Wednesday, December 19, 2018
'Portfolio Management Practices in HDFC Bank Essay\r'
'HDFC fix Ltd is a major Indian financial services sm finesse set based in Mumbai. The marge is a publicly held wedgeing company engaged in providing a widely range of banking and financial services including commercial banking and treasury operations. The Bank at present has an enviable network of 2201 branches and 7110 ATMs spread in 996 cities across India. They also defend one overseas wholesale banking branch in Bahrain, a branch in Hong Kong and two representative offices in UAE and Kenya. The Bank has two subsidiary companies, that is to say HDFC Securities Ltd and HDB Financial Services Ltd. The Bank has three primitive business segments, namely banking, wholesale banking and treasury.\r\nThe Bank`s shares are listed on the Bombay Stock shift confine and The National Stock Exchange of India Ltd. The Bank`s American Depository Shares (ADS) are listed on the parvenu York Stock Exchange (NYSE) and the Bank`s globose Depository Receipts (GDRs) are listed on capital of Luxembourg Stock Exchange. HDFC Bank Ltd Was incorporated on marvellous 30, 1994 by Housing Development pay passel Ltd. In the twelvemonth 1994, Housing Development Finance Corporation Ltd was amongst the first to receive an Ã¢â¬Å"in beliefÃ¢â¬Â approval from the Reserve Bank of India to set up a bank in the occult sector, as part of the RBI`s liberalization of the Indian Banking Industry. HDFC Bank commenced operations as a schedule Commercial Bank in January 1995. In the socio-economic class 1996, the Bank was appointed as the clearing bank by the NSCCL.\r\nIn the year 2001, they became the first private sector bank to be authorized by the Central Board of Direct Taxes (CBDT) as fountainhead as the RBI to accept direct taskes. During the year, the Bank made a strategic tie-up with a Bangalore-based business solutions software developer, Tally Solutions Pvt Ltd for developing and religious offering products and services facilitating on-line accounting and banking ser vices to SMEs. During the year 2001-02 the bank was listed on the New York Stock Exchange. In September 28, 2005, the Bank increased their stake in HDFC Securities Ltd from 29.5% to 55%. Consequently, HDFC Securities Ltd became a subsidiary of the Bank. During the year 2007-08, the Bank added 77 new branches take the total to 761 branches.\r\nThe art and science of making decisions about investment blend and policy, matching investments to objectives, asset allocation for individuals and institutions, and balancing put on the line against performance.\r\nPortfolio oversight is all about strengths, weaknesses, opportunities and threats in the filling of debt vs. equity, domestic vs. international, growth vs. safety, and many separate tradeoffs encountered in the attempt to maximize return at a given appetite for risk. The meaning of Portfolio Management is as follows: * Portfolio is a collection of asset.\r\n* The asset may be physical or financial like share, Bonds, Debentures and gustatory perception Shares etc. * The individual investor or fund motorbus would not like to put all his cash in the shares of one company, for that would amount to great risk. * principal(prenominal) objective is to maximize portfolio return and at the selfsame(prenominal) time minimizing the portfolio risk by diversification. * Portfolio management is the management of various financial assets, which comprise the portfolio. * According to Securities Exchange Board of India Act 1993, Ã¢â¬Å"PortfolioÃ¢â¬Â means the total place of securities belonging to any person. * Designing portfolios to suit investor prerequisite often involves making several projections regarding the future, based on the current information. * One of the key inputs in portfolio building is the risk bearing ability of the investor. * Portfolios are create to suit the return expectations and the risk appetite of the investor.\r\nThe prefatory objective is to maximize yield and minimize risk. The some other objectives are as follows: * Stability of Income: An investor considers stability of income from his investment. He also considers the stability of purchasing power of income.\r\n* metropolis Growth: Capital appreciation has become an authorized investment principle. Investors seek growth stocks which bring home the bacon a very large capital appreciation by way of rights, bonus and appreciation in the securities attention price of the share.\r\n* Liquidity: An investment is a liquefiable asset. It can be converted into cash with the help of stock exchange. The portfolio should contain a planned similarity of high grade and readily salable investment.\r\n* arctic: Safety means protection for investment against red under reasonably variations. In order to provide safety, a careful review of economic and industry trends is necessary. In other words, errors in portfolio are necessary and it requires extensive diversification.\r\n* Tax Incentives: Investors try to minimize their tax liabilities from the investments. The portfolio manager has to keep a list of such(prenominal) investment avenues along with the return risk, profile, tax implications, yields and other returns.\r\n'