ANVESHAK-International Journal of Management

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Scanning the Financial Performance of Union Bank of India Applying DuPont Analysis


Affiliations
1 Assistant Professor, Dr. Thakorbhai Patel Girl’s Commerce College, Vadodara – 390015, Gujarat, India
     

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To scrutinize and scan the optimization of banks and its functioning, a world-wide famous and robust indicator DuPont analysis model is implemented confidently since ages. This model has had experience of putting not only banks, but also companies and industries of diversified sections, under estimation. Union Bank of India of public sector is opted for contemplating its performance through DuPont model in this paper. Scrutiny period is designed of 10 years from 2012-13 to 2021-22. Employing the secondary data, trend of Union Bank is examined considering ratios of net profit margin, total asset turnover, equity multiplier and return on equity. Mean, standard deviation, coefficient variance and CAGR (%) is computed along with establishing the correlation between ROE and its financial components using SPSS software 26.0. The overall inferences drawn states that ROE shows fluctuating trend and EM is inversely related to ROE whereas NPM and TAT are positively related to ROE and NPM reveals a very strong relationship with ROE.


Keywords

DuPont Model, Equity Multiplier, Net Profit Margin, Performance Evaluation, ROE, Total Asset Turnover
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  • Bansal, R. (2014). A comparative analysis of the financial ratios of selected banks in India for the period of 2011-2014. Research Journal of Finance and Accounting, 2014, Vol. 5. No. 19, pp. 153–168.

  • Lakshmi, B. (2020). A study on financial performance evaluation using Dupont analysis in select automobile. International Journal of Management, Technology and Engineering, 2020, Vol. IX, No. 1, pp. 354–362.

  • Nwuba, E., Omankhanlen, A. E., and Osuma, G. O. (2021). Decomposition of Banks ‘ return on equity using Dupont Model: Evidence from the Nigerian Banking Industry. Journal of Legal, Ethical and Regulatory Issues, 2021, Vol. 24, No. 1, pp. 1-10.

  • Padake, V., and Soni, R. (2015). Measurement of efficiency through DuPont analysis: A study of top 12 Banks in India. The IUP Journal of Bank Management, 2015, Vol. 3, No. 1, pp. 1–15. PMid: 26213149 PMCid: PMC4576154. https://doi.org/10.1016/j.bpj.2015.06.056

  • Rahman, M. Z., and Mia, R. (2018). Deconstruction of ROE: An implementation of DuPont model on selected Bangladeshi Commercial Banks. International Journal of Economics and Financial Research, 2018, Vol. 4, No. 6, pp. 165–170.

  • S. AlAli, M. (2019). The use of DuPont modified financial model in evaluating the financial performance of Kuwaiti Banks. Journal of Banking and Financial Dynamics, 2019, Vol. 3, No. 1, pp. 1–9. https://doi.org/10.20448/journal.525.2019.31.1.9

  • Websites

  • https://www.unionbankofindia.co.in/

  • https://www.rbi.org.in/

  • https://dbie.rbi.org.in/

  • https://www.moneycontrol.com/

  • https://economictimes.indiatimes.com/


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  • Scanning the Financial Performance of Union Bank of India Applying DuPont Analysis

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Authors

Yasmin A. Barodawala
Assistant Professor, Dr. Thakorbhai Patel Girl’s Commerce College, Vadodara – 390015, Gujarat, India

Abstract


To scrutinize and scan the optimization of banks and its functioning, a world-wide famous and robust indicator DuPont analysis model is implemented confidently since ages. This model has had experience of putting not only banks, but also companies and industries of diversified sections, under estimation. Union Bank of India of public sector is opted for contemplating its performance through DuPont model in this paper. Scrutiny period is designed of 10 years from 2012-13 to 2021-22. Employing the secondary data, trend of Union Bank is examined considering ratios of net profit margin, total asset turnover, equity multiplier and return on equity. Mean, standard deviation, coefficient variance and CAGR (%) is computed along with establishing the correlation between ROE and its financial components using SPSS software 26.0. The overall inferences drawn states that ROE shows fluctuating trend and EM is inversely related to ROE whereas NPM and TAT are positively related to ROE and NPM reveals a very strong relationship with ROE.


Keywords


DuPont Model, Equity Multiplier, Net Profit Margin, Performance Evaluation, ROE, Total Asset Turnover

References





DOI: https://doi.org/10.15410/aijm%2F2022%2Fv11i2%2F172152