Financial Ratios Liquidity Ratios Ratio Current Ratio Number 0.

958 Interpretation This indicates that Liberty has Rs. 0.958 in short-term resources to service each ruppee of current debt. This is a low number indicating liquidity issues. In the case of Liberty the Net Working Capital is negative, represented by slow moving or obsolete inventory and past due accounts. Liberty will have difficulty paying its bills without having to sell inventory. This doesn't necessarily mean they face short term liquidity constraints. But businesses usually do not plan to keep their cash and cash equivalent at level with their current liabilities because they can use a portion of idle cash to generate profits. This means that a normal value of cash ratio is somewhere below 1.00. But Liberty has too low a cash ratio. Libertys liquid assets relative to its needs are very low.

Net Working Capital Quick Ratio Cash Ratio

Rs. (17,371, 000) 0.164 0.07

Net Working 0.0016 Capital to Sales Ratio Activity Ratios Ratio Accounts Receivables Turnover Inventory Turnover Number 8.94

6.08

Asset Turnover

1.358

Fixed Assets Turnover

5.99

Interpretation The number indicates that LIBERTY has Rs. 8.94 in short term resources to service every ruppee of current debt. This is a fairly high number by most standards and would be considered very strong. The number of 6.08 indicates that goods were bought and sold about 6.08 times in the year. Generally, the higher the number the better. The less time goods spend in inventory the better the return the company is able to earn from funds tied up in inventory. A large stale inventory can distort the asset position of the company and should be monitored for that reason also. This indicates that LIBERTY with a ratio of 1.358 is generating about 1.358 Rs. for every ruppee invested in assets. A high level of return suggests that corporate resources are being well managed and that the firm is able to realize high level of sales from its asset investments. Liberty is using its fixed assets efficiently.

Leverage Measures

Ratio Debt to Equity Ratio

Number 0.137

Times Interest Earned

2.689

Interest Coverage Ratio

2.69

Interpretation This is a measure used to identify companies who run the risk of defaulting on loans, and is therefore helpful in assessing a stock's exposure. Liberty with a ratio of .137 ruppee of debt in capital structure for every ruppee of equity This is an indication of the companys ability to meet interest expense. The Liberty number of 2.689 indicates that there is Rs. 2.689 to cover every ruppee of interest expense. Libertys number indicates reason for concern. The company is able to cover its interest expenses 2.69 times over using earnings which is a healthy number.

Profitability Ratios Ratio Net Profit Margin Return on Equity Return on Assets Gross Profit Margin Operating Profit Margin Sales Growth Number Interpretation 0.04 Liberty reports a decimal fraction of .04 or 4%, that is, the company's return is roughly 4 cents on every ruppee. 0.148 The company earned 14.8% on its asset investments. As a rule the higher the ROA the more profitable a company but Libertys number is very low. 0.057 ROE shows the annual payoff to investors, which in the case of LIBERTY amounts to .057 cents for every ruppee of equity. Libertys falling ROE could spell trouble later on. 0.122 Rs. 0.122 is left for every rupee of sales after cost of goods sold. 0.083 31.32 Rs. 0.083 is left for every rupee of sales after operating expenses. Sales grew from last year by 31.32%

Common Stock Ratios Ratio Earnings Per Share Annual Sales per Share Dividend per Share Price Earnings Ratio Price to Sales Ratio Number Interpretation 18.90 Each share earned Rs. 18.90 in 2012. 45.22 Liberty generates Rs. 45.22 for every share. 1.50 9.68 4.047 Liberty declared Rs. 1.50 for every sharein 2012. An investor pays Rs. 9.68 for every 1 dollar the company earns. In the case of EMC the PSR is 4.047, an indication that the market price of the stock is 4.047 times the annual sales per share. It represents the difference between total assets and total liabilities.

Book Value per Share

131.44

Price to Book Ratio Price Earnings to Growth Ratio Payout Ratio Divided Yield

1.392 7.58 0.08 0.007

This is a convenient way to relate the book value of a company to the market price of its stock. This shows that the stock is overvalued at the current price. The payout ratio of company is 8%. Comparing it to interest rates in Pakistan, the return is not very attractive to investors.