INSTITUTE FOR TECHNOLOGY AND MANAGEMENT

EQUITY RESEARCH ON BANKING SECTOR

FACULTY GUIDE : PROF. VIJAYANTA PAWASE BY : SAGAR MODI

COMPANY GUIDE : MR. NIKESH RUPAREL PGDM 1985

FINANCE 1

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OBJECTIVES

To apply principles and theories learned in classroom in a

professional environment To understand the formal and informal relationships in an

organization To understand the basics of Equity research Fundamental analysis of Banking sector Technical analysis of selected stocks To provide an overview of Banking sector To create a virtual mutual fund and to compare total fund’s NAV with

SENSEX

COMPANY’S PROFILE

Established in 1994 The investment manager of Birla Sun Life Mutual Fund Joint venture between the Aditya Birla Group and the Sun Life

Financial Inc. of Canada.

Assure Fund Income Advantage Fund Protector Fund Builder Fund Balancer Fund Enhancer Fund Magnifier Fund

CLASSROOM TRAINING

• Goal Setting

• Risk Profiling

• Asset Allocation

• Equity Market

• Debt Market

• Mutual Fund

• Life/General Insurance

• Fundamental Analysis

• Online Share Trading

• M & A

• Venture Capital

• Private Equity

• Sector Analysis

• IPO

• FPO

• Technical Analysis

• Target Achieved

- Sold a Life Insurance Policy o of Rs. 50000

BANKING SECTOR IN INDIA

1876.8 billion US $ - India’s GDP in 2014

10% contribution from Insurance and banking

58.7% of the households have access to banking services

1,15,082 (38.2% in rural) bank branch network

1,60,055 (14.58% in rural) ATM network

BUSINESS DIVISIONA. Retail Banking

B. Wholesale Banking

C. Treasury Operation

D. Other Banking Businesses

IMPACT OF UNION BUDGET 2014-15

POSITIVE IMPACT Allowed PSU banks to raise capital by selling Govt. stake Allowed banks to raise long-term funds for lending to the

Infrastructure sector Increase in Tax exemptions

NEGATIVE IMPACT PSU Banks would need Rs. 2.4 lakh crore Govt. infusion by 2018 Hike in farm credit from 7 lakh crore to 8 lakh crore

RECENT DEVELOPMENT

PRADHAN MANTRI JAN - DHAN YOJNA

- launched by the Prime Minister of India,

Narendra Modi on 28 August 2014

OBJECTIVES :

- Universal access to banking facilities

- Providing Basic Banking Accounts with overdraft facility

and RuPay Debit card to all households

- An inbuilt Accident insurance

- Financial Literacy Programme

SWOT ANALYSIS

STRENTHS WEAKNESSES - Valuable contributor to GDP - Increasing NPA

- Regulatory environment - Lack of product differentiation

- Government support - Low penetration

OPPORTUNITIES THREATS

- Modern technology - Customer dissatisfaction

- Untapped rural market - Rise of monopolistic structure

- Globalization

PEST ANALYSIS

POLITICAL FACTORS ECONOMIC FACTORS- Monitary policy - More saving

- Changes in interest rates - More capital formation

- Budget and budget measures - Increase in production of goods and s services

SOCIAL FACTORS TECHNOLOGICAL FACTORS

- Increase in population - Internet banking

- Changes in lifestyle - IT services and mobile banking

- Exploring banking facilities - Credit cards

in rural areas

PORTER’S FIVE FORCES

Supply : Liquidity is controlled by the Reserve Bank of India (RBI).

Demand : India is a growing economy and demand for credit is high

Barriers to entry : Licensing requirement, investment in technology and b branch network, capital requirements.

Bargaining power : During periods of tight liquidity. Depositors

of suppliers m may invest elsewhere if interest rates fall.

Competition : Public sector, private sector and foreign banks along with non non banking finance companies competing in similar business business segments

TECHNICAL ANALYSIS

CUP WITH HANDLE CUP WITH HANDLE

TECHNICAL ANALYSIS

SYMMETRICAL TRIANGLE ASCENDING TRIANGLE

TECHNICAL ANALYSIS

ROUNDING BOTTOM

GROWTH ENHANCER FUND

CONCUSION

SENSEX AND NAV COMARISION

RECOMMENDATION

Invest for long - term Invest in Private sector banks stocks Do not rely on Intra – Day trading To Invest in Mutual Fund is the best option