Company Analysis

COMPANY ANALYSIS

BANK OF BARODA

CORPORATE OVERVIEW 

CORPORATE HISTIORY:

 The bank was brought into existence by a Ordinance issue on 19thJuly , by the Central

Government. The Government of India under taking and carries on all types of banking business including foreign exchange.

 The bank sponsored and set-up five RRbs taking the total number of RRbs to 19.  The erstwhile ‘Trades Bank Ltd’ was amalgamated with the Bank.  The bank received ‘in principal’ approval from RBI to set up a separate subsidiary for its

credit card business.

 The

Company lead managed I public and 5 rights issue aggregating Rs.40.541 lakhs through BOB Capital Marks Ltd.

 Bank of Baroda (BOB)has received permission from the Reserve Bank of India to open a

branch at Durban in South Africa.

 Bank of Baroda(BOB) plans to have an alliance with a foreign bank

banking.

for merchant

 Bank of India(BOB) has revised the rate of interest on its FCNR(B) deposits for various

maturities and different currencies with effect from February.

 Bank of Baroda (BOB) will launch seven day banking in two branches of Chennai and

Mylapore and K.K Nagar ,on 17th August.

 The Bank will introduce 7-day banking at 10 branches in Mumbai from October 8th .  Bank of Baroda proposes to go in for a major drive to expand its ATM network across the

country.

KEY FACTS:  Starting place: Baroda House Mondvi vadodra  person who starts : Mallaya

Ø In its quest become a multi specialist bank took a large no business Oriented and customer centric initiative during 2007-2008. Ø It completed cbs roll out in 1700 branches in India more than 90 percent total business and expected in atm net work tuch the count of 1100 by end of mach 2008. Ø Targeting on improving non interest income through innovate wealth management product. Ø A dedicated effort to add 2.5 to3.0 million qualities customers to bank book in 09 and in subsequent years. Ø Bank hr reference and continuous improvement super experience bank board baced business exp with cost continuousness. KEY PEOPLE : Sri . M.D MALLYA Sri.V.SANTHANARAMAN Sri. AMITABH VERMA DR.DHARMENDRA BHANDARI

v M.D.MALLAYA Sri. M.D. Mallaya has taken over as Chairman and Managing Director of Bank of Baroda on 07thMay, 2008. prior to joining the Bank. He was the Chairmen & Managing Director of Bank Maharashtra.

Sri . V. Santhanaraman: Mr. V. Santhanaraman is Executive Director of bank Baroda since 10th October, 2006.He is a whole time Director appointed by the Government of India. He is also a Director on the Board of Bank Baroda

sri. Amitabh verm:

sri amitabh verma I A S officer of 1982 batch is it joint secretary (BOA) in the ministry of department of financial services. He is post graduate in political science from university of Delhi and also holds a post-graduate degree in economics. zania)ltd.

Dr. Dharmendra Bhandari: Dr. Dharmendra Bhandari is an elected director representing the share holders of the Bank other than Central Government .He is a chartered Accountant and also holds a Doctorate degree in Taxation of Nonresident India.

BUSINESS PERFORMANCE BUSINESS SEGMENTS PRODUCTS\SERVICES Ø The bank received in principle approfval from rbi to set up a separate subsidiary for its credit card business. Ø The bank in stalled several measures, to bring quality improvement. First India credit cards interdicted for international use. Ø Bob has been desighinated as a c lerining bank for castor oil trading in the fecture launched by the bombay oil seeds and oil excahnges. Ø Bod launched e-banking products

GEOGRAPHICAL SEGMENT ATION Bank established a ‘Non-resident portfolio Management consultancy cell ‘.Due to closure of 2 branch in U.K. and I branch in USE, npn-operative branch in Bangladesh was hot taken into account. Bank of Baroda(BoB) hgsa received permisson from the reserve bank of India to opin abranch at durban in south Africa. Bob fescal servecel ltd. Bob launched e-booking systemchennai in products. Bank of Baroda houseing finance,a subsidiary of the bank of baroda,has disbursed a sum of Rs5- 50.0 crore to2578 beneficiaries in rural and semi-urban areas under the golden rural housing schemes of the National housing bank.

KEY PARTNERS-ALLIENCE BOB signs memorandum of cooperation with EXIM bank BOB signs memorandum of cooperation with EXIM bank. Bank of Baroda inks co-financing agreement with SIDBI. Bob sign as contact with HP India sales Pvt. Ltd for implementation of Banks IT enabled Business Transformation process.  BOB has tied up with Mahindra and Mahindra Ltd (M&M) for tractor financing.  Ties up with Chennai-based Tractor &Farm Equipments Ltd(TAFE) for financing their tractors.  Ties up with Punjab Tractors for offering finance to farmers buying tractors from Punjab Tractors.    

SWOT ANALYSIS v STRENGTHS: 1. Fast in transactional process 2.Earning the confidence of the customers. 3. Strong organization line up. 4.Good and response to the customers. 5.Offering more number of service than the customers.

v WEAKNESSES: 1.Lack of individual decision making. 2.Dependence on RBI for Interest rates. 3.Regulation of Interest rates basing on RBI.

●

OPPURTUNITIES

1.Liberating the banking regulation is providing more opportunities. 2.Entering into alliance offr9ing diversified products and services.

v THREATS 1.Service competition from private and global blanks possess a new threat. 2.Threat from private banking sector. The Managing Director ,Boards of Directors and Organizational line up are working in order to over come the thetas and weakness.

Financial performance Financial Highlights 1.Total Business (Deposit+ Advances)

increased to Rs.2,58,735,45 corer

reflecting a growth of 24.07%. 2.Gross profit and net profit were Rs.3,028,55 crore and Rs 1,435,52 corer respectively ,net profit registered a growth of 39.85% over previous year. 3.Retail Credit posted a decent growth of 17.97% constituting 19.79% of Gross Domestic Credit against 20.98% last year. 4.Net Interest Margin (NIM) as per cent of interest earning assets was at the level of 2.90% 5.Net Worth improved to Rs. 9,526,97 crore registering a rise of 12.93%.

RATIO ANALYSIS Gross Profit Ratio(Gross Profit/sales)*100 YEAR G.P SALES RATIO 2004-05 2485.3 6146.99 40.53 2005-2006 2301.9 6431.41 35.79 2006-2007 2031.65 7100 28.61 2007-2008 2415.01 9212.64 26.21 2008-2009 3028.55 11813.47 25.64

NET PROFIT RATIO Net Profit Ratio(Net Profit/Netsales)*100 YEAR N.P SALES RATIO 2004-2005 967 6146.99 15.73 2005-2006 676.846431.41 10.52 2006-2007 826.967100 11.65 2007-2008 1026.47 9212.64 11.14 2008-2009 1435.52 118113.47 12.15

FINDING AND SUGGESTIONS

FINDINGS 1.The operating profit ratio of the Bank is gradually incresing from year to year. 2. Similarly the fixed assets turnover ratio and capital turnover are also gradually increasing in every. 3.The ratios that are gradually decreasing every year are net profit ratio and Gross profit ratio. 4.In financial ratio the current ratio is gradually decreasing while the absolute liquidity ratio gradually increasing. 5.The operating profit is gradually increasing 547.22 to 724.00.

OUTLOOK ANALYSIS VIEW BANK OF BARODA

Ø The out look on this stock positive. The upside target is Rs.188. Consider buying the December future on the Initiated the position with stop at Rs.161. Ø This trading pattern suggests that the position cannot be effectively hedged. with puts. Ø If the stock rises to Rs.188 at the horizon, the long December futures will generate 20 points per unit(1,400 units per contract) Ø If the stock triggers the stop of Rs. 161 the position will lose 7 points per unit. Ø Note that the trading strategy will be sub-optimal if profit talking pushes the stock down to the stop level first.

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