Institute Narsee Monjee Institute of Management Studies

Program PGDM
Year 2019-21
Division C
Project Financial Accounting
Company Bajaj Finance
Competitor L&T Finance

SUBMITTED BY :
NAME SECTION SAP ID
Ashish Yadav C 80203190185
Lakshmikanth Bandiathmakur C 80203190022
Priya Singh C 80203190168
Rangala Prity Reddy C 80203190168
Shankhesh Mutta C 80203190114
Shivangi Bhardwaj C 80203190030
Management Studies

ROLL NUMBER
C009
C023
C032
C034
C041
C042
Consolidated Financial Statement

Consolidated Balance Sheet

31 March 31 March
Particulars
2019 2018

EQUITY AND LIABILITIES

Shareholders’ funds
Share capital 115 115
Reserves and surplus 19,448 16,431
Total Equity 19,563 16,546

Non-current liabilities
Long-term borrowings 101,588 45,896
Other long-term liabilities 358 500
Long-term provisions 74 1,136
Total Non-current liabilities 102,020 47,533

Current liabilities
Current maturities of long-term borrowings 0 7,828
Short-term borrowings 0 10,757
Trade payables
– Total outstanding dues of micro enterprises and small enterprises 0 0
– Total outstanding dues of creditors other than micro enterprises and small enterprises 844 460

Other current liabilities 1,672 3,509

Short-term provisions 133 191
2,649 22,746
Total 124,232 86,824

ASSETS
Non-current assets
Fixed assets
– Property, plant and equipment 527 346
– Intangible assets 165 121
692 467
Goodwill on consolidation 3 3
Non-current investments 0 838
Deferred tax assets (net) 669 386
Receivables under financing activity 207 47,268
Long-term loans and advances 0 82
1,571 49,044
Current assets
Current investments 8,599 2,308
Receivables under financing activity 898 34,332
Cash and bank balances 349 339
Short-term loans and advances 112,513 262
Other current assets 303 539
122,661 37,781
Total Assets 124,232 86,824

Profit and Loss Statement

31 March 31 March
Particulars
2019 2018
INCOME
Revenue from operations 18,485 13,442
Other income 17 24
Total income 18,502 13,466

EXPENDITURE
Operating and direct expenses 2,214 0
Employee benefits expense 1,941 1,420
Finance costs 6,624 4,634
Depreciation and amortisation 144 102
Loan losses and provisions 0 1,045
Other expenses 1,400 2,169
Total expenditure 12,323 9,370

Profit before tax 6,179 4,096

Tax expense:
– Current tax 2,086 1,439
– Deferred tax expense/(credit) 98 -17
Total tax expense 2,184 1,422

Profit after tax 3,995 2,674

(In Crore)
31 March
2017

109
9,491
9,600

33,116
485
1,086
34,686

7,211
8,922

0
309

2,792
209
19,444
63,731

288
75
363
3
762
369
32,028
60
33,585

3,307
25,655
 326
501
356
30,145
63,731

31 March
2017

9,967
25
9,992

0
932
3,804
71
804
1,564
7,175

2,817

1,070
-89
981

1,836
Common Size Statement

Consolidated Balance Sheet

31 March 31 March
Particulars
2019 2018

EQUITY AND LIABILITIES

Shareholders’ funds
Share capital 115 115
Reserves and surplus 19,448 16,431
Total Equity 19,563 16,546

Non-current liabilities
Long-term borrowings 101,588 45,896
Other long-term liabilities 358 500
Long-term provisions 74 1,136
Total Non-current liabilities 102,020 47,533

Current liabilities
Current maturities of long-term borrowings 0 7,828
Short-term borrowings 0 10,757
Trade payables
– Total outstanding dues of micro enterprises and small enterprises 0 0
– Total outstanding dues of creditors other than micro enterprises and small enterprises 844 460

Other current liabilities 1,672 3,509

Short-term provisions 133 191
2,649 22,746
Total 124,232 86,824

ASSETS
Non-current assets
Fixed assets
– Property, plant and equipment 527 346
– Intangible assets 165 121
692 467
Goodwill on consolidation 3 3
Non-current investments 0 838
Deferred tax assets (net) 669 386
Receivables under financing activity 207 47,268
Long-term loans and advances 0 82
1,571 49,044
Current assets
Current investments 8,599 2,308
Receivables under financing activity 898 34,332
Cash and bank balances 349 339
Short-term loans and advances 112,513 262
Other current assets 303 539
122,661 37,781
Total Assets 124,232 86,824

Profit and Loss Statement

31 March 31 March
Particulars
2019 2018
INCOME
Revenue from operations 18,485 13,442
Other income 17 24
Total income 18,502 13,466

EXPENDITURE
Operating and direct expenses 2,214 0
Employee benefits expense 1,941 1,420
Finance costs 6,624 4,634
Depreciation and amortisation 144 102
Loan losses and provisions 0 1,045
Other expenses 1,400 2,169
Total expenditure 12,323 9,370

Profit before tax 6,179 4,096

Tax expense:
– Current tax 2,086 1,439
– Deferred tax expense/(credit) 98 -17
Total tax expense 2,184 1,422

Profit after tax 3,995 2,674

 Vertical Analysis
(In Crore)
31 March 31 March 31 March 31 March
2017 2019 2018 2017

109 0.1% 0.1% 0.2%

9,491 15.7% 18.9% 14.9%
9,600 15.7% 19.1% 15.1%

33,116 81.8% 52.9% 52.0%

485 0.3% 0.6% 0.8%
1,086 0.1% 1.3% 1.7%
34,686 82.1% 54.7% 54.4%

7,211 0.0% 9.0% 11.3%

8,922 0.0% 12.4% 14.0%

0 0.0% 0.0% 0.0%

309 0.7% 0.5% 0.5%

2,792 1.3% 4.0% 4.4%

209 0.1% 0.2% 0.3%
19,444 ### 2.1% 26.2% 30.5%
63,731 100.0% 100.0% 100.0%

288 0.4% 0.4% 0.5%

75 0.1% 0.1% 0.1%
363 0.6% 0.5% 0.6%
3 0.0% 0.0% 0.0%
762 0.0% 1.0% 1.2%
369 0.5% 0.4% 0.6%
32,028 0.2% 54.4% 50.3%
60 0.0% 0.1% 0.1%
33,585 1.3% 56.5% 52.7%

3,307 6.9% 2.7% 5.2%

25,655 0.7% 39.5% 40.3%
 326 0.3% 0.4% 0.5%
501 90.6% 0.3% 0.8%
356 0.2% 0.6% 0.6%
30,145 98.7% 43.5% 47.3%
63,731 100.0% 100.0% 100.0%

31 March 31 March 31 March 31 March

2017 2019 2018 2017

9,967 99.9% 99.8% 99.7%

25 0.1% 0.2% 0.3%
9,992 100.0% 100.0% 100.0%

0 12.0% 0.0% 0.0%

932 10.5% 10.5% 9.3%
3,804 35.8% 34.4% 38.1%
71 0.8% 0.8% 0.7%
804 0.0% 7.8% 8.0%
1,564 7.6% 16.1% 15.7%
7,175 66.6% 69.6% 71.8%

2,817 33.4% 30.4% 28.2%

1,070 11.3% 10.7% 10.7%

-89 0.5% -0.1% -0.9%
981 11.8% 10.6% 9.8%

1,836 21.6% 19.9% 18.4%

Trend Analysis

Consolidated Balance Sheet

31 March 31 March
Particulars
2019 2018

EQUITY AND LIABILITIES

Shareholders’ funds
Share capital 115 115
Reserves and surplus 19,448 16,431
Total Equity 19,563 16,546

Non-current liabilities
Long-term borrowings 101,588 45,896
Other long-term liabilities 358 500
Long-term provisions 74 1,136
Total Non-current liabilities 102,020 47,533

Current liabilities
Current maturities of long-term borrowings 0 7,828
Short-term borrowings 0 10,757
Trade payables
– Total outstanding dues of micro enterprises and small enterprises 0 0

– Total outstanding dues of creditors other than micro enterprises and small enterprises 844 460

Other current liabilities 1,672 3,509

Short-term provisions 133 191
2,649 22,746
Total 124,232 86,824

ASSETS
Non-current assets
Fixed assets
– Property, plant and equipment 527 346
– Intangible assets 165 121
692 467
Goodwill on consolidation 3 3
Non-current investments 0 838
Deferred tax assets (net) 669 386
Receivables under financing activity 207 47,268
Long-term loans and advances 0 82
1,571 49,044
Current assets
Current investments 8,599 2,308
Receivables under financing activity 898 34,332
Cash and bank balances 349 339
Short-term loans and advances 112,513 262
Other current assets 303 539
122,661 37,781
Total Assets 124,232 86,824

Profit and Loss Statement

31 March 31 March
Particulars
2019 2018
INCOME
Revenue from operations 18,485 13,442
Other income 17 24
Total income 18,502 13,466

EXPENDITURE
Operating and direct expenses 2,214 0
Employee benefits expense 1,941 1,420
Finance costs 6,624 4,634
Depreciation and amortisation 144 102
Loan losses and provisions 0 1,045
Other expenses 1,400 2,169
Total expenditure 12,323 9,370

Profit before tax 6,179 4,096

Tax expense:
– Current tax 2,086 1,439
– Deferred tax expense/(credit) 98 -17
Total tax expense 2,184 1,422

Profit after tax 3,995 2,674

 Horizontal Analysis Trend Analysis
(In Crore)
31 March 31 March 31 March 31 March 31 March 31 March
2017 2019 2018 2019 2018 2017

109 0.0% 5.2% 105.1 105.2 100.0

9,491 18.4% 73.1% 204.9 173.1 100.0
9,600 18.2% 72.3% 203.8 172.3 100.0

33,116 121.3% 38.6% 306.8 138.6 100.0

485 -28.4% 3.2% 73.8 103.2 100.0
1,086 -93.5% 4.7% 6.8 104.7 100.0
34,686 114.6% 37.0% 294.1 137.0 100.0

7,211 -100.0% 8.6% 0.0 108.6 100.0

8,922 -100.0% 20.6% 0.0 120.6 100.0

0 -55.6% 150.0% 111.1 250.0 100.0

309 83.3% 48.9% 273.1 148.9 100.0

2,792 -52.4% 25.7% 59.9 125.7 100.0

209 -30.4% -8.8% 63.5 91.2 100.0
19,444 -88.4% 17.0% 13.6 117.0 100.0
63,731 43.1% 36.2% 194.9 136.2 100.0

288 52.1% 20.4% 183.1 120.4 100.0

75 36.6% 60.6% 219.4 160.6 100.0
363 48.1% 28.7% 190.7 128.7 100.0
3 -8.3% 0.0% 91.7 100.0 100.0
762 -100.0% 9.9% 0.0 109.9 100.0
369 73.1% 4.7% 181.3 104.7 100.0
32,028 -99.6% 47.6% 0.6 147.6 100.0
60 -100.0% 36.1% 0.0 136.1 100.0
33,585 -96.8% 46.0% 4.7 146.0 100.0

3,307 272.5% -30.2% 260.0 69.8 100.0

25,655 -97.4% 33.8% 3.5 133.8 100.0
326 2.7% 4.1% 106.9 104.1 100.0
 501 42899.6% -47.8% 22450.0 52.2 100.0
356 -43.8% 51.5% 85.2 151.5 100.0
30,145 224.7% 25.3% 406.9 125.3 100.0
63,731 43.1% 36.2% 194.9 136.2 100.0

31 March 31 March 31 March 31 March 31 March 31 March

2017 2019 2018 2019 2018 2017

9,967 37.5% 34.9% 185.5 134.9 100.0

25 -30.2% -6.3% 65.4 93.7 100.0
9,992 37.4% 34.8% 185.2 134.8 100.0

0
932 36.7% 52.4% 208.3 152.4 100.0
3,804 42.9% 21.8% 174.1 121.8 100.0
71 41.2% 43.4% 202.5 143.4 100.0
804 -100.0% 30.0% 0.0 130.0 100.0
1,564 -35.4% 38.6% 89.5 138.6 100.0
7,175 31.5% 30.6% 171.7 130.6 100.0

2,817 50.9% 45.4% 219.3 145.4 100.0

1,070 44.9% 34.5% 194.9 134.5 100.0

-89 -666.8% -80.5% -110.4 19.5 100.0
981 53.6% 45.0% 222.6 145.0 100.0

1,836 49.4% 45.6% 217.5 145.6 100.0

Financial Ratios

Particulars 2019 2018 2017

INCOME
Revenue from operations 18,485 13,442 9,967
Other income 17 24 25
Total income 18,502 13,466 9,992

EXPENDITURE
Operating and direct expenses 2,214 0 0
Employee benefits expense 1,941 1,420 932
Finance costs 6,624 4,634 3,804
Depreciation and amortisation 144 102 71
Loan losses and provisions 0 1,045 804
Other expenses 1,400 2,169 1,564
Total expenditure 12,323 9,370 7,175

Profit before tax 6,179 4,096 2,817

Tax expense:
– Current tax 2,086 1,439 1,070
– Deferred tax expense/ 98 -17 -89
(credit)
Total tax expense 2,184 1,422 981

Profit after tax 3,995 2,674 1,836

Earnings per share:

(Nominal value per share H 2)
– Basic (H) 69 48 34
– Diluted (H) 69 47 34
Consolidated Balance sheet

Particulars 2,019 2,018 2,017

EQUITY AND LIABILITIES

Shareholders’ funds
Share capital 115 115 109
Reserves and surplus 19,448 16,431 9,491
19,564 16,546 9,600
Non-current liabilities
Long-term borrowings 101,588 45,896 33,116
Other long-term liabilities 358 500 485
Long-term provisions 74 1,136 1,086
102,092 47,533 34,686
Current liabilities
Current maturities of long-term 0 7,828 7,211
borrowings
Short-term borrowings 0 10,757 8,922
Trade payables
– Total outstanding dues of 0 0 0
–micro
Totalenterprises
outstanding and small
dues of 844 460 309
creditors
Other current other than micro
liabilities 1,672 3,509 2,792
Short-term provisions 0 191 209
 2,516 22,746 19,444
Total 124,233 86,824 63,731

ASSETS
Non-current assets
Fixed assets
– Property, plant and 527 346 288
equipment
– Intangible assets 165 121 75
692 467 363
Goodwill on consolidation 3 3
Non-current investments 0 838 762
Deferred tax assets (net) 669 386 369
Receivables under financing activity 207 47,268 32,028
Long-term loans and advances 0 82 60
1,571 49,044 33,585
Current assets
Current investments 8,599 2,308 3,307
Receivables under financing activity 898 34,332 25,655
Cash and bank balances 349 339 326
Short-term loans and advances 112,513 262 501
Other current assets 303 539 356
122,661 37,781 30,145
Total 124,233 86,824 63,731
PROFITABILITY RATIOS
Net Profit (or Net Margin)
Return on Assets (ROA) (also called ROI)
Return on Equity (ROE)
Return on Capital Employed (ROCE)

LIQUIDITY RATIOS
Current Ratio
Quick Ratio (or Acid Test Ratio)
Cash Ratio
Times Interest earned

SOLVENCY RATIOS
Debt-Equity Ratio (Leverage)
Alternatively
Cash Coverage for Interest
Debt Service Coverage Ratio (DSCR)

DU POINT ANALYSIS
ROE is
ROE can also be expressed as
 2019
Net Profit/ Net Sales 21.59%
Net Income (PAT)/ Average Total Assets 3.79%
Net Income (PAT)/ Average Shareholders' Equity 22.13%
EBIT/ Average Total Assets 6.73%

Current Assets/ Current Liabilities 48.76

(Current Assets-Inventory)/ Current Liabilities 44.72
Cash/ Current Liabilities (Cash = Cash+ Bank + Short term investments) 44.86
EBIT/ Interest expense 2.14

Total Debt/ Shareholders' Equity 5.17

Long term Debt/ Shareholders' Equity 5.19
(EBIT+Non cash charges)/ Interest expense 2.14
(EBIT+Non cash charges)/ (Interest expense + Loan repayments) 2.14

Net Income (PAT)/ Average Shareholders' Equity 22.13%

ROA * Leverage 31.58%
 2018 2017 Expressed as
19.86% 18.38% %
3.55% NA %
20.46% NA %
7.24% NA %

Expressed as
1.66 1.55 Ratio
0.01 0.03 Ratio
0.03 0.04 Ratio
2.35 2.15 Number of times

Expressed as
3.40 4.34 Ratio
2.77 3.45 Ratio
2.58 2.36 Number of times
0.96 0.82 Number of times

20.46%
24.76%
Commentary on Analysis

Product Comparison
Bajaj Finance
Mortgage loans
Personal loans
Business loans
Loans:
Home loan
Gold loan
Loan against property
EMI Cards
Cards: Credit Cards
Products offered
Wallet
Fixed deposits
Investments:
Mutual funds
Life Insurance
Health Insurance
Insurance: Car Insurance
Home Insurance
Child plans

Comparison of Financial Posi

Profit and Loss Comparison
Bajaj Finance
2019 2018
INCOME
Total Operating Revenues 18485 13442
Total Revenue 18502 13446
EXPENSES
Operating And Direct Expenses 2214 0
Finance Costs 6624 4634
Depreciation And Amortisation Expenses 144 102
Total Expenses 12323 9370
PBT 6179 4096
PAT 3995 2674

Balance sheet Comparison

Bajaj Finance
2019 2018
Assets
Investments 8599 2308
Cash and cash equivalents 349 339
Loans and advances 112513 262
Total current assets 122661 37781
Liabilities
Loans 101588 45896
Total liabilities 102092 47533
Cash flows Comparison
Net Cash From Operating Activities 7682.63 5100.11
Net cash from Investing operating -5375.79 1075.43
Net cash from Financing activities 34531 19503.35
Financial Heath Comparison
Bajaj Finance
2019 2018
PROFITABILITY RATIOS
Gross Profit (or Gross Margin)
Net Profit (or Net Margin) 21.59 19.86
EBITDA Margin
Return on Assets (ROA) (also called ROI) 3.79 3.55
Return on Equity (ROE) 22.13 20.46
Return on Capital Employed (ROCE)
LIQUIDITY RATIOS
Current Ratio 49 2
Quick Ratio (or Acid Test Ratio) 44.72 0.01
Cash Ratio 44.76 0.03
Times Interest earned 2 2.35
SOLVENCY RATIOS
Debt-Equity Ratio (Leverage) 5.17 3.4
Cash Coverage for Interest 2.14 5.58
Debt Service Coverage Ratio (DSCR) 2.14 0.96
DU PONT ANALYSIS
ROE is 22.13 20.46
ROA = 0.316

Conclusion:

Financials is one space where the opportunity is largest in Lending, Protection and Wealth Management segments. Considering
number of opportunities to tap into. Parent Support: The one which helps in scaling up or continuation of growth. Bajaj Finan
Finance started with giving loans on two wheeler’s for the Bajaj Auto customers, understood the lending business well Then s
primarily in infrastructure are now scaling up their fin
 L&T Finance
Two wheeler
Housing loans
Farm equipment loans
Micro loans
NA
Real estate loans
NA
NA
NA
Mutual funds
Wealth management
Estate planning
Alternate investments
NA
NA
NA

mparison of Financial Position

Profit and Loss Comparison
Finance L&T Finance
2017 2019 2018 2017

9967 12989 10212 8340

9992 13301 10266 8572

0 1092 961
3804 6860 5449 4627
71 49.62 51.63 67.3
7175 10249.54 8820.5 7493.41
2817 3051.98 1445.76 1078.9
1836 2232.03 1277.52 1042.47

Balance sheet Comparison

Finance L&T Finance
2017 2019 2018 2017

3307 9146.19 7840.39 5644.17

326 2.36 12.26 2.22
501 890.37 1276.57 731.34
 30145 11.53 69.89 2.22

33116 1167.48 468.7 973.9

34686 10030.12 9172.51 6297.63

7337.02 744.99 -272.03 -127.82

-3046.76 -1306.32 -2191 -56.02
12513 520.56 2473.76 144.09

L&T Finance
2017 2019 2018 2017

18.38 55.39 58.52 89.58

2.65 2.89 3.89

3.41 3.46 6.04
5.03 4.95 5.46

2 1679.92 845.51 0.9

0.03 1679.92 845.51 0
0.04
2.15

4.34 0.15 0.06 0.24

2.36
0.82

3.41 3.46 6.04

2.65 2.89 3.89

Conclusion:

ment segments. Considering the current scenario and Bajaj Finance dominating the financials space, Bajaj Finance has a large
tion of growth. Bajaj Finance wouldn’t have been able to reach where they are today without the support of Bajaj Auto. Bajaj
ending business well Then scaled up into other segments like Consumer etc. It is the same case with L&T Finance who were
are now scaling up their financial business segments.
 Analysis of Bajaj Finance and L&T

20000

Revenue Comparison: It can be analysed that for both the 15000

companies revenues has been increasing at a increasing rate 10000
from 2017 to 2019.But the revenue in case of Bajaj Finance is
much higher than L&T Finance. 5000

0
2019

25

20
Return on Equity: Return on equity ratio shows how much
profit each dollar of common stockholders' equity generates. 15
ROE is considered a measure of how effectively management is
using a company’s assets to create profits. Bajaj Finance has a 10
better return that L& T Finance.
5

4500
4000
3500
Profit after Tax: The profit after-tax margin is closely watched 3000
by investors to see if the income-generating ability of a firm is 2500
changing over time. The Profit after Tax is increasing in case of 2000
both the Companies at a stable rate. 1500
1000
500
0
2019
Technical Analysis of the stock price: As we can see from the
share price of the chart of Bajaj finance how they have scaled
their business and it was reflected in the expectations of
investors and maintaining the P/E ratio of 43.

Bajaj Finance vs L&T Finance vs Nifty 50 Analysis: When

the price charts of Bajaj Finance and L &T Finance are
compared over the NIFTY based on their daily price changes, it
was clearly visible that both the companies made the best when
the economy was growing and both outperformed the index.
Bajaj Finance on the other had making the best use of brand
equity had expanded its share and continues its dominance over
the peers and beating the index by a large margin.
s of Bajaj Finance and L&T Finance

Revenue comparison
20000

15000

10000

5000

0
2019 2018 2017
Row 11 Row 12

Return on Equity
25

20

15

10

0
2019 2018

Profit after tax

4500
4000
3500
3000
2500
2000
1500
1000
500
0
2019 2018 2017
Row 37 Row 38