 Many people of Rourkela are dissatisfied with the services of HDFC BANK

 HDFC PRODUCT compared to other bank product is easy to invest able.

 Many People are interested in investing in kids advantage plan of HDFC Bank

 The products of HDFC BANK are so beneficial that it does not take time to convince people

 you not only can purchase shares but also mutual fund, insurance, savings certificate and also

play in commodities & derivatives.

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

 SUGGESTIONS or RECOMMENDATIONS

1. Rourkela people are not aware of current HDFC product too much, so there should

be all totally different office for HDFC bank to gain popularity among people.

2. Documentation should be made easy and less time taking.

3. Customers complain of its server to be slow while trading session it should be taken

care of by the authorities.

4. People complain of hidden charges, the charges take should be made crystal clear.

5. Always training should be provided to players from time to time so that they can

play easily.

6. There should be people from the authority who could be contracted while customers

face problem while playing.

CONCLUSION

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From the above study and after doing the overall market survey of HDFC BANK I concluded that
largely the affluent people of Rourkela invest in HDFC BANK. Middle class and lower middle class
are rather unwilling to invest in HDFC BANK because the big amount required. Due to the speedy
procedure of HDFC BANK many people are interested to invest in HDFC BANK and at the same time
many people complained about the services of the HDFC BANK.I found that most of the business men
of Rourkela invest in current account of HDFC BANK .Some people are more willing to invest in kids
advantage plan because of its good features and benefits like- free ATM/INTERNATIONAL debit
cards for kids between 7 to 18 years of age, free education insurance of Rs. one lakh etc .During my
survey I found that some people queried about D-MAT section which reveals the potential D-MAT
customers which can be converted into regular customers. Finally I would like HDFC BANK to
introduce some new products targeting lower income people to dilute the market share of its
competitors. Finally the bank should be very cautious about the services it provide and which is very
essential to retain regular customers and attract new customers

BIBLIOGRAPHIE

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www.Google.com
www.HDFC bank.com
Marketing management-By Philip kotler

APPENDIX

QUESTIONNAIRE

st
I AM 1 Year MBA student doing summer training with HDFC BANK conducting a survey on investor’s

behavior and psychology. We assure you that individual responses will be kept confidential. Please circle or

tick the appropriate option.

Q1. Do you have a bank account?

a) Yes b) No

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Q2. Your investment decisions are influenced by:

a) Oneself b) Brokers c) Economic Policies d) Market Rumors

e) Friends/Relatives f) Any Other (Please Specify) ………

Q3. In which, sectors are you currently investing?

a) IT b) FMCG C) Automobile d) Banking e) Cement f) Others

Q4. What are the factors, which you consider before investing in a particular
company?

a) Financial Position b) Current Market Position c) Goodwill/Brand Name

d) Future Prospects e) Any Other (Please Specify)

Q5. In which banks do you have your account?

a) ICICI b) UTI c) HDFC d) SBI e) PNB

f) Any Other (Please Specify) ………………………….

Q6. AreYou Satisfy The Services Given By The Bank(HDFC BANK)?

a) yes b)no

PERSONAL DETAILS:

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Name: Mr/Mrs/Miss --------------------------------------------------------

Address: ------------------------------------------------------------------------------------

Age: ------------ years

Phone No: -----------------------------

E-mail: -----------------------------------

Occupation:

a) Govt. Employee b) Private Employee (if yes then please specify the name
of the organization) ---------------- c) Self Employed d) Student e) Housewife

Your monthly income:

a) Less than 15000 b) 15000 – 25000 c)25000 – 35000 d) 35000 and

above

Please give some references of people who you know are trading offline / interested in
investing in stocks:

• ------------------------------------------
• ------------------------------------------
• -------------------

THANKS FOR YOUR VALUEABLE TIME AND INPUTS.

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