Ratio analysis of the square pharmaceuticals

1. SM Rafeun Alahe Raad
ID: 184
Sec: A

2. Square Pharmaceuticals
Limited
 SQUARE Pharmaceuticals Limited is the
largest pharmaceutical company in Bangladesh
 It has been continuously in the 1st position
among all national and multinational company
since 1985.
 1958: Debut of SQUARE Pharmaceuticals as a
Partnership Firm.
 1964: Converted into a Private Limited
Company.
 1991: Converted into a Public Limited Company

4. Description Year
2015-16 2016-17
Return on Assets=
(Net Income/Average
Total Assets)x100
13.69% 12.39%
Gross Profit Ratio=
(Gross Profit/Sales)x100
41.82% 42.23%
Earnings Per Share=
Income available to
Share Holders/No.
of Shares
Outstanding
10.95 11.36
Ratio Analysis
Profitability Ratio
Comments:
1.Return on Assets decreased in 2016-17. It is consistent with the
findings in Horizontal analysis, where we found stagnant turnover
despite significant growth in Assets.
2.Gross Profit ratio remained almost the same, 42%

5. Description Year
2015-16 2016-17
Current Ratio =
(Current Assets/Current
Liabilities)
6.61 6.35
Quick Ratio=
(Current Assets-(Inventory
+ Prepayments)/Current
Liabilities)
5.06 5.11
Liquidity Ratio
Comments:
1.The liquidity position is very strong for the company as the current ratio
remained steady during the observed period despite of huge investment
activities.
2.The quick ratio also remained almost same, around 5%. The high quick ratio
shows
strong ability to pay off the short debts. It also indicates that the company
has high amount cash sitting in its reserves.

6. Description Year
2015-16 2016-17
Total Assets Turn Over Ratio =
(Net sales/Average Total assets)
0.95 0.78
Inventory Turn Over Ratio=
(Costs of Goods Sold/Average Inventory)
5.09 4.99
Days Holding Inventory Ratio=
(360/Inventory Turn Over Ratio)
71 72
Comments:
1. It is observed the TATO Ratio decreased significantly in 2016-17, from
0.95 to 0.78. It is
consistent with the findings in horizontal analysis where we found
huge increase in current assets despite sales remained almost same.
Efficiency Ratio

7. Description Year
2015-16 2016-17
Debt-Equity Ratio =
(Total Debt/Total Equity)
0.10 0.11
Debt to Total Assets Ratio=
(Total Debt/Total Assets)
0.09 0.10
Solvency Ratio
Comments:
1.Debt-Equity Ratio has increased slightly in the year
2016-17.
2.Debt is significantly low compared to equity.

8. THANK YOU 