FINANCIAL & OPERATING LEVERAGE ANALYSIS

Particulars Rs.( crore)

Sales 580.37
(-)PBIT 26.15
Total cost 554.22
F.C. 65.81
V.C.(55%) 488.41
Debt 107.66
Equity 100.71
Interest 8.6
Tax 8.71
No. of Shares 71821970

Given Financing Debt+Equity

Sales 580.37
(-)V.C. 488.41
Contribution 91.96

(-)F.C. 65.81
PBIT 26.15

(-)Interest 8.6
PBT 17.55

(-)Tax 8.71
PAT 8.84

No. of Shares 71821970

EPS 1.23
Contribution Ratio 0.16
BEP 415.33
Margin of Safety 28.43%
DOL 3.52
DFL 1.49
DCL 5.24

Conclusions Drawn
1% decline in sales causes 3.52% decline in PBIT

Also, 100/3.52 = 28.41% decline will sales will wipe out PBIT

1% decline in sales causes 5.248% decline in EPS

REFERENCE

Profit & loss account: summary / mfg. cos.

Profit & loss account: summary / mfg. cos.
Mar 2001 Mar 2002 Mar 2003 Mar 2004 Mar 2005 Mar 2006
Rs. Crore (Non-Annualised) 12 mths 12 mths 12 mths 12 mths 12 mths 12 mths
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Income
Sales 270.16 310.23 379.13 424.63 482.73 568.31
Other income 2.45 2.98 4.39 3.89 4.03 3.64
Change in stocks 1.48 -1.25 1.46 0.8 5.09 1.9
Non-recurring income 0.08 0.19 0.38 7 7.09 6.52
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Expenditure
Raw materials, stores, etc. 132.65 150.31 208 213.52 262.01 313.64
Wages & salaries(FIXED) 18 19.21 24.05 27.65 31.98 38.32
Energy(FIXED) 7.88 8.21 9.9 10.18 10.9 12.28
Indirect taxes (excise, etc.) 36.52 42.23 52.55 58.75 66.59 80.92
Advertising & marketing expenses 7.26 13.31 11.84 13.93 11.26 16.74
Distribution expenses 3.51 3.78 4.26 4.48 5.1 6.49
Others 32.96 37.32 26.04 57.27 60.65 70.37
Less: expenses capitalised 0.63 0.33 0 0 0 0
Non-recurring expenses 0.38 0.62 0.98 1.04 0.04 0.15
Depreciation 10.87 12.21 13.7 14.58 14.74 15.31
TOTAL 249.4 286.87 351.32 401.4 463.27 554.22

Profits / losses
PBIT 24.77 25.28 34.04 34.92 35.67 26.15
Financial charges (incl. lease rent) 19.73 17.86 13.71 8.8 7.33 8.6
PBT 5.04 7.42 20.33 26.12 28.34 17.55
Tax provision 0.47 3.46 8.61 9.44 10.45 8.71
PAT 4.57 3.96 11.72 16.68 17.89 8.84
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