Mock projection of Axis Bank
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This document presents a mock takeover proposal for Axis Bank, including projections for balance sheets, profit and loss accounts, and cash flow over a five-year period. Key recommendations include expanding branch locations, lowering minimum account balances to attract more customers, and addressing corporate loan risks that impact investor confidence. The analysis indicates potential issues with operational costs and dependency on competitive income sources, suggesting a need for strategic adjustments.
Mock projection of Axis Bank
- 1. MOCK TAKEOVER PROPOSAL OF - AXIS BANK By Srinadh 14MBA1047
- 2. Objective Projection of Balance Sheet. Projection of Profit and loss account. To Project Cash flow, Fund flow statement. Assumptions Evaluation of Mock valuation Disclaimer: This report was made only for internal assignment purpose for MBA’S in VIT Chennai. Some values are modified. I will not be liable to company if any loss occur due to this report.
- 3. FIXED INVESTMENT COST • ALLTHEVALUESARE IN – INR • PROJECTION FOR FIVE YEARS
- 4. OPERATIONAL COSTS Increase in operating expense means that company is spending more on wages, establishing factory at site. Reason for decrease in Gross profit from operation Is that company focus on execution , slow down in execution of project due to downfall of market and thus their market share downfall • ALLTHEVALUESARE IN – INR • PROJECTION FOR FIVE YEARS
- 5. BALANCE SHEET Foreign currency 2014 2015 2016 2017 2018 2019 TOTAL ASSETS 10,853,606,557.38 16,984,398,828.84 22,968,407,371.32 28,795,162,414.80 34,448,914,237.15 39,912,362,553.22 Total current assets 3,781,355,737.70 9,912,148,009.16 15,896,156,551.65 21,722,911,595.13 27,376,663,417.48 32,840,111,733.55 Total fixed assets, net of depreciation 7,072,250,819.67 7,072,250,819.67 7,072,250,819.67 7,072,250,819.67 7,072,250,819.67 7,072,250,819.67 TOTAL LIABILITIES 10,853,606,557.38 16,984,398,828.84 22,968,407,371.32 28,795,162,414.80 34,448,914,237.15 39,912,362,553.22 Total current liabilities 0 3,994,668.73 4,369,837.27 4,806,857.95 5,287,543.75 5,816,298.12 Total long-term debt 1,639,344.26 1,625,683.06 1,461,748.63 1,297,814.21 1,133,879.78 969,945.36 Total equity capital 10,851,967,213.11 10,851,967,213.11 10,851,967,213.11 10,851,967,213.11 10,851,967,213.11 10,851,967,213.11 Reserves, retained profit brought forward 0 0 6,126,811,263.93 12,110,608,572.30 17,937,090,529.52 23,590,525,600.51 Retained profit 0 6,126,811,263.93 5,983,797,308.36 5,826,481,957.23 5,653,435,070.99 5,463,083,496.12 Net worth 10,851,967,213.11 16,978,778,477.05 22,962,575,785.41 28,789,057,742.64 34,442,492,813.62 39,905,576,309.74 Equity to total liabilities (%) 99.984896 63.893738 47.247365 37.686772 31.501623 27.189488 Net worth to total liabilities (%) 99.984896 99.966909 99.97461 99.9788 99.98136 99.982997 Long-term debt to net worth 0.000151 0.000096 0.000064 0.000045 0.000033 0.000024 Current assets to current liabilities 0 2,481.34 3,637.70 4,519.15 5,177.58 5,646.22 • ALLTHEVALUESARE IN – INR • PROJECTION FOR FIVE YEARS
- 6. BRIEF CASHFLOW AND FUNDFLOW STATEMENTS Foreign currency Construction 2014 Production 2015 Production 2016 Production 2017 Production 2018 Production 2019 Scrap TOTAL CASH INFLOW 10,853,606,557.38 7,560,945,488.40 7,557,325,988.22 7,557,387,840.35 7,557,431,505.47 7,557,479,574.05 7,095,516,012.16 Inflow funds 10,853,606,557.38 3,994,668.73 375,168.55 437,020.68 480,685.80 528,754.37 0 Inflow operation 0 7,556,950,819.67 7,556,950,819.67 7,556,950,819.67 7,556,950,819.67 7,556,950,819.67 0 Other income 0 0 0 0 0 0 7,095,516,012.16 TOTAL CASH OUTFLOW 7,072,250,819.67 1,446,065,726.50 1,574,884,419.63 1,732,380,745.21 1,905,602,426.29 2,096,146,275.48 6,786,243.48 Increase in fixed assets 7,072,250,819.67 0 0 0 0 0 0 Increase in current assets 0 15,912,509.56 1,566,973.90 1,747,948.35 1,922,743.18 2,115,017.50 0 Operating costs 0 1,430,139,555.74 1,573,153,511.31 1,730,468,862.44 1,903,515,748.69 2,093,867,323.56 0 Loan repayment 0 13,661.20 163,934.43 163,934.43 163,934.43 163,934.43 6,786,243.48 SURPLUS (DEFICIT) 3,781,355,737.70 6,114,879,761.90 5,982,441,568.59 5,825,007,095.13 5,651,829,079.17 5,461,333,298.57 7,088,729,768.68 CUMULATIVE CASH BALANCE 3,781,355,737.70 9,896,235,499.60 15,878,677,068.19 21,703,684,163.32 27,355,513,242.49 32,816,846,541.06 39,905,576,309.74 Local surplus (deficit) 3,781,355,737.70 6,114,879,761.90 5,982,441,568.59 5,825,007,095.13 5,651,829,079.17 5,461,333,298.57 7,088,729,768.68 Local cumulative cash balance 3,781,355,737.70 9,896,235,499.60 15,878,677,068.19 21,703,684,163.32 27,355,513,242.49 32,816,846,541.06 39,905,576,309.74 Net flow of funds 10,853,606,557.38 3,981,007.52 211,234.12 273,086.25 316,751.37 364,819.95 -6,786,243.48 • ALLTHEVALUESARE IN – INR • PROJECTION FOR FIVE YEARS
- 7. SUMMARY SHEET INVESTMENT ALLOANCES 0.00 0.00 0.00 TAXABLE PROFIT 6,126,811,263.93 6,126,811,263.93 5,463,083,496.12 INCOME(CORPORA TE)TAX 0.00 0.00 0.00 NET PROFIT 6,126,811,263.93 6,126,811,263.93 5,463,083,496.12 • ALLTHEVALUESARE IN – INR • PROJECTION FOR FIVE YEARS
- 8. ASSUMPTIONS • The overhead expenses and advertisement costs are exempted to increase IRR • An increment projection of salary and administration expenses @of 10% per annum. • Depreciation is not considered. • The firm is considered to be running in profit and ongoing concerned.
- 9. Recommendations • Increase its branch locations to expand and penetrate into market. • Decrease the min. amount to maintain SB account in increase the no. of customers. • The corporate loan is a hidden worry for share investors this has to be take care as it holds around 47 % of it credit book which is at risk. • The main income source of Axis bank is from its brokerage, additional fee and operational costs which is dependent on competitors and cannot be a vital long run income for it.