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FINANCIAL REPORT:
Profit and loss - measures the company’s performance in terms of Sales and
Productivity.
Cash Flow - shows how an organization generates cash flow and how it
spends its cash.
RATIO ANALYSIS:
Ratio analysis is important tool used for analyzing the company’s financial
performance. The roles of ratio analysis are very significant to increase the
efficiency of the management, to reduce the expenditure arid to increase the rate of
profit etc. We are analyzing the statement in 5 ways. They are
1. Liquidity ratio
2. Leverage ratio
3. Activity ratio
4. Profitability ratio
I.TIME SERIES ANALYSIS
NON-CURRENT
117430 149226 247642 317558 377351
LIABILITIES
Short Term
174794 217237 151741 2500 58741
borrowings
Other current
184042 113223 81008 216390 178504
liabilities
CURRENT
824698 642159 489018 501722 458660
LIABILITIES
1.LIQUIDITY RATIO:
i) CURRENT RATIO:
Current Ratio= Current Assets / Current Liabilities
2017-18: 2016-17:
2015-16: 2014-15:
2013-14:
C.R= = 0.768:1
Quick Ratio =
2017-18: 2016-17:
2015-16: 2014-15:
Q.R = = 0.5097:1
In financial year 2016-17, the quick assets of the company is very much
lesser than current liabilities therefore the company is in risky state.
But in financial year 2017-18, the quick assets is almost equal to the
current liabilities hence the company is slightly solvent.
iii) CASH RATIO:
Cash Ratio =
2017-18 2016-17
2015-16 2014-15
2013-14
Ca.R = = 0.00254
NWC Ratio = =
2017-18
NWC Ratio = (786981 – 824698) / (786981+ 537546) = -0.0284
2016-17:
NWC Ratio = (597712 – 642159) / (597712 + 517667) = -0.0398
2015-16:
NWC Ratio = (518095 – 489018) / (518095 + 486784) = 0.0289
2014-15:
NWC Ratio = (469299 – 501722) / (469299 + 537570) = -0.0322
2013-14:
2017-18:
–
I.R= –
= 78.317 = 78 days (approx).
2016-17:
–
I.R = –
= 52.736 = 53 days (approx).
2015-16:
–
I.R = –
= 60.606 = 61 days (approx).
2014-15:
–
I.R = –
= 78.53 = 79 days (approx).
2013-14:
–
I.R = –
= 75.87 = 76 days (approx).
In financial year 2016-17, the company can survive only upto 53 days
(approx) without expecting the next income.
Whereas in financial year 2017-18, the company’s interval ratio is
increased and can survive up to 78 days without the next income.
2. LEVERAGE RATIO:
i) INTEREST COVER RATIO:
2017-2018 2016-2017
2013-2014
I.C.R = = -0.32
In financial year 2017-18, the company can pay back its interest charges
18.09 times which means the company has earned sufficient profits. In
year 2013-14, the company’s profit is low hence the interest pay back
ratio is low.
ii) DEBT RATIO:
Debt ratio
2017-18 2016-17
2015-16 2014-15
2013-14
2015-16 2014-15
2013-14
D/E = = 0.8732
2015-16 2014-15
2013-14
I.T.R = = 8.8843
2017-18 2016-17
2015-16 2014-15
In financial year 2013-14, for every one rupee of capital employed in net
asset the company is producing only 1.1273 times the sales.
Whereas in the year 2017-18, the company’s efficiency is increased and
for every one rupee of capital employed in net asset it can produce
2.0025 times the sales.
iii) FIXED ASSETS TURNOVER RATIO:
2017-18 2016-17
2015-16 2014-15
2013-14
D.T.R = =25.67
2016-2017:
D.T.R = = 17.40
2015-2016:
D.T.R = = 15.10
2014-2015:
D.T.R = = 10.61
2013-2014:
D.T.R = = 7.32
In financial year 2017-18, the debtors are paying back 25.67 times a year
whereas in year 2013-14 the debtors are paying back 7.32 times a year.
4. PROFITABILITY RATIOS:
i) RETURN OF INVESTMENT:
ROI = .
Tax% =
2016-17
2015-16
2014-15
2013-14
2017-18
2016-17
2014-15
2013-14
In financial year 2013-14, the gross profit margin is very low 0.863%
only but in the year 2017-18, the gross profit margin is drastically
increased to 8.41%.
iii) NET PROFIT MARGIN:
2017-18
2016-17
2015-16
2014-15
In financial year 2013-14, the net profit margin is very low 0.278%
only but in the year 2017-18, the net profit margin is drastically
increased to 5.89%.
iv)RETURN ON EQUITY:
2017-2018 2016-2017
2015-2016 2014-2015
2013-2014
R.O.E = = 2.26
In financial year 2017-18, the R.O.E is 3.5 which means the company
has used the resources very well whereas in year 2013-14, the R.O.E is
2.26 which means the resource usage is not up to the mark.
II.CROSS SECTIONAL ANALYSIS
COMPETITORS:
TATA Motors
Mahindra and Mahindra
Force Motors
Eicher Motors
SML isuzu Motors
1.LIQUIDITY RATIO:
i)CURRENT RATIO:
Current Ratio =
TATA FORCE SML
0.60 1.65 1.25
MAHINDRA EICHER ASHOKLEYLAND
1.06 1.15 0.954
The company Force motors has current assets of 1.65 times the
current liabilities hence the company is solvent. But for the
company Ashok Leyland the current assets is lesser than the
current liabilities therefore it is in slightly risk state.
Quick ratio =
Cash ratio =
–
Interval ratio =
NWC Ratio = =
i)DEBT RATIO:
Debt ratio
=
TATA FORCE SML
0.81 0 0.47
MAHINDRA EICHER ASHOKLEYLAND
0.01 0.02 0.0719
The company Mahindra, Eicher Motors and Ashok Leyland has
the debt contribution very less when compared to equity
contribution hence those companies are low geared. Eventhough
the Tata Motors has debt contribution 0.81 times the equity
contribution still the equity contributes the maximum therefore
this company is also low geared.
iii)INTEREST COVER:
Interest cover =
3. TURNOVER RATIO
IV.PROFITABILITY RATIO:
i)RETURN ON INVESTMENT:
Return on Investment =
v) INTERVAL MEASURE:
2. LEVERAGE RATIO:
3. TURNOVER RATIO:
4.PROFITABILITY RATIO :
i) RETURN OF INVESTMENT:
i) CURRENT RATIO:
2017-2018 FUTURE
2017-18 FUTURE
2017-18 FUTURE
2017-18 FUTURE
v) INTERVAL MEASURE:
2017-18 FUTURE
2. LEVERAGE RATIO:
2017-18 FUTURE
2017-18 FUTURE
2017-18 FUTURE
3. TURNOVER RATIO:
2017-18 FUTURE
2017-18 FUTURE
2017-18 FUTURE
2017-18 FUTURE
i) RETURN OF INVESTMENT:
2017-18 FUTURE
2017-18 FUTURE
2017-18 FUTURE
2017-18 FUTURE