PIONEER INSTITUTE OF PROFESSIONAL STUDIES

Department of Management Research paper on

THE IMPACT OF FINANCIAL PERFORMANCE OF PUNJAB NATIONAL BANK ON ITS SHARE PRICE.

GUIDED BY :BY:PROF. RASHMI CHOUDHARY

SHITLANI

SUBMITTED

MANISH

MBA 3rd (MF1)

CONTENTS
1) Introduction Conceptual frame work 2) 3) 4) 5) 6) 7) 8) Defining Variables Industry Growth rate Objective(s) Literature Review Research Methodology Research Type Tools for data analysis Major results Conclusion References

INTRODUCTION

Distinction of being the first Indian bank to have been started solely with Indian capital It has over 60 million satisfied customers and more than 5100 offices including 5 overseas branches Strong correspondent banking relationships with more than 217international banks of the world

Anytime Anywhere banking facility to all customers including customers of more than 3200 nd

More than 50 renowned international banks maintain their Rupee Accounts with PNB

The Bank has been able to maintain its stakeholders interest by posting an improved NIM of 3.96% in Mar11 (3.57% Mar10). Towards developing a cost effective alternative channels of delivery, the Bank with 5050 ATMs has the largest ATM network amongst Nationalized Banks.

1.1 Conceptual frame work :

The project work entitled THE IMPACT OF FINANCIAL PERFORMANCE OF PUNJAB NATIONAL BANK ON ITS SHARE PRICE In this study the financial performance of bank will studied and after that its impact on its share prices will be seen on yearly bases. In assessing the significance of various industry financial data, experts engage in financial ratio analysis, which is the process of determining & evaluating financial ratios, this ratio help to know the actual performance of Punjab National Bank & then find out its impact on its Share price. The basic sources for these ratios are the company financial statements within which the industry contain figure on assets & liability, profit & losses.

1.2

Defining Variable:

Share Price :- A share price is the price of a single share of a number of saleable stocks of a company. Once the stock is purchased, the owner becomes a shareholder of the company that issued the share.

Financial Performance :- A subjective measure of how well a firm can use assets from its primary mode of business and generate revenues. This term is also used as a general measure of a firm's overall financial health over a given period of time, and can be used to compare similar firms across the same industry or to compare industries or sectors in aggregation.

Ratios Analysis :- A tool used by individuals to conduct a quantitative analysis of information in a company's financial statements. Ratios are calculated from current year numbers and are then compared to previous years, other companies, the industry, or even the economy to judge the performance of the company. Ratio analysis is predominately used by proponents of fundamental analysis.

OBJECTIVE (S)

The main objectives of the project undertaken are-

To study the financial performance of Punjab National Bank.

To study the impact of Profitability ratios of Bank on its share price.

LITERATURE REVIEW Punjab National Bank posts marginal rise in first quarter profit by krsrivats@thehindu.co.in
New Delhi, July 28: The report was given by the editor of HINDUSTAN TIMES that 3.44 per cent increase in net profit for the quarter ended June 30, 2011, at Rs 1,105.06 crore as compared to a net profit of Rs 1,068.29 crore in the same quarter last year. Total income for the period under review increased 36.94 per cent to Rs 9,398.90 crore (Rs 6,863.38 crore). For the first quarter, the bank's net interest margin (NIM) stood at 3.84 per cent. The financial performance of the bank was satisfactory given the turbulent economic environment in the first quarter of this fiscal, said PNB officials. I still stick to the NIM guidance of 3.5 per cent that was given at the beginning of this fiscal, Mr K.R. Kamath, Chairman & Managing Director, PNB, told presspersons here. PNB's financial performance was weighed down by a 32.91 per cent increase in provisions to Rs 1,368.86 crore (Rs 1,029.88 crore). This included provision for depreciation on investments in Government securities amounting to Rs 133.70 crore (Rs 13.62 crore). There was also a substantial increase in provision for standard assets at Rs 159.08 crore (Rs 40 crore). Also, trading profits for the quarter under review fell sharply to Rs 47.88 crore (Rs 121.11 crore). The other income for the quarter stood at Rs 1,083.67 crore (Rs 891.74 crore).

2) SECURITY ANALYSIS & INVESTMENT MANAGEMENT FUNDAMENTAL ANALYSIS ON PUNJAB NATIONAL BANK LIMITED by Ashutosh Gupta at TECNIA INSTITUTE OF ADVANCED STUDIES

Explanation for Income Statement:

1. The total income rose by 130.03% from year 2006 to 2010 and 11.84% from year 2009 to 2010. 2. The total expenditure rose by 60.06% only from year 2006 to 2010 and 19.29% from year 2009 to 2010. 3. The net profit after tax rose by 42.34% from year 2006 to 2010 and 33.02% from year 2009 to 2010.

Explanation for Balance Sheet:

1. The total assets rose by 104.20% from year 2006 to 2010 and by 20.133% from 2009 to 2010. 2. The equity was kept same from 2006 to 2010 at the level of ` 315.50 crore. 3. The Deposits rose by 108.32% from 2006 to 2010 and by 18.86% from 2009 to 2010. 4. The investments rose by 89.32% from 2006 to 2010 and by 22.62% from 2009 to 2010.

RESEARCH METHODOLOGY

Research type :Descriptive and Exploratory research. This is an secondary data base study

Sample design
The study covers period of five years from 2006-2011

Tools for the data analysis:Various Financial Ratios will be used.

References Bibliography :
1) Pandey I.M., Financial Management,
2)

C.R. Kothari., Research methodology

3) Derivative Market module under NCFM.

Webliography :
http://www.pnbindia.in/

http://www.scribd.com/ http://www.nseindia.com http://www.bseindia.com

http://www.moneycontrol.com