Financial Analysis of Suzuki Motors

Financial Analysis of Pak Suzuki Motors and Hino Pak Motors

NAME : MUHAMMAD WAQAS

STUDENT ID : Mc080201777
MBA 4TH SEMESTER
VIRTUAL UNIVERSITY OF PAKISTAN

SUBMISSION DATE:

21TH DECEMBER, 2009.

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Financial Analysis of Suzuki Motors

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 Financial Analysis of Suzuki Motors

A CKNOWLEDGMENT

“Praise to Be ALLAH, Lord of the worlds, The Beneficient,The Merciful, Lord of

The Day of Judgement,Thee (Alone) We Worship, And Thee (Alone) we Ask For
Help. Show Us The Straight Path, The Path of Those whom Thou Hast Favored. Not
the Path of Those Who Earn Thin wrath or Of Those Who Go Astray.”
(Holy Quran, Surah Al-Fatiha)

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 Financial Analysis of Suzuki Motors

First of all I am thankful to Allah who blessed us the potential

and ability to accomplish this proposal of project.

Then we deem it a great honor and privilege to record sense for

gratitude to the respected teacher for the construction and exuberant
stage of teaching.

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 Financial Analysis of Suzuki Motors

TABLE OF CONTENTS

Topic: Page #
1. Introduction of project 05
2. Description of project 05
3. Rationale 05
4. Background 06
5. Objective and Significant 09
6. Project Proceeding 09
7. Project Methodology 13
8. Bibliography 14

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 Financial Analysis of Suzuki Motors

i) CHAPTER 1:
Introduction of the Project:
a)
This project is related to financial statement analysis of two
company’s i.e. Suzuki Motors Vs Hino Pak motors. In this project
all calculation will be carried regarding financial analysis. This
material will help us to see the financial position of the companies,
compare whether the companies going to profitable or losses and
what types of strategy will help us to make it survival.
b) Description of the Project:

Description of the project includes, ration analysis, SWOT

analysis, horizontal analysis, vertical analysis, trend analysis
review of descriptive information and Comparison etc.
c) Rationale

This all techniques will help us to compare whether the

companies going to loss or profit and what types of fund needed
to company. What the Suzuki motors or Hino pak motor require
capital through equity or debt etc.

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 Financial Analysis of Suzuki Motors

ii)
BACKGROUND:
In background you are supposed to write about the
project background instead of that Pak Suzuki or other
company’s.
Give details for any previously conducted
project/research work relevant to your topic and project.
Refer any article, magazine, industry analysis you
consulted for this topic, including current fact and
figures.

Pak Suzuki Motor Company Limited (PSMC) is public limited

company with its shares quoted on Stock Exchanges in Pakistan.
The Company was formed in August 1983 in accordance with the
terms of a joint venture agreement between Pakistan Automobile
Corporation Limited (representing Government of Pakistan) and
Suzuki Motor Corporation (SMC) – Japan.

The Company started commercial production in January 1984 with

the primary objective of progressive manufacturing, assembling
and marketing of Cars, Pickups, Vans, and 4×4 vehicles in
Pakistan. The Company’s long term plans inter-alia includes
tapping of export markets.
The foundation stone laying ceremony of the Company’s existing
plant located at Bin Qasim was performed in early 1989 by the
Prime Minister then in office. By early 1990, on completion of first
phase of this plant, in-house assembly of all the Suzuki engines
started.
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 Financial Analysis of Suzuki Motors

In 1992, the plant was completed and production of the Margalla

Car commenced. Presently the entire range of Suzuki products
currently marketed in Pakistan is being produced at this plant.

Under the Government’s privatization policy, the Company was

privatized and placed under the Japanese management in
September 1992. At the time of privatization, SMC increased its
equity from 25% to 40%. Subsequently, SMC progressively
increased its equity to 73.09% by purchasing remaining shares
from PACO. The total foreign investment brought in by SMC –
Japan since inception stands at Rs. 1027.47 million.

The Suzuki Management immediately after privatization started

expansion of the existing plant to increase its installed capacity to
50000 per annum. The expansion was completed in July 1994.

However capacity remained substantially under utilized until 2002

because of economic recession. Company increased capacity in
phases. The first phase was completed in January 2005 when
capacity was enhanced to 80000 vehicles per annum. In the second
phase it has further been raised to 120000 vehicles per year by
January 2006.

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 Financial Analysis of Suzuki Motors

Background of Hino Pak Motors.

Hinopak Motors Limited assembles, manufactures and markets

world renowned Hino diesel trucks and buses in Pakistan. The
Company has held the top position in the domestic market for
medium and heavy-duty vehicles for 17 consecutive years and is
highly acclaimed for quality and technological excellence.

Backed by Hino's expertise Hinopak has achieved standard of

quality and excellence that rival the best in the region. With over
39,000 vehicles on road, Hinopak has gained 65% market share
making it the largest manufacturer in medium and heavy-duty
truck and bus industry in Pakistan.

HinoPak's product range has been designed and built in Hino's

traditions of automotive excellence to be the leader in its category
and the main emphasis has been given to passengers' safety &
comfort.

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 Financial Analysis of Suzuki Motors

iii) Objectives:

The objective of this project is to gain proficiency in the field of

financial analysis and research. All facts and figures will be
located true and fair. For this I personally visited two companies
and suggest about my project.

IV) Significance:
Here you need to mention what is your project significance for the
stakeholders and you? Stakeholders include management of the companies,
shareholders, customers, investors and all related persons that can be
influenced and that can influence by the decisions and strategies of the
companies.

I will visit to Suzuki Company As Well As Hino Pak Company.

Through the project i will collect data of income statement,
balance sheet and inflow statement which would help to me for
preparations.

Outcome of the research considered helping material or rough

material thorough which project will be prepared.

CHEPTER 2:

PROJECT PROCEEDINGS:

The expected working of the final project included following

headings and subheadings. In these headings there may be detailed

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 Financial Analysis of Suzuki Motors

information (FSA analysis) regarding Suzuki Pak motors and Hino

pak motors.

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 Financial Analysis of Suzuki Motors

1. Executive Summary
2. Introduction
3. Vision
4. Mission
5. History
6. Company Profile
In company profile it includes the following information. Exclude
unnecessary information in the project. Your financial analysis is
already too much lengthy.
 COMPANY NAME:

 YEAR OF ESTABLISHMENT:
 LOCATION:
 TOTAL AREA:
 PRODUCTION CAPACITY:
 C.E.O:
 DEPTY. MANAGING DIRECTOR:
 NO. OF EMPLOYEES:
 PRODUCTION CAPACITY:
• COMPANY COMPETITORS:
 BUSINESS TYPE:
7. Hierarchy Just add headings here

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 Financial Analysis of Suzuki Motors

In hierarchy there is company’s structure. It tells us who the

information goes down i.e. how the information transferred, it may
be centralization or decentralization.

8. Management Philosophy of the industries.

Pakistan’s automobile industry has become a major contributor to
GDP. The industry for cars and light commercial vehicles
witnessed a growth of 17% during the calendar year. Automobile
industry is mother of all industries. Therefore growth of
automobile industry benefits other industries as well.
9. Caring for Environment
As a responsible automobile manufacturer, Pak Suzuki and Hino
Pak motors has always responded positively and promptly to the
cause of the environment.
I) Introduction of CNG
10. Products briefly give details of products.
This portion includes the currently products of both companies i.e.
Pak Suzuki motors and Hino pak motors. It includes Mehran,
bolan van, Ravi pick-up and various.
11. Financial Analysis
a) Ration Analysis

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I Liquidity Ration
II Solvency Ration
III Activity Ration
IV Profitability Ration
V Investor Ration
VI Market Ration etc.

b) Horizontal Analysis
c) Vertical Analysis
d) Review of Descriptive information
e) Comparison of both companies.Also make an industry
comparison.
In this comparison I will choose two techniques.
i) Trend Analysis
ii) Industrial Averages comparison with competitors.
12. SWOT Analysis
13. Conclusions: Your conclusion should be based on true facts
and figures from your financial analysis.
14. Recommendations
15. Bibliography

NOT:

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 Financial Analysis of Suzuki Motors

There may be some changes in project proceeding when I submit

project but it is confirm that I will go with the help of following
above mentioned techniques.

CHEPTER 3

1. PROJECT METHODOLOGY:Your this part is not

according to the format we demanded from you to follow.
Where are the rest of the headings?

I) Secondary Sources

This Project is related to FSA in which all required

information to complete the project will be
readymade (Secondary Source) i.e. profit and loss
accounts, balance sheet, cash flow statement etc.
In my project, I achieved all data with the help of
internet. I have also attached the link shown in
bibliography part through which I achieved my all
information related to annual accounts etc.

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 Financial Analysis of Suzuki Motors

I) Pak Suzuki motors.

For Pak Suzuki motors I will choose 2005-2006
annual accounts for ration analysis.
II) Hino Pak motors.
For Hino pak motors I will choose 2006-2007
annual accounts for ration analysis.
As per asking you suggest most recent accounts. I
choose above mentioned accounts with my full try.

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 Financial Analysis of Suzuki Motors

FINANCIAL REPORT 2006 OF SUZUKI MOTORS:

WEBSITES:

www.globalsuzuki.com
www.paksuzukimotors.com
www.ask.com
www.wikipedia.com
www.yahoosearch.com
www.google.com

HINO PAK MOTORS 2007 report.

http://www.hinopak.com/report_2007.htm

www.Ask.com

Google.com

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Market search

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