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Ioc Ioc Presentation Transcript

  • INDIAN OILCORPORATION LIMITED
  • • I ndianOil is also t he highest r anked I ndian company in t he pr est igious For t une Global 500 list ing, having moved up 19 places t o t he 116t h posit ion in 2008. I t is also t he 18t h lar gest pet r oleum company in t he wor ld .
  • FINANCIALSTATEMENT ANALYSIS OF COMPANY
  • RATIO ANALYSISLiquidity Leverage Coverage Profitability Turnover Ratios Ratios Ratios Ratios Ratios
  • LIQUIDITY RATIOCURRENT QUICK CASH RATIO RATIO RATIO
  • CURRENT RATIOYEAR C.R 1.62005 1.2921 1.4 1.22006 1.4053 12007 1.3996 0.8 0.62008 1.3302 0.42009 1.5181 0.2 02010 1.2538 YEAR 2004 2005 2006 2007 2008 2009
  • QUICK RATIOYEAR Q.R QR2005 0.643985 0.7 0.62006 0.629437 0.52007 0.547197 0.4 QR 0.32008 0.540943 0.22009 0.679925 0.1 02010 0.616093 04 05 06 07 08 09
  • CASH RATIOYEAR C.R C.R2005 0.0553 0.062006 0.0458 0.052007 0.0313 0.04 0.03 C.R2008 0.0293 0.022009 0.0238 0.012010 0.0224 0 04 05 06 07 08 09
  • ANALYSIS• The cur r ent r at io f or t he last 6 year s is appox. 1.3:1 which is quit e unsat isf act or y accor ding t o t he st andar d nor ms, but in t his indust r y sect or it is f air enough.• The quick r at io is 0.6:1 which is again unsat isf act or y. I t implies t hat t he company may f ind it dif f icult t o pay it s cur r ent liabilit ies.
  • LEVERAGE RATIOS Debt Preference Debt Equity InterestEquity Ratio Dividend Asset Ratio Asset Ratio Coverage Ratio Coverage Ratio
  • DEBT EQUITY RATIOYEAR D/E D/E2005 0.64845 1.2 12006 0.78237 0.82007 1.02594 0.6 D/E2008 0.84554 0.4 0.22009 0.94480 0 04 05 06 07 08 092010 1.07531
  • DEBT ASSET RATIOYEAR D/A D/A2004 0.209052 0.352005 0.240617 0.3 0.252006 0.296022 0.2 D/A 0.152007 0.266715 0.12008 0.287211 0.05 02009 0.324213 04 05 06 07 08 09
  • ANALYSIS• Fr om t he debt -equit y, debt -asset and equit y-asset r at ios, we int er pr et t hat most of t he money involved is of owner ’s and it is saf e f or cr edit or s t o invest money in t his company.• Thus we can say t hat company can per f or m sat isf act or ily in long t er m.
  • TURNOVER RATIO TOTALINVENTORY DEBTORS AVERAGE ASSETTURNOVER TURNOVER COLLECTION TURNOVER RATIO RATIO PERIOD RATIO
  • INVENTORY TURNOVER RATIO ITRYEA ITR(timeR s) 122004 6.699831 102005 5.836031 82006 6.686472 6 ITR2007 6.915437 4 22008 7.885222 02009 11.08482 04 05 06 07 08 09
  • DEBTORS TURNOVER RATIOYEAR DTR(times) DTR2004 14.48785 20 182005 13.65056 16 142006 18.74085 12 10 DTR2007 17.55006 8 6 42008 13.02869 2 02009 17.18733 04 05 06 07 08 09
  • TOTAL ASSET TURNOVER RATIOYEAR TATR(times) TATR2004 1.89321 2.52005 1.79170 22006 1.89715 1.5 TATR2007 2.07175 1 0.52008 1.91765 02009 2.16625 04 05 06 07 08 09
  • ANALYSIS• The avg. I nvent or y t ur nover r at io f or t he last 6 yr s is appr ox 6 t imes per year ,which is sat isf act or y. I t implies t hat t he invent or ies have been sold f ast .• The avg. Debt or s t ur nover r at io is 15 t imes per year (indust r ial avg. is 7) which is quit e high and indicat es t hat t her e is a shor t t ime-lag bet ween sales and cash collect ion• The TATR is ar ound 1.8 (avg. of 6 yr s)
  • PROFITABILITY RATIOS Return Gross Operating Earning Net Profit on TotalProfit Margin Profit Ratio Power Ratio Assets Ratio Ratio
  • NET PROFIT RATIOYEAR NPR(%) NPR2004 5.79 0.062005 3.897 0.05 0.042006 2.654 0.03 NPR2007 3.572 0.022008 3.298 0.01 02009 0.757 04 05 06 07 08 09
  • RETURN ON TOTAL ASSETYEAR ROTA(%) ROTA2004 10.9617 0.122005 6.9833 0.1 0.082006 5.0367 0.06 ROTA2007 7.401 0.042008 6.3257 0.02 02009 1.6411 04 05 06 07 08 09
  • EARNING PER RATIO EPRYEAR EPR(%)2004 16.0656 0.18 0.162005 9.8272 0.14 0.122006 8.4142 0.1 EPR 0.082007 12.0844 0.06 0.042008 10.5712 0.02 02009 5.3833 04 05 06 07 08 09
  • ANALYSIS• The Net Pr of it Mar gin (avg. of 6 yr s) is 3.25% which is a lit t le low. But since t he invent or y t ur nover r at io is high it can ear n a high r at e of r et ur n on invest ment s.• Ther e is a huge dr op in ROTA f r om 2004 t o 2009. I n 2004 t he analysis shows t hat t he f ir m
  • DU PONTANALYSIS
  • Pioneer ed by Du Pont Company of USA.I t analyses impor t ant int er -r elat ionshipsbased on inf or mat ion f ound in f inancialst at ement s.I t is def ined as-Net P itrof = Net P it rof ×Net SalesTotal assets Net salesTotal assets R OTA NP M TATR Such a decomposit ion helps in under st andinghow t he r et ur n on t ot al asset s is inf luenced
  • YEAR 2005 2006 2007 2008 2009 2010NPM 0.0579 0.03897 0.02654 0.03572 0.03298 0.00757TATR 1.8932 1.79170 1.89715 2.07175 1.91765 2.16625NPM 0.1096 0.06983 0.05036 0.07401 0.06325 0.01641 XTATR = = = = = = =ROTA 0.1096 0.06983 0.05036 0.07401 0.06325 0.01641
  • OVERALL ANALYSIS Thus, we see t hat t he shor t -t er mf inancial st at e of t he company isslight ly weak but it is sat isf act or yin t he long-t er m. The asset s ar eemployed ef f icient ly by t he f ir m.The use of capit al employed is alsodone ef f icient ly. But t her e is a huge dr op inROTA, in t he year 2010. I n f actt he net pr of it has also dr opped agr eat ext ent in t his year . One of