Supply Chain Management

Assignment 1







Made by:
Group No: 11
Kartik Vijay (82)
Mrinal Sahoo (107)
Nirjhar Virendra (121)
Ravikanth Rao (159)


The Industry chosen for analysis is food processing.
The players for whom financial measures of supply chain performance have been calculated are as
follows:
1. Nestle
2. Britannia
3. GSK CH
4. Kwality

All of these are established players in the domain and manufacture a range of products from chocolates
to biscuits to ice cream etc.
Following is the financial data used for these Companies obtained from www.moneycontrol.com


The various Financial ratios which indicate a companys supply chain health are as follows:
1. Return on equity
ROE=Net income/ Avg shareholders equity
2. Return on assets
ROA= EBIT/ Avg total assets
3. Accounts payable turnover
APT= Cost of goods sold/ accounts payable
4. Accounts receivable turnover
ART= Sales revenue/ Accounts reveivable
5. Inventory Turnover
INVT = COGS/Inventories
6. Plant and equipment turnover
PPET= Sales revenue/ PP&E
Nestle Britannia GSK CH Kwality
Net income 9,092.63 5,681.12 5,066.57 3,688.13
Average shareholder equity
96.42 26.2 42.06
20.32
EBIT 1,947.58 371.53 872.76 231.32
Avg total assets 3,558.24 833.17 1,812.86 1136
Cost of goods sold
7,048.15 5,254.12 3,986.90 3,477.09
Accounts payable
1,348.76 576.9 1,204.64
76.18
Sales revenue
9,101.05 5,615.49 4,868.57 3,692.29
Accounts recievable(Current assets) 391.9 550.35 2,369.14 1125.65
Inventories
735.93 331.49 407.42 98.66
PP&E 4,220.39 580.12 378.36 81.54
The following is the various ratios calculated for the given companies

Analysis:
For ROE it is clear that Britannia has been the most profitable company for the shareholders as it has
returned the maximum amount for the money invested in it.
For ROA, Nestle leads from Britannia and GSK CH by a small margin, this is mainly due to its early entry
into India and also usage of its vast Multi-national experiences that it is able to utilize its assets to a
greater extent.
For APT, as GSK CH has the lowest value for APT, it has outperformed the other 3 companies in this
regard as it is better able to use the money it owed suppliers to finance a considerable fraction of its
operations, helping improve financial performance.
For ART, Nestle has the highest value, this means it collected the money receivable from sales fairly
quickly after it made the sale as compared to other players where GSK CH and Kwality lack in this regard,
probably giving higher deadlines and credit limit windows to the distributors.
For INVT, Kwality leads in this regard having the highest value meaning that it turned its inventory
around the most no of times, this primary leads to the thinking that they are operating with low
inventory across the supply chain. Nestle and GSK CH perform worse in comparison, indicating the
presence of high inventory across the chain. Kwality probably sells its inventory faster and faces higher
stock outs could also be a possibility.
For PPET, Kwality has highest value indicating that each Re invested in PP&E supported sales to a higher
extent in comparison to other platers like Nestle, Britannia. A small amount invested has led to higher
sales in this company as compared to others.

Nestle Britannia GSK CH Kwality
ROE 94.30 216.84 120.46 181.50
ROA 0.55 0.45 0.48 0.20
APT 5.23 9.11 3.31 45.64
ART 23.22 10.20 2.05 3.28
INVT 9.58 15.85 9.79 35.24
PPET 2.16 9.68 12.87 45.28