Table of Contents

Chapter -1 (Industry Analysis)

1. 2. 3. 4. 5. Industry Profile Competition in the industry Potential of new entrants into industry Power of suppliers Power of customers Threat of substitute products 03 06 06 06 06

6.

07

Chapter -2 (Company Analysis)

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. About the Company Vision and Mission Products/Offerings Competitors information Awards/Achievements Work Flow Model Mckinsey 7-s Model Organizational Structure Organizational Hierarchy SWOT Analysis 09 12 14 19 21 24 26 27 30 31

Chapter 3 (Discussion on Training)

1. 2. 3. Roles and Responsibilities Description of Task Handled Contribution to the Organization 42 43 43

Chapter 4 (Analysis of Task/Research Undertaken)

1. 2. 3. Introduction Research Design Findings, Recommendations & conclusion 45 46 48

Bibliography Annexure
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CHAPTER - I INDUSTRY ANALYSIS

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INSURANCE INDUSTRY IN INDIA

The insurance sector in India has come a full circle from being an open competitive market to
nationalization and back to a liberalized market again. Tracing the developments in the Indian insurance sector reveals the 360 degree turn witnessed over a period of almost two centuries. A brief history of the Insurance sector The business of life insurance in India in its existing form started in India in the year 1818 with the establishment of the Oriental Life Insurance Company in Calcutta.

Some of the important milestones in the life insurance business in India are: 1912: The Indian Life Assurance Companies Act enacted as the first statute to regulate the life insurance business. 1928: The Indian Insurance Companies Act enacted to enable the government to collect statistical information about both life and non-life insurance businesses. 1938: Earlier legislation consolidated and amended to by the Insurance Act with the objective of protecting the interests of the insuring public. 1956: 245 Indian and foreign insurers and provident societies taken over by the central government and nationalized. LIC formed by an Act of Parliament, viz. LIC Act,1956, with a capital contribution of Rs. 5 crore from the Government of India. The General insurance business in India, on the other hand, can trace its roots to the Triton Insurance Company Ltd., the first general insurance company established in the year 1850 in Calcutta by the British.

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INSURANCE SECTOR REFORMS

In 1993, Malhotra Committee headed by former Finance Secretary and RBI Governor R.N. Malhotra was formed to evaluate the Indian insurance industry and recommend its future direction. The Malhotra committee was set up with the objective of complementing the reforms initiated in the financial sector. The reforms were aimed at creating a more efficient and competitive financial system suitable for the requirements of the economy keeping in mind the structural changes currently underway and recognizing that insurance is an important part of the overall financial system where it was necessary to address the need for similar reforms

In 1994, the committee submitted the report and some of the key recommendations included: i) Structure Government stake in the insurance Companies to be brought down to 50% Government should take over the holdings of GIC and its subsidiaries so that these subsidiaries can act as independent corporations. All the insurance companies should be given greater freedom to operate ii) Competition Private Companies with a minimum paid up capital of Rs.1bn should be allowed to enter the industry. No Company should deal in both Life and General Insurance through a single entity. Foreign companies may be allowed to enter the industry in collaboration with the domestic companies. Postal Life Insurance should be allowed to operate in the rural market. Only one State Level Life Insurance Company should be allowed to operate in each state

With largest number of life insurance policies in force in the world, Insurance happens to be a mega opportunity in India. Its a business growing at the rate of 15-20 per cent annually and presently is of the order of Rs 450 billion. Together with banking services, it adds about 7 per cent to the countrys GDP. Gross premium collection is nearly 2 per cent of GDP and funds available with LIC for investments are 8 per cent of GDP.

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Yet, nearly 80 per cent of Indian population is without life insurance cover while health insurance and non-life insurance continues to be below international standards. And this part of the population is also subject to weak social security and pension systems with hardly any old age income security. This itself is an indicator that growth potential for the insurance sector is immense. A well-developed and evolved insurance sector is needed for economic development as it provides long term funds for infrastructure development and at the same time strengthens the risk taking ability. It is estimated that over the next ten years India would require investments of the order of one trillion US dollar. The Insurance sector, to some extent, can enable investments in infrastructure development to sustain economic growth of the country. Insurance is a federal subject in India. There are two legislations that govern the sector- The Insurance Act- 1938 and the IRDA Act- 1999. The insurance sector in India has come a full circle from being an open competitive market to nationalization and back to a liberalized market again. Tracing the developments in the Indian insurance sector reveals the 360 degree turn witnessed over a period of almost two centuries.

iii) Regulatory Body The Insurance Act should be changed An Insurance Regulatory body should be set up Controller of Insurance (Currently a part from the Finance Ministry) should be made independent

iv) Investments Mandatory Investments of LIC Life Fund in government securities to be reduced from 75% to 50% GIC and its subsidiaries are not to hold more than 5% in any company (There current holdings to be brought down to this level over a period of time)

v) Customer Service LIC should pay interest on delays in payments beyond 30 days Insurance companies must be encouraged to set up unit linked pension plans Computerization of operations and updating of technology to be carried out in the Insurance industry

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The committee emphasized that in order to improve the customer services and increase the coverage of the insurance industry should be opened up to competition. But at the same time, the committee felt the need to exercise caution as any failure on the part of new players could ruin the public confidence in the industry. Hence, it was decided to allow competition in a limited way by stipulating the minimum capital requirement of Rs.100 crore. The committee felt the need to provide greater autonomy to insurance companies in order to improve their performance and enable them to act as independent companies with economic motives. For this purpose, it had proposed setting up an independent regulatory body.

1.2 POTENTIAL OF NEW ENTRANTS INTO INDUSTRY:

It is very difficult for any new company to enter the insurance business because of lots of barriers to entry. 1. A very huge capital is required to start an insurance business. 2. As the business is regulated by IRDA a company needs license to run insurance business. 3. Insurance is a very complex business so a company needs great experience to enter.

1.3 POWER OF SUPPLIERS

Being a service industry power of supplier is negligible.

1.4 POWER OF CUSTOMER:

1. There are many companies selling somewhat similar policies so the customer has the power to choose. 2. A customer has the power to file a complaint against the insurer in IRDA or consumer forum in case of any unfair practice. 3. The customer has a power to enquire about the current status of his plan at any point of time. 4. The customer has a power to withdraw from the chosen plan within a specified period of time.

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1.5 THREATS OF SUBSTITUTE PRODUCTS

As such there is no direct substitute for an insurance policy because it is the only option available for risk management. 1. Many people buy insurance for tax saving purpose , but there are other substitute products in which a customer can invest to save tax. 2. Some people buy unit linked policy for good return on investment so they can also go for equity, MF etc.

The Insurance Regulatory and Development Authority (IRDA) Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in Parliament in December 1999. The IRDA since its incorporation as a statutory body in April 2000 has fastidiously stuck to its schedule of framing regulations and registering the private sector insurance companies. The other decision taken simultaneously to provide the supporting systems to the insurance sector and in particular the life insurance companies was the launch of the IRDAs online service for issue and renewal of licenses to agents. The approval of institutions for imparting training to agents has also ensured that the insurance companies would have a trained workforce of insurance agents in place to sell their products, which are expected to be introduced by early next year. Since being set up as an independent statutory body the IRDA has put in a framework of globally compatible regulations. In the private sector 12 life insurance and 6 general insurance companies have been registered.

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CHAPTER II

COMPANY ANALYSIS

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COMPANY PROFILE OF HDFC - STANDARD LIFE

The company was incorporated on 14th August 2000 under the name of HDFC Standard Life Insurance Company Limited. Their ambition from the beginning was to be the first private company to re-enter the life insurance market in India. On the 23rd of October 2000, this Ambition was realized when HDFC Standard Life was the first life company to be granted a Certificate of registration. HDFC are the main shareholders in HDFC Standard Life, with 81.4%, while Standard Life owns 18.6%.HDFC Standard Life Insurance Company Ltd. is one of Indias leading private life insurance companies, which offers a range of individual and group insurance solutions. It is a joint venture between Housing Development Finance Corporation Limited (HDFC Ltd.), Indias leading housing finance institution and one of the subsidiaries of Standard Life plc, leading providers of financial services in the United Kingdom. HDFC Incorporated in 1977 with a share capital of Rs 10 Crores, HDFC has since emerged as the largest residential mortgage finance institution in the country The corporation has had a series of share issues raising its capital to Rs. 119 crores. The gross premium income for the year ending March 31, 2007 stood at Rs. 2, 856 crores and new business premium income at Rs. 1,624 crores. The company has covered over 8,77,000 lives year ending March 31, 2007. HDFC operates through almost 450 locations throughout the country with its corporate headquarters in Mumbai, India. HDFC also has an International Office in Dubai, UAE, with service associates in Kuwait, Oman and Qatar. HDFC is the largest housing Company in India for the last 27 years.

Mr. Deepak S. Parekh is the Chairman of the Company. He is also the Executive Chairman of Housing Development Finance Corporation Limited (HDFC Limited). He joined HDFC Limited in a senior management position in 1978. He was inducted as a wholetime director of HDFC Limited in 1985 and was appointed as its Executive Chairman in 1993. He is the Chief Executive Officer of HDFC Limited. Mr. Parekh is a Fellow of the Institute of Chartered Accountants (England & Wales).

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JOINT VENTURE:

HDFC Standard Life Insurance Company Limited was one of the first companies to be granted license by the IRDA to operate in life insurance sector. Reach of the JV player is highly rated and been conferred with many awards. HDFC is rated AAA by both CRISIL and ICRA. Similarly, Standard Life is rated AAA both by Moodys and Standard and Poors. These reflect the efficiency with which HDFC and Standard Life manage their asset base of Rs. 15,000 Cr and Rs. 600,000 Cr. Respectively. HDFC Standard Life Insurance Company Ltd was incorporated on 14th August 2000. HDFC is the majority stakeholder in the insurance JV with 81.4 %stale and Standard of as a staple pf 18.6% Mr. Deepak Satwalekar is the MD and CEO of the venture. HDFC Standard Life Insurance Company Ltd. Is one of Indias leading Private Life Insurance Companies., which offers a range of individual and group insurance solutions. It is a joint venture between Housing Development Finance Corporation Limited (HDFC Ltd.) Indias leading housing finance institution and the Standard Life Assurance Company, a leading provider of financial services from the United Kingdom. Both the promoters are will known for their ethical dealings and financial strength and are thus committed to being a long-term player in the life insurance industry- all important factors to consider when choosing your insurer.

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A) Background and inception of the company

HDFC Standard Life Insurance Company Limited. is one of India's leading private insurance companies, which offers a range of individual and group insurance solutions. It is a joint venture between Housing Development Finance Corporation Limited (HDFC Limited), India's leading housing finance institution and a Group Company of the Standard Life Plc, UK. As on February 28, 2009 HDFC Ltd. holds 72.43% and Standard Life (Mauritius Holding) 2006, Ltd. holds 26.00% of equity in the joint venture, while the rest is held by others. The company was incorporated on 14th august 2000 under the name of Hdfc Standard Life Insurance Company Ltd. The ambition of the company from as far back as October 1995 was to be the first private company to re-enter the life insurance market in India ,on 23rd of October 2000,this ambition was realized when HDFC LIFE was the only life insurance company to be granted certification of registration . Hdfc Standard Life has a long and close relationship build upon shared value and trust. The ambition of Hdfc Standard Life is to mirror the success of the parent company and be the yard stick by which all other insurance companies in India are measured. HDFC Life is a joint venture between HDFC, Indias largest housing finance institution standard life assurance company , Europes largest housing finance institution and standard life assurance companies , Europes largest mutual life company HDFC over RS- 280000 CRORES.

B) Nature of the business carried

HDFC Standard Life Insurance is into a business of insurance. It is one of the first private insurance companies. Its sell various insurance policy based on the needs of consumer. Its has traditional insurance plan as well as modern ulip plan in its portfolio, But HDFC is in diversified business like banking, housing finance, securities and also.

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C) Vision, Mission and quality policy Vision

The most successful and admired life insurance company, which mean that we are the most trusted company, the easiest to deal with, offer the best value for money, and set the standards in the industry. In short, The most obvious choice for all.

Mission
We aim to be the top new life insurance company in the market. This does not just mean being the largest or the most productive company in the market, rather it is a combination of several things like

Customer service of the highest order Value for money for customers Professionalism in carrying out business Innovative products to cater to different needs of different customers Use of technology to improve service standards Increasing market share

Values

Integrity Innovation Customer centric People Care One for all and all for one Team work Joy and Simplicity

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Quality policy
Quality road map time lines Phase-1 to phase-3 should run simultaneously

Phases

Objectives

Visible proof

When

Phase-5

Business excellence

BE award (external)/service guarantee

12-24 months and Improve levels

Phase-4

Value stream map projects Process maturity

6 sigma processes, SLA, financial benefit. Process complaint functions

6-8 months and improve 8-12 months and sustenance

Phase-3

Organized work places Phase-2

Zone/region/branch/location certification

6-10 months and sustenance

Phase-1

Current business improvement programs

Completion of projects and benefits derived and sustenance

4-6 months and sustenance

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D) Product/service profile

1. Protection Plans
HDFC Term Assurance Plan: This plan is designed to help secure familys financial needs in case of uncertainties. The plan does this by providing a lump sum to the family of the life assured in case of death or critical illness (if option is chosen) of the life assured during the term of the contract. One can choose the lump sum that would replace the income lost to ones family in the unfortunate event of ones death. HDFC Loan Cover Term Assurance Plan: This plan aims to protect family from loan liabilities in case of unfortunate demise within the policy term. It provides the beneficiary with a lump sum amount, which is a decreasing percentage of the initial Sum Assured. This means that as the outstanding loan decreases as per the loan schedule, the cover under the policy also decreases as per the policy schedule.

HDFC Home Loan Protection Plan: This plan aims to protect family from loan liabilities in case of unfortunate demise within the policy term. It ensures that family does not lose the dream house that person have purchased for them, in case person is not around to repay the outstanding monthly installments on their housing loan.

2. Children's Plans
HDFC Children's Plan: As a parent, everyone priority is their childs future and being able to meet their childs dreams and aspirations. With HDFC Childrens Plan, they can start building their savings today and ensure a bright future for their child. HDFC Young Star Super: This Plan provides valuable protection to insured person child in case his/her is not around and gives them an outstanding investment opportunity to maximize their savings by providing them a choice of thoroughly researched and selected investments. This plan also gives Bumper Addition to the fund value at Maturity. HDFC Young Star Super Suvidha: It is a convenient plan, which saves insured person from the need of going for Medicals. This Unit Linked Plan provides valuable protection to his/her child in case he is not around and gives him with an outstanding investment opportunity to maximize their savings by providing them a choice of thoroughly researched

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and selected investments. This plan also gives Bumper Addition to the fund value at Maturity. HDFC Young Star Supreme Suvidha: This Plan provides valuable protection to insured person child in case he is not around and gives him an outstanding investment opportunity to maximize his savings by providing him a choice of thoroughly researched and selected investments. This plan also gives Bumper Addition to the fund value at Maturity. HDFC SL Young Star Champion Suvidha: This is a convenient plan, which saves him from the need of going for Medicals. This Unit Linked Plan gives him with an outstanding investment opportunity to maximize his savings by providing you a choice of thoroughly researched and selected investments. This plan also gives Bumper Addition to the fund value at Maturity.

3. Retirement Plans
HDFC Personal Pension Plan: The HDFC Personal Pension Plan is a With Profits insurance policy that is designed to provide a post-retirement income for life with the freedom to choose your retirement date. HDFC Pension Super: The HDFC Personal Pension Plan is a With Profits insurance policy that is designed to provide a post-retirement income for life with the freedom to choose your retirement date.

HDFC Pension Supreme: The HDFC Pension Supreme is Unit Linked plan, designed to provide a post-retirement income for life with the freedom to choose their retirement date. This plan gives them with an outstanding investment opportunity to maximize their savings by providing them a choice of thoroughly researched and selected investments. This plan also gives Bumper Addition to the fund value at vesting. HDFC SL Pension Champion: The HDFC SL Pension Champion is Unit Linked plan, designed to provide a post-retirement income for life with the freedom to choose their retirement date. This plan gives them with an outstanding investment opportunity to maximize their savings by providing them a choice of thoroughly researched and selected investments. This plan also gives Bumper Addition to the fund value at vesting. HDFC SL Unit Linked Pension Maximiser II: HDFC SL Unit Linked Pension Maximiser II is a unique Single Premium unit linked plan, designed to provide a post-retirement income for life with the freedom to maximize their investment returns. This plan also gives Bumper Addition* of 5% of initial single premium at vesting and on death.

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 HDFC Immediate Annuity: The HDFC Immediate Annuity is a contract that uses investor capital to provide them with a guaranteed gross income throughout their lifetime or over a period of their choice. The income is guaranteed and is unaffected by the rise and fall of interest rates. This means the investor can plan their life the way they want it to be, safe in the knowledge that their gross income will not fall during the period they have selected. The HDFC Immediate Annuity offers a number of options to meet all their income needs.

4. Savings & Investment Plans

HDFC Endowment Super: With HDFC Endowment Super, investors can start building their savings and it ensures that their family remains financially independent, even when they are not around. This Unit Linked Plan also gives them with an outstanding investment opportunity to maximize their savings by providing them a choice of thoroughly researched and selected investments. HDFC Endowment Supreme: With HDFC Endowment Supreme, investors can start building their savings today and it ensures that their family remains financially independent, even when they are not around. It is a convenient plan, which saves them from the need of going for Medicals. This Unit Linked Plan gives them with an outstanding investment opportunity to maximize their savings by providing them a choice of thoroughly researched and selected investments. This plan also gives Bumper Addition to the fund value at Maturity. HDFC SimpliLife: It is a convenient plan, which saves investors from the need of going for Medicals. This Unit Linked Plan gives them with an outstanding investment opportunity to maximize their savings by providing them a choice of thoroughly researched and selected investments. HDFC Endowment Super Suvidha: It is a convenient plan, which saves investors from the need of going for Medicals. This Unit Linked Plan gives them with an outstanding investment opportunity to maximize their savings by providing you a choice of thoroughly researched and selected investments. This plan also gives Bumper Addition to the fund value at Maturity. HDFC Endowment Supreme Suvidha: It is a convenient plan, which saves insured person from the need of going for Medicals. This Unit Linked Plan gives them with an outstanding investment opportunity to maximize their savings by providing them a choice of thoroughly researched and selected investments. This plan also gives Bumper Addition to the fund value at Maturity. HDFC Wealth Builder: HDFC Wealth Builder is an exclusive plan crafted for elite achievers. An investment cum insurance plan that will actively help in building investor wealth and give them twin advantage of exclusive funds (actively managed ) along with choice of limited premium payment term. This plan provides the financial protection to their

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loved ones and builds up their wealth effortlessly. This plan also gives Bumper Addition to the fund value at Maturity. HDFC Endowment Assurance Plan: With HDFC Endowment Assurance Plan, investors can start building their savings today and ensure that their family remains financially independent, even when they are not around. This With Profits plan is designed to secure their familys future by giving their family a guaranteed lump sum on maturity or in case of their unfortunate demise, early into the policy term. HDFC Money Back Plan: With HDFC Money Back Plan, investors can plan now to ensure that they have the necessary funds to have the necessary funds to secure their long-term as well as short-term financial goals. This With Profits plan gives them a proportion of the basis Sum Assured as Cash lump sums at regular 5-year intervals within the policy term. HDFC Single Premium Whole of Life Insurance Plan: HDFC Single Premium Whole of Life Plan is a tailor made plan well suited to meet investors long-term investment needs and help them to maintain their familys financial independence. This single premium investment plan is a Whole of Life plan aimed at providing long-term real growth of their money. HDFC Assurance Plan: HDFC Assurance Plan helps investors conveniently build their long-term savings while keeping their familys future protected. This With Profits savings plan helps them to build their long-term savings while securing their familys future. HDFC Savings Assurance Plan: HDFC Savings Assurance Plan is a With Profits savings plan which helps investors conveniently build their long-term savings and ensure that their family is protected even if they are not around.

5. Health Plans
HDFC Critical Care Plan: HDFC Critical care plan provides for a lump sum payment on survival post diagnosis of a critical illness, so that in the event a critical illness strikes, investors dont have to dig into those precious savings of them. HDFC SurgiCare Plan: HDFC SurgiCare Plan provides investors with timely support in case they have to undergo a major surgery and hospitalization, as the case maybe, ensuring their financial independence at all times.

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6. Rural Products
HDFC Gramin Bima Kalyan Yojana HDFC Gramin Bima Mitra Yojana HDFC Bima Bachat Yojana

7. Social Products
HDFC Development Insurance Plan

E) Area of operation
During the year, company continued to increase its focus on service quality. The company aims to provide consistent and high quality service across the country through, all channels of delivery - branches, call centers, internet and the customer portal. Towards this end, periodic service audits conducted across all regional offices and at the call centres provide useful insights into customer requirements and expectations helping the company improve its processes. The company has implemented a Quality Initiative across its offices which regularly measures the effectiveness of its processes, reduces leakage and contributes to increasing revenues, managing costs and improving service quality. The company has also launched a completely revamped website with a big focus on customer education and knowledge. The company has continued to strengthen its presence in the virtual world, both for creating awareness and facilitating selfservice. Your company continues to explore strategic outsourcing partnerships with a focus on handling volumes and reaping economies of scale. The combination of outsourcing partnerships and technology implemented by the company is assisting in improvement of service turnaround times. As part of its Corporate Social Responsibility, your company continues to explore partnerships with

F) Ownership pattern
It is a joint venture between Housing Development Finance Corporation Limited (HDFC Limited), India's leading housing finance institution and a Group Company of the Standard Life Plc, UK. As on February 28, 2009 HDFC Ltd. holds 72.43% and Standard Life (Mauritius Holding) 2006, Ltd. holds 26.00% of equity in the joint venture, while the rest is held by others.

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Associate Companies: HDFC Limited HDFC Bank HDFC Mutual Fund HDFC Sales HDFC ERGO General Insurance

G) Competitors information

Aegon Religare Life

AEGON, an international life insurance, pension and investment company, Religare, one of Indias leading integrated financial services groups and Bennett, Coleman & company, Indias largest media house, have come together to launch AEGON Religare Life Insurance Company Limited. This venture is dedicated to build a firm future, both for customers and employees and will continue to balance a local approach with the power of an expanding global operation. We launched our pan-India multi-channel operations in July, 2008 with over 30 branches spread across India. Our business philosophy is to help people plan their life better. We provide high quality advice to our customers and offer superior customer service.

Aviva India
Aviva India is a joint venture between one of the countrys oldest and largest groups, Dabur, and Aviva plc, the UK's largest insurance group, whose association with India dates back to 1834.

Dabur Group
Founded in 1884, Dabur Group is one of India's oldest and largest groups of companies with a consolidated annual turnover in excess of Rs 2,396 crores. A professionally managed company, it is the country's leading producer of traditional healthcare products.

Aviva Group
Aviva Group is the UKs largest and one of the biggest Insurance groups worldwide. It is one of the leading providers of life and pensions products to Europe and has substantial businesses elsewhere around the world. With a history dating back to 1696, Aviva Group has a 50 million customer base worldwide.

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Bajaj Allianz Life Insurance Co Ltd

Bajaj Allianz Life Insurance is a union between Allianz SE, one of the largest Insurance Company and Bajaj Finserv. Allianz SE is a leading insurance conglomerate globally and one of the largest asset managers in the world, managing assets worth over a Trillion (Over INR. 55, 00,000 Crores). Allianz SE has over 115 years of financial experience and is present in over 70 countries around the world.

Canara HSBC OBC Life

The shareholding pattern of the Joint Venture is as follows - Canara Bank holds 51% equity, HSBC Insurance (Asia Pacific) Holdings Ltd 26% and Oriental Bank of Commerce 23%. The Venture has an initial paid up capital of INR 325 crores which will further increase in line with our expansion plans. The Company commenced business 16th of June, 2008 after receiving requisite approvals from the Insurance Regulatory Development Authority (IRDA). Canara HSBC Life has access to 4100 bank branches all over India.

Future Generali Life

Future Generali is a joint venture between the India-based Future Group and the Italy-based Generali Group. Future Generali is present in India in both the Life and Non-Life businesses as Future Generali India Life Insurance Co. Ltd. and Future Generali India Insurance Co. Ltd.

ICICI Prudential Life Insurance

ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank - one of India's foremost financial services companies-and prudential plc - a leading international financial services group headquartered in the United Kingdom. Total capital infusion stands at Rs. 47.80 billion, with ICICI Bank holding a stake of 74% and Prudential plc holding 26%. We began our operations in December 2000 after receiving approval from Insurance Regulatory Development Authority (IRDA). Today, our nation-wide team comprises of 2074 branches (inclusive of 1,116 micro-offices), over 225,000 advisors; and 7 bancassurance partners.

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ICICI Prudential is the first life insurer in India to receive a National Insurer Financial Strength rating of AAA (Ind) from Fitch ratings. For three years in a row, ICICI Prudential has been voted as India's Most Trusted Private Life Insurer, by The Economic Times - AC Nielsen ORG Marg survey of 'Most Trusted Brands'. As we grow our distribution, product range and customer base, we continue to tirelessly uphold our commitment to deliver world-class financial solutions to customers all over India.

H) Infrastructural facilities
HDFC SL is providing good infrastructural facilities which are required for employees to perform their work in a better way. During the year, the Company has invested in additional infrastructure capacity and human capital, in terms of offices, technology, staff, financial consultants, in order to be well positioned to increase the growth momentum in the year ahead. The company stepped up the recruitment programme in the latter part of the year in preparation for the next year.

I) Awards/achievements

Received CIO 'the Ingenious 100 2009' Award HDFC Standard Life has received the CIO The Ingenious 100 - 2009 Award, for ATLAS (Agency Training Licensing and Servicing System). Additionally, the company has received the CIO 100 Security Award 2009 for pioneering LANDesk Management and Security Suite security implementation and taking its security to a higher level of technological excellence. HDFC Standard has received the CIO 100 Award for the third consecutive year. It had received the 2008 CIO Bold Award for Consultant Corner and CIO Security Award for our initiatives for a secure computing environment, including Sesame - Identity and Access Management. In 2007, the company received CIO 100 award for Wonders and a Special Award in Storage category. CIO magazine has a long tradition of honoring leading companies for business and technology leadership and innovations through its flagship award program CIO 100. Its a celebration of 100 organizations (and the people within them) that are using IT in innovative ways to deliver business value, whether by creating competitive advantage, optimizing business processes, enabling growth or improving relationships with customers.

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Received Diamond EDGE Award 2009

HDFC Standard Life has received the Diamond EDGE Award 2009 for its mobile workforce portal - Consultant Corner. EDGE - Enterprises Driving Growth and Excellence (using IT) is an initiative by the ,Network Computing magazine to identify, recognize, and honors end-user companies in India that have demonstrated the best use of technology to solve a business problem, improve business competitiveness, and deliver quantifiable ROI to stakeholders. Network Computing magazine is part of CMP Technology, which brings more than 100 IT media brands to more than 18 million technology and business decision makers worldwide. Received 2008 CIO Bold 100 and CIO Security Awards HDFC Standard Life has received the 2008 CIO Bold 100 Award. This annual award recognizes organizations that exemplify the highest level of operational and strategic excellence in information technology. This year's award theme, The Bold 100, recognized those executives and organizations that embraced great risk for the sake of great reward. HDFC Standard Life has also been one of the five recipients of the Special 2008 CIO Security Award aimed at CIOs, whose pioneering implementations have taken their enterprise security to the next level. This award category identifies innovative and groundbreaking deployment of technologies aimed at creating a secure business infrastructure. The company received the 2008 CIO Bold Award for its mobile workforce portal and the CIO Security Award for its initiatives for a secure computing environment, including identity management. Received PCQuest Best IT Implementation Award 2008 HDFC Standard Life received the PCQuest Best IT Implementation Award 2008 for Consultant Corner, the applications for its financial consultants, providing centralized control over a vast geographical spread for key business units such as inventory, training, licensing, etc. HDFC Standard Life has won the PCQuest Best IT Implementation Award for two years consequently. Last year, the company received the award for Wonders, its path-breaking implementation of an enterprise-wide workflow system. Silver Abby at Goafest 2008 HDFC Standard Life's radio spot for Pension Plans won a Silver Abby in the radio writing craft category at the Goafest 2008 organized by the Advertising Agencies Association of India (AAAI). The radio commercial Pata nahin chala touched several changes in life in the blink of
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an eye through an old mans perspective. The objective was drive awareness and ask people to invest in a pension plan to live life to the fullest even after retirement, without compromising on ones self-respect

Unit Linked Savings Plan Tops Mint Best TV Ads Survey The Unit Linked Savings Plan advertisement of HDFC Standard Life, one of the leading private insurance companies in India, has topped Mints Top Television Advertisement survey conducted, for February 2008. HDFC Standard Lifes Unit Linked Savings Plan advertisement was ranked 4th in terms of a combined score of ad awareness and brand recall and 3rd in terms of ad diagnostic scores (likeability, enjoyment, believability, and claim). Deepak M Satwalekar Awarded QIMPRO Gold Standard Award 2007 Mr. Deepak M Satwalekar, Managing Director and CEO, HDFC Standard Life, received the QIMPRO Gold Standard Award 2007 in the business category at the 18th annual Qimpro Awards function. The award celebrates excellence in individual performance and highlights the quality achievements of extraordinary individuals in an era of global competition and expectations. Sar Utha Ke Jiyo among Indias 60 Glorious Advertising Moments HDFC Standard Lifes advertising slogan honored as one of 60 Glorious Advertising & Marketing Moments' over the last 60 years in India, by 4Ps Business and Marketing magazine. The magazine said that HDFC Standard Life is one of the first private insurers to break the ice using the idea of self-respect (Sar Utha Ke Jiyo) instead of 'death' to convey its brand proposition. This was then, followed by others including ICCI Prudential, thus giving HDFC Standard Life the credit of bringing up one such glorious advertising and marketing moment in the last 60 years.

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J) Work flow model

During the year the company launched ATLAS (Agents Training and Licensing Administration System),a workflow based system, which enables efficient processing of data for training and licensing of Financial Consultants. Life insurance is a mechanism for pooling the resources by issuing policy to the investors and investing funds in securities in accordance with objectives as disclosed in offer document. Investments in securities are spread among a wide cross-section of industries and sectors thus the risk is reduced. Diversification reduces the risk because all stocks may not move in the same direction in the same proportion at same time. Hence through diversification the insurance company earns return through their investment and which is passed back to the investors. This is just like a Life Cycle which repeats in nature

WORK FLOW:
MANAGER CHANNEL DEVELOPMENT MANAGER FINANCIAL CONSULTANTS CUSTOMERS

MANAGER

CORPORATES

CUSTOMERS

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K) Future growth and prospects

New Business Market Share HDFC Life growing steadily
BAJAJ ALLIANZ: 8% BIRLA SUNLIFE: 5%

REALIANCE LIFE: 6%
MAX NEW YORK: 3%

OTHERS: 59%

HDFC SL: 5%
SBI LIFE: 9%

LIC: 40%

Thus from the above diagram we can say that HDFC SL is growing steadily as it is acquiring market share from 4.10% to 4.5% in march 2009. Through many strategies like: advertising, good service to customers than competitors etc, it can acquire a good market share in future

ICICI PRUDENTIAL: 12% OTHERS: 12%

Thus from the above diagram we can say that HDFC SL is growing steadily as it is acquiring market share from 4.10% to 4.5% in march 2009. Through many strategies like: advertising, Marketto Share for HDFC Life has gone from 4.6% Mar 10 to 5.9% 11 good service customers than competitors etc, up it can acquire a good market shareMar in future also. Thus from the above diagram we can say that HDFC Life is growing steadily as it is acquiring market share from 4.6% in march 2010 to 5.9% in march 2011. Through many strategies like: advertising, good service to customers than competitors etc, it can acquire a good market share in future.

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3) MCKINSEY 7-S MODEL

The 7-s model with reference to Hdfc standard life:

The 7s model is better known as Mc-Kinsey 7s. This is because the persons who developed this model Robert H Waterman, Jr., Thomas J. peters and Julian R Philips have been consultants at MC-Kinsey and co. they published their 7s model in their article STRUCTURE IS NOT ORGANISTATION(1980) and in their books THE ART OF JAPANESE MANAGEMENT (1981) and IN SEARCH OF EXCELLENCE(1982). Productive organization change is not simply a matter of structure, although strategy is critical too. Our claim is that effective organizational change is really the relationship between structure, strategy, systems, styles, skills, staff and something we call super-ordinate goals. Our central idea is that organization effectives, systems from the interaction of several factorsome especially obvious and some under analysed. Our framework for organization change graphically depicted the figure.

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STRUCTURE
In the HDFC Life each and every department is empowered with the officer, clerk and sub staff. The authority is delegated to officer/manager to extract work from the staff. The each department consists of members based on its requirements. Thus it is having an effective work on the various activities efficiently and effectively.

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SKILLS
It is a more reputed insurance company, as it is providing financial solution of where to invest, how to invest and number of products with having more benefits to investors. It has reputed customers who are loyal to the organization. The service given to the customers are accomplished as per their requirements. Financial services generally do mass supporting services are rendered to all types (classes) of customers. More over the people feel their task is in safe hands of the industry. The organization is having various capabilities over the competitors. These skills are unique from the competitors of HDFC Life. The skills are broadly categorized as follows:Market knowledge, analytical skills, Services, Research, Personal/administration, Soft skills, Supporting, Medical, Finance, Information relations, others

STYLE
Hdfc standard life follows tip down/bottom up style in its management, where in each major decision regarding the company is taken in tip down fashion and other decision like targets and growth aspects HDFC Life follows bottom up style. We think it is important to distinguish between the basic personality of a top management team and the way the team comes across to the organization. Organization may listen to what managers say but they believe what managers do. Not words, but pattern of action is decisive. The power of style then is essentially manageable. One aspect of style is symbolic behaviour. Typically have more people on board who understand exploration are have headed exploration department. Typically they fund exploration more consistently.

STRATEGY
By strategy we mean those actions that a company plans in response to or anticipation of changes in its customers, its competitors. Strategy is the way A Company aims to improve its position vis--vis competition perhaps through low cost production or delivery, perhaps by providing better value to the customer, perhaps by achieving sales and service dominance. it is, or ought to be, an organization way of saying: here is how we will create unique value. The HDFC Life has set of objectives, strategies to achieve the objective, the course of action to be taken to achieve the objective and guidelines for the course of action. Hdfc standard adopts low pricing strategy to generate huge returns and good market share in the industry, since it has well expanded its business all over INDIA. HDFC Life charges minimal to its clients for the services. It provides more benefits to customers compared to its competitor. Hence it is known for the good pricing strategy in the industry.

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SYSTEM
The HDFC Life has various techniques to control this procedure as system like to improve the back office targets by giving addition support. Information system: the implementation of computers has made information flow fast and reliable. The information is versatile. Since HDFC Life has good backup system. Recruitment, training and development system Recruitment process starts with the identification of the vacancies by the department head of the respective department. A form requesting for the human resource is sent from the department to HRD.

STAFF
Staff (in the sense of people, not line/staff) is often treated in one of two ways. At the hard end of the spectrum, we talk of appraisal systems, pay scales, formal training program and the like. At the soft end, we talk about morale, attitudes, motivation and behaviour. The HDFC Life is in the course of cutting down the cost of service. If it starts recruiting, the selection is done based on the education qualification first class degree. The various training program to the employees are taken like refresher course, job rotation and job training. The promotion in the organization is taken place based upon the service, seniority and educational qualification. The performance appraisal is also taken as a basis for promotion so officers staff makes it.

SHARED VALUES
Unlike the other six Ss, super ordinate goals dont seem to be present in all, or even most, organizations. They are, however, evident in most of the superior performers. The value shared by the members of an enterprise is known as the shared values. The organization of HDFC LIFE is having a strategy of sharing values.

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ORGANISATIONAL HIERARCHY

CHAIRMAN

MD

ZONAL MANAGER

REGIONAL MANAGER

RETAIL MARKETING

ALTERNATIVE CHANNEL

OPERATION CHANNEL

HUMAN RESOURCE

TERRITORY MANAGER

TERRITORY MANAGER

TEAM MANAGER

HR EXCUTIVES

BRANCH MANAGER

BRANCH MANAGER

OPERATION MANAGER

ASST. B.M

CHANNEL EXUCATIVE

BUSINESS DEV. MANAGER

SALES DEV. MANAGER

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5) SWOT ANALYSIS
STRENGTHS 1. HDFC Life offers a range of individual and group insurance solutions. 2. HDFC Life has the financial expertise required to manage your long-term investments safely and efficiently. 3. Rated AAA by CRISIL and ICRA for the 10th consecutive year for High service standards 4. Life insurance industry is a rapid growing and a nobler service industry. WEAKNESSES 1. LIC is prevalent and sustains even today a major source of population. 2. Low number of offices and network and number of life insurance agents. 3. Lack of knowledge and expertise. OPPORTUNTIIES 1. Life insurance has captured its mere15 20% growth therefore a wide open untapped market is open to the company to develop, grow and measure its success. 2. Still the numbers of companies are few and company has every capability to grow and forward its performance areas to the widest.

THREATS 1. People are hesitant to invest and put their hard earned money to the private life insurance company with the fear of getting lost. 2. Belief towards LIC as it is a government corporation phobia is continue to surmount the people of India despite lots of flaws and development and liberalization of life insurance. 3. Alternative financial services such as mutual fund, banking services, share and securities also pose problems and threats to the working of the life insurance sector. 4. Illiteracy and unemployment also pose threat.

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Rising real estate industry also pose threat as people are investing a bulk of their money over to that industry.

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OPERATION AND FINANCIAL HIGHLIGHT

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CHAPTER III

DISCUSSION ON TRAINING

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LEARNING EXPERIENCE
HDFC SLIC is one of the top insurance company in India were people trusted the company and their product in market. HDFC SLIC wants to help his customers to live with pride and selfrespect. It was the good experience to be the part of HDFC SLIC which I come to learn some basic insurance and their uses and benefits in our life. Firstly, I have attended the training session of insurance in Ritu Nanda insurance service and I come to know about various product of HDFC SLIC. The training classes were in M.G Road, Bangalore was around 20 to 25 students is present in one batch and the lunch and tea is provided by the HDFC SLIC. The total no of 50 hours is required to complete the training of IRDA Certification. After training I have given one online IRDA exam and pass the exam. Some basic skill is taught to me that how to deal with the customer or people and how to convince them about the product. The people tries to hear all the benefits of the policy or any product that how the policy is benefiting them in future prospective like tax benefit, retirement benefit or some other benefit such as 80c , etc. When there is any understanding is required from the customer side than I with other member explain him 80c tax benefits to meet customer needs and wants and bring the product policy according to the requirement to different customer. I have done one policy on one customer name in which is very difficult to convince the customer towards the product.

ROLES AND RESPOSIBILITIES

The company gave me the project to work on the Financial Analysis of HDFC Life where my job is to evaluate the performance of the company and to compare it with last 5 years performance to see the position of the company with new trend of company performance as compare with previous. It was really quite a good experience to deal with the customer in market with different products and plans and different demands from the customer side which make me learn how to deal with

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customer in market being as an employee, it also required huge patience to operate or deal with the people.

DESCRIPTION OF THE TASK HANDLED

During my 8 weeks of project in HDFC Life, a good insight was obtained about the working of the Insurance sector as the project was mainly on financial analysis of HDFC Life, for that:
A necessary amount of knowledge was gained about the different funds in HDFC Life. The various products of insurance, the benefits of insurance. The methods of how financial planning can be done for an investor to assist in investment were learned. Valuable experience in financial planning technique which helps to plan investment for long term so it can to protect from all severities in life, was gained.

CONTRBUTION TO ORGANIZATION
The internship duration that is, 8 weeks of time span is very short for the contribution to any organization. However, I have succeeded in giving reference for one Life insurance policy to the company during this period along with this research work which may help the company in taking useful and important decisions in regard with financial analysis.

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CHAPTER IV

ANALYSIS OF TASK/RESEARCH UNDERTAKEN

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Introduction and Background

The main objective of any company is to make profit and have a sustainable growth; to fulfil this objective a company should always analyse its current business condition. This analysis not only conducted for its own benefit but also for the sake of its shareholders who heavily rely upon them in the hope of good return on their investment. Analysis helps companies to understand their own potential and to present themselves in front of the shareholders, customers as a reliable one. As an insurance company it should always focus on their current position and their performance compared to the other similar companies in the market so that they can maintain a proper health. Thousands of investors, policy makers rely upon an insurance company their emotion and trusts should be kept in mind.

The company was incorporated on 14th August 2000 under the name of HDFC Standard Life Insurance Company Limited. Their ambition from the beginning was to be the first private company to re-enter the life insurance market in India. On the 23rd of October 2000, this Ambition was realized when HDFC Standard Life was the first life company to be granted a Certificate of registration. HDFC are the main shareholders in HDFC Standard Life, with 81.4%, while Standard Life owns 18.6%.HDFC Standard Life Insurance Company Ltd. is one of Indias leading private life insurance companies, which offers a range of individual and group insurance solutions.

The topic is financial analysis of HDFC Life to analyse the current position and performance of the company. As a student of finance and accounting background its opportunity and practical exposure to analyse a companys annual report and finding out the objective as mentioned above. It will help to gain more and more knowledge through the procedure of analysing the annual report that will help me in future to conduct the job more easily and efficiently.

The research and the findings done in this report will help the organization to understand their business more thoroughly and evaluate their performance in terms of other competitive companies in the market. It will help them to cut out or minimize the loop holes that are present in the business. It will help them to make future plans and strategies for the future. It will help them to ascertain themselves where they stand in the current insurance market in India.

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Research Design
AIM
To know the financial position and evaluating the performance of HDFC Life.

STATEMENT OF PROBLEM
Todays financial market is very volatile. Its very tough for a company to maintain a sustainable growth in this market. Investment is to be thoroughly scrutinized before making it. Risks are increasing both for the companies and for the people who invests so its a tough job for a company to sustain growth and make profit. As an insurance company it should always focus on their current position and their performance compared to the other similar companies in the market so that they can maintain a proper health. Thousands of investors, policy makers rely upon an insurance company their emotion and trusts should be kept in mind. The research and the findings done in this report will help the organization to understand their business more thoroughly and evaluate their performance in terms of other competitive companies in the market. It will help them to cut out or minimize the loop holes that are present in the business. Therefore there is a need to study the financial position and performance of the company, so that appropriate measure can be taken to sustain the growth and make profit. Analysis shows the current scenario of the company to company associates as well to the shareholders.

RESEARCH OBJECTIVE
To ascertain the financial position as well as to evaluate the performance of HDFC Life. To know the current market share of HDFC Life in Insurance Industry and its growth.

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RESEARCH METHODOLOGY Approaches to Research Design

1. Research Design Descriptive Research Design: The research conducted in this project is concerned with finding who, what, where, when, or how much, hence it is descriptive in nature. In this research financial analysis of the annual report of the HDFC Life is undertaken from where description of the current financial position as well as the performance of the company compared to last financial year is analysed. 2. Data Collection

Secondary data: The secondary data for the project is obtained from various sources such as websites, company brochures, journals and publications. 3. Data Analysis
The data was collected by means of secondary data, classified and suitable tables were prepared. The data was analysed, inferences were drawn and recommendations were given to meet the objective.

Scope of the study

The scope of the study conducted in this project is restricted to Bangalore.

Limitations of the Study

The study was undertaken only for HDFC Life and the opinion for the life insurance companies might differ. The data is based on secondary data only as mentioned above.

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Findings, Recommendations and Conclusions

ANALYSIS OF FINANCIAL STATEMENT

Financial statement analysis is an analysis of all the three financial statements: balance sheet, income statement, and cash flow statement. Financial statements provide us with useful information. However, right information from the right data is very necessary. We can undertake the financial statement analysis from employees, creditors, credit rating agencies, existing shareholders, potential shareholders, bankers, internal management too. The purpose of the financial statement analysis is to help users to understand the organization and the business decisions. These users are both internal and external. The internal users include the management, employees, and the external users include the shareholders, researchers, bankers, customers, suppliers government representatives. It helps in understanding the financial position and performance of the company. The performance of an organization can be explained on the basis of the four important aspects of the business:

Liquidity: Liquidity shows the ability of the business to service the short term obligation. Solvency: Solvency shows the ability of the business to meet the long term obligation. Efficiency: Efficiency shows the ability of the business to use the resources of the business. Profitability: Profitability shows the ability to the business to generate and distribute profit.

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Intra firm comparison of HDFC:

1. Analysis of Short Term Liquidity:

a. Current ratio = Total Current Assets / Total Current Liabilities b. Net working capital =Current asset current liabilities

Table showing: current ratio and quick ratio of HDFC Life in the year 2010-11 Year Current assets 2011 (RS.crs) 2010 (RS.crs)

10607595

7947934

Current liabilities

13187652

12673016

Current ratio

0.804

0.627

Inference:
The above table is showing the details regarding the current ratio of HDFC Life. The standard current ratio is 0.8:1 in this current year which shows that current liabilities are much more higher than current asset and the company might face the problem in meeting up its current liability. But compare to year 2010 the condition in 2011 is much better.

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Graph showing: current ratio and quick ratio of HDFC Life in the year 2010-11

25000000 20000000 15000000 10000000 5000000 0 2011 2010 CURRENT LIABILITIES CURRENT ASSETS

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b. Net working capital: Working capital is the lifeblood of the business. Working capital refers to that part of the firms capital, which is used for financing short term or current assets, such as, cash, marketable securities, debtors, inventories, bills receivables etc. in a narrow sense, the term working capital refers to the net working capital. Net working capital is the excess of current assets over current liabilities.

Net working capital = Current assets Current liabilities

Table showing: Working Capital of HDFC Life in the year 2010-2011. Years

2011 (RS.crs)

2010 (RS.crs) 7947934 12673016

Total Current Asset Total Current Liability

10607595 13187652

Net working Capital

( 2580057)

(4725082)

Inference : The working capital is negative that shows the current liability is higher than the current asset that may affect day to day operation of the business. But it is comparatively in a better condition than the previous year .

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Graph showing: Working Capital of HDFC Life in the year 2010-2011.

25000000 20000000 15000000 10000000 5000000 0 2011 2010 CURRENT LIABILITIES CURRENT ASSETS

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2. Capital Structure and Long -Term Solvency Ratios:

Debt equity ratio =long Term Debt / shareholders fund Table showing: debt equity ratios of HDFC Life in the year 2010-11.

Years

2011 (RS.crs)

2010 (RS.crs)

Outsiders Funds

256449214

193089795

Share Holders Fund

22155241

20417327

Debt Equity Ratio

Inference:

11.57

9.45

There is continues increase in Share holders Funds and also in an outsider funds from the year 2010 to 2011. Outsiders funds are increased more than the shareholders fund. Hence the outsiders funds has been increased year by year, it shows the larger outsiders funds are available to the company. Since this is quite satisfactory and in the same way it is not good to the shareholders point of view and also to the company.

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Graph showing: debt equity ratios of HDFC Life in the year 2010-11.

300000000 250000000 200000000 Share Holders Fund 150000000 100000000 50000000 0 2011 2010 Outsiders Funds

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Debt assets ratio: Another approach to calculating the debt to capital ratio is to relate the total debt to the total assets of the firm. The total debt of the firm comprises long- term debt plus current liabilities. The total assets consist of permanent capital plus current liabilities. Thus, Debt to total assets/capital ratio= total debt/ total assets Debt - assets ratio table Particulars 2011 (Rs.crs) 2010 (Rs.crs)

Total debt

260921468

195644639

Total assets

10607595

7947934

Debt-assets Ratio

24.59

24.61

Analysis: The debt-assets ratio of HDFC life is 24.59 for 2011 and 24.61 for the year 2010.

Inference: There is continues burden of total debt and also in total assets. Debt ratio is near about equal. Hence the debt ratio has been is high; it shows the larger total debt is more than the total assets available to the company.

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Graph showing Debt- Asset ratio of HDFC Life in the year 2010-2011

300000000 250000000 200000000 150000000 100000000 50000000 0 2011 2010 Total Assets Total Debt

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Equity assets ratio: Still another variant of the debt/equity ratio is to relate the owners/proprietors funds with total assets. This is called the proprietary ratio. The ratio indicates the proportion of total assets financed by owners. Symbolically, it is equal to: Proprietary ratio = Proprietors funds / total assets x 100

Proprietary Fund to Fixed Assets Proprietary ratio relates shareholders funds to total assets. It is a variant of debt equity ratio. This ratio shows long term or future of the business. It calculated by dividing shareholders funds by the total assets.

Proprietary ratio = shareholders funds/ Fixed assets

Preference share capital and equity share capital plus all reserves and surplus items are called shareholders fund. Total assets include all assets including goodwill.

Significance of the ratio: The acceptable norm for the ratio is 1: 3. The ratio shows the general strength of the company. It is very important to creditors as it helps to find out the proportion of shareholders funds in the total assets used in the business. Higher ratio indicates a secured position to creditors and a low ratio indicates greater risk to creditors. Proprietary ratio is also analysis in the following manner

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Table showing: the Proprietary Ratio of HDFC Life in the year 2010-11.

2011 Years (RS.crs)

2010 (RS.crs)

Fixed Asset

2395729

1143777

Shareholders Fund

22155241

20417327

Proprietary ratio

0.108

0.05

Analysis: The ratio of 1:3 is considered satisfactory; the Proprietary Ratio of HDFC Life is having a proprietary ratio of 0.108 which is not satisfactory but its near about double than the previous year.

Inference: The Proprietary Ratio of HDFC Life is increasing over the years. It shows good investment over by the company in Fixed Asset. In the year 2010 it was 0.05 but it had had risen near about double in 2011 to 0.108 so it a sign of good health and may show a further improvement in future.

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Table showing: the Proprietary Ratio of HDFC Life in the year 2010-11.

25000000 20000000 15000000 10000000 5000000 0 2011 2010 Shareholders Fund Fixed Assets

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3. Profitability Ratios:

a. Gross profit ratio = gross profit / sales*100

Table showing: the gross profit ratio of HDFC Life in the year 2010-11.

Year

2011 (Rs.crs)

2010(Rs.crs)

Gross profit

(990021)

(2751844)

Sales

89547169

69556324

Gross profit ratio

-1.105%

-3.95%

Analysis:
The high ratio of gross profit is considered satisfactory; HDFC Life is suffering gross loss in the year 2010 and 2011.

Inference:
There is an decrease in gross loss and also the percentage of loss in the year 2010 to 2011 is 3.95 and -1.105 respectively. In the year 2010 it was facing higher gross loss, but later it went on decreasing. In the year 2011, loss percentage is -1.105 compare to last year the loss has decreased.

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Table showing: the gross profit ratio of HDFC Life in the year 2010-11

90000000 80000000 70000000 60000000 50000000 40000000 30000000 20000000 10000000 0 -10000000 2011 2010 Sales Gross Profit

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b. Net profit ratio = Net profit ratio= net profit/sales*100

Table showing net profit ratio of HDFC Life for the year 2010-11

Year

2011 (RS.crs)

2010 (RS.crs)

Net profit

(15654987)

(14664966)

Sales

89547169

69556324

Net profit ratio

-17.48%

-21.08%

ANALYSIS: The high ratio of net profit is considered satisfactory ; HDFC Life. is suffering net loss in the year 2010 and 2011 respectively.

INFERENCE: There is an decrease in net loss in 2011 compare to year-2010. The percentage of loss in the year 2010 and 2011 is -17.48 and -21.08 respectively. Though it is not good from the company point of view as it need to be brought in to positive figure.

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Graph showing net profit ratio of HDFC Life for the year 2010-11

100000000 80000000 60000000 40000000 20000000 0 2011 -20000000 2010 Sales Net Profit

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Return on capital employed: The ROCE is the second type of ROI. Here the profits are related to the total capital employed. The term capital employed refers to long- term funds supplied by the lenders and owners of the firm. It can be computed in two ways. First, it is equal to non-current liabilities (long term liabilities) plus owners equity. Return on capital employed = (Net profit / Capital employed) x 100

Return on capital employed ratio table 2011 (Rs. Crs) 2010 (Rs.Crs)

Particulars

Net profit

(15654987)

(14664966)

Capital employed

22155241

20417327

Return on capital employed ratio

-0.70

-71.82

Analysis: The high ratio of rate of return on capital employed is considered satisfactory; HDFC standard life insurance company ltd. is not in the position to earn a better rate of return on total capital employed in the year 2010-11 respectively.

Inference: There is an increase in rate of return on capital employed but still it is negative and also the percentage of capital employed is increasing from the year 2010 to 2011.

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Graph showing Return on capital employed in the year 2010-2011.

25000000 20000000 15000000 10000000 5000000 0 -5000000 -10000000 -15000000 -20000000 2011 2010 Capital Employed Net Profit

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FINDINGS
Ratio analysis is an important tool for financial statement analysis. Here we studied various ratios relating to measurement of the financial performance such as current ratio, quick ratio, debt equity ratio, proprietary ratio, gross profit ratio etc. In the previous chapter we made a detailed analysis of the HDFC Life on the year 2010-11. The major findings are given below:

The study shows there is a slight change in the current ratio and also it is not satisfactory when compare to actual standard of 2:1 The study shows that the net working capital in the company is Rs. (2580057) in 2011 and Rs.(4725082). The working capital is negative that shows the current liability is higher than the current asset that may affect day to day operation of the business. The study shows that the debt equity ratio is satisfactory from the creditors point of view that is in the year 2010 the percentage of ratio is 9.45 and 11.57 in 2011. Since this is quite satisfactory and in the same way it is not good to the shareholders point of view and also to the company. The debt-assets ratio is near about equal compared to last financial year. The study shows that the proprietary ratio to fixed assets is 0.108 in 2011 compared to 0.05 in previous year, so it a sign of good health and may show a further improvement in future. The study shows that gross profit ratio of the company is -1.105% in 2011, though its in loss but still it has decreased from -3.95%. That is good indication for the company. There is a decrease in net loss in 2011 compare to year-2010. The percentage of loss in the year 2010 and 2011 is -17.48 and -21.08 respectively. Though it is not good from the company point of view as it need to be brought in to positive figure. The study shows that the return on capital employed is not good because in this year also it is earning negative returns and also the percentage of negative returns is near about equal.

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RECOMMENDATION

a. It can try to create awareness about this company through some programs. b. There may be proper and immediate response in case of any queries from customers. c. It can concentrate to increase its sales revenue as finance is life blood of any business. d. It is able try to increase its profits through using better portfolios. e. There can be an outstanding after sales service which is one of the important factors. f. There may be more effective response in case of any incidents/events. g. Feedback information can be inculcated. h. It is able to concentrate on decreasing other expenses and it has to spend the expenses which are really required to the development of the company. i. Proper management is to be there and also it should supervise the activities of the company very well.

j. It needs to be aware of its competitors to overcome from the competition and to get more market share.

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CONCLUSION

HDFC Life has been one of the best life insurance service providers in India. It provides excellent quality service to their customer. The overall performance of HDFC Life is very good compared to other insurance service providers. It stands on fifth position in the insurance industry. They share a very good rapport with the customers. The financial condition is not good from year to year. It is in loss condition from past five years. Its debt- equity ratio is good as compared to previous year because of that the company is in a good condition to get survival in the market. It is selling more policies from year to year that means the sales percentage is increasing from many years it is the signal to the growth of the company. Presently it is incurring more expenses and market share is very less compare to other competitors like LIC, ICICI Prudential etc.

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BIBILOGRAPHY
WEBSITES: WWW.HDFCINSURANCE.COM WWW.GOOGLE.COM WWW.YAHOOSEARCH.COM

REFERENCE BOOKS: PRASANNA CHANDRA: FINANCIAL MANAGEMENT, (TMH), 6/e, 2004 M.Y. KHAN & P.K. JAIN: FINANCIAL MANAGEMENT, (TMH), 4/e, 2004

OTHER REFERENCES: NEWS PAPERS: o TIMES OF INDIA o ECONOMIC TIMES

MAGAZINES: o BUSINESS WORLD

M S RAMAIAH INSTITUTE OF MANAGEMENT, BANGALORE

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ANNEXURES
Balance sheet of HDFC LIFE as at March 31, 2011

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Profit & Loss Account for year ended March 31,2011.

Shareholders Account (Non-technical Account)

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