By

Vishnu Kumar Kedia

Roll No - 38
 Preface
The project is based upon the emergence and
development of Axis Bank Ltd (Formerly known as UTI
Bank Ltd). The report covers the emergence of Axis
bank and its path to development.
The report also covers about the recent takeover of
Enam Securities by Axis Bank. The benefits to both the
parties of the merger, the future plans upon the
merger and the effect of the merger on the market
has been discussed.
 Acknowledgement

I would like to acknowledge and extend my gratitude

towards the following persons who have helped me in
completing this report.
Prof. Surekha Thakur
Dr. Rajini Chandrasekhar
Mr. Abhishek Sinha
 Contents

1. Formation of Axis Bank Ltd

2. Development of Axis Bank Ltd
3. Axis Bank today
4. Axis Performance comparison from 2005 to 2010.
5. Axis Financial Position as on 31.3.2010
6. Enam History
7. Enam Financial Position as on 31.3.2010
8. Enam Takeover by Axis
9. Effects of merger
Formation of Axis Bank Ltd
Axis Bank was formed as UTI when it was incorporated
in 1994 when Government of India allowed private
players in the banking sector. The bank was sponsored
together by the administrator of the specified
undertaking of the Unit Trust of India, Life Insurance
Corporation of India (LIC) and General Insurance
Corporation ltd. and its subsidiaries namely National
insurance company ltd., the New India Assurance
Company, the Oriental Insurance Corporation and
United Insurance Company Ltd. With its first
registered office at Ahmadabad. However, the name
of UTI was changed because of the disagreement on
terms and conditions of the bank authority over
certain stipulations including royalty charged over the
name from UTI AMC. The bank also wanted to have a
new name from its pan-Indian as well as international
business perspective. So from July 30, 2007 onwards
the UTI bank was named as Axis Bank.
Development of Axis Bank
Axis Bank was incorporated in the year 1994, with an
initial capital of Rs. 150 crores. The initial capital was
contributed by Union Trust of India (Rs. 100 crores),
Life Insurance Corporation (Rs. 7.5 crores) and General
Insurance Corporation and four of its subsidiaries (Rs.
1.5 crores each).
In 1997, two major developments had taken place.
The bank had obtained the license to act as
Depository Participant with NSDL and also applied for
with SEBI to act as ‘Trustee to Debenture Holders’.
By 1998, 28 fully computerized branches in urban and
semi – urban areas and ATM services were available in
27 branches.
During 1998, the bank had issued an IPO of
1,50,00,000 equity shares of face value of Rs.10/-
each. They charged a premium of Rs.11/- per share.
Out of the public issue of 1,50,00,000 shares the bank
had reserved 2,20,000 shares for allotment on
preferential basis to employees of the bank.
the bank had generated an amount of Rs. 31.50 crores
from the public issue.
Apart from this the bank had signed a co-brand
agreement with Citibank and in 1999 they launched
their co-brand international credit card under the
umbrella of MasterCard.
In 2000, the bank inaugurated its telephonic –
depository, internet banking and online trading
facilities to facilitate the customers.
Later in 2001, it launched a private placement of non-
convertible debentures to raise up to Rs.75 crores.
The bank had seen a tremendous increase of 62% in
their net profits in the first quarter of September,
2001.
 Axis Bank Today

Axis bank has a subscribed and paid up capital of Rs.

409.68 crores out of its authorized capital of Rs. 500
crores.
the bank has set up more than 925 branches and
extension counters across the towns and villages of
India.
It provides various facilities as per the requirements of
the customers such as Corporate facilities that include
Cash Credit, Working Capital Demand Loan, Export
Finance, term Loan, etc and personal facilities such as
Home Loans, Personal Loans, Zero balance savings
account, mobile banking and many more.
The present composition of the Board of Directors is
as follows –
Dr. Adarsh kishore – Chairman
smt. Shikha Sharma – Managing Director and CEO
Shri. S. k. Chkrabarti – Deputy Managing Director
And 11 other Directors.
 Enam History

Enam was found in 1984 by Manek Bhansali, Nemish

Shah, Vallabh Bhansali and jagdish Master.
It was a professionally managed institution which had
exceptionally high level of commitment to excellence
in client service.
The major principles of Enam are
• Clients First
• Commitment to Quality
• Integrity
• Team Work
 Takeover of Enam by Axis
Bank
The takeover of Enam by Axis bank was a 2,067 crore deal.

Axis bank has taken over only the companies of Enam

dealing in the following sectors:
• Investment Banking
• Retail and Institutional Equities
• Corporate Advisory and
• Stock Broking

The Asset management, Wealth management and Insurance

business of Enam remain with Enam itself.

Axis Bank and Enam to carry on the business for the next 2
years under the same names and then the new firm name
shall be decided.

As one of the important terms, Axis Bank shall not compete

with entities of Enam which have not been taken over by
Axis Bank for a period of next 5 years.
The shareholders of Enam shall receive 5.7 shares of
Axis Bank for every 1 share of Enam held by them.
This would bring up the stake of Enam shareholders to
3.3% in Axis Bank.

There shall be a transfer of Rs.300 crores net current

assets from Enam to Axis Bank.

The book value of Axis bank fro Fy’11 is expected to

shrink by 1.9%.

The PBT of Enam From April to October 2010 is Rs. 77

Crores.
 Effects of Merger
• The share value of Axis bank had fallen almost by 3%
the next day after the declaration of the merger with
Enam.

• The shareholders of Axis bank have been selling

shares since the declaration of the merger was made.

• The shares of Axis bank have fallen from around

Rs.1,883/- to Rs.1450/- and currently trading around
the same.

• The Managing Director and CEO of Axis Bank, Smt.

Shikha Sharma has expanded the advisory Board to
take measures against the increase sale of shares of
the bank.
 References
The various references used are:
• Axis Bank Website
• Google Search
• Google News
• ET Now
• Business Line
• Times of India