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Yamaha ratio analysis

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  • 1. RATIO ANALYSIS AND INTERPRETATION
    RD350
  • 2. COMPANY PROFILE
    About India Yamaha Motor Pvt. Ltd.
    • Yamaha made its initial foray into India in 1985. Subsequently, it entered into a 50:50 joint-venture with the Escorts Group in 1996.
    • 3. However, in August 2001, Yamaha acquired its remaining stake becoming a 100% subsidiary of Yamaha Motor Co., Ltd, Japan (YMC).
    • 4. In 2008, Mitsui & Co., Ltd. entered into an agreement with YMC to become a joint-investor in the motorcycle manufacturing company "India Yamaha Motor Private Limited (IYM)".
    I
    CURRENT SCENARIO
    Yamaha continues to soar high, Domestic Sales up by 35.2 % in September.
    Sep 06, 2011
    • Yamaha zips ahead with the launch of the YZF-R15 version 2.0
    Sep 05, 2011
    • Fourth Leg of Yamaha YZF-R15 One Make Race - Season 2011 rounds off in style.
    Sep 01, 2011
    • Yamaha upbeat about upcoming festive season, registers a domestic sales growth of 32% in August.
    Aug 01, 2011
    • Yamaha continues to ride high on sales in July 2011.
  • BALANCE SHEET
  • 5.
  • 6. PROFIT AND LOSS ACCOUNT
  • 7.
  • 8. RATIO INTERPRETATION
  • 9.
  • 10. Current Ratio
    The relationship between current assets and current liabilities is called current ratio. It is a measure of general liquidity and is most widely used to make the INTERPRETATION for short term financial position or liquidity of a firm.
    Current Ratio = Current Assets / Current Liabilities
    INTERPRETATION
    The ideal figure should always be greater than 1.The company has a current ratio of 0.8 and it should look to improve it. The higher the better.
  • 11. Liquid Ratio
    It is the ratio of liquid assets to current liabilities. The true liquidity refers to the ability of a firm to pay its short term obligations as and when they become due.
    Liquid Ratio = Liquid Assets / Current Liabilities
    INTERPRETATION
    A Company’s liquidity ratio should ideally be more than 1.a liquidity ratio of 1:1 is considered satistaftory.since the ratio is 0.71 the company needs to work on its liquidity ratio.
  • 12. Inventory turnover ratio
    This ratio is a relationship between the cost of goods sold during a particular period of time and the cost of average inventory during a particular period. This ratio indicates whether investment in stock is within proper limit or not.
    Inventory Turnover Ratio = Cost of goods sold / Average inventory at cost
    INTERPRETATION
    The higher the better. A higher inventory turnover ratio shows either strong sales or ineffective buying.
  • 13. Debt Equity Ratio
    Debt-to-Equity ratio indicates the relationship between the external equities or outsiders funds and the internal equities or shareholders funds.
    Debt Equity Ratio = External Equities / Internal Equities
    INTERPRETATION
    INTERPRETATION
    Manufacturing companies tend to have a debt equity ratio of above 2.The company has a debt-equity ratio of 0.7 which means the company is not been wanting to take risks.
  • 14. Net Profit ratio
    Net profit ratio is the ratio of net profit (after taxes) to net sales. It is expressed as percentage. The two basic components of the net profit ratio are the net profit and sales. The net profits are obtained after deducting income-tax and, generally, non - operating expenses and incomes are excluded from the net profits for calculating this ratio.
    Net Profit Ratio = (Net profit / Net sales) × 100
    INTERPRETATION
    This ratio also indicates the firms capacity to face adverse economic conditions such as low demand price competition etc.
  • 15. Gross profit ratio
    Gross profit ratio (GP ratio) is the ratio of gross profit to net sales expressed as a percentage. It expresses the relationship between gross profit and sales.
    INTERPRETATION
    Gross profit margin is fluctuating ,till 2010 Yamaha was enjoying good profits but again profit went down in 2011.
  • 16. Conclusion
    • YAMAHA’S FINANCIAL POSITION IS NOT AS PER STD.
    • 17. WORKING CAPITAL RATIO IS NEGATIVE FOR ALL THE YEAR WHICH IS NOT GOOD FOR THE COMPANY
    • 18. CURRENT RATIO AND LIQUID RATIO IS ALSO SHOWING A DECREASING TREND
    • 19. YAHAMA SHOULD TRY TO IMPROVE ITS CURRENT
    RATIO

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