Project Report on Comparative Study Of Profits Of Sbi & Icici

Submitted by Nikhil gupta Pgdm (2011-13)

Abstract
The efficiency or the growth of a bank can be measured through various measures like deposits, advances, working funds, incomes, expenditures, profits, assets, number of Account and branches etc. The role of profits is very significant as each and every activity of a bank is directly related to the profits of bank. Therefore, the parameters, which are used to measure the efficiency of Banks, should also include the profits. In the present study, analysis of SBI & ICICI Banks has been performed on the basis of profits. This shows the % of growth in profits of banks in private sector banks in comparison of government sector. In this I used descriptive analysis test for judging the growth of profits & whose bank is more consistent & good.

STATE BANK OF INDIA

Introduction
HISTORY

seal of Imperial Bank of India. The roots of the State Bank of India rest in the first decade of 19th century, when the Bank of Calcutta, later renamed the Bank of Bengal, was established on 2 June 1806. The Bank of Bengal was one of three Presidency banks, the other two being the Bank of Bombay and the Bank of Madras . All three Presidency banks were incorporated as joint stock companies. The Presidency banks amalgamated on 27 January 1921, and the reorganized banking entity took as its name: Imperial Bank of India.

Pursuant to the provisions of the State Bank of India Act (1955), the Reserve Bank of India, which is India's central bank, acquired a controlling interest in the Imperial Bank of India. On 30 April 1955, the Imperial Bank of India became the State Bank Of India. In 1959, the government passed the State Bank of India (Subsidiary Banks) Act, enabling the State Bank of India to take over eight former state-associated banks as its subsidiaries.

International presence

The Israeli branch of the State Bank of India located in Ramat Gan. State bank of India had 157 overseas offices spread over 32 countries. SBI operates several foreign subsidiaries or affiliates. In 1990, it established an offshore bank: State Bank of India (Mauritius). In 1982, the bank established a subsidiary, State Bank of India (California), which now has ten branches nine branches in the state of California and one in Washington, D.C. In Nepal, SBI owns 55% of Nepal SBI Bank, which has branches throughout the country. In Moscow, SBI owns 60% of Commercial Bank of India, with Canara Bank owning the rest. In Indonesia, it owns 76% of PT Bank Indo Mone

Associate banks

Main Branch of SBI at Mumbai. SBI has five associate banks; all use the same logo of a blue circle and all the associates use the "State Bank of" name, followed by the regional headquarters' name;

State Bank of Bikaner & Jaipur State Bank of Hyderabad State Bank of Mysore State Bank of Patiala State Bank of Travancore

Services provided by SBI

Personal Banking NRI Services Agricultural & Rural Banking Corporate Banking Government Business International Banking Internet & Mobile Banking Insurance Services Credit & Debit Card Facility

Present Financial status of SBI 2010-11

The Profit & Loss statement of State Bank of India in March 2011 is: Mar ' 11 (In crore) Income Operating income Expenses Material consumed Manufacturing expenses Personnel expenses Selling expenses Administrative expenses Expenses capitalised Cost of sales Operating profit Other recurring income Adjusted PBDIT Financial expenses Depreciation 95,525.58 14,480.17 257.88 15,702.33 30,440.38 16,217.24 1,065.14 17,282.39 48,867.96 990.50

Other write offs Adjusted PBT Tax charges Adjusted PAT Nonrecurring items Other non cash adjustments Net profit

-32,576.07 5,709.54 8,283.03 -912.68 7,370.35

Icici
Introduction
HISTORY ICICI Bank was established in 1994 by the Industrial Credit and Investment Corporation of India, an Indian financial institution, as a wholly owned subsidiary. The parent company was formed in 1955 as a joint-venture of the World Bank, India's public-sector banks and public-sector insurance companies to provide project financing to Indian industry. The bank was initially known as the Industrial Credit and Investment Corporation of India Bank, before it changed its name to the abbreviated ICICI Bank. The parent company was later merged into ICICI Bank. ICICI Bank launched internet banking operations in 1994. ICICI's shareholding in ICICI Bank was reduced to 46 percent, through a public offering of shares in India in 1998, followed by an equity offering in the form of American Depositary Receipts on the NYSE in 2000. ICICI Bank acquired the Bank of Madura Limited in an all-stock deal in 2001, and sold additional stakes to institutional investors during 2001-02. In the 1990s, ICICI transformed its business from a development financial institution offering only project finance to a diversified financial services group, offering a wide variety of products and services, both directly and through a number of subsidiaries and affiliates like ICICI Bank. In 1999, ICICI become the first Indian company and the first bank or financial institution from non-Japan Asia to be listed on the NYSE.

In 2000, ICICI Bank became the first Indian bank to list on the New York Stock Exchange with its five million American depository shares issue generating a demand book 13 times the offer size. In October 2001, the Boards of Directors of ICICI and ICICI Bank approved the merger of ICICI and two of its wholly owned retail finance subsidiaries, ICICI Personal Financial Services Limited and ICICI Capital Services Limited, with ICICI Bank. The merger was approved by shareholders of ICICI and ICICI Bank in January 2002, by the High Court of Gujarat at Ahmedabad in March 2002, and by the High Court of Judicature at Mumbai and the Reserve Bank of India in April 2002. In 2008, following the 2008 financial crisis, customers rushed to ATM's and branches in some locations due to rumours of adverse financial position of ICICI Bank. The Reserve Bank of India issued a clarification on the financial strength of ICICI Bank to dispel the rumours.

Subsidiaries
DOMETIC

ICICI Lombard ICICI Prudential Life Insurance Company Limited ICICI Securities Limited ICICI Prudential Asset Management Company Limited ICICI Venture ICICI Home Finance ICICI direct.com ICICI Foundation

INTERNATIONAL

ICICI Bank UK PLC ICICI Bank Canada ICICI Bank Eurasia LLC

Acquisitions

2005: Investitsionno-Kreditny Bank (IKB), a Russian bank 2007: Sangli Bank 2010: Bank of Rajasthan

Services provided by ICICI

Finance Banking Insurance Banking Retail Banking Commercial Banking Private Banking Investment Banking Asset Management

Present Financial status of icici 2010-11

The Profit & Loss statement of ICICI in March 2011 is: Mar11 (In crore)

Income Interest Earned Other Income Total Income Expenditure Interest expended Employee Cost Selling and Admin Expenses Depreciation Miscellaneous Expenses Preoperative Exp Capitalised Operating Expenses Provisions & Contingencies Total Expenses

25,974.05 7,108.91 33,082.96 16,957.15 2,816.93 3,785.13 562.44 3,809.93 0.00 8,594.16 2,380.27 27,931.58

Net Profit for the Year Extraordinary Items Profit brought forward Total

5,151.38 -2.17 3,464.38 8,613.59

Objective
The banking sector is growing very fast. The objective is to know the future of these banks. By this I come to know the position of the company that which company is doing better in present & from last 10 years. Also by this we come to know the company performs better in future.

Research methodology
Sources of data:
The data is basically secondary in nature It was obtained from the following: 1) 2) 3) 4) 5) Google Sbi.co.in Icici bank site Moneycontrol.com Scribd.com

Data analysis Appropriate statistical analysis will be adopted. The data will be tabulated & analyzed. The data is used in forecasting the future of both the companies.

Limitation of study The study is limited to SBI & ICICI banks. Since it was taken from bank site it is assumed that this data is right.

PROFIT OF SBI & ICICI OF LAST 10 YEARS

(profit in crore) year Mar '02 Mar '03 Mar '04 Mar '05 Mar '06 Mar '07 Mar '08 Mar '09 Mar '10 Mar '11

ICICI 268.28 1,225.74 1,642.16 2,058.29 2,728.29 3,403.66 5,156.00 6,193.87 6,834.63 8,613.59

SBI 2,431.62 3,105.00 4,378.72 4,304.52 4,406.67 4,541.31 6,729.12 9,121.23 9,166.05 7,370.35

The table above show the profit of both the companies of last 10 years.SBI shows the growth from financial year 2002-2010 but in financial year 2011 it shows reduction in profit where as ICICI bank shows continuously increasing in their profits. In last 10 years ICICI increases their profit from Rs268.28 crore to Rs.8613.59 crore. It shows how fast private banks work & increases their profits.

10000 9000 8000 7000 6000 5000 4000 3000 2000 1000 0 Mar Mar Mar Mar Mar Mar Mar Mar Mar Mar '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 ICICI SBI

Descriptive statistics of SBI

Mean Standard Error Median Mode Standard Deviation Sample Variance Kurtosis Skewness Range Minimum Maximum Sum Count 5555.459 756.3310306 4473.99 #N/A 2391.728722 5720366.278 -1.119052202 0.493946766 6734.43 2431.62 9166.05 55554.59 10

Co efficient of variation of SBI=43.05%

Descriptive statistics of ICICI

Mean Standard Error Median Mode Standard Deviation Sample Variance Kurtosis Skewness Range Minimum Maximum Sum Count

3812.451 869.5002578 3065.975 #N/A 2749.601241 7560306.983 -0.956914793 0.503868527 8345.31 268.28 8613.59 38124.51 10

Co efficient of variation of ICICI=72.12%

Co efficient of which ever company is low is more consistent. As calculated above, it shows that SBI is more consistent & good than ICICI. Also the future of the SBI is more brighter than ICICI. Below it shows the future profits of both the company. The future is forecasted by moving average method.

MOVING AVERAGEOF SBI

profit(in crore) year sbi forecast #N/A Mar '02 2,431.62 #N/A Mar '03 3,105.00 3,305.11 Mar '04 4,378.72 3,929.41 Mar '05 4,304.52 4,363.30 Mar '06 4,406.67 4,417.50 Mar '07 4,541.31 5,225.70 Mar '08 6,729.12 6,797.22 Mar '09 9,121.23 8,338.80 Mar '10 9,166.05 8,552.54 Mar '11 7,370.35 8,675.03 Mar '12 9,488.69 forecast #N/A #N/A #N/A #N/A 657.0685 229.4302 871.2981 1599.648 1667.897 1579.34 956.3761

Moving Average
10,000.00 Value 5,000.00 Actual 0.00 Mar Mar Mar Mar Mar Mar '02 '04 '06 '08 '10 '12 Data Point Forecast

MOVING AVERAGE OF ICICI

profit (in crore) Year Mar '02 Mar '03 Mar '04 Mar '05 Mar '06 Mar '07 Mar '08 Mar '09 Mar '10 Mar '11 Mar '12

icici 268.28 1,225.74 1,642.16 2,058.29 2,728.29 3,403.66 5,156.00 6,193.87 6,834.63 8,613.59 8,715.68

forecast #N/A #N/A 1045.393 1642.063 2142.913 2730.08 3762.65 4917.843 6061.5 7214.03 8054.633

forecast #N/A #N/A #N/A #N/A 539.1478 568.5128 955.301 1158.07 1178.615 1181.065 998.9129

Moving Average
10000 Value 5000 0 Mar '02 Mar '03 Mar '04 Mar '05 Mar '06 Mar '07 Mar '08 Mar '09 Mar '10 Mar '11 Mar '12 Actual Forecast

Data Point

Conclusion
From the above analysis, I can conclude that future of both the company is good but SBI have more consistent than ICICI. The profits forecast by us by using moving average method shows that SBI earns more profit than ICICI in future. The company make less profit in current financial year but in future company cover up & earn more profit than previous years. Company must recover their loan to increase their profits.