OPTCL Financial Performance using ratio analysis

1. Name – Sudipta Mohanty
Roll No – 2018IMBA027
Guides (Internal)- Prof.Mrs.Apeksya Sahay.
(External) =
Project On
“A Studyon Financial Performance of State Bank of India”

2. Objective of the study
 To find out the profitability of State Bank of India,
study the profitability ratios.
 To study solvency ratios to measure the financial
position of State Bank of India.
 To analyze the liquidity, profitability performance of
State Bank of India.
 To offer finding and suggestions to enhance the
financial performance of State Bank of India.

3. Research Methodology
 Method of the study: The research presented in of
type of person studied.
 Sample selection: The sample of research
presented is State Bank of India.
 Data Sources: The study is based on secondary
data that has been collected from annual reports of
the SBI bank, books, newspapers, magazines,
journals, documents, research papers, websites and
other published information.
 The study period for data analysis: The study
covers 5year data for 2016 - 2017 to 2020 - 2021 in
State Bank of India.
 Tools used in analysis :The descriptive analysis
was done using table, graphs, ratio analysis and trend

4. Company Profile
 State Bank of India is an Indian multinational, Public Sector
banking and financial services company. It is a government-
owned corporation with its headquarters in Mumbai,
Maharashtra. As of December 2013, it had assets of US$388
billion and 17,000 branches, including 190 foreign offices, making
it the largest banking and financial services company in India by
assets.
 State Bank of India is one of the Big Four banks of India, along
with Bank of Baroda, Punjab National Bank and Bank of India.
 The bank traces its ancestry to British India, through the Imperial
Bank of India, to the founding, in 1806, of the Bank of Calcutta,
making it the oldest commercial bank in the Indian Subcontinent.
Bank of Madras merged into the other two "presidency banks" in
British India, Bank of Calcutta and Bank of Bombay, to form the
Imperial Bank of India, which in turn became the State Bank of
India. Government of India owned the Imperial Bank of India in
1955, with Reserve Bank of India (India's Central Bank) taking a
60% stake, and renamed it the State Bank of India. In 2008, the
government took over the stake held by the Reserve Bank of
India.
 State Bank of India is a regional banking behemoth and has 20%

5. Topic Profile
 Financial performance principally reflects business sector outcomes and
results that shows overall financial health of the sector over a specific
period of time. It indicates that how well an entity is utilizing its
resources to maximize the shareholders wealth and profitability.
Although a complete evaluation of a firm’s financial performance takes
into account many other different kind of measures but most common
performance measurement used in the field of finance and statistical
inference is financial ratios.
 One way to analyze financial performance is to calculate key financial
ratios over the last five years. Ratios can be compared year over year to
measure progress and performance. Financial ratios are a comparison
of two or more elements of financial data. They are expressed in
percentage or as ratios.
 Since each ratio tells you a little about the farm’s financial story, it’s
important that they be analyzed collectively. One ratio with good results
or one with poor results should not alone be the basis upon which to
make management decisions, especially decisions with transition
planning implications. It is important to review all the ratios over a period
of five year timeline to reveal trends.
 Trends with stable or improving performance are the strength when
facing a potential intergenerational transfer. Trends with declining
performance can be a weakness and should be analyzed carefully
before proceeding.

6. Data analysis
 Basic Earnings per Share Ratio - It can be
analyzed that, during 2017-18 the company had the
lowest basic earnings per ratio and during 2020-21
the company is having highest ratio. Hence, the
company’s growth is increased by 25% during 5
years.
 Return on Assets - It is determined that, during the
study period the return on assets has been decreased
from 2017-2018 to 2019-20 but in 2021-21 it has been
increased and the growth of the company is
decreased by 14.29% during from 2017 to 2020.
 Net Profit Margin Ratio - It can be analyzed that,
during 5 years the company is having lowest net profit
margin ratio in the year 2017-18 and gradually

7. Data analysis
 Income to Total Assets - It can be stated that, during
5 years the company had the lowest income to total
assets i.e. 93.24 in the year 2017-18 and in the year
2019-20 it has increased by 94.82 and in the year
2020-21 the company again decreased by 93.67.
 Net Profit per Share Ratio - It can be interpreted
that, during 5 years the company is having the lowest
net profit per share in the year 2017-18 and in the
year 2019-20 and 2020-21 the company are having
highest ratio.
 Retention Ratio - It can be inferred that, the company
had the constant ratio in the year 2017-18, 2018-19
and 2019-20 during 5 years.

8. Data analysis
 Dividend per Share - It can be understood that, in the first year the
company had 2.6 ratio dividend per share and in the next 3 years the
company had no dividend per share during 5 years. The last year
company had 4.0 ratio dividend per share.
 Current Ratio - It can be inferred that, during 5 years the company
had the lowest current ratio in the year 2017-18.
 Income Statement - It can be analyzed that the Interest Earned is
increased by 7% in the year 2016-17 and increased up to 56% in the
year 2020-21 during 5 years. During 5 years the total income is less
than the total expenditure. Operating profit is increased by 57% in the
year 2020-21. Provisions and contingencies are highest in the year
2018-19 i.e. 254.52 and it was gradually decreased to 146.96. Profit
before tax is lesser in the year 2018-19. Tax is highest in the year
2020-21. Net profit is increased by 45% in the year 2020-21 and it is
lowest in the year 2018-19 during the study period.
 Balance Sheet - It can be determined that, the company’s share
capital is constant in the year 2017-18, 2018-19, 2019-20 and 2020-
21. Reserves and surplus and deposits are increasing year to year.

9. Finding
 The study of comparative study, common size
analysis and trend analysis is very good.
 The profitability position of the SBI is not good.
 The value of current ratio of SBI is irregular year
after year.
 The retention ratio indicates the equal ratio in the
year 2017-18 to 2019-20.
 The dividend per share shows no value in the
year 2017-18 to 2019-20.
 The net profit per share ratio is increased in the
year 2020-21.
 The company needs to lower the deposits and it
should increase the loans

10. Limitations of the Study
 However I tried my level best in collecting the
relevant information for my research report, yet
there are always some problems faced by the
researcher. The prime difficulties I faced in
collection of information are discussed below:
 Analysis of the study was depended only on the information
available in the internet.
 Study was restricted to the period of 5 years
 Detail study was not possible because of time constraints.
 Study process was restricted to the company’s rules and
regulations.

11. Conclusion of the Study
 A sound financial system is indispensable for a
healthy and vibrant economy. The performance of any
economy is to largest extent dependent on the
performance of the banking sector. Banks play a key
role in improving economic efficiency by channeling
funds from resources surplus unit to those with better
productive investment opportunities. The financial
system is dominated by banking industry. However,
the banking sector is very important for the economic
development of a country. The SBI is one of the
leading banks of Public sector Bank in India. The
market position of SBI is better in the year 2020-21
during last 5 years. According to this project I came to
know that from the analysis of financial performance it
is clear that SBI had been incurred the loss during the
year 2017-18. So the company should focus on
getting profits in the coming years.

12. THANK YOU