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ACKNOWLEDGEMENT

It is indeed very pleasure to express thanks to our statistics teacherPrabhat Upreti for

his kind cooperation, support and guidance, and providing us the opportunity to explore our

interest and ideas in practical field of statistics.

This project is the outcome of our knowledge acquired through studies of trend analysis

in regression chapter in the class of statistics in MBA II trimester. It is a result of our hard work,

our team effort and the guidance of teachers. Finally, we would like to express our heartfelt

gratitude to our friends, and staff of college who have directly and indirectly helped us in the

completion of project.


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CHAPTER 1: INTRODUCTION .................................................................................... 1

1.1BACKGROUND OF THE STUDY..................................................................................... 1

1.2COMPANY PROFILE: .................................................................................................... 2

1.3OBJECTIVES................................................................................................................ 2

CHAPTER 2: TREND ANALYSIS ................................................................................ 4

2.1TREND ANALYSIS OF PAID UP CAPITAL-ORDINARY SHARE ........................................ 4

2.2TREND ANALYSIS OF LOAN ........................................................................................ 5

2.3TREND ANALYSIS OF DEPOSIT.................................................................................... 7

2.4TREND ANALYSIS OF INVESTMENT ............................................................................. 8

2.5TREND ANALYSIS OF NET PROFIT .............................................................................. 10

2.6LIMITATIONS OF TREND ANALYSIS............................................................................ 11

CHAPTER 3: SUMMARY AND CONCLUSION ...................................................... 12

REFERENCES ................................................................................................................ 13


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LIST OF TABLE

Table 2.1 Trend analysis of Paid Up Capital-Ordinary Share ........................................................ 4

Table 2.2: Trend Analysis of Loan ................................................................................................. 5

Table 2.3 Trend Analysis of Deposit .............................................................................................. 7

Table 2.4 Trend analysis of Investment .......................................................................................... 8

Table 2.5 Trend analysis of net profit ........................................................................................... 10


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List of figure

Figure 1.1: Paid up capital Trend Graph ............................................................................ 4

Figure 2.2: Loan Trend Graph ............................................................................................ 6

Figure 2.3: Deposit Trend Graph ........................................................................................ 7

Figure 2.4: Investment Trend Graph ................................................................................... 9

Figure 2.5: Net Profit Trend Graph................................................................................... 10


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Chapter 1: Introduction

A trend analysis is a method of analysis that allows to predict what will happen in the

future. Trend analysis is based on historical data about the performance given the overall trends

of the market and particular indicators within the market. Trend analysis takes into account

historical data points for a stock and, controlling for other factor like the general changes in the

sector, market conditions, competition, it allows to forecast short, intermediate, and long term

possible market situation. There are some limitation of trend analysis if conditions change

dramatically, historical data may not apply, comparing data on an annual basis may not always

accurately represent business performance, since other factors may influence results, data

collected over an extended period of time does not allow adjustments for inflation

1.1 Background of the Study

For our academic purpose to see the trend line we chose the linear trend line analysis. We

are supposed to calculate the various variable related to banking area like paid up capital, loan,

profit, deposit and many more for last 5 years and we have to draw the linear trend line based on

these information. After drawing trend line we will able to forecast the future situation, we have

to forecast the value for next three years. The forecasting equation for the linear trend model is:

Y(x) = b0 +b1*x where x is the time index. The parameters b0 and b1 (the "intercept" and

"slope" of the trend line) are usually estimated via a simple regression in which Y is the

dependent variable and the time index x is the independent variable.

Where x= X- mean of (X) if n is odd where n is number of observed year and

x=2(X-(mean of X)) if n is even Then b1=xy/x2

and b0=y/n


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1.2 Company profile:

We use the past five years data of Everest Bank Limited to analyze the trend of different

variable associated with the bank. Everest bank is joint venture of Punjab national bank, which is

one of the largest nationalized bank in India. It is establish in the year of 1994 the bank has been

one of the leading banks of the country and has been catering its services to various segments of

the society since then. With clients from all walks of life, the bank has helped develop the nation

corporately, agriculturally and industrially. Everest Bank Limited (EBL) provides customer-

friendly services through its Branch Network and all its branches are connected through

Anywhere Branch Banking System (ABBS), which enables customers for operational

transactions from any branches. The bank has 50 Branches, 68 ATM Counters, 5 extension

counter & 20 Revenue Collection across the country making it a very efficient and accessible

bank for its customers, anytime, anywhere

1.3 Objectives

The general trend analysis give an information of how the market is responding for

particular factor. Trend analysis evaluates an organizations financial information over a period

of time. Periods may be measured in months, quarters, or years, depending on the circumstances.

The goal is to calculate and analyze the amount change and percent change from one period to

the next. Trend analysis plays a major role in case of Decisions Making, Problem Solving and

Strategy development.

The main objective of trend analysis is to

1. To find out the general pattern of a relationship between associated factors or variables.We are interested to find out the general pattern of different variable like paid up capital, profit,

loan, deposit of the bank since from last 5 years. How the paid up capital of the bank are

changing and whether they are changing with regular pattern or not. We can conclude these


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information by drawing the trend line. Such that trend lines gives pattern of changing the

variable within a time.

2. Forecast the future direction of this patternThe other main objective is to forecast the future. The trend line give general pattern of changing

and after analyzing we can able to forecast the future value or sale. Its gives idea about what will

be the consumption how much will be the sell increase and in the view of production it allows

produce to produce expected value of product to meet consumer demand. In our trend line

analysis we are able to forecast the expected loan the bank able to out within next 3 years also

we will able to forecast the total profit that bank will make by going these trend. Such that it

helps to forecast the future value

3. Growth rate or amount per time periodBy analyzing the trend line we are able to view the growth rate per time period. We can

analyze whether the variable is increase or decrease as our expectation or not. We are able to see

whether the loan launches is increase or decrease whether the profit is increase or decrease. Such

that it helps to analyze in which direction the business is heading. By seeing we are able to make

quick decision.


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Chapter 2: Trend Analysis

2.1 Trend analysis of Paid up Capital-Ordinary Share

Table 2.1 Trend analysis of Paid up Capital-Ordinary Share

S. No

(X)

Year paid of capital:-

ordinary shares(

RS in lacks)

x=X-

mean

x *x x*y

1 2006/07 3780 -2 4 -75602 2007/08 4914 -1 1 -4914

3 2008/09 6388 0 0 0

4 2009/10 8305 1 1 8305

5 2010/11 11196 2 4 22392

Total 15 34583 0 10 18223

Mean 3

b1 1822.3

b0 6916.6

Forecasting for next three years y= b0+ b1*x6 2011/12 12383.5 3

7 2012/13 14205.8 4

8 1013/14 16028.1 5

Figure 1.1: Paid up capital Trend Graph

By analyzing the past five years data of paid up capital; ordinary share of Everest Bank

we are able to understand that it is increasing each year. The highest percent increase in the year

0

2000

4000

6000

8000

10000

12000

1 2 3 4 5


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from 2009/10 to 2010/11. Then we forecast for next three years of paid up capital. Till the year

of 2013/14 the paid up capital will be reach around Rs 16028.1 lacks. The graph shows the how

the paid up capital is increasing per year.

2.2 Trend Analysis of Loan

Table 2.2: Trend Analysis of Loan

S.No

(X)

Year loan( RS in

lacks)

x=X-

mean

x*x x*y

1 2006/07 300 -2 4 -600

2 2007/08 300 -1 1 -300

3 2008/09 612 0 0 0

4 2009/10 704 1 1 704

5 2010/11 782 2 4 1564

Total 15 2698 0 10 1368

Mean 3

b1 136.8bo 539.6

Forecasting for next three years y= b0+ b1*x

6 2011/12 950 3

7 2012/13 1086.8 4

8 2013/14 1223.6 5


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Figure 2.2: Loan Trend Graph

By analyzing the status of five years loan transaction of the bank we are able to say the

loan delivery by bank is increasing. In the first two years the loan level is same but in the third

year at 2008/09 the loan suddenly increase to Rs 612 lacks. We forecast the amount of loan that

bank will able to execute for three years. In the year 2013/14 the bank will able to loan Rs

1223.6 lacks.

0

100

200

300

400

500

600

700

800

900

1 2 3 4 5


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2.3 Trend Analysis of Deposit

Table 2.3 Trend Analysis of Deposit

S.No (X) Year Deposit( RS

in lacs)

x=X-

mean

x*x x*y

1 2006/07 18186.2 -2 4 -36372.4

2 2007/08 23976.3 -1 1 -23976.33 2008/09 33322.9 0 0 0

4 2009/10 36932.3 1 1 36932.3

5 2010/11 41127.9 2 4 82255.8

Total 15 153545.6 0 10 58839.4

Mean 3

b1 5883.94

bo 30709.12


6 2011/12 48360.94 3

7 2012/13 54244.88 48 2013/14 60128.82 5

Figure 2.3: Deposit Trend Graph

0

5000

10000

15000

20000

25000

30000

35000

40000

45000

1 2 3 4 5


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By analyzing the status of five years of Deposit amount in the bank we are able to say

that deposit balance of bank is increase by 38.98% in the year 2007/08. We forecast the amount

of deposit that bank will receive. In the year 2013/14 the bank will have a deposit amount of Rs

60128.82 lacks.

2.4 Trend analysis of Investment

Table 2.4 Trend analysis of Investment

S.No

(X)

Year Investment( RS

in lacks)

x=X-

mean

x *x x*y

1 2006/07 4984.3 -2 4 -9968.6

2 2007/08 5059.6 -1 1 -5059.6

3 2008/09 5948.5 0 0 0

4 2009/10 5008.3 1 1 5008.3

5 2010/11 7743.9 2 4 15487.8

Total 15 28744.6 0 10 5467.9

Mean 3

b1 546.79

bo 5748.92


6 2011/12 7389.29 3

7 2012/13 7936.08 4

8 2013/14 8482.87 5


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Figure 2.4: Investment Trend Graph

By analyzing the status of five years investment of the bank we are able to say that

investment of bank is increasing but in the year 209/10 the investment is drop by 940.2 lacks.

Then after a year 2010/11 it increases. We forecast the amount of investment that bank will

invest in the coming year. In the year 2013/14 the bank will invest around Rs 8482.87 lacks.

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

1 2 3 4 5


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2.5 Trend analysis of net profit

Table 2.5 Trend analysis of net profit

Figure 2.5: Net Profit Trend Graph

0

200

400

600

800

1000

1 2 3 4 5

S. No

(X)

Year Net profit( RS

in lacks)

x=X-

mean

x

*x

x*y

1 2006/07 296.4 -2 4 -592.8

2 2007/08 451.2 -1 1 -451.2

3 2008/09 638.7 0 0 04 2009/10 831.8 1 1 831.8

5 2010/11 931.3 2 4 1862.6

Total 15 3149.4 0 10 1650.4

Mean 3

b1 165.04

bo 629.88


6 2011/12 1125 37 2012/13 1290.04 4

8 2013/14 1455.08 5


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By analyzing the last five years net profit of bank is increasing each year. The profit of

the bank in 2010/11 is Rs 931.3 lacks. We forecast the amount of net profit that bank will able to

meet. In the year 2013/14 the bank profit will be around Rs 1455.08 lacks.

2.6 Limitations of trend analysis

There are certain situations when trend analysis is of limited use. Examples include:

If conditions change dramatically, historical data may not apply Comparing data on an annual basis may not always accurately represent business

performance, since other factors may influence results

Data collected over an extended period of time does not allow adjustments for inflation.


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Chapter 3: Summary and Conclusion

Trend analysis is used to predict the future so that companies are able to make proper

strategies and decisions for the benefit of their company. We have analyzed the trend line of

Everest Bank regarding their paid up capital, deposits, loans, investments and profit. We used

past five years data and forecasted the future trend of the bank based on these data.

The paid up capital of Everest bank was Rs. 11196 Lakhs in 2010/11 and tends to

increase to Rs. 16028.1 Lakhs in 2013/14. Similarly, total investment of the bank was Rs. 7743.9

Lakhs in 2010/11 and tends to Rs. 8482.87 Lakhs in 2013/14, Loan was Rs. 782 Lakhs in

2010/11 and tends to Rs. 1223.6 in 2013/14, and Deposit was Rs. 41127.9 Lakhs in 2010/11 and

tends to Rs. 60128.82 in 2013/14, and Profit was Rs. 931.3 Lakhs in 2010/11 and tends to Rs.

1455.08 in 2013/14.

Upon evaluating the data, this report reveals that there is an increasing trend in past five

years and will continue to increase in next three years.


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References

Goverment, Q. (2013).Business and industry portal. Retrieved from

http://www.business.qld.gov.au: http://www.business.qld.gov.au/business/business-

improvement/trend-analysis-business-improvement/developing-trend-analysis-system

Levine, D. M., Krenbiel, T. C., Berenson, H. L., & Viswanathan, P. K. (2010). Simple Linear

Regression. In Quantitive Technique (p. 435). Pearson prentince hall.

Ltd, E. B. (2010/11). 17th Annual Report. Kathmandu.

Ltd., A. S. (2007). Retrieved from http://www.ambarasoft.com:

http://www.ambarasoft.com/researchservices/trendanalysis.html

Rae, P. A. (2013).springerreference.com/docs/html/chapterdbid/363617.html. Retrieved from

http://www.springerreference.com:

http://www.springerreference.com/docs/html/chapterdbid/363617.html

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