a report on profitability of icici pru

8/9/2019 a report on profitability of icici pru

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A Report on

A Study on Profitability of ICICI bank

(From investor point of view)

Submitted by;

M. ZABIULLA (MBA)BIT IT HINDUPUR.

Submitted to;

MBA DEPRTMENT, BIT IT HINDUPUR.


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I C I C I(INDUSTRIAL CREDIT AND INVESTMENT CORPORATION OF INDIA.)


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Introduction

Profitability of a firm is the ability to generate profits. A common man cananalyze the profitability position of a company by there net profits generatedin the financial year. But an investor is interested in there future earnings.

This project is all about analyzing the profitability and operating efficiencyof the firm by using one of the important tools in financial statementanalysis RATIO ANALYSIS.

Ratios are well known and most widely used tools of financial analysis. The

analysis of ratios can disclose relationship as well as basis of comparisonthat reveals conditions and trends that can not be detected by going throughindividual components of the ratio.


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Objectives of the study

To analyze the profitability of the funds invested by share holders.

To analyze the operating efficiency of the firm


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(INDUSTRIAL CREDIT AND INVESTMENT CORPORATION OF INDIA.)

History of ICICI

1955: The Industrial Credit and Investment Corporation of India Limited (ICICI)was incorporated at the initiative of World Bank, the Government of India andrepresentatives of Indian industry, with the objective of creating a developmentfinancial institution for providing medium-term and long-term project financingto Indian businesses.

1994: ICICI established Banking Corporation as a banking subsidiary.formerlyIndustrial Credit and Investment Corporation of India. Later, ICICI BankingCorporation was renamed as 'ICICI Bank Limited'. ICICI founded a separate legalentity, ICICI Bank, to undertake normal banking operations - taking deposits,credit cards, car loans etc.

2001: ICICI acquired Bank of Madura(est. 1943). Bank of Madura was a Chettiarbank, and had acquired Chettinad Mercantile Bank (est. 1933) andIllanji Bank(established 1904) in the 1960s.

2002: The Boards of Directors of ICICI and ICICI Bank approved the reversemerger of ICICI, ICICI Personal Financial Services Limited and ICICI Capital Services Limited,into ICICI Bank. After receiving all necessary regulatory approvals, ICICI

integrated the group's financing and banking operations, both wholesale andretail, into a single entity. At the same time, ICICI started its internationalexpansion by opening representative offices inNew York and London. In India,ICICI Bank bought the Shimla and Darjeeling branches that Standard Chartered Bankhad inherited when it acquired Grindlays Bank.

2003: ICICI opened subsidiaries in Canada and the United Kingdom (UK), and inthe UK it established an alliance with Lloyds TSB. It also opened an OffshoreBanking Unit (OBU) in Singapore and representative offices in Dubai andShanghai.

2004: ICICI opened a representative office in Bangladesh to tap the extensivetrade between that country, India and South Africa.

2005: ICICI acquired Investitsionno-Kreditny Bank (IKB), a Russia bank withabout US$4mn in assets, head office inBalabanovo in the Kaluga region, and with abranch in Moscow. ICICI renamed the bank ICICI Bank Eurasia. Also, ICICIestablished a branch inDubai International Financial Centre and in Hong Kong.

2006: ICICI Bank UK opened a branch in Antwerp, in Belgium. ICICI openedrepresentative offices in Bangkok,Jakarta, and Kuala Lumpur.

2007: ICICI amalgamated Sangli Bank, which was headquartered in Sangli, inMaharashtra State, and which had 158 branches in Maharashtra and another 31 in
http://en.wikipedia.org/wiki/Bank_of_Madurahttp://en.wikipedia.org/wiki/Bank_of_Madurahttp://en.wikipedia.org/wiki/Chettiarhttp://en.wikipedia.org/w/index.php?title=Chettinad_Mercantile_Bank&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Illanji_Bank&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Illanji_Bank&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=ICICI_Personal_Financial_Services_Limited&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=ICICI_Capital_Services_Limited&action=edit&redlink=1http://en.wikipedia.org/wiki/New_Yorkhttp://en.wikipedia.org/wiki/New_Yorkhttp://en.wikipedia.org/wiki/Londonhttp://en.wikipedia.org/wiki/Shimlahttp://en.wikipedia.org/wiki/Darjeelinghttp://en.wikipedia.org/wiki/Standard_Chartered_Bankhttp://en.wikipedia.org/wiki/Grindlays_Bankhttp://en.wikipedia.org/wiki/Balabanovohttp://en.wikipedia.org/wiki/Balabanovohttp://en.wikipedia.org/wiki/Kalugahttp://en.wikipedia.org/wiki/Moscowhttp://en.wikipedia.org/wiki/Dubaihttp://en.wikipedia.org/wiki/Dubaihttp://en.wikipedia.org/wiki/Hong_Konghttp://en.wikipedia.org/wiki/Antwerphttp://en.wikipedia.org/wiki/Belgiumhttp://en.wikipedia.org/wiki/Bangkokhttp://en.wikipedia.org/wiki/Bangkokhttp://en.wikipedia.org/wiki/Jakartahttp://en.wikipedia.org/wiki/Kuala_Lumpurhttp://en.wikipedia.org/wiki/Kuala_Lumpurhttp://en.wikipedia.org/wiki/Sanglihttp://en.wikipedia.org/wiki/Maharashtrahttp://en.wikipedia.org/wiki/Bank_of_Madurahttp://en.wikipedia.org/wiki/Chettiarhttp://en.wikipedia.org/w/index.php?title=Chettinad_Mercantile_Bank&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Illanji_Bank&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=ICICI_Personal_Financial_Services_Limited&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=ICICI_Capital_Services_Limited&action=edit&redlink=1http://en.wikipedia.org/wiki/New_Yorkhttp://en.wikipedia.org/wiki/Londonhttp://en.wikipedia.org/wiki/Shimlahttp://en.wikipedia.org/wiki/Darjeelinghttp://en.wikipedia.org/wiki/Standard_Chartered_Bankhttp://en.wikipedia.org/wiki/Grindlays_Bankhttp://en.wikipedia.org/wiki/Balabanovohttp://en.wikipedia.org/wiki/Kalugahttp://en.wikipedia.org/wiki/Moscowhttp://en.wikipedia.org/wiki/Dubaihttp://en.wikipedia.org/wiki/Hong_Konghttp://en.wikipedia.org/wiki/Antwerphttp://en.wikipedia.org/wiki/Belgiumhttp://en.wikipedia.org/wiki/Bangkokhttp://en.wikipedia.org/wiki/Jakartahttp://en.wikipedia.org/wiki/Kuala_Lumpurhttp://en.wikipedia.org/wiki/Sanglihttp://en.wikipedia.org/wiki/Maharashtra


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Karnataka State. Sangli Bank had been founded in 1916 and was particularly strongin rural areas. With respect to the international sphere, ICICI also receivedpermission from the government ofQatar to open a branch inDoha. Also, ICICIBank Eurasia opened a second branch, this time in St. Petersburg.

2008: The US Federal Reserve permitted ICICI to convert its representative office inNew York into a branch. ICICI also established a branch inFrankfurt.

2009: ICICI made huge changes in its organistion like elimination of loss makingdepartment and restreching outsourced staff or renegotiate their charges inconsequent to the recession. In addition to this, ICICI adopted a massive approachaims for cost control and cost cutting. In consequent of it, compesation to staffwas not increased and no bonus declared for 2008-09.

About Us

ICICI Bank is India's second-largest bank with total assets of Rs. 3,562.28 billion (US$77 billion) at December 31, 2009 and profit after tax Rs. 30.19 billion (US$ 648.8million) for the nine months ended December 31, 2009. The Bank has a network of 1,694branches and about 4,883 ATMs in India and presence in 18 countries. ICICI Bank offersa wide range of banking products and financial services to corporate and retail customersthrough a variety of delivery channels and through its specialized subsidiaries andaffiliates in the areas of investment banking, life and non-life insurance, venture capitaland asset management. The Bank currently has subsidiaries in the United Kingdom,Russia and Canada, branches in United States, Singapore, Bahrain, Hong Kong, SriLanka, Qatar and Dubai International Finance Centre and representative offices in UnitedArab Emirates, China, South Africa, Bangladesh, Thailand, Malaysia and Indonesia. OurUK subsidiary has established branches in Belgium and Germany.

ICICI Bank's equity shares are listed in India on Bombay Stock Exchange and theNational Stock Exchange of India Limited and its American Depositary Receipts (ADRs)are listed on the New York Stock Exchange (NYSE).Corporate ProfileICICI Bank is India's second-largest bank with total assets of Rs. 3,562.28 billion (US$77 billion) as on December 31, 2009
http://en.wikipedia.org/wiki/Karnatakahttp://en.wikipedia.org/wiki/Qatarhttp://en.wikipedia.org/wiki/Dohahttp://en.wikipedia.org/wiki/Dohahttp://en.wikipedia.org/wiki/US_Federal_Reservehttp://en.wikipedia.org/wiki/New_Yorkhttp://en.wikipedia.org/wiki/Frankfurthttp://en.wikipedia.org/wiki/Frankfurthttp://en.wikipedia.org/wiki/Karnatakahttp://en.wikipedia.org/wiki/Qatarhttp://en.wikipedia.org/wiki/Dohahttp://en.wikipedia.org/wiki/US_Federal_Reservehttp://en.wikipedia.org/wiki/New_Yorkhttp://en.wikipedia.org/wiki/Frankfurt


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CHAIRMAN & DIRECTORS

S.No Name Designation

AN OVER VIEW OF ICICI

TypePrivate

BSE & NSE:ICICI,NYSE:IBN

Industry

Banking

Insurance

Capital Marketsand allied industries

Founded 1955 (as Industrial Credit and Investment Corporation of India)

Headquarters

ICICI Bank Ltd.,ICICI Bank Towers,

Bandra Kurla,

Mumbai,India

Key people

K.V. Kamath,Chairman

Chanda Kochhar, Managing Director & CEO

Sandeep Bakhshi, Deputy Managing Director

N.S. Kannan, Executive Director & CFO

K. Ramkumar, Executive Director

Sonjoy Chatterjee, Executive Director

Products Loans,Credit Cards, Savings, Investment vehicles, Insurance etc.

Revenue USD15.06 billion

Total assets USD120.61 billion (at March 31, 2009.)

Website www.icicibank.com
http://en.wikipedia.org/wiki/Types_of_business_entityhttp://en.wikipedia.org/wiki/Private_companyhttp://en.wikipedia.org/wiki/Bombay_Stock_Exchangehttp://en.wikipedia.org/wiki/National_Stock_Exchange_of_Indiahttp://en.wikipedia.org/wiki/New_York_Stock_Exchangehttp://en.wikipedia.org/wiki/New_York_Stock_Exchangehttp://www.nyse.com/about/listed/ibn.htmlhttp://www.nyse.com/about/listed/ibn.htmlhttp://en.wikipedia.org/wiki/Industryhttp://en.wikipedia.org/wiki/Bankinghttp://en.wikipedia.org/wiki/Insurancehttp://en.wikipedia.org/wiki/Capital_Marketshttp://en.wikipedia.org/wiki/Capital_Marketshttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/K.V._Kamathhttp://en.wikipedia.org/wiki/K.V._Kamathhttp://en.wikipedia.org/wiki/Chanda_Kochharhttp://en.wikipedia.org/wiki/Chanda_Kochharhttp://www.icicibank.com/pfsuser/aboutus/newsroom/executivebio/sandeepresume.htmhttp://www.google.co.in/url?sa=t&source=web&ct=res&cd=1&url=http%3A%2F%2Fwww.iciciprulife.com%2Fpublic%2FAbout-us%2FProfileTeam-NSKannan.htm&ei=Hm15Sv_kCob6kAXMhZS7Bg&usg=AFQjCNGrNWm9KBeFK8ECi6w5fJ896TdmpA&sig2=xulVedKfizzwojKQN7-YlAhttp://www.google.co.in/url?sa=t&source=web&ct=res&cd=18&url=http%3A%2F%2Fwww.icicibank.com%2Fpfsuser%2Faboutus%2Fnewsroom%2Fexecutivebio%2Framkumarresume.htm&ei=Xm15SsvHEIHs6APR74GlBQ&usg=AFQjCNF8v8x13iVBwIJflxdj3KFXCQiZmA&sig2=UjBAMVFDRl2e9JqC1kdC8Ahttp://www.google.co.in/url?sa=t&source=web&ct=res&cd=1&url=http%3A%2F%2Fwww.icicibank.com%2Fpfsuser%2Faboutus%2Fnewsroom%2Fexecutivebio%2FSonjoyChatterjeeresume.htm&ei=7215SouIJI6PkAWa_fi5Bg&usg=AFQjCNFLjYIJlKTZeC_Nfh5SzIKaKReSQA&sig2=PwAnEhYQsj--jud3ytWGCwhttp://en.wikipedia.org/wiki/Product_(business)http://en.wikipedia.org/wiki/Credit_Cardhttp://en.wikipedia.org/wiki/Credit_Cardhttp://en.wikipedia.org/wiki/Credit_Cardhttp://en.wikipedia.org/wiki/Revenuehttp://en.wikipedia.org/wiki/USDhttp://en.wikipedia.org/wiki/USDhttp://en.wikipedia.org/wiki/Assethttp://en.wikipedia.org/wiki/USDhttp://en.wikipedia.org/wiki/USDhttp://en.wikipedia.org/wiki/Websitehttp://www.icicibank.com/http://en.wikipedia.org/wiki/Types_of_business_entityhttp://en.wikipedia.org/wiki/Private_companyhttp://en.wikipedia.org/wiki/Bombay_Stock_Exchangehttp://en.wikipedia.org/wiki/National_Stock_Exchange_of_Indiahttp://en.wikipedia.org/wiki/New_York_Stock_Exchangehttp://www.nyse.com/about/listed/ibn.htmlhttp://en.wikipedia.org/wiki/Industryhttp://en.wikipedia.org/wiki/Bankinghttp://en.wikipedia.org/wiki/Insurancehttp://en.wikipedia.org/wiki/Capital_Marketshttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/K.V._Kamathhttp://en.wikipedia.org/wiki/Chanda_Kochharhttp://www.icicibank.com/pfsuser/aboutus/newsroom/executivebio/sandeepresume.htmhttp://www.google.co.in/url?sa=t&source=web&ct=res&cd=1&url=http%3A%2F%2Fwww.iciciprulife.com%2Fpublic%2FAbout-us%2FProfileTeam-NSKannan.htm&ei=Hm15Sv_kCob6kAXMhZS7Bg&usg=AFQjCNGrNWm9KBeFK8ECi6w5fJ896TdmpA&sig2=xulVedKfizzwojKQN7-YlAhttp://www.google.co.in/url?sa=t&source=web&ct=res&cd=18&url=http%3A%2F%2Fwww.icicibank.com%2Fpfsuser%2Faboutus%2Fnewsroom%2Fexecutivebio%2Framkumarresume.htm&ei=Xm15SsvHEIHs6APR74GlBQ&usg=AFQjCNF8v8x13iVBwIJflxdj3KFXCQiZmA&sig2=UjBAMVFDRl2e9JqC1kdC8Ahttp://www.google.co.in/url?sa=t&source=web&ct=res&cd=1&url=http%3A%2F%2Fwww.icicibank.com%2Fpfsuser%2Faboutus%2Fnewsroom%2Fexecutivebio%2FSonjoyChatterjeeresume.htm&ei=7215SouIJI6PkAWa_fi5Bg&usg=AFQjCNFLjYIJlKTZeC_Nfh5SzIKaKReSQA&sig2=PwAnEhYQsj--jud3ytWGCwhttp://en.wikipedia.org/wiki/Product_(business)http://en.wikipedia.org/wiki/Credit_Cardhttp://en.wikipedia.org/wiki/Revenuehttp://en.wikipedia.org/wiki/USDhttp://en.wikipedia.org/wiki/Assethttp://en.wikipedia.org/wiki/USDhttp://en.wikipedia.org/wiki/Websitehttp://www.icicibank.com/


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1 K V Kamath Chairman

2 N S Kannan Executive Director & Chief Financial Officer

3 Sridar Iyengar Director

4 Narendra Murkumbi Director

5 M K Sharma Director

6 P M Sinha Director

7 V Prem Watsa Director

8 Anup K Pujari Director

9 M S Ramachandran Director

10 K Ramkumar Executive Director

12 Homi R Khusrokhan Non Executive Director

13 V Sridar Non Executive Director

11 Tushaar Shah Non Executive Director

14 Sandeep Bakhshi Deputy Managing Director

Present Scenario


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ICICI Bank has its equity shares listed in India on Bombay Stock Exchange and theNational Stock Exchange of India Limited. Overseas, its American Depositary Receipts(ADRs) are listed on the New York Stock Exchange (NYSE). As of December 31, 2008,ICICI is India's second-largest bank, boasting an asset value of Rs. 3,744.10 billion and

profit after tax Rs. 30.14 billion, for the nine months, that ended on December 31, 2008.

Branches & ATMsICICI Bank has a wide network both in Indian and abroad. In India alone, the bank has1,420 branches and about 4,644 ATMs. Talking about foreign countries, ICICI Bank hasmade its presence felt in 18 countries - United States, Singapore, Bahrain, Hong Kong,Sri Lanka, Qatar and Dubai International Finance Centre and representative offices inUnited Arab Emirates, China, South Africa, Bangladesh, Thailand, Malaysia andIndonesia. The Bank proudly holds its subsidiaries in the United Kingdom, Russia andCanada out of which, the UK subsidiary has established branches in Belgium andGermany.

Products & Services

Personal Banking

Deposits Loans Cards Investments Insurance

Demat Services Wealth Management

NRI Banking

Money Transfer Bank Accounts Investments Property Solutions Insurance Loans

Business Banking

Corporate Net Banking Cash Management


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Trade Services

FXOnline

SME Services Online Taxes

Custodial Services

Head Office:

ICICI Bank

9th Floor, South TowersICICI TowersBandra Kurla ComplexBandra (E)MumbaiPhone: 91-022-653 7914Website: www.icicibank.com

Achievements/ recognition:


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2009

ICICI Bank Mobile Banking was adjudged 'Best Bank Award for Initiatives inMobile Payments and Banking' by IDRBT, on May 18, 2009 in Hyderabad.

ICICI Bank's b2 branchfree banking was adjudged 'Best E-Banking Project

Implementation Award 2008' by The Asian Banker, on May 11, 2009 at the ChinaWorld Hotel in Beijing.

ICICI Bank bags the Best bank in SME financing (Private Sector) at the Dun &Bradstreet Banking awards 2009.

ICICI Bank NRI services win the Excellence in Business Model InnovationAward in the eighth Asian Banker Excellence in Retail Financial ServicesAwards Programme.

ICICI Bank's Rural Micro Banking and Agri-Business Group wins WOW Event& Experiential Marketing Award in two categories - Rural Marketingprogramme of the year and Small Budget On Ground Promotion of the Year.These awards were given for Cattle Loan 'Kamdhenu Campaign' and 'Talkies on

the move campaign' respectively. ICICI Bank's Germany Branch has been certified by Stiftung Warrentest. ICICI

Bank is ranked 2nd amongst 57 savings products across 19 banks ICICI Bank Germany won the yearly banking test of the investor magazine euro

in the call money category. The ICICI Bank was awarded the runner's up position in Gartner Business

Intelligence and Excellence Award for Asia Pacific for its Business Intelligencefunctions.

ICICI Bank's Organisational Excellence Group was recently awarded ISO9001:2008 certification by TUV Nord. The scope of certification comprisedprocesses around consulting and capability building on methods of quality &

improvements. ICICI Bank has been awarded the following titles under The Asset Triple A

Country Awards for 2009: Best Transaction Bank in India Best Trade Finance Bank in India Best Cash Management Bank in India Best Domestic Custodian in India ICICI Bank has bagged the Best Cash Management Bank in India award for the

second year in a row. The other awards have been bagged for the third year in arow.

ICICI Bank Canada received the prestigious Canadian Helen Keller Award at the

Canadian Helen Keller Centre's Fifth Annual Luncheon in Toronto. The awardwas given to ICICI Bank its long-standing support to this unique training centrefor people who are deaf-blind.

ICICI Bank wins World Finance 2009 Banking Awards for Best NRI ServicesBank. ICICI Bank wins Asset Triple A Investment Awards for the BestDerivative House, Indi


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Vision:

To be the leading provider of financial services in India and a major global bank.

Mission:

We will leverage our people, technology, speed and financial capital to:

be the banker of first choice for our customers by delivering high quality, world-class products and services.

expand the frontiers of our business globally. play a proactive role in the full realization of Indias potential. maintain a healthy financial profile and diversify our earnings across businesses

and geographies. maintain high standards of governance and ethics. contribute positively to the various countries and markets in which we operate. create value for our stakeholders.


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S.W.O.T. analysis of ICICI BANK

Introduction to SWOT Analysis.

The overall evaluation of the companys Strength, Weakness, Opportunities and

Threats is called as SWOT Analysis.

The external environment analysis of any business will give you the opportunities

and threats facing the business. The external environment consist of two parts:

1) Macro Environment: Demographic, Economic, Technology, Political-legal,

Socio-cultural

2) Micro Environment: Customers, Competition, Distributors, Suppliers.

The Internal Environment Analysis will give you the strength and weakness of the

business.

Opportunity Matrix

A Marketing opportunity is an area of interest in which a company can perform

profitably. An opportunity can take many forms. Some of them are:

1) Buying process made easy- Internet shopping

2) Meet the information needs of the customers in a betterway.3) A company can customize the product which was originally offered in standard

form.


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OPPORTUNITY MATRIX.

The opportunities that fall under the first quadrant are higher on the side of

success probability and also on the attractiveness, so the company should tap

those opportunities as early as possible.

The opportunities falling under the second quadrant should be

tapped only after the success of the opportunities in the first quadrant. Although

the success probability is on the lower side still the attractiveness is on the

higher side.

The opportunities in the third quadrant are less important as compared to the

opportunities in the first and second quadrant. Although the attractiveness is on

the lower side but the success probabilities of these opportunities are on the

higher side.

The opportunities in the fourth quadrant are negligible as the success probabilityand attractiveness both are on the lower side


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Threat Matrix.

An Environmental Threat is a challenge posed by an unfavourable trend or

development. In the absence of any defensive marketing action these threats may

lead to deterioration in sales and indirectly in the profits of the company.

THREAT MATRIX.

The Threats falling under the first quadrant are harmful to the progress of the firm.

Their occurrence probability and also the seriousness is on the higher side.

Therefore the company should take immediate actions against these threats.

The Threats falling under the second quadrant are also very harmful as their

seriousness of these threats is on the higher side, although the probability

occurrence is on the lower side.

The Threats coming under the third quadrant are less serious as compared to the

threats in the first and second quadrant. The company should keep a backup plans

for these threats as this can also affect the profitability of the company.

The Threats under the fourth quadrant are negligible as the probability occurrence

and seriousness both are on the lower side of the matrix.


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Introduction to ICICI Bank

-The ICICI Bank Managing Director and CEO, Mr K.V. Kamath, and the Joint

Managing Director, Ms Lalita D. Gupte, addressing a press conference to the

announce bank's results in Mumbai on Saturday.

INTRO:

The Bank went on to cross-sell and up-sell its products aggressively,

growing into Indias second largest bank. But ICICI was not only looking at

banking. In 1993, the company set-up ICICI Securities and Finance Company

Limited in a joint venture with JP Morgan, and the same year, it set up ICICI Asset

Management Company. This was the just the beginning; several mergers,

acquisitions and joint ventures followed

ICICI is one of the leading private sector banks in India,

which combines financial strength with a reputation for innovation and a universal

culture that embraces change.ICICI, a colossal presence on the Indian financial

scene, has an element of enormity in all that it does from ambition to projections

and achievements. Ranked as the number one bank in India several times, this

institution appears virtually unstoppable, but can it, in fact, fall prey to weakness?

ICICIs

impressive rise over the last couple decades cannot be denied, but now as the brand

starts to over extend with a dizzying array of products and services, one worries

that an impressive fall may follow.


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SWOT Analysis of ICICI Bank.

STRENGHTS:

1) Online Services: ICICI Bank provides online services of all its banking facilities.

It also provides D-Mart account facilities on-line, so a person can access his account

from anywhere he is.

[D-Mart is a dematerialized account opened by a salaried person for

purchase & sale of shares of different companies.]

2) Advanced Infrastructure: Branches of ICICI Bank are well equipped withadvanced technology to provide the customers with taster banking services. All the

computerized machines are located in suitable manner & are very useful to the

customers & staff of the bank.

3) Friendly Staff: The staff of ICICI Bank in all branches is very friendly & help the

customers in all cases. They provide faster services along with bonding & personal

relationship with the customers.

4) 12 hrs. Banking services: Compared to other bank ICICI bank provides long hrs.

of services i.e. 8-8 services to the customers. This service is one of its kind & is very

helpful for the customers who are in urgent need of money.

5) Other Facilities to the Customers & Employees: ICICI Bank also provides other

facilities like drinking water facilities, proper sitting arrangements to the customers.

And there are also proper Ventilation & sanitary facilities for the employees of the

bank.

6) Late night ATM services: ICICI bank provides late night ATM services to the

customers. The ATM centers of ICICI bank works even after 11:00pm. at night in

certain branches.

Weakness:

1) High Bank Service Charges: ICICI bank charges highly to customers for the

services provided by them when compared to other bank & that is why it is only in

the reach of higher class of society.


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2) Less Credit Period: ICICI bank provides credit facilities but only upto limited

period. Even when the credit period is not over it sends reminder letters to the

customers which may annoy the

OPPORTUNITIES:

1) Bank Insurance services: The bank should also provide insurance services. That

means the bank can have a tie-up with a insurance company. The bank will

advertise & promote the different policies introduced by the insurance company &

convince their customers to buy insurance policies.

2) Increase in percentage of Returns on increase: The bank should provide higher

returns on deposits in comparison of the present situation. This will also upto largeextent help the bank earn profits & popularity.

3) Recruit professionally guided students: Bank & Insurance is a special non-aid

course where the students specialize in the functioning & services of the bank & also

are knowledge about various tax policies. The bank can recruit these students

through tie-ups with colleges. Such students will surely prove as an asset to the

bank.

4) Associate with social cause: The bank can also associate itself with social causeslike providing relief aid patients, funding towards natural calamities. But this falls

in the 4th quadrant so the bank should neglect it.

THREATS

1) Competition: ICICI Bank is facing tight competition locally as well as

internationally. Bank like CITI Bank, HSBC, ABM, Standered Chartered, HDFC

also provide equivalent facilities like ICICI do and also ICICI do not have

consistency in its international operation.

2) Net Services: ICICI Bank provides all kind of services on-line. There can be easy

access to the e-mail ids of the customers through wrong people. The confidential

information of the customers can be leaked easily through the e-mail ids.


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3) Decentralized Management: Each branch manager is given the authority of

taking decisions in their respective branches. The decisions made by different

managers are diverse and any one wrong decision can laid to heavy losses to the

bank.

4) No Proper Facilities To Uneducated customers: ICICI Bank provides all services

through electronic computerized machines. This creates problems to the less

educated people. But this threat falls in the 4 th quadrant so its negligible. The

company can avoid this threat.

Conclusion.Thus, ICICI has been able to use technology to provide value-added service to its

customers during the last few years. For ICICI, technology is an integral part of

their business. However, their overall progress could have been smoother but for

certain internal and extraneous factors and also a pressure on spreads due to a

competitive market (Annual report, 2000 01). E-banking has become a necessary

survival weapon and is fundamentally changing the banking industry worldwide. To

day, the click of the mouse offers customers banking services at a much lower cost

and also empowers them with unprecedented freedom in choosing vendors for their

financial service needs. No country today has a choice- whether to implement E-

banking or not given the global and competitive nature of the economy. ICICI have

toupgrade and constantly think of new innovative customized packages and services

to remain competitive. The invasion of banking by technology has created an

information age and commoditization of banking services. ICICI have come to

realize that survival in the new e-economy depends on delivering some or all of their

banking services on the Internet while continuing to support their traditional

infrastructure. The rise of E-banking is redefining business relationships and the

most successful banks will be those that can truly strengthen their relationship with

their customers. Without any doubt, the international scope of E-banking provides

new growth perspectives and Internet business is a catalyst for new technologies and

new business processes.


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Competition:

State Bank of India -State Bank of India, a public sector bank, is the largest bank inIndia.[24] Besides personal and corporate banking, SBI is also involved in NRI (NonResident Indian) services through its network in India and overseas. It is the only bankthat figures in Fortunes top 100 banks. Its 11,000 branches and 5,600 automatic tellermachines give it a reach throughout the length and breadth of the country; its work forceof 200,000 dwarfs all other banks in India.

Punjab National bank - Punjab National Bank (PNB) is the second largestgovernment-owned commercial bankin India with about 4,500 branches across 764 cities.This financial institution offers services in personal and corporate banking, includingindustrial, agricultural, and export finance, as well as international banking. It competes

with ICICI mostly in retail lending and wholesale businesses

HDFC - Housing Development Finance Corporation Limited Bank Limited orHDFCBank is one of the largest private banks in India. The company competes with ICICI ineach segment, over a wide range of banking services covering commercial and investmentbanking on the wholesale side and transactional/branch banking on the retail side.Recently, HDFC has overtaken ICICI Bank in terms of number of branches. HDFC'sStandard Life Insurance company competes with ICICI's insurancesubsidiaries. Theirmutualfund and asset management businesses are also in direct tussle.

Bank of Baroda - Bank of Baroda is another private player. It has an edge over ICICIdue to its rich countrywide network of over 2800 branches. It also has significantinternational presence with a network of 74 offices in 25 countries.

Total Deposits Total Advances Net profit Total Assets Branches

ICICI Bank 2,305.10 1,958.66 31.10 3,453.12 1,400

State Bank of India 4,355.21 3,373.36 45.41 5,665.65 10,186

Punjab National Bank 1, 398.60 1,990.48 20.48 1,990.48 4,500

HDFC Bank 1,007.69 634.27 15.90 1,332.51 1,412

Bank of Baroda 1,520.34 1,067.01 14.35 1,795.99 2,800(all money figures in Rs. billions, as on 31st March, 2008) Sources:[31][32][33]
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Company Overview

The bank, headquartered in Mumbai, has a network of about 1,400 branches and 4,530ATMs in India and a presence in 18 countries. It offers a wide range of banking productsand financial services to corporate and retail customers through its specialized subsidiariesand affiliates in the areas ofinvestment banking, life and non-life insurance, venture capitalandasset management. The bank currently has subsidiaries in the United Kingdom, Russiaand Canada, branches in United States, Singapore, Bahrain, Hong Kong, Sri Lanka, Qatarand Dubai.

ICICI Company Structure (as on 31st December, 2007)

Business and Financial Metrics

In the quarter ended September 30, 2008, the bank reported a 42% year-on-year increasein core operating profit. The bank's current and savings account (CASA) ratio increased to30% in 2008 from 25% in 2007.[9] ICICI's earnings and net income have growncontinuously -- its income increased by a compound annual growth rate (CAGR) of 58%from1999-2008 to Rs 31.15 billion.[2] Its interest income has grown at CAGR 56% from1999-2008. This growth has been sustained in part by achieving robust growth in its feeincome from both corporate and retail businesses. Its fee income, about 40% of its totalincome, is the highest among Indian banks and comparable with global banks. Thegrowth has also been fueled by strengthening its deposit franchise and significantly

scaling up its international banking operations.Key Financial Metrics (in Rs. billions) 2008 2007 2006

Interest Income 340.94 240.02 151.35

Net Income 31.15 26.33 23.99

Net Interest Income / Total Funds (%) 1.96 1.89 2.24
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Revenue 605.31 415.42 254.68

Total Assets 4,862.48 3,949.84 2,776.56

Business Per Employee 0.1008 0.1027 0.0905

Source: Company reports

Net Income and Revenue

Business Segments

Retail Banking (58% of Revenue)ICICI Bank is the largest provider of retail creditin India. Its total retail portfolio was Rs.1,316.63 billion at March 31, 2008, constituting 58% of total loans at that date. ICICI hascontinued its focus on strengthening its retail deposit franchise to create a stable fundingbase. Its currentand savings account(CASA) deposits as a percentage of total deposits

increased from 22% at March 31, 2007 to 26% at March 31, 2008, withsavings account

deposits increasing by 36% during fiscal 2008. During the year, it also expanded itsbranch network substantially. At March 31, 2008, it had 1,262 branches & extensioncounters compared to 755 branches & extension counters at March 31, 2007, includingthe addition of about 200 branches through the merger of Sangli Bank. Its branchnetwork has further increased to 1,367 as of May 31, 2008.
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ICICI Revenue Decomposition (as on 30th September, 2008)

Small Enterprises (8% Revenue)

During fiscal 2008, ICICI's small enterprises customer base increased by 26% to about1.1 million accounts. It has introduced its service offerings in over 400 new branches,increasing its coverage to over 1,000 branches. During 2008, ICICI focused on productspecialization including investment banking for SMEs.

Corporate Banking & Project Finance (13% Revenue)

ICICI offers a complete range of corporate banking products including rupee and foreigncurrency debt, working capitalcredit, structured financing, syndication and transactionbanking products and services. Fiscal 2008 saw continued demand forcredit from the

corporate sector, with growth and additional investment demand across all sectors.Making use of its rich international presence, during fiscal 2008, ICICI was involved in75% of outbound mergers and acquisitions deals from India. It is now a preferred partnerfor Indian companies for syndication of external commercial borrowings and other fundraising in international markets and has been ranked number one in offshore loansyndications of Indian corporates in calendar year 2007.Project Finance is the financing of long-term infrastructure and industrial projects basedupon a complex financial structure where project debt and equity are used to finance theproject, rather than thebalance sheets of project sponsors. ICICI has the lead arrangerposition across a variety of project finance transactions in diverse sectors. In 2008, it alsoforayed into select international project finance transactions.

International Banking (21% Revenue)

In 2001, ICICI identified international banking as a key opportunity. This businesssegment is ICICI's highest growth segment (95.6% year-on-year growth). ICICI'sinternational strategy is focused on building a retail deposit franchise, diverse wholesalefunding sources and strong syndication capabilities to support its corporate and
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investment banking business, and achieving the status of a non-resident Indian (NRI)community bank in key markets.

Key Trends and Forces:

Indian companies increasing commercial borrowing for both international and domesticgrowth a key lever for ICICI's growthICICI Bank is a the preferred partner for a large number of Indian companies that need toraise debtfrom foreign creditmarkets in the form of external commercial borrowing(ECB). The aggregate external commercial borrowing by Indian companies increased bya CAGR of 59.1% between 2004-07. ICICI Bank is the preferred lead arranger for a largenumber of these transactions and this revenue stream should continue to boost ICICIs feeincome.ICICI Bank is currently the best-placed Indian bank to cater to Indian companiesincreasing appetite for international mergers and acquisitions. During fiscal 2008, ICICI

was involved in 75% of outbound mergers and acquisitions deals from India. It is now apreferred partner for Indian companies for syndication of external commercialborrowings and other fund raising in international markets and has been ranked numberone in offshore loan syndications of Indian corporates in calendar year 2007.Reserve Bank of India (RBI) approval for new branches leads to increase in low-costdepositsThe RBI approved 587 new deposit-taking branches for ICICI Bank in 2008. In 2007, ithad approved 450 branches for ICICI. Bank branch expansion in India is regulated byRBI and banks cannot expand their branch network without RBIs approval. As low-costdeposits are directly tied to the size of the branch network, the number of branches a bankhas, is a key success factor for any bank in India. While public sector banks (state owned

banks) enjoy a pre-eminent position in terms of low-cost deposit base (also called CASAdeposits in India stands forCurrent Accounts and Savings Account), private-sector bankshave been increasing their CASA base steadily over the years. ICICI Bank has expandedits CASA market share by 218% over the period of 2003-2007. The banks CASA depositshave grown at a CAGR of 61% over the same period, compared with a growth of 17.1%for public-sector banks, 32.5% for private sector banks and 29% for foreign banks inIndia.
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Interest rate fluctuations increase ICICI Bank debt paymentsTaking advantage of theeasy liquidity conditions in the international markets and depreciating foreign currencies,

ICICI Bank

Borrowing Mix for ICICI Bank (Source: BNP Paribas Research)dramatically increased its external commercial borrowing between FY04 and FY07 (asthe green line in the Borrowing Mix of ICICI graph shows). While this strategy hasserved it well in the past, the recent turmoil in the international credit markets have causedits borrowing costs (overLIBOR) to widen. The global currencies- American dollar andeuro have also appreciated with respect to the Indian Rupee, increasing their borrowingcosts. An inability to improve the funding mix in favour of low cost deposits hampers thebanks ability to improve its net interest margins in line with the competition. Prolongeddependence on wholesale deposits will cause the net interest margins for the bank to be

volatile and could result in some loss ofmarket share, especially in the retail lendingportfolio.In the domestic market, RBI had tightened domestic liquidity conditions in 2007 and firsthalf of 2008 through cash reserve ratio increases, repot rate hikes and other mechanisms.Interest rates have been eased in the last quarter of 2008 and this should further boost thebanks net interest margins.

FIANCIAL STATEMENT OF ICICI BANK
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Latest Quarterly/Halfyearly

As on(Months) 31-Mar-10(3) 31-Mar-09(3) % Change

Interest Income 58269.80 75296.90 -22.61

Other Income 18908.40 16736.70 12.98

Total Income 77178.20 92033.60 -16.14Interest Expenses 37920.40 53908.50 -29.66

Other Expenses 15268.90 16570.50 -7.85

Provision & Contingencies 9897.50 10845.40 -8.74

OPBDT 14091.40 10709.20 31.58

Depreciation 0.00 0.00 --

Extra-Ordinary / Cash Adjustment 0.00 0.00 --

Provision for Tax 4035.70 3271.60 23.36

After tax Profit 10055.70 7437.60 35.20

Equity Capital 11148.90 11132.90 0.14

Reserves 505034.80 484197.30 4.30

Notes to Accounts Click here Click here Click here

Income Statement

31-Mar-09(12) 31-Mar-08(12) 31-Mar-07(12)

Profit/Loss A/C Rs. mn %OI Rs. mn %OI Rs. mn %OI

Interest Income Earned310925.4

880.35

307883.43

77.75229942.9

279.50

Commission, Exchange and BrokerageIncome

56258.93 14.54 56053.13 14.16 43308.56 14.97

Lease Income 0.00 0.00 0.00 0.00 0.00 0.00

Dividend Income 3348.23 0.87 11519.50 2.91 4484.91 1.55

Miscellaneous Income 16430.10 4.25 20535.00 5.19 11498.22 3.98

Other Income 76037.27 19.65 88107.63 22.25 59291.69 20.50

Total Income (OI)386962.7

6100.0

0395991.0

6100.0

0289234.6

0100.00

Interest Expenditure227259.3

458.73

234842.42

59.30163584.9

856.56

Employee Expenditure 19717.04 5.10 20788.97 5.25 16167.49 5.59

Depreciation 6785.97 1.75 5783.51 1.46 5447.83 1.88

Other Operating Expenditure 43948.12 11.36 54969.33 13.88 45290.25 15.66

Provision and Contingencies 38082.58 9.84 29045.84 7.33 22263.66 7.70

Total Expenditure335793.0

686.78

345430.08

87.23252754.2

187.39

Pretax Income 51169.70 13.22 50560.98 12.77 36480.39 12.61

Tax 13588.36 3.51 8983.70 2.27 5378.19 1.86

Extra Ordinary and Prior Period Items Net 0 0.00 0 0.00 0 0.00

Net Profit 37581.33 9.71 41577.28 10.50 31102.20 10.75

Adjusted Net Profit 37581.33 9.71 41577.28 10.50 31102.20 10.75

Dividend - Preference 0.04 0.00 0.04 0.00 0.04 0.00

Dividend - Equity 12245.77 3.16 12277.02 3.10 9011.69 3.12
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Balance Sheet31-Mar-09 %BT 31-Mar-08 %BT 31-Mar-07 %BT

Equity Capital 11132.90 0.29 11126.79 0.28 8898.57 0.26

Preference Capital 3500.00 0.09 3500.00 0.09 3500.00 0.10

Share Capital 14632.90 0.39 14626.79 0.37 12493.44 0.36

Reserves and Surplus 484197.29 12.77 453575.31 11.35 234139.21 6.79

Deposits 2183478.25 57.57 2444310.50 61.14 2305101.86 66.88

Borrowings 673236.89 17.75 656484.34 16.42 512560.26 14.87

Other Provisions and Liabilities 437464.30 11.53 428953.83 10.73 382286.36 11.09

Capital and Liabilities (BT) 3793009.62 100.00 3997950.76 100.00 3446581.13 100.00

Fixed Assets 38016.21 1.00 41088.97 1.03 39234.23 1.14

Investments 1030583.08 27.17 1114543.42 27.88 912578.42 26.48

Advances 2183108.49 57.56 2256160.83 56.43 1886140.06 54.72

Cash & Money at Call 299665.64 7.90 380411.29 9.52 371213.25 10.77

Other Current Assets 241636.20 6.37 205746.26 5.15 164899.23 4.78

Properties and Assets (BT) 3793009.62 100.00 3997950.76 100.00 3446581.13 100.00

Ratio Analysis

As on 31-Mar-09 31-Mar-08 31-Mar-07

Profitablility

Interest Income/Total Income (%) 80.40 77.80 76.00

Non Interest Income/Total Income (%) 19.60 22.20 24.00

Reported Net Profit/Total Income (%) 9.70 10.50 10.80

Net Interest Income/Total Income (%) 21.60 18.40 19.50

Net Interest Margin (%) 3.80 3.20 3.00

Return Related

ROE (%) 7.50 8.90 12.60

ROA (%) 1.00 1.00 0.90


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Leverage & Capital Measures

Customer loans/deposits (%) 100.00 92.30 81.80

Investments/Deposits (%) 47.20 45.60 39.60

Total Liabilities/Networth 7.70 8.60 14.20

Growth (%)

Growth in Interest Income 0.99 39.98 53.75

Growth in Interest Expenses -- 43.56 70.45

Growth in Employee cost -- 28.59 49.38

Growth in PAT -- 33.68 22.45

Growth in Deposits -- 6.04 39.63

Growth in Borrowings 2.55 28.08 33.06

Per Share

Book Value Per Share (Rs) 444.90 417.50 269.70

Earnings Per Share (Rs) 33.80 37.40 34.60

Dividend Per Share (Rs) 11.00 11.00 10.00


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Financial Statement Analysis - Efficiency Ratios

Efficiency Ratios:

Efficiency ratios are ratios that come off the the Balance Sheet and the Income Statementand therefore incorporate one dynamic statement, the income statement and one staticstatement , the balance sheet. These ratios are important in measuring the efficiency of acompany in either turning their inventory, sales, assets, accounts receivables or payables.It also ties into the ability of a company to meet both its short term and long termobligations. This is because if they do not get paid on time how will you get paid paid ontime. You may have perhaps heard the excuse 'I will pay you when I get paid' or 'Mycustomers have not paid me!'

FIRST EFFICIENCY RATIO

DSO (Days Sales Outstanding): The Days Sales Outstanding ratio shows both theaverage time it takes to turn the receivables into cash and the age, in terms of days, of acompany's accounts receivable. The ratio is regarded as a test of Efficiency for acompany. The effectiveness with which it converts its receivables into cash. This ratio isof particular importance to credit and collection associates.Best Possible DSO yields insight into delinquencies since it uses only the current portionof receivables. As a measurement, the closer the regular DSO is to the Best PossibleDSO, the closer the receivables are to the optimal level.

Best Possible DSO requires three pieces of information for calculation:

Current Receivables Total credit sales for the period analyzed The Number of days in the period analyzed

Formula:

Best Possible DSO = Current Receivables/Total Credit Sales X Number of Days

The formula:

Regular DSO = (Total Accounts Receivables/Total Credit Sales) x Number of Days inthe period that is being analyzedAn example from ourBalance sheetandIncome Statement:

Total Accounts Receivables (fromBalance Sheet) = $97,456Total Credit Sales (fromIncome Statement) = $727,116Number of days in the period = 1 year = 360 days ( some take this number as 365 days)DSO = [ $97,456 / $727,116 ] x 360 = 48.25 days
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The Interpretation:

Lumber & Building Supply Company takes approximately 48 days to convert itsaccounts receivables into cash. Compare this to their Terms of Net 30 days. This meansat an average their customers take 18 days beyond terms to pay.Review the Industry Norms and Ratios for this ratio to compare and see if they are abovebelow or equal to the others in the same industry.

SECOND EFFICIENCY RATIO

Inventory Turnover ratio: This ratio is obtained by dividing the 'Total Sales' of acompany by its 'Total Inventory'. The ratio is regarded as a test of Efficiency andindicates the rapiditity with which the company is able to move its merchandise.

The formula:

Inventory Turnover Ratio = Net Sales / InventoryIt could also be calculated as:Inventory Turnover Ratio = Cost of Goods Sold / InventoryAn example from ourBalance sheetandIncome Statement:

Net Sales = $727,116 (fromIncome Statement)Total Inventory = $156,822 (fromBalance sheet)Inventory Turnover Ratio = $727,116/ $156,822Inventory Turnover = 4.6 times

The Interpretation:Lumber & Building Supply Company is able to rotate its inventory in sales 4.6 times inone fiscal year.Review the Industry Norms and Ratios for this ratio to compare their efficiency and see ifthey are above, below or equal to the others in the same industry.

THIRD EFFICIENCY RATIO

Accounts Payable to Sales (%): This ratio is obtained by dividing the 'Accounts Payables'of a company by its 'Annual Net Sales'. This ratio gives you an indication as to how muchof their suppliers money does this company use in order to fund its Sales. Higher the ratiomeans that the company is using its suppliers as a source of cheap financing. Theworking capital of such companies could be funded by their suppliers..

The formula:

Accounts Payables to Sales Ratio = [Accounts Payables / Net Sales ] x 100An example from ourBalance sheetandIncome Statement:
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Accounts Payables = $152,240 (fromBalance sheet)Net Sales = $727,116 (fromIncome Statement)Accounts Payables to Sales Ratio = [$152,240 / $727,116] x 100Accounts Payables to Sales Ratio = 20.9%

The Interpretation:

21% of Lumber & Building Supply Company's Sales is being funded by its suppliers.Review the Industry Norms and Ratios for this ratio to compare and see if they are abovebelow or equal to the others in the same industry.

Financial Statement Analysis - Profitability Ratios

Profitability Ratios:

Profitability Ratios show how successul a company is in terms of generating returns orprofits on the Investment that it has made in the business. If a business is Liquid andEfficient it should also be Profitable.

FIRST PROFITIBILITY RATIOReturn on Sales or Profit Margin (%): The Profit Margin of a company determines itsability to withstand competition and adverse conditions like rising costs, falling prices ordeclining sales in the future. The ratio measures the percentage of profits earned perdollar of sales and thus is a measure of efficiency of the company.

The formula:

Return on Sales or Profit Margin = (Net Profit / Net Sales) x 100An example from ourBalance sheetandIncome Statement:

Total Net Profit after Interest and Taxes (fromIncome Statement) = $5,142Net Sales (fromIncome Statement) = $727,116Return on Sales or Profit Margin = [ $5,142 / $727,116] x 100Return on Sales or Profit Margin = 0.71%

The Interpretation:

Lumber & Building Supply Company makes 0.71 cents on every $1.00 of Sale
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Review the Industry Norms and Ratios for this ratio to compare and see if they are abovebelow or equal to the others in the same industry.

SECOND PROFITABILITY RATIO

Return on Assets: The Return on Assets of a company determines its ability to utilize theAssets employed in the company efficiently and effectively to earn a good return. Theratio measures the percentage of profits earned per dollar of Asset and thus is a measureof efficiency of the company in generating profits on its Assets.

The formula:

Return on Assets = (Net Profit / Total Assets) x 100An example from ourBalance sheetandIncome Statement:

Total Net Profit after Interest and Taxes (fromIncome Statement) = $5,142Total Assets (fromBalance sheet) = $320,044Return on Assets = [ $5,142 / $320,044] x 100Return on Assets = 1.60%

The Interpretation:

Lumber & Building Supply Company generates makes 1.60% return on the Assets that itemploys in its operations.Review the Industry Norms and Ratios for this ratio to compare and see if they are abovebelow or equal to the others in the same industry.

THIRD PROFITABILITY RATIOReturn on Equity or Net Worth: The Return on Equity of a company measures the abilityof the management of the company to generate adequate returns for the capital investedby the owners of a company. Generally a return of 10% would be desirable to providedividends to owners and have funds for future growth of the company

The formula:

Return on Equity or Net Worth = (Net Profit / Net Worth or Owners Equity) x 100Net Worth or Owners Equity = Total Assets (minus) Total LiabilityAn example from ourBalance sheetandIncome Statement:

Total Net Profit after Interest and Taxes (fromIncome Statement) = $5,142Net Worth (fromBalance sheet) = $133,522Return on Net Worth = [ $5,142 / $133,522] x 100Return on Equity or Return on Net Worth = 3.85%
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The Interpretation:

Lumber & Building Supply Company generates a 3.85% percent return on the capitalinvested by the owners of the company.Review the Industry Norms and Ratios for this ratio to compare and see if they are above

below or equal to the others in the same industry.
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a report on profitability of icici pru

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