HDFC

HDFC STANDARD LIFE
CHAPTER-1
INDUSTRY PROFILE
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.
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.
CAMBRIDGE INSTITUTE OF TECHNOLOGY 1

HDFC STANDARD LIFE
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
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

HDFC STANDARD LIFE
 Computerization of operations and updating of technology to be carried out in the

Insurance industry
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.
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 IRDA’s 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.

HDFC STANDARD LIFE
CHAPTER-2
COMPANY PROFILE OF HDFC - STANDARD LIFE
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.
HDFC Limited
HDFC Limited, India’s premier housing finance institution has assisted more than 3.3 million
families own a home, since its inception in 1977 across 2400 cities and towns through its
network of over 250 offices. It has international offices in Dubai, London and Singapore with
service associates in Saudi Arabia, Qatar, Kuwait and Oman to assist NRI’s and PIO’s to own
a home back in India. As of December 2008, the total asset size has crossed more than Rs.
95,000 crores including the mortgage loan assets of more than Rs. 82,800 crore. The
corporation has a deposit base of Rs. 17,551 crore, earning the trust of more than 9, 00,000
depositors. Customer Service and satisfaction has been the mainstay of the organization.
HDFC has set benchmarks for the Indian housing finance industry. Recognition for the
service to the sector has come from several national and international entities including the
World Bank that has lauded HDFC as a model housing finance company for the developing
countries. HDFC has undertaken a lot of consultancies abroad assisting different countries
including Egypt, Maldives, and Bangladesh in the setting up of housing finance companies.
Standard Life Group (Standard Life plc and its subsidiaries)
The Standard Life Group has been looking after the financial needs of customers for over
180 years. It currently has a customer base of around 7 million people who rely on the
company for their insurance, pension, investment, banking and health-care needs. Its
investment manager currently administers £125 billion in assets. It is a leading pensions
provider in the UK, and is rated by Standard & Poor's as 'strong' with a rating of A+ and as
'good' with a rating of A1 by Moody's. Standard Life was awarded the 'Best Pension Provider'
in 2004, 2005 and 2006 at the Money Marketing Awards, and it was voted a 5 star life and
pension’s provider at the Financial Adviser Service Awards for the last 10 years running. The

HDFC STANDARD LIFE
'5 Star' accolade has also been awarded to Standard Life Investments for the last 10 years, and
to Standard Life Bank since its inception in 1998. Standard Life Bank was awarded the 'Best
Flexible Mortgage Lender' at the Mortgage Magazine Awards in 2006.
B) Nature of the business carried
HDFE standard life is on the business of life insurance. But HDFC is in diversified business
like banking, housing finance, securities etc…….
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

HDFC STANDARD LIFE
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 12-24 months and

guarantee
Improve levels
Phase-4 Value stream map 6 sigma processes, SLA, 6-8 months and
projects financial benefit. improve
Process maturity Process complaint functions 8-12 months and

sustenance
Phase-3
Organized work Zone/region/branch/location 6-10 months and

places certification sustenance
Phase-2
Current business Completion of projects and 4-6 months and

improvement benefits derived and sustenance
Phase-1 programs sustenance

HDFC STANDARD LIFE
How (1) how (2) how (3) how (4)
BUSINESS
EXCELLENC
VALUE
E
STREAM
MAP
Proces
Workplac PROJECT
s
O e S
manag
B Align and organizati ement
integrate
J
long term
E loans
Optimize
C IMPROVEMENT
value
PROJECTS
T streams
Process
(KNOWN
maturity
I OPPORTUNITY)
Organized
V
workplace
E Current Prioritized All Business Primary Organization
S business functions/C value
locations and Stake
improveme FT Processe
holders
nt s Streams
BREADTH OF QUALITY INTERVENTION
How (1): How to achieve
 Quality awareness
 Identify known opportunities
 Implement prioritized projects
 Develop capability- BB/GB
 Deliver and quantify value
 Share and recognize
 Basic workplace hygiene

HDFC STANDARD LIFE
 Standard processes
 Process rollout
 Process adherence
 Dash board
 Value stream projects.

 SLA
 Service guarantee
 Stake holders delight

 Business excellence
D) Product/service profile
1. Protection Plans
 HDFC Term Assurance Plan: This plan is designed to help secure family’s 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 one’s family in the unfortunate event of one’s death.

HDFC STANDARD LIFE
 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 child’s future and being
able to meet their child’s dreams and aspirations. With HDFC Children’s 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

HDFC STANDARD LIFE
researched 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
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

HDFC STANDARD LIFE
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.
 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

HDFC STANDARD LIFE
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
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 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 family’s future by giving their family a guaranteed lump sum on maturity or
in case of their unfortunate demise, early into the policy term.

HDFC STANDARD LIFE
 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 family’s 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 family’s future protected. This ‘With Profits’
savings plan helps them to build their long-term savings while securing their family’s
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 don’t 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.
6. Rural Products

HDFC STANDARD LIFE
 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
HDFC STANDARD LIFE is operating internationally, that means all over INDIA and
outside India; it is rendering its insurance services including rural places.
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.
Associate Companies:
 HDFC Limited
 HDFC Bank
 HDFC Mutual Fund
 HDFC Sales
 HDFC ERGO General Insurance

HDFC STANDARD LIFE
G. Competitors information
Aegon Religare Life
AEGON, an international life insurance, pension and investment company, Religare, one of
India’s leading integrated financial services groups and Bennett, Coleman & company, India’s
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 country’s 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 UK’s 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.
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

HDFC STANDARD LIFE
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.
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.
F) Infrastructural facilities

HDFC STANDARD LIFE
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.
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. It’s 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.
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.

HDFC STANDARD LIFE
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 an eye through an old man’s 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 one’s 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 Mint’s Top Television Advertisement
survey conducted, for February 2008. HDFC Standard Life’s 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).

HDFC STANDARD LIFE
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 India’s 60 Glorious Advertising Moments
HDFC Standard Life’s 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.
G) Work flow model
The work will starts from the innovating of new product or policy and giving training
regarding exiting products or new products to sales development officers. They will start their
work of selling policies to the customers. Then from the premium amount company
management people take the decision to invest in different portfolios, after that when the
customers going to withdraw the money in that time after a fixed term that is minimum 3
years what will be the market return in that percentage, company will reimburse their amount
that may happen after the death of a person also.

HDFC STANDARD LIFE
H) Future growth and prospects
New Business Market Share

HDFC Standard Life growing steadily
BAJAJ ALLIANZ: 8%
BIRLA SUNLIFE: 5%
REALIANCE LIFE: 6%
HDFC SL: 5%
MAX NEW YORK: 3%

OTHERS: 59%
SBI LIFE: 9%
LIC: 40%
ICICI PRUDENTIAL: 12%

Thus from
OTHERS: 12% 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
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
also.

HDFC STANDARD LIFE
CHAPTER-3
Five S Model
5- S Model is followed by HDFC STANDARD LIFE instead of 7- s Model
Introduction:
FIVE S is a basic and the simplest methodology used to establish and maintain quality
environment in organization. It is a part of a Japanese philosophy known as Kaizen; Kai in
Japanese means, “to change” and Zen means “for better”. It involves setting standards and
then continuously improving on those standards to achieve their goals.
The ultimate goal of 5s is to make the workplace more effective and efficient by its own
people in a short span of time so that efficiency of that workplace is enhanced in an
innovative and sustainable manner. Thus it requires active involvement of everyone in the
organization across the hierarchy and to come up with suggestions on regular basis.
The name stands for five Japanese words

Japanese English
S1 SEIRI SORTING
S2 SEITON SYSTEMATIC ARRANGEMENT
S3 SEISO SPIC N SPAN/SANITIZE
S4 SEIKETSU STANDARDISE
S5 SHITSUKE SELF DISCIPLINE/SUSTENANCE
BENEFITS OF 5S:
• Can be started immediately.

HDFC STANDARD LIFE
• Reduces wastages and fatigue.
• Improves the efficiency of workplace and wastages are made visible.
• Improves self – organization and overall self –appearance of company.
• Everyone can participate and does not require any quality background.
• Brings in the feelings of ownership of workplace.
Thus the 5s are the pillars of visually managed workplace. This process starts with identifying
the area where 5s is to be deployed. It can be a single workstation or area as big as entire
office. Teams are nominated for carrying out the 5s and to ensure that everyone on a regular
basis practices it.
In detail:
S1 sorting:
The meaning of s1 that is sorting is to “straighten and contain “ that is to divide the objects
into 2 groups one that is “needed” and other that is “wanted and then remaining the unneeded
ones from the workplace.
Needed items: “needed items” are items that are critical in terms of existence at the
workplace and are required from process point of view.
Wanted items: wanted items are those, which we want, but are not required from process
point of view. We can also determine the criteria to distinguish between the need and want
items.
Red Tag Square (R.T.S)
The use of a red tag square is generally during the time of a blitz, that is during the blitz the
material identified as obvious scrap and other “abnormal material” shall be parked in a
common place which will be known as “Red Tag Square”, however the items which are in
excess quantities can also be put in the R.T.S and be noted in the Red Tag Matrix.
S 2 systematic arrangements:
“Place for everything and everything in place”.
After the “needed” and “wanted” items are identified properly and the R.T items have been
parked at the R.T.S.

HDFC STANDARD LIFE
The next step is to identify the right place for all the needed /wanted items kept at workplace.
Workstation illustration:
The layout of the workplace should be prepared in such a manner so that the owners know the
exact location. Layout helps the owner to locate the workplace and assign responsibilities to
his team. Again the “needed” and “wanted” items (from need want matrix) needs to taken into
consideration. So that place to keep them can be decided according to the frequency or usage.
Storeroom illustration:
After sorting out the needed and unneeded items and putting the unneeded items in the red tag
square, one must make the layout of the store and start specifying the areas where the things
are supposed to be placed. It is very important to allocate right areas so that no rework needs
to be done.
S 3 : Spin N Span
“Cleaning with meaning” and “cleaning is inspection”
Sanitize means keeping things clean and in order. It is a maintenance made, which looks for
damages, defects and potential problems.
Once s1 and s2 have been done it is the responsibilities of the staff to ensure that s3 is done on
regular basis so that the items stored are properly identified.
S4 – Standardize:
This step is about making standards for all the procedures and practices followed in five s.
 Abnormality identification register
 R.T. Matrix
 Cabinet index
 Master index
 Store master index
S5 – discipline:

HDFC STANDARD LIFE
The main objective of five s is to follow and spread the learning to others. All employees need
to keep five s as an ongoing improvement plan and for that there is a fifth s that emphasizes
on ‘sustenance’. It is the culmination of s1, s2, s3, and s4, which is likely to happen over a
period of time.
MCKINSEY 7-S MODEL
The 7-s model with reference to Hdfc standard life:
The 7s model is better known as Mc-Kinsey 7’s. 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 7’s 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 factor-
some especially obvious and some under analyzed. Our framework for organization change
graphically depicted the figure.

HDFC STANDARD LIFE
STRUCTURE
In the hdfc standard 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.
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 standard 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 standard 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 behavior. Typically have more people on board who
understand exploration are have headed exploration department. Typically they fund
exploration more consistently.
STRATEGY

HDFC STANDARD LIFE
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-à-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 standard 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 standard 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.
SYSTEM
The hdfc standard 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 standard 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 behavior.
The hdfc standard 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 officer’s staff makes it.

HDFC STANDARD LIFE
SHARED VALUES
Unlike the other six S’s, super ordinate goals don’t 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 STANDARD LIFE is having a strategy of sharing values.
SWOT ANALYSIS
STRENGTHS
1. HDFC Standard life insurance offers a range of individual and group insurance solutions.
2. HDFC Standard 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.

HDFC STANDARD LIFE
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.
5. Rising real estate industry also pose threat as people are investing a bulk of their money
over to that industry.
ANALYSIS OF FINANCIAL STATEMENT
Financial statement analysis is a comprehensive analysis of all three financial statements:
balance sheet, income statement, and cash flow statement. Financial statements provide useful
information. However, one has to meticulously look for the right information from the right
data. One can undertake the financial statement analysis from different stakeholders’
perspective: creditors, bankers, credit rating agencies, existing shareholders, potential
shareholders, internal management, and employees too.
Financial statement helps in understanding the performance of the organization. The

performance of an organization can be explained on the basis of the four important aspects of
the business:
a) Liquidity: Liquidity shows the ability of the business to service the short term obligation.
b) Solvency: Solvency shows the ability of the business to meet the long term obligation.
c) Efficiency: Efficiency shows the ability of the business to use the resources of the
business.
d) Profitability: Profitability shows the ability to the business to generate and distribute
profit.
Intra firm comparison of hdfc:
1. Analysis of Short – Term Liquidity:
a. Current ratio = Total Current Assets / Total Current Liabilities
b. Quick ratio = quick current assets / quick current liabilities
Table showing: current ratio and quick ratio of hdfc standard life insurance company ltd. for
the year 2008 and 2009.

HDFC STANDARD LIFE
Year 2009 (RS.’000) 2008 (RS.’000)
Current assets 9,643,629 8,575,727
Current liabilities 9,029,038 6,251,168
Current ratio and quick ratio 1.07% 1.37%
Inference:
The above table is showing the details regarding the current ratio and quick ratio of hdfc
standard life insurance company ltd. The standard current ratio is 2:1, and quick ratio is 1:1,
but the company has got only 1.37 and 1.07 both the year the ratio is not satisfactory. But
compare to year-2009 ratio year-2008 ratio was good.
2. Capital Structure and Long -Term Solvency Ratios:
Debt equity ratio =long Term Debt / shareholders fund
Table showing: debt equity ratios of hdfc standard life in the year 2008 and 2009.
Years 2009 (RS.’000) 2008 (RS.’000)
Outsiders Funds 97,578,470 84,012,076
Share Holders Fund 18,433,462 13,263,132
Debt Equity Ratio 5.29% 6.33%
Inference:

HDFC STANDARD LIFE
There is continues increase in Share holders’ Funds and also in an outsider funds from the
year 2008 to 2009. Outsider’s funds are increased more than the shareholders fund. Hence the
outsider’s 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.
3. Profitability Ratios:
a. Gross profit ratio = gross profit / sales*100
Table showing: the gross profit ratio of hdfc standard life insurance company ltd.
Year 2009 (Rs.’000) 2008 (Rs.’000)
Gross profit (5,029,631) (2,435,094)
Sales 55,183,763 48,176,166
Gross profit ratio -0.09% -0.05%
Analysis:
The high ratio of gross profit is considered satisfactory; hdfc standard life insurance company
ltd. is suffering gross loss in the year 2008 and 2009.
Inference:
There is an increase in gross loss and also the percentage of loss in the year 2008 to 2009 is
0.05, and 0.09 respectively. In the year 2008 it was facing less gross loss, but later it went on
increasing. In the year 2009, loss percentage is 0.09 compare to last year the loss has
increased.
b. Net profit ratio:
Net profit ratio= net profit/sales*100
Table showing net profit ratio of hdfc standard life for the year 2008 and 2009

HDFC STANDARD LIFE
Year 2009 (RS.’000) 2008 (RS.’000)
Net profit (11,913,122) (6,883,491)
Sales 55,183,763 48,176,166
Net profit ratio -0.22 -0.14
Inference: The high ratio of net profit is considered satisfactory; hdfc standard life insurance
company ltd. is suffering net loss in the year 2008 and 2009 respectively.
There is an increase in net loss in 2009 compare to year-2008. The percentage of loss in the
year 2008 and 2009 is 0.14, and 0.22 respectively. This is not good from the company point of
view.
LEARNING EXPERIENCE
In the class just we can assume how the corporate world is but it is completely
different when I started to go to the company. In the class just we will read, learn and
same thing we will write in the exam and we will get pass but when we go for
searching job really we will feel the heat of outside world, regarding pressure for
target achievement, competition for jobs etc…
That was a wonderful experience to me in that company. I learnt so many things there,
what is the real corporate culture, How much we have to be smart, How much talented
we should, How we should achieve our target, what is our responsibity.
Actually I got the work of recruitment consultant; there I need to call to the people
who want to work as financial consultant for part or full time as per their requirement,

HDFC STANDARD LIFE
I had to take interview to them and need to motivate them to take up that job, for that
they need to write the exam and get through with the exam. And then they need to get
the licence from IRDA to do that work.
Chapter-4
General Introduction
Financial Statement Analysis

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.
Boards of directors analyze the financial statements to understand the impact of the decisions
and use the same for future decision making. Employees use the financial statements to

HDFC STANDARD LIFE
negotiate the union demands. Potential investors use the financial statements to decide about
the investment to be made. The common goal of these users is to understand the past and use
the data to predict the future.
For answering the above mentioned questions one has to undertake a detailed analysis of the
financial statements. Financial statement analysis is a comprehensive analysis of all three
financial statements: balance sheet, income statement, and cash flow statement. Financial
statements provide useful information. However, one has to meticulously look for the right
information from the right data. One can undertake the financial statement analysis from
different stakeholders’ perspective: creditors, bankers, credit rating agencies, existing
shareholders, potential shareholders, internal management, and employees too. There are
different tools of financial statement analysis: common-size statement, comparative
statements, and ratio analysis. Before we get into the financial statement analysis, in the first
section we will recapitulate the financial statements.
Tools for Financial Statement Analysis

Following the important tools which are used for undertaking FSA:
a) Comparative Statements
b) Common Size Statements
c) Ratio Analysis
d) Trend Analysis
e) Du-Pont analysis
f) Fund flow analysis
g) Cash flow statement
h) Cost-volume profit analysis
Statement of the problem
Finance is the life blood of all business activities. Financial soundness is the basic
requirement on which the progress and success of any business firm rests in the long run.
Firms should be able to mobilize adequate funds to carry on their regular and normal activities
without any difficulty.
The year 08-09 has been a difficult year for the financial sector and the impacts have been felt
in the Indian life insurance industry. Growth rate in the private sector have declined over the
year on the back of a much more cautious attitude adopted by individual customers. There
have been changes in asset allocation and preferences during the year. Main purpose of this
topic is to analyze the financial statement to know regarding the performance of the company
and to know whether it has performed well in this financial year (2009) compare to past five
years.

HDFC STANDARD LIFE
Objectives of the study
I. To study the overall financial performance of the company.
II. To know the debt and equity position in the company
III. To analyze whether company is in good financial position or not.
IV. And to gain the professional knowledge while working in corporate environment.
Scope of the study
a. Hdfc standard life financial statements analysis with comparison of financial statements of
past five years.
b. To study regarding insurance industry
c. To know about hdfc standard life insurance company
d. To know the status of hdfc standard life in the market
Methodology
This project is on descriptive research and some extent it regards to causal research, and to
use the available facts as information and analyze these to make a critical evaluation of the
materials this is also a causal research with an aim to find a solution for an immediate

HDFC STANDARD LIFE
problem facing by industry or business organization. The control aim of descriptive research
is to discover a solution for some pressing problem.
1. Type of research – descriptive research
2. Tool – Ratio analysis
3. Company annual reports and e-mail at www.hdfcinsurance.com
Source of data
Secondary data:
Secondary was collected through available records/annual reports of 5 year period from
2005-2009 and web sites of hdfc standard life insurance company.
Data Collection:
The required data was collected from the annual report of the company and direct Personal
interview with the officer of the company and also through company website.
Limitations of the study
• It was difficult to collect some information because of some company rules.
• Interaction with the employees was limited because of the work schedule.
• It was difficult to cover all the types of ratios because of lack of information i.e.
regarding inventories, debtor’s turnover etc…..
•
CHAPTER-5
ANALYSIS /DESIGN
Ratio analysis of financial statements

HDFC STANDARD LIFE
It is a systematic use of ratios to interpret/ assess the performance and status of the firm.
• A ratio expresses a mathematical relation between two quantities.
• Ratios are tools providing us which clues and symptoms of underlying conditions. Ratios
can help us to identify areas requiring further investigation.
• The usefulness of ratio depends on the quality of the numbers in their calculation.
That is our ability to draw useful insights and make valid intercompany comparisons is
enhanced by our skill in adjusting reported numbers prior to inclusion in these analyses.
• Ratios are interpretable only in comparison with
1) Prior ratios
2) Predetermined standards.
3) Ratios of competitors.
Ratio analysis of a firm’s financial statements is of interest to shareholders, creditors, and the
firm’s management. Stockholders are interested in the firm’s current and future level of risk
and return, which directly affect the stock price. The firm’s creditors are primarily interested
in the short-term liquidity of the company and in its ability to make interest and principal
payments.
Internal management is concerned with all aspects of the firm’s financial performance.
Therefore, they attempt to produce financial ratios that will be considered favorable to both
owners and creditors. Additionally, management uses ratios to monitor the firm’s
performance from period to period. Unexpected changes or variances are identified to isolate
developing problem areas.
IMPORTANCE OF RATIO ANALYSIS
Ratio analysis does two things, immediately.

HDFC STANDARD LIFE
The first thing is it allows the company to compare itself with other like companies. If
management feels things aren't going well, they can help pinpoint the problem through
comparing their ratios with other companies.
They may have several ratios that are comparable, but a couple which are way off. That might
be where the problem is.
Also, ratio analysis may help by comparing your company with prior periods. If a particular
ratio is declining when it would be better if it were staying the same or increasing, then again
looking at the ratios are important to find out where the problem lies. Ratios are important to
spot trends easily.
Types of ratios:
Ratios can be classified into six broad groups:
1. Liquidity ratios
2. Capital structure/ leverage ratios
3. Profitability ratios
4. Activity/ efficiency ratios
5. Integrated analysis of ratios
6. Growth ratios.
1. Liquidity Ratios:
It is the ability of a firm to satisfy its short- term obligations as they become due. The
importance of adequate liquidity in the sense of the ability of a firm to meet current / short –
term obligations when they become due for payment can hardly be overstressed.
a) Current Ratio:
Current Ratio is the ratio between Current Assets and Current Liabilities. It calculated by
dividing Current Assets by Current Liabilities. Current assets include all assets, which can
convert easily into near money within a year. Current assets include cash in hand, cash at
bank, debtors, stock, and money at short or call notice etc. Current liabilities are the sum of all
short-term payables within a year, which include Sundry Creditors, Bills payable, Bank

HDFC STANDARD LIFE
overdraft, Expenses outstanding etc. the current ratio of a firm measures its short term
solvency that is, its ability to meet short-term obligations.
As a measure of short-term current financial liquidity, it indicates the amount of current

assets available for each amount of current liability. Formula for finding current ratio is given
below.
Current Ratio = Current Assets/Current
Significance of the ratio

Current ratio provides a margin of safety to the creditors. In a sound business, a current ratio
of 2:1 is considered an ideal one. Current ratio indicates firm’s ability to pay its current
liabilities, i.e. day-to-day financial obligation. Current ratio is an index of the firm’s financial
stability i.e., an index of technical solvency and an index of the strength of working capital,
which means excess of current assets over current liabilities. Higher ratio more than 2:1
indicates sound solvency position. Lower ratio less then 2:1 indicates inadequate working
capital.
Table: 1
Table showing: the Current Ratios of hdfc standard life from the year 2005-09.

HDFC STANDARD LIFE
Year 2009 2008 2007 2006 2005
(RS.’000) (RS.’000) (RS.’000) (RS.’000) (RS.’000)
Current assets 9,643,629 8,575,727 5,325,536 3,869,728 1,143,024
Current 9,029,038 6,251,168 3,905,497 2,687,296 1,090,355

liabilities
Current ratio
1.07% 1.37% 1.36% 1.44% 1.05%
Analysis:
Hdfc standard life insurance company ltd. is having a low current ratio in the year 2005 (1.05)
in the year 2006 the ratio has been increased to 1.44. It has been reduced to 1.36 in the year of
2007, and in 2008 current ratios increased further (1.37). But again the current ratio has
decreased in the year 2009 (1.07).
Inference:
The Current assets in the year 2005 is Rs.1, 143,024,000, in the year 2006 is Rs.
3,869,728,000, in the Year 2007 Rs. 5,325,536,000, in the year 2008 Rs. 8,575,727,000, and
in the year 2009 Rs. 9,643,629,000. When there is an increase in current assets in the same
way Current liabilities are also increasing from year to year. In the year 2005 the current
liability was Rs. 1,090,355,000, in 2006 it increased to Rs. 2,687,296 and it increased in the

HDFC STANDARD LIFE
year 2007 to Rs. 3,905,497,000.and in the year 2008 it increased more than the last year that
is Rs. 6,251,168,000. And in 2009 it increased much more i.e., 9,029,038,000.
Since the current ratio is not Satisfactory in the year 2005 & 09. But in the year 2006, 2007,
and 2008 Current ratios is not up to the level.
Graph-1
Graph showing: the Current ratios of hdfc standard life insurance company ltd. from the
year2005 to 2009. Current Ratio
P 1.6
E 1.4
R 1.2
C
1
E
N 0.8
T 0.6
A
G 0.4
E
0.2
0
2005 2006 2007 2008 2009
YEARS
Quick ratio:

HDFC STANDARD LIFE
Quick ratio is also known as liquid ratio or Acid test ratio. Quick ratio shows the liquidity of
the business. Quick ratio is the ratio between quick assets and quick liabilities. The term
quick asset refers to current assets, which can be converted into, cash immediately or at a
short notice without diminution of value. Quick assets comprise of all current assets minus
stock and pre paid expenses.
The formula to find quick ratio is as follows.
Quick Assets = Current assets – (Stock +

Prepaid expenses)
Quick liabilities comprises of all current liabilities minus Bank over draft.
The formula is shown below:
Quick Ratio = Quick assets / Quick

Liabilities
(Or)
Quick Ratio = Quick assets/Current

Liabilities
It is the true test of business solvency. Generally an acid test ratio of 1:1 considered as
satisfactory, by that a firm can easily meet all current claims. Higher ratio more than 1:1
indicates sound and good financial position. If the ratio is less then 1:1, that is, liquid assets are
less than current liabilities, the financial position of the concern shall be deemed to be
unsound. This ratio gives a picture of firm’s ability to meet its short-term debts out of short-
term assets. If less the quick ratio, higher the incidence of inventory in inflating the current
ratio and higher is quick ratio, the incidence of inventory in inflating the current ratio is less.

HDFC STANDARD LIFE
Table-2
Table showing the quick or Acid Test ratios of hdfc standard life from the year 2005-09
Years 2009 2008 2007 2006 2005
(Rs.’000) (Rs.’000) (Rs.’000) (Rs.’000) (Rs.’000)
Liquid assets 9,643,629 8,575,727 5,325,536 3,869,728 1,143,024
Liquid liabilities 9,029,038 6,251,168 3,905,497 2,687,296 1,090,355
Acid test ratio

1.07% 1.37% 1.36% 1.44% 1.05%

HDFC STANDARD LIFE
Analysis:
Hdfc standard life insurance company ltd. is having a low acid test ratio in the year 2005 and
2009 i.e. (1.05 and 1.07). When compare to next years, in the year 2006, 2007 and 2008, it has
1.44, 1.36 and 1.37 respectively.
Inference:
As a rule of thumb quick ratios for the past consecutive years are well above the rule
of thumb. It indicates that the firm is liquid and has the ability to meet its current or liquid
liabilities in time.
Graph – 2
Graph showing the quick ratios or Acid test ratio of hdfc standard life insurance.ltd
from the year 2005 to 2009
R
C
E
N
T
A
G
E
Years
Net working capital:

HDFC STANDARD LIFE
Working capital is the lifeblood of the business. Working capital refers to that part of the
firm’s 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: 3
Table showing: Working Capital of HDFC Standard life insurance company ltd. from
the year 2005-09.
Years 2009 2008 2007 2006 2005
(RS.’000) (RS.’000) (RS.’000) (RS.’000) (RS.’000)
Total Current 9,643,629 8,575,727 5,325,536 3,869,728 1,143,024

Asset
Total Current 9,029,038 6,251,168 3,905,497 2,687,296 1,090,355

Liability
Net working
614,591 2,324,559 1,420,039 1,182,432 52,669
Capital

HDFC STANDARD LIFE
b) Turnover ratios:
It measures the speed with which various accounts /assets are converted into sales or cash. It
is concerned with measuring the efficiency in asset management. These ratios are also called
efficiency ratios or asset utilization ratios.
The liquidity ratios mentioned above are related to the liquidity of a firm as a whole. Another
way of examining the liquidity is to determine how quickly certain current assets are
converted into cash. The ratios to measure these are referred to as turnover ratio.
The three relevant turnover ratios are,
1. Inventory turnover ratio:
This ratio is also known as stock velocity. This ratio calculated to consider the adequacy of the
quantum of capital and its justification for investing in inventory. A firm must have reasonable
stock in comparison to sales. It is the ratio of cost of sales and average inventory. This ratio
helps the finance manager to evaluate inventory policy. This ratio reveals the number of times
finished
Inventory turnover Ratio = Cost of sales/Average

inventory
2. Debtors’ turnover ratio:
Debtor’s turnover ratio is also called ‘Debtors velocity’ or ‘Receivables turnover’. A firm
sells goods on credit and basis. When the firm extends its customers, book debts are created in
the firms account. Debtors are expected to convert into cash over a short period, so it included

HDFC STANDARD LIFE
in current assets. Debtors include the amount of bills receivables and book debts at the end of
accounting period. It is a test to understand the reasonable quantitative relationship between
outstanding receivables and sales. Financial analysts employ two ratios to judge the quality or
liquidity of the Debtors turnover and Average collection period. Debtor’s turnover is found by
dividing total sales by sundry debtors. Formula to find debtors turnover ratio is given below
Debtors turnover = Total

sales/Sundry debtors
3. Creditors’ turnover ratio:
It is a ratio between net credit purchases and the average amount of creditors outstanding
during the year. It is calculated as follows:
Creditors turnover ratio= net credit purchases /

average creditors
Net credit purchases= gross credit purchases –

returns to suppliers
Average creditors= average of creditors (including

bills payable) outstanding at the beginning and at
the end of the year
A low turnover ratio reflects liberal credit terms granted by suppliers, while a high ratio
shows that accounts are to be settled rapidly. The creditor’s turnover ratio is an important tool
of analysis as a firm can reduce its requirement of current assets by relying on supplier’s

HDFC STANDARD LIFE
credit. The extent to which trade creditors are willing to wait for payment can be
approximated by the creditor’s turnover ratio.
c) Defensive – interval ratios:
It is the ratio between quick assets and projected daily cash requirement.
Defensive – interval ratios = Liquid assets /projected daily cash requirement
Projected daily cash requirement=projected cash operating expenditure/number of days in a year
d) Cash flow from operations ratio:
This ratio measures liquidity of a firm by comparing actual cash flows from operations with
current liability. It is calculated as per equation
Cash flow from operations ratio= Cash flow from operations/ current
liabilities
Being a cash measure, the ratio does not encounter the problems of actual convertibility of
current assets and the need for maintaining minimum levels of these assets. In general, the
higher the ratio, the better is a firm from the point of view of liquidity.

HDFC STANDARD LIFE
2. Capital structure /leverage ratios:
The long term lenders/creditors would judge the soundness of a firm on the basis of the long
term financial strength measured in terms of its ability to pay the interest regularly as well as
repay the installment of the principal on due dates or in one lump sum at the time of maturity.
The long term solvency of a firm can be examined by using leverage or capital structure
ratios. It may be defined as financial ratios which throw light on the long term solvency of a
firm as reflected in its ability to assure the long term lenders with regard to
(1) Periodic payment of interest during the period of the loan and
(2) Repayment of principal on maturity or in predetermined installments at due dates
e) Ratios based on relationship between borrowed funds and owner’ capital:
A. Debt –equity ratio:

The financing of total assets of a business concern is done by owner’s equity as well as
outsider’s debts. The relationship between borrowed funds and owner’s capital is a popular
measure of long-term financial solvency of a firm. The relationship is shown by the debt
equity ratio. This ratio indicates the relative proportions of debts and equity in financing the
assets of a firm the formula we use is Total long-term debts by Shareholders fund. Total long-
term debts include mortgage loans, long term loans; debentures etc. share holders fund
includes Preference share holders, Equity share holders, capital reserve, revenue reserve etc.
Debt equity ratio = Total long term

funds/Share holders fund
Significance of the ratio:

HDFC STANDARD LIFE
Acceptable norm for this ratio is considered to be 2:1. A higher debt-equity ratio is allowed in
the case of capital-intensive industries, a norm of 4:1 is used for fertilizer and cement units and a
norm of 6:1 is used for shipping units. A high ratio shows that the claims of creditors are greater
than that of owners. A very high ratio is unfavourable from the firm’s point of view. A high debt
company, also known as highly leveraged or geared, is able to borrow funds on very restrictive
terms and conditions. A low debt-equity ratio implies greater claim of owners then creditors.
From the point of view of creditors, it represents a satisfactory capital structure of the business
since a high proportion of equity provides a larger margin of safety for them. This ratio shows the
extent to which debt financing is used in the business.
Table: 4
The debt equity ratios of hdfc standard life insurance company ltd. from the year 2005
to 2009.
Analysis:
Years 2009 2008 2007 2006 2005
(RS.’000) (RS.’000) (RS.’000) (RS.’000) (RS.’000)
Outsiders 97,578,470 84,012,076 45,999,541 23,633,655 8,470,669

Funds
Share
Holders
18,433,462 13,263,132 8,360,441 6,331,725 3,194,450
Fund
Debt Equity
5.29% 6.33% 5.50% 3.73% 2.65%
Ratio

HDFC STANDARD LIFE
The ratio of 2:1 is considered satisfactory, the debt equity ratios of hdfc standard life insurance
company ltd is 2.65, 3.73, 5.50, 6.33, and 5.29 from the year 2005 – 2009 respectively.
Inference:
There is continues increase in Share holders’ Funds and also in an outsider funds from the
year 2005 to 2009. Outsider’s funds are increased more than the shareholders fund. Hence the
outsider’s funds has been increased year by year, it shows the larger outsiders funds are
available to the company. It has crossed more than maximum level also. 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.
Graph- 3

HDFC STANDARD LIFE
Chart showing: the debt equity ratios of HDFC STANDARD LIFE from the year 2005-
09.
Debt equity ratios
P
e
r
c
e
n
t
a
g
e
Years
b). 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

HDFC STANDARD LIFE
Table: 5
Debt - assets ratio table
2009 2008 2007 2006 2005
Particulars (Rs.’000) (Rs.’000) (Rs.’000) (Rs.’000) (Rs.000)
Total debt 116,011,932 97,275,208 54,359,982 29,965,380 11,665,119
Total assets 11,091,335 9,907,527 6,061,590 4,471,073 1,874,848
Debt-assets 10.45% 9.82% 8.97% 6.70% 6.22%
Ratio
Analysis:
The ratio of 2:1 is considered satisfactory, the debt equity ratios of hdfc standard life
insurance company ltd is 6.22, 6.70, 8.97, 9.82, and 10.45% from the year 2005 – 2009
respectively.
Inference:
There is continues increase in total debt and also in total assets from the year 2005 to 2009.
Debt ratio is increasing more than the assets ratio. Hence the debt ratio has been increased year
by year; it shows the larger total debt is more than the total assets available to the company.

HDFC STANDARD LIFE
Since this is quite satisfactory and in the same way it is not good to the share holder’s point of
view and also to the company.
Graph: 4
Debt assets ratio of HDFC STANDARD LIFE, from the year 2005 to 2009
Years
c) Equity assets ratio:
Still another variant of the debt/equity ratio is to relate the owner’s/proprietor’s 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:

HDFC STANDARD LIFE
Proprietary ratio = Proprietor’s 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
Table: 6
Table showing: the Proprietary Ratio of hdfc standard life from the year 2005-09.

HDFC STANDARD LIFE
2009 2008 2007 2006 2005
Years (RS.’000) (RS.’000) (RS.’000) (RS.’000) (RS.’000)
Fixed Asset 1,447,706 1,331,800 736,054 601,345 731,824
Shareholders
18,433,462 13,263,132 8,360,441 6,331,725 3,194,450
Fund
Proprietary ratio
12.73% 9.96% 11.36% 10.53% 4.37%
Analysis:
The ratio of 1:3 is considered satisfactory; the Proprietary Ratio of Hdfc standard life
insurance company is having a proprietary ratio of 4.37, 10.53, 11.36, 9.96, and 12.73 in the
year 2005, 2006, 2007, 2008, and in 2009 respectively.
Inference:
The Proprietary Ratio of hdfc standard life insurance company is increasing over the years.
It shows Good investment over by the company in Fixed Asset.
Graph – 5
Graph showing the Proprietary Ratio of hdfc standard life insurance company ltd. from
the year 2005-09
Proprietary Ratio

HDFC STANDARD LIFE
Years
Ratio of current assets to proprietor’s funds:
It shows the relationship between current assets and Shareholders funds. The purpose of this
ratio is to calculate the percentage of shareholders funds invested in current assets. It found by
dividing current assets by proprietors funds.

This ratio can be expressed in percentage or as a proportion. Different industries are using
different norms and hence the ratio should be carefully used.
Table: 7

HDFC STANDARD LIFE
Table showing the Proprietary Ratio of hdfc standard life insurance company ltd. from
the year 2005-09
Years 2009 2008 2007 2006 2005
(RS.’000) (RS.’000) (RS.’000) (RS.’000) (RS.’000)
Current Asset 9,643,629 8,575,727 5,325,536 3,869,728 1,143,024
Proprietors Fund
18,433,462 13,263,132 8,360,441 6,331,725 3,194,450
Proprietary
1.91% 1.55% 1.55% 1.64% 2.79%
Ratio
Analysis:
Hdfc standard life is having a current asset to proprietary ratio of 2.79, 1.64, 1.55, 1.55, and
1.91 percent in the year 2005, 2006, 2007, 2008, and in 2009 respectively.
Inference:
The Proprietary ratio of hdfc standard life insurance company ltd. is varying from the
year 2005 to 2009. It indicates that the Proprietary ratio is not up to the level.
Graph -6
Graph showing the Proprietary Ratio of hdfc standard life insurance company ltd. from
the year 2005-2009.

HDFC STANDARD LIFE
YEARS
c) Coverage ratios:
It measures the firm’s ability to pay certain fixed charges. These ratios are computed from
information available in the profit and loss account. For a normal firm, in the ordinary course
of business, the claims of creditors are not met out of the sale proceeds of the permanent
assets of the firm. The obligations of a firm are normally met out of the earning or operating
profits.
1. Interest coverage ratio:
It measures the firm’s ability to make contractual interest payments.
Interest coverage = EBIT /

interest

HDFC STANDARD LIFE
It is also known as ‘time-interest- earned ratio’. This ratio measures the debt servicing
capacity of a firm insofar as fixed interest on long term loan is concerned. It is determined by
dividing the operating profits or earnings before interest and taxes by the fixed interest
charges on loans.
2. Dividend coverage ratio:
It measures the ability of a firm to pay dividend on preference shares which carry a stated rate
of return. This ratio is the ratio of net profits after taxes and the amount of preference
dividend. Thus,
Dividend coverage ratio = EAT/ PREFERENCE

DIVIDEND
3. Total fixed charges coverage ratio:
It measures the firm’s ability to meet all fixed payment obligations. The total coverage ratio
has a wider scope and takes into account all the committed fixed obligations of a firm, that is,
1) Interest on loan
2) Preference dividend
3) Lease payments
4) Repayment of principal
Symbolically,

HDFC STANDARD LIFE
Total fixed charges coverage ratio = EBIT + Lease payment/

interest + lease payment + (preference dividend + installment of
principal) / (1-t)
4. Cash flow coverage ratio:
Total cash flow coverage = EBIT+ lease payments + depreciation

+ non-cash expenses / lease payment + interest + (principal
repayment)/(1-t) + (preference dividend)/ (1-t)
The overall ability of a firm to service outside liabilities is truly reflected in the total cash
flow coverage ratio: the higher the coverage, the better is the ability
5. Debt services coverage ratio:
Debt service capability is the ability of a firm to make the contractual payments required on a
scheduled basis over the life of the debt. It is considered a more comprehensive and apt
measure to compute debt service capacity of a business firm. It provides the value in terms
of the number of times the total debt service obligations consisting of interest and repayment
of principal in installments are covered by the total operating funds available after the
payment of taxes: Earnings after taxes, EAT + interest + depreciation + other non – cash
expenditure like amortization.
3. Profitability ratios:
The profitability of a firm can be measured by its profitability ratio. Apart from the creditors,
both short-term and long terms, also interested in the financial soundness of a firm are the
owners and the management or the company itself. The management of the firm is naturally

HDFC STANDARD LIFE
eager to measure its operating efficiency. Similarly the owners invest their funds in the
expectation of reasonable returns. The operating efficiency of a firm and its ability to ensure
adequate returns to its shareholders/ owners depends ultimately on the profits earned by it.
a) Gross profit ratio:
Gross profit is the result of the relationship between prices, sales volume and costs. It
measures the percentage of each sales rupee remaining after the firm has paid for its goods. A
change in the gross margin can be brought about by changes in any of these factors. The gross
margin represents the limit beyond which fall in sales prices are outside the tolerance limit.
Further, the gross profit ratio/ margin can also be used in determining the extent of loss
caused by theft, spoilage, damage, and so on in the case of these firms which follow the
policy of fixed gross profit margin in pricing their products.
A high ratio of gross profit to sales is a sign of good management as it implies that the cost of
production of the firm is relatively low. It may also be indicative of a higher sales price
without a corresponding increase in the cost of goods sold. It is also likely that cost of sales
might have declined without a corresponding decline in sales price.
A relatively low gross margin is definitely a danger signal, warranting and careful and
detailed analysis of the factors responsible for it.
Gross profit ratio= gross profit x 100
Sales
Table: 8
Table showing: the gross profit ratio of hdfc standard life insurance company ltd.

HDFC STANDARD LIFE
Year 2009 2008 2007 2006 2005
(Rs.’000) (Rs.’000) (Rs.’000) (Rs.’000) (Rs.’000)
Gross profit (5,029,631) (2,435,094) (1,255,611) (1,287,572) (897,348)
Sales 55,183,763 48,176,166 28,226,248 15,469,501 6,866,346
Gross profit -0.09% -0.05% -0.04% -0.08% - 0.13%

ratio
Analysis:
The high ratio of gross profit is considered satisfactory; hdfc standard life insurance company
ltd. is suffering gross loss from the year 2005 – 2009 respectively. Even though having a very
good sales and growth in the market company is not in the position to make profit.
Inference:
There is continues decrease in gross loss suffered by this company and also the percentage of
loss from the year 2005 to 2009 is 0.13, 0.08, 0.04, 0.05, and 0.09 respectively. In the year
2005 it was facing more gross loss, but later it went on decreasing the loss. In the year 2009,
again it faced more loss percentage compare to last three years.
Graph- 7

HDFC STANDARD LIFE
The gross profit ratios of hdfc standard life insurance company.ltd from the year 2005-
09.
Gross profit ratio in percentage
YEARS
P
E
R
C
E
N
T
A
G
E
b.Net profit ratio:
It measures the percentage of each sales rupee remaining after all costs and expenses
including interest and taxes have been deducted.
The net profit margin is indicative of management’s ability to operate the business with
sufficient success not only to recover from revenues of the period, the cost of merchandise or
services, the expenses of operating the business (including depreciation) and the cost of the
borrowed funds, but also to leave a margin of reasonable compensation to the owners for
providing their capital at risk. The ratios of net profit (after interest and taxes) to sales
essentially express the cost price effectiveness of the operation.

HDFC STANDARD LIFE
A high net profit margin would ensures adequate return to the owners as well as enable a firm
to withstand adverse economic conditions when selling price is declining, cost of production
is rising and demand for the product is falling.
A low net profit margin has the opposite implications.
Net profit ratio = Net profit x 100
Sales
Table: 9
Table showing net profit ratio of hdfc standard life from the year 2005 to 2009
Year 2009 2008 2007 2006 2005
(RS.’000) (RS.’000) (RS.’000) (RS.’000) (RS.’000)
(11,913 (6,883,49 (4,421,36 (3,165,75 (1,878,18

,122) 1) 4) 3) 1)
Net profit
Sales 55,183,763 48,176,166 28,226,248 15,469,501 6,866,346
Net profit -0.22% -0.14% -0.16% -0.20% -0.27%

ratio
Analysis:
The high ratio of net profit is considered satisfactory; hdfc standard life insurance company
ltd. is suffering net loss from the year 2005 – 2009 respectively. It is having very good sales

HDFC STANDARD LIFE
and growth in the market then also its profit is not increasing, but net loss is reducing compare
to past years.
Inference:
There is continues decrease in net loss, which is suffered by this company and also the
percentage of loss from the year 2005 to 2009 is 0.27, 0.20, 0.16, 0.14, and 0.22 respectively.
In the year 2005 it was facing more net loss, but later it went on decreasing the loss. In the
year 2009, again it faced more loss percentage compare to last three years.
Graph- 8
Chart showing the Net profit ratios of hdfc standard life insurance company.ltd from the
year 2005-09.
YEARS
p
e
r
c
e
n
t
a
g
e

HDFC STANDARD LIFE
c. 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 x100
Capital employed
Table-10
Return on capital employed ratio table

HDFC STANDARD LIFE
Particulars 2009 2008 2007 2006 2005
(Rs.’000) (Rs.’000) (Rs.’000) (Rs.’000) (Rs.’000)
Net profit (11,913,122) (6,883,491) (4,421,364) (3,165,753) (1,878,181)
Capital 18,433,462 13,263,132 8,360,441 6,331,725 3,194,450

employed
Return on -64.62% -51.90% -52.88% -49.99% -58.80%

capital
employed ratio
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 from the year 2005 – 2009 respectively.
Inference:
There is continues decrease in rate of return on capital employed, and also the percentage of
capital employed is increasing continuously from the year 2005 to 2009 i.e. is 3,194,450,000,
6,331,725,000, 8,360,441,000, 13,263,132,000, and 18,433,462,000 respectively. In the year
2005 and 2009 it was earning very low return on capital employed compare to other financial
years.
Graph- 9

HDFC STANDARD LIFE
Chart showing the return on capital employed ratio of hdfc standard life insurance
company.ltd from the year 2005-09.
YEARS
P
e
r
c
e
n
t
a
g
e
SUMMARY OF 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 standard life insurance company ltd. from 2005 to 2009. The
major findings are given below
 The study shows there is a continuous changes in the current ratio and also it is not
satisfactory when compare to actual standard of 2:1.

HDFC STANDARD LIFE
 Current ratio in the year 2005, it is showing 1.05% and later on it went on increasing way
i.e. in 2006 – 1.44%, 2007 – 1.36, 2008-1.37%.
 Current ratio in past three years it was getting to meet the standard, but in the year of 2009
again it went down to 1.07%.
 The quick ratio for this company is same as mentioned in the above table. Because as
there is no inventory and prepaid expenses to deduct in this company as it is insurance
company we cannot find inventory.
 The study shows that the net working capital in the company is Rs.52,669,000 in 2005,
Rs.1,182,432,000 in 2006, in 2007 – Rs.1,420,039,000, in 2008 – Rs.2,324,559,000 and in
2009 again it decreased to Rs.614,591,000.
 The study shows that the debt equity ratio is satisfactory from the creditors point of view
that is in the year 2005 the percentage of ratio is 2.65%, in 2006 – 3.73%, in the year 2007
– 5.50%, in 2008- 6.33% and in 2009 it is 5.29%.
 The study shows that the proprietary ratio to fixed assets is 2005- 4.37%, 2006- 10.53%,
2007- 11.36%, 2008- 9.96%, 2009- 12.73%.
 The study shows that the proprietary ratio to current ratio is in 2005-2.79%, 2006- 1.64%,
2007- 1.55%, 2008- 1.55%, 2009- 1.91%.
 The study shows that gross profit ratio of the company was went on decreasing but it is
recovering from more loss to less loss and the percentage of ratio is, in the year 2005 is
-0.13%, in 2006 it is -0.08%, in 2007 it is -0.04%, in 2008 it is -0.05%, in 2009 it is
-0.09%

HDFC STANDARD LIFE
 The study shows that the net loss was went on decreasing from the year 2005 to 2008. But
in the year 2009 it has incurred more loss than 2006, 2007, and 2008 but less than 2005
(i.e. 2005 = -0.27, 2006= -.20, 2007= -.16, 2008= -0.14, 2009= -0.22)
 The study shows that the return on capital employed is not good because every year it is
earning negative returns and also the percentage of negative returns went on increasing
way (i.e. 2005= -58.80%, 2006= -49.99%, 2007= -52.88%, 2008= -51.90%, 2009=
-64.62%.
 The return on capital employed is more negative in the year 2009 as compared to all other
four years. (I.e. 64.62%)

HDFC STANDARD LIFE
SUGGESSITIONS
a. It can try to create awareness about this company through some programmes.
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.

HDFC STANDARD LIFE
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.
CONCLUSION
HDFC STANDARD LIFE has been one of the best life insurance service providers in India. It
has the excellent quality service provider to their customer. The overall performance of
HDFC STANDARD LIFE is very good compared to other service providers. It got 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. 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

HDFC STANDARD LIFE
expenses and market share is very less compare to other competitors like LIC, ICICI
Prudential etc….
ANNEXURES
Balance sheet of HDFC STANDARD LIFE as at March 31 for five years
Particulars Schedule 2009 2008 2007 2006 2005
(Rs.‘000) (Rs.‘000) (Rs.‘000) (Rs.‘000) (Rs.‘000)
SOURCES OF
FUNDS
SHAREHOLDERS’
FUNDS:
3,190,898

HDFC STANDARD LIFE
Share Capital 5 17,958,180 12,706,359 8,007,148 6,192,718
Share application -
money received
pending allotment of - - 287,391 -
shares -
Reserve and Surplus 6 552,892 552,892 65,902 65,902
Credit / [Debit] Fair 3,552
Value Change
Account (77,610) 3,881 - 73,105
Sub-Total 18,433,462 13,263,132 8,360,441 6,331,725 3,194,450
BORROWINGS 7 - - - - -
POLICYHOLDERS’
FUNDS:
Credit / [Debit] Fair

Value Change (296,885) 193,745 91,247 209,569 174,980
Account
Policy Liabilities
29,092,419 24,366,747 17,391,531 11,487,996 6,377,397
Insurance Reserves
- - - - -
Provision for Linked
liabilities 84,085,083 56,317,976 25,934,264 9,732,781 1,918,292
Add: Fair value

change
(15,302,147 3,133,608 2,582,499 2,203,309 -
)
Total Provision for 68,782,936 59,451,584 28,516,763 11,936,090 -

Linked Liabilities
Sub-Total 97,578,470 84,012,076 45,999,541 23,633,655 8,470,669
Funds for Future 586,395 - - - -

Appropriations
Funds for future

appropriation -

HDFC STANDARD LIFE
Provision for lapsed 531,970 246,951 59,485 25,516 -

policies unlikely to
be revived
Surplus Allocated to
Shareholders - - - - -
TOTAL 117,130,297 97,522,159 54,419,467 29,990,896 11,665,119
APPLICATION OF
FUNDS:
INVESTMENTS
Shareholders’
8 4,291,597 4,213,064 1,529,743 1,380,910 984,253
Policyholders’
8A 30,050,097 23,299,043 17,782,866 11,695,010 6,087,916
Assets held to cover
Linked Liabilities 8B 68,782,936 59,451,584 28,516,763 11,936,090 1,918,292
LOANS 9 30,248 18,618 12,638 29,356 11,984
FIXED ASSETS 10 1,447,706 1,331,800 736,054 601,345 731,824
CURRENT ASSETS
Cash and bank 11 4,108,660 4,493,238 3,363,556 2,879,622 733,529

balances
Advances and Other 12 5,534,969 4,082,489 1,961,980 990,106 409,495

Assets
Sub-total (A) 9,643,629 8,575,727 5,325,536 3,869,728 1,143,024
CURRENT 13 8,820,225 6,129,149 3,874,652 2,658,567 1,069,635

LIABILITIES
PROVISIONS

HDFC STANDARD LIFE
14 208,813 122,019 30,845 28,729 20,720
Sub-Total (B) 9,029,038 6,251,168 3,905,497 2,687,296 1,090,355
NET CURRENT
ASSETS (C) =
(A - B) 614,591 2,324,559 1,420,039 1,182,432 52,669
MISCELLANEOUS 15 - - - - -
EXPENDITURE (to
the extent not written
off or adjusted)
DEBIT BALANCE 11,913,122 6,883,491 4,421,364 3,165,753 1,878,181

IN PROFIT AND
LOSS ACCOUNT
(Shareholders’
account)
TOTAL 117,130,297 97,522,159 54,419,467 29,990,896 11,665,119
CONTINGENT
LIABILITIES
1. Partly paid-up
investments - - - - -
2. Claims, other than

against policies, not
acknowledged as - - - - -
debts by the company
3. Underwriting
commitments
outstanding (in - - - - -
respect of share and
securities)
4. Guarantees given
by or on behalf of the
Company - - - - -
5. Statutory
demands / liabilities
1,465,718 262,091 309,494 119,829 -
in dispute, not
provided for

HDFC STANDARD LIFE
6.Reinsurance
obligations to the - - - -
extent not provided
for in the accounts -
7.Others - - - -
Total 1,465,718 262,091 309,494 119,829 -
Profit & Loss Account for year ended March 31, from 2005 to 2009
Shareholders’ Account (Non-technical Account)

2009 2008 2007 2006 2005
Particulars schedule (RS.’000) (RS.’000) (RS.’000) (RS.’000) (RS.’000)
Amounts transferred 794,984 516,341 - - -

from the Policyholders
Account (Technical
Account)
Income from
Investments
(a) Interest,
Dividends & 302,367 242,109 126,836 138,496 65,321
Rent - Gross

HDFC STANDARD LIFE
(b) Profit on sale /

redemption of
investments 13,924 98,694 114,192 7,989 10,117
(c) (Loss on sale /

redemption of (35,870) (11,142) (12,470) (6,933) (4,043)
investments)
(d) Transfer / gain

on revaluation /
change in fair
value 51,887 (21,384) (23,909) (6,594) -
(e) Amortization of
(premium)/disco
(2,965) 561 (2,375) (8,926) (5,156)
unt on
investments
Sub Total 329,343 308,838 202,274 124,032 66,239
Other Income 300 531 764 3,650 1587
TOTAL (A) 1,124,627 825,710 203,038 127,682 67,826
Expenses other than 3A 5,307 12,596 8,252 18,251 10,490

those directly related to
the insurance business
Bad debts written off - - - - -
Provisions (other than

taxation)
(a) For diminution

- - - - -
in the value of
Investments
(net)
- - - - -
(b) Provision for
doubtful debts
(c) Others - - - - -
Contribution to the 6,148,951 3,248,208 1,450,397 1,397,003 954,744

Policyholders Fund

HDFC STANDARD LIFE
TOTAL (B) 6,154,258 3,260,804 1,458,649 1,415,254 965,234
Profit / (Loss) before tax (5,029,63 (2,435,094 (1,255,611 (1,287,572 (897,348)

1) ) ) )
Provision for Taxation -
- - - -
Profit / (Loss) after tax (897,348)
(5,029,63 (2,435,094 (1,255,611 (1,287,572
APPROPRIATIONS 1) ) ) )
(a) Balance at the (980,833)
beginning of the
Year (6,883,49 (4,421,364 (3,165,753 (1,878,181
1) ) ) )
(b) Interim -
dividends paid
during the Year
- - - - -
(c) Proposed final
dividend
(d) Dividend - - - - -
distribution tax
(e) Transfer to - - - -
liabilities on -
account of
Employee
benefits - (27,033) - -
Profit / (Loss) carried

forward to the Balance
Sheet (11,913,1 (6,883,491 (4,421,364 (3,165,753 (1,878,181
22) ) ) ) )
Earnings per share - (3.28) (2.42) (1.83) (2.92) (3.38)

Basic
Earnings per share - (3.28) (2.42) (1.81) (2.92) (3.38)

Diluted

HDFC STANDARD LIFE
BIBILOGRAPHY
WEBSITES:
 WWW.HDFCINSURANCE.COM
 WWW.GOOGLE.COM
 WWW.YAHOOSEARCH.COM
REFERENCE BOOKS:
 PRASANNA CHANDRA: FINANCIAL MANAGEMENT, (TMH), 6/e, 2004

HDFC STANDARD LIFE
 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

HDFC

Transféré par

Informations du document

Description originale:

Copyright

Formats disponibles

Partager ce document

Partager ou intégrer le document

Options de partage

Avez-vous trouvé ce document utile ?

Ce contenu est-il inapproprié ?

Droits d'auteur :

Formats disponibles

HDFC

Transféré par

Droits d'auteur :

Formats disponibles

HDFC STANDARD LIFE

A brief history of the Insurance sector

Insurance sector reforms

CAMBRIDGE INSTITUTE OF TECHNOLOGY 1

iii) Regulatory Body

 The Insurance Act should be changed

 Mandatory Investments of LIC Life Fund in government securities to be reduced from

 LIC should pay interest on delays in payments beyond 30 days

CAMBRIDGE INSTITUTE OF TECHNOLOGY 2

 Computerization of operations and updating of technology to be carried out in the

The Insurance Regulatory and Development Authority (IRDA)

CAMBRIDGE INSTITUTE OF TECHNOLOGY 3

COMPANY PROFILE OF HDFC - STANDARD LIFE

A) Background and inception of the company

Standard Life Group (Standard Life plc and its subsidiaries)

CAMBRIDGE INSTITUTE OF TECHNOLOGY 4

B) Nature of the business carried

C) Vision, Mission and quality policy

 Customer service of the highest order

CAMBRIDGE INSTITUTE OF TECHNOLOGY 5

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 12-24 months and

Process maturity Process complaint functions 8-12 months and

Organized work Zone/region/branch/location 6-10 months and

Current business Completion of projects and 4-6 months and

CAMBRIDGE INSTITUTE OF TECHNOLOGY 6

How (1) how (2) how (3) how (4)

BREADTH OF QUALITY INTERVENTION

How (1): How to achieve

CAMBRIDGE INSTITUTE OF TECHNOLOGY 7

How (2): How to achieve

How (3): How to achieve

 Value stream projects.

How (4): How to achieve

 Stake holders delight

CAMBRIDGE INSTITUTE OF TECHNOLOGY 8

CAMBRIDGE INSTITUTE OF TECHNOLOGY 9

CAMBRIDGE INSTITUTE OF TECHNOLOGY 10

savings by providing them a choice of thoroughly researched and selected investments.

4. Savings & Investment Plans

CAMBRIDGE INSTITUTE OF TECHNOLOGY 11

 HDFC Endowment Supreme Suvidha: It is a convenient plan, which saves insured

CAMBRIDGE INSTITUTE OF TECHNOLOGY 12

CAMBRIDGE INSTITUTE OF TECHNOLOGY 13

 HDFC Gramin Bima Kalyan Yojana

 HDFC Development Insurance Plan

It is a joint venture between Housing Development Finance Corporation Limited (HDFC

 HDFC Mutual Fund

 HDFC ERGO General Insurance

CAMBRIDGE INSTITUTE OF TECHNOLOGY 14

Aegon Religare Life

Bajaj Allianz Life Insurance Co Ltd

CAMBRIDGE INSTITUTE OF TECHNOLOGY 15

Canara HSBC OBC Life

Future Generali Life

ICICI Prudential Life Insurance

CAMBRIDGE INSTITUTE OF TECHNOLOGY 16

Received Diamond EDGE Award 2009

CAMBRIDGE INSTITUTE OF TECHNOLOGY 17

Received 2008 CIO Bold 100 and CIO Security Awards

Received PCQuest Best IT Implementation Award 2008