Beruflich Dokumente
Kultur Dokumente
OF BUSINESS FINANCE
Submitted to:
Sir Rehan Aslam
Submitted By:
Ali Tariq
Roll No. 19
M - COM
1st Semester
DEPARTMENT OF COMMERCE
BZU
Ratio’s Analysis
Pakistan Petroleum Limited PPL
2009-2010
1.Liquidity Ratios:
1.Current Ratio:
Current Ratio = Current Asset/current liability
2009
45438653/14648084=3.10
2010
63057116/19623088=3.21
Current Ratio shows the company liquidity,
shows how much company has to pay
obligation’s. So the current ratio of the
company has become better. Now company
has 3.21 assets to pay the obligations of 1. Its
Current ratio has increased from 3.10-3.21.
2.Quick Ratio:
Quick Ratio=current assets-inventory/current
liability
2009
45438653-1871644/14648084=2.91
2010
63057116-2069408/19623088=3.07
Quick ratio is more refine ratio than current
ratio. As current ratio become well the quick
ratio also become well. It increases 1.6.
2.Profitability Ratios:
1. Operating Margin:
=Operating income /sales
2008-2009
40955586/61580072=67%
2009-2010
34612499/59961616=58%
It shows that in 2009-2010 the company
earned less income than 2008-2009 income.
Due to the increase in operating expense the
operating income of 2009-2010 is decreased.
3. Return On Equity:
=Net income-preferred stock/Share holder
equity
2008-2009
44%
2009-2010
29%
This shows that the company is going in down
fall, because its return on equity is becoming
low in 2009-2010. The shareholders of PPL are
getting less return on there capital.
4. Return on Assets:
=Net income/assets
2008-2009
27702791/82916131=33%
2009-2010
23320518/107579583=22%
This shows that the ROA has decreased. The
company ROA is decreased.
4.Debt Ratios:
1. Debt Ratio:
=Total Debt/Share Holder Equity
Not Applicable because company don’t have
debt besides lease financing of vehicles and
computer equipments which form very small
part of capital structure.
2. Capital Structure:
Not Applicable because company don’t have
debt besides lease financing of vehicles and
computer equipments which form very small
part of capital structure.
3. Cash Flows to Liability:
EBITDA/Total Liability
2008-2009
41814792/19857574=2.10
2009-2010
34373375/27673352=1.242
The above ratios show that the company
earnings are decreasing in compare with
liabilities.
4. Coverage Ratios:
1. Cash Flow Coverage:
=EBITDA/Total Interest
2008-2009
41814792/15483200=2.70
2009-2010
34373375/15593215=2.20
2. Business Worth:
=Total Asset-Total Liability
2009-2010
82916131-15169024=Rs67747107
2009-2010
107579583-27673352= Rs79906231
The business worth is increased to 12%. The
company has hired more assets. Company is
relaying more on current assets.
Market Ratios:
1. Earning Per Share:
=Profit-Preferred Dividend/No of shares
2008-2009
27702791-43/995815958= Rs27.81
2009-2010
23320518-42/995815958=Rs23.42
The above calculation shows that the company
EPS has decreased due to decrease in profit in
the period of 2009-2010.
3.Dividend Yield:
=Dividend Per Share/Share Price
2008-2009
1296/189=6.86%
2009-2010
900/184=4.89
The above calculation shows that the company
share is providing less dividend then previous
year 2009.
Summery:
The Pakistan Petroleum Company (PPL) is
going in down fall, but its not bad situation due
to economical, weather and political condition a
company has faced a lot of problems. The
horrible flood in Pakistan also affected a
company badly. Some other problems are
fluctuations in petroleum price through out the
world in the period of 2009-2010.