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  • Analysis of financial ratios of a company from 2011-2015

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    puneet
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    The document analyzes various financial ratios of a company from 2011-2015: 1) The current ratio and quick ratio decreased over this period, indicating a reduction in the safety margin for creditors and liquidity. 2) The debt-equity ratio increased to over 1 in 2015, showing debt levels rose and exceeded equity that year. 3) Most profitability ratios like gross profit margin, net profit margin, and return on net worth were negative in 2015, but positive in earlier years, demonstrating a decline in profits. 4) Inventory, debtors, and assets turnover ratios decreased slightly over time, while fixed assets turnover rose, suggesting less efficient use of company's assets and resources.

    Originalbeschreibung:

    FINANCIAL RATIOS

    Originaltitel

    Finance

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    The document analyzes various financial ratios of a company from 2011-2015: 1) The current ratio and quick ratio decreased over this period, indicating a reduction in the safety margin for creditors and liquidity. 2) The debt-equity ratio increased to over 1 in 2015, showing debt levels rose and exceeded equity that year. 3) Most profitability ratios like gross profit margin, net profit margin, and return on net worth were negative in 2015, but positive in earlier years, demonstrating a decline in profits. 4) Inventory, debtors, and assets turnover ratios decreased slightly over time, while fixed assets turnover rose, suggesting less efficient use of company's assets and resources.

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    11 Ansichten12 Seiten

    Analysis of financial ratios of a company from 2011-2015

    Hochgeladen von

    puneet
    The document analyzes various financial ratios of a company from 2011-2015: 1) The current ratio and quick ratio decreased over this period, indicating a reduction in the safety margin for creditors and liquidity. 2) The debt-equity ratio increased to over 1 in 2015, showing debt levels rose and exceeded equity that year. 3) Most profitability ratios like gross profit margin, net profit margin, and return on net worth were negative in 2015, but positive in earlier years, demonstrating a decline in profits. 4) Inventory, debtors, and assets turnover ratios decreased slightly over time, while fixed assets turnover rose, suggesting less efficient use of company's assets and resources.

    Copyright:

    © All Rights Reserved
    Als DOCX, PDF, TXT herunterladen oder online auf Scribd lesen
    Markieren Sie unangemessene Inhalte
    von 12

    current ratio=currentassets /current liabilties

    Current
    0.42 0.43 0.42 0.5 0.52
    Ratio

    Current Ratio

    0.52
    0.5

    0.42 0.43 0.42

    2015 2014 2013 2012 2011

    The current ratio represents safety of margin for creditors. Current ratio is
    decreasing from 2011 to 2015 which shows that safety of margin for creditors is
    decreasing from year to year.
    Quick ratio=(current assetinventories)/current liabilities

    Quick
    0.42 0.36 0.4 0.43 0.54
    Ratio

    Quick Ratio

    0.54

    0.42 0.43
    0.4
    0.36

    2015 2014 2013 2012 2011

    Quickratio specifies whether the assets that can be quickly converted into cash are
    sufficient to cover current liabilities. For years 2011-2015 quick ratio is less than 1
    which shows that company has rupee less than 1 for all the years for the liability of
    rupee 1. Companys liquidity position is not so good.
    DebtEquity ratio=Total debt / Net worth

    Debt
    Equity 1.35 0.76 0.75 0.56 0.73
    Ratio

    Debt Equity Ratio

    1.35

    0.76 0.75 0.73


    0.56

    2015 2014 2013 2012 2011

    Debt-Equity ratio shows that the extent to which debt financing has been used in
    business. For year 2011 to 2014 it is less than 1 which shows owners equity is more
    than debt but for year 2015 debt to equity ratio is 1.35 which shows that debt is
    suddenly increased and debt proportion is increased in the company.
    Long
    Term
    Debt 0.83 0.51 0.42 0.41 0.48
    Equity
    Ratio

    Long Term Debt Equity Ratio

    0.83

    0.51
    0.48
    0.42 0.41

    2015 2014 2013 2012 2011


    Gross profit margin=(salesCOGS)/sales

    Gross
    Profit
    -10.58 -8.69 -0.24 4.73 7.01
    Margin(%
    )

    Gross Profit Margin(%)


    7.01

    4.73

    -0.24
    2015 2014 2013 2012 2011

    -8.69
    -10.58
    Net Profit
    Margin(% -13.05 0.97 0.67 2.28 3.84
    )

    Net Profit Margin(%)

    3.84
    2.28
    0.97 0.67
    2015 2014 2013 2012 2011

    -13.05
    Profit
    Before
    Interest
    -10.06 -7.82 -0.23 4.68 6.95
    And Tax
    Margin(%
    )

    Profit Before Interest And Tax Margin(%)


    6.95

    4.68

    -0.23
    2015 2014 2013 2012 2011

    -7.82

    -10.06

    Return On
    Capital
    -5.61 2.52 5.92 10.27 10.76
    Employed
    (%)
    Return On Capital Employed(%)

    10.27 10.76

    5.92

    2.52

    2015 2014 2013 2012 2011

    -5.61

    Return
    On Net -31.93 1.74 1.57 6.33 9.06
    Worth(%)

    Return On Net Worth(%)

    9.06
    6.33
    1.74 1.57
    2015 2014 2013 2012 2011

    -31.93

    Total
    Debt to
    1.35 0.76 0.75 0.56 0.73
    Owners
    Fund
    Total Debt to Owners Fund

    1.35

    0.76 0.75 0.73


    0.56

    2015 2014 2013 2012 2011

    Inventory
    Turnover 8.23 9.78 11.07 12.91 13.15
    Ratio

    Inventory Turnover Ratio

    12.91 13.15

    11.07
    9.78
    8.23

    2015 2014 2013 2012 2011

    Debtors
    Turnover 31.14 22.6 19.78 20.45 18.86
    Ratio
    Debtors Turnover Ratio

    31.14

    22.6
    19.78 20.45
    18.86

    2015 2014 2013 2012 2011

    Fixed
    Assets
    1.48 1.49 2.03 2.66 2.55
    Turnover
    Ratio

    Fixed Assets Turnover Ratio

    2.66
    2.55

    2.03

    1.48 1.49

    2015 2014 2013 2012 2011


    Total
    Assets
    1.16 1.12 1.48 1.99 1.47
    Turnover
    Ratio

    Total Assets Turnover Ratio

    1.99

    1.48 1.47

    1.16 1.12

    2015 2014 2013 2012 2011

    Asset
    Turnover 1.06 1.02 1.4 1.66 1.43
    Ratio

    Asset Turnover Ratio

    1.66

    1.4 1.43

    1.06 1.02

    2015 2014 2013 2012 2011


    Dividend
    Payout
    Ratio -- 193.87 213.77 103.09 70.32
    Net
    Profit

    Dividend Payout Ratio Net Profit

    213.77
    193.87

    103.09

    70.32

    0
    2015 2014 2013 2012 2011

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