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MMS I DIV B
Sonali Sakpal 48
Sayali Phatak 44
Tanvi Pawar 43
Nikita Rathod 46
Nikita Watve 55
Tushar Sadhye 47
Vikrant Pokharkar 45
RATIO ANALYSIS
CURRENT RATIO
QUICK RATIO
Purpose
Serves index of shortterm solvency.
2423.55 617.72
2078.94 500.32
Analysis
A quick ratio of 1.00 or 1:1 means that the most liquid assets of
a business are equal to its total debts
More than one indicates that the most liquid assets of a business
exceed its total debts.
Less than one indicates that a business would not be able to
repay all its debts by using its most liquid assets.
Thus we conclude that, generally, a higher quick ratio is
preferable because it means greater liquidity and a lower quick
ratio company indicates a relatively lower liquidity position than
its competitors.
Low or decreasing quick ratios generally suggest that a
company is over-leveraged, struggling to maintain or grow sales,
paying bills too quickly or collecting receivables too slowly
Debt Equity ratio
It indicates what proportion of equity
and debt the company is using to finance
its assets.
Formulae:
Debt:equity ratio=debt/equity
Standard ratio of debt equity is 2:1
Analysis of Asian paint
2013 2014
Significance:-
It is a profitability ratio measuring what proportion of
revenue is converted into gross profit .
Formula:
GP RATIO = *100
Formula:-
Net Profit Ratio = x 100
Here,
Net Profit Ratio can vary significantly from business to business and
can be affected by internal and external factors, Examples of factors
that can affect the net profit ratio are as follows
Industries & Segments
Selling Price
Cost of Factors
Efficiency
Taxation
Here, In this case of Asian Paints, the Net Profit Ratio has decreased from
11.70% in 2013 to 11.22% in 2014, which means company has failed to convert
its revenue into actual profit.
FIXED ASSET TURNOVER RATIO
Fixed-asset turnover is the ratio of sales (on the profit and loss
account) to the value of fixed assets (on the balance sheet). It
indicates how well the business is using its fixed assets to
generate sales.
Formula:
FIXED ASSET TURNOVER RATIO :-
Net Sales/Fixed Assets
0.07 11.7
11.6
0.06
11.5
0.05
11.4
0.04
11.3
0.03
11.2
0.02
11.1
0.01 11
0 10.9
2013-2014 2012-2013 2011-2012 2013-2014 2012-2013 2011-2012
Series1 Series1
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