finanancial analysis report file

http://www.superhouse.in/group-over.asp?links=links9
SUMMER TRAINING PROJECT REPORT
ON
(A STUDY ON FINANCIAL
PERFORMANCE OF SUPER
HOUSECOMPANY USING TOOLS OF
RATIO)
SUBMITTED TO
IN PARTIAL FULFILLMENT OF THE REQUIREMENT
FOR THE AWARD OF THE DEGREE OF
“BACHELOR OF BUSINESS ADMINISTRATION”
Batch 2015-18
Session 2017-18
Submitted by:
Saurabh Kumar Singh
BBA V Semester
Roll No.:154100199
Supervised by:
Dr. Pallavi Kaushal
Asst. Professor -Dept. of Mgmt.
GLA University, Mathura

CERTIFICATE
This is to certify that the summer training project report entitled “A STUDY ON
FINANCIAL PERFORMANCE OF SUPER HOUSECOMPANY USING TOOLS OF
RATIO”, is submitted by Mr./Ms Saurabh Kumar Singh, student of BBA V Semester of
“Institute of Business Management”, GLA University, Mathura, under my supervision for the
partial fulfillment for the award of the degree of Bachelor of Business Administration, Session
2017-18, Batch 2015-17.

Place: Mathura
Date- Dr. Pallavi kaushal
Signature of Supervisor
DECLARATION
I Saurabh Kumar Singh, student of BBA (V Semester) Session 2017-2018, Batch 2015-2018
hereby declare that my work entitled
“ A STUDY ON FINANCIAL PERFORMANCE OF SUPER HOUSECOMPANY
USING TOOLS OF RATIO”, is the outcome of genuine efforts done by me under
the able guidance Dr. Pallavi Kaushal and being submitted to “Institute of Business
Management”, GLA University, Mathura as summer training project report in partial
fulfillment for the award of the degree of Bachelor of Business Administration
(BBA).
Place: Mathura

Date: 10 Oct 2017
Name: Saurabh Kumar Singh
Course: BBA (V Semester)
University Roll No:- 154100199
ACKNOWLEDGEMENT
Firstly, I would like to express my sincere gratitude to Prof. A. M Agarwal – Pro Vice-
Chancellor and Director - IBM without whose blessings my summer training project work
would not be completed.
I also want to thank our HOD - Prof. Somesh Dhamija for providing me encouragement,
motivation and moral support throughout the project work.
In addition to this I would also like to thank Dr. Pallavi Kaushal IBM who supervised my
project. Under his unrelated support and guidance, my project has taken this shape.
I am equally indebted to my family and friends who always inspired and motivated me to do
something better throughout this project.
At last I would like to extend my sincere thanks to all the respondents to whom I visited for
giving their support and valuable information, which helps me in completing my project work.
Saurabh Kumar Singh
Course - BBA V sem.
University Roll No. 154100199

EXECUTIVE SUMMARY
This project has been completed in SUPER HOUSECOMPANY. The project is on “ A STUDY ON
FINANCIAL PERFORMANCE OF SUPER HOUSECOMPANY USING TOOLS OF RATIO”
project starts with the introduction of Indian commercial leather industry. It includes various
topics:
• PROFILE OF COMPANY: It covers the introduction of company, joint ventures, company’s
developments and values.
• STARBUSES: Explanation of specification of various ranges of Starbuses, their advantages
and disadvantage
• ANALYSIS OF CUSTOMER’S NEED: Analysis of the primary, secondary needs and the
peripheral needs of the customers.
• SWOT ANALYSIS: Swot analysis explains the strength, weakness, threats and opportunity
available to the company. Swot analysis is based on the study of previous year.
RECOMMENDATIONS: In the end a comprehensive list of recommendations and suggestions is
included. Such recommendations are drafted with the purpose of bringing to light the issues which push
the finance of company.
TABLE OF CONTENT

CHAPTER
NO.
CONTENTS PAGE
NO.
01 About the Company 08
02 Introduction to the Topic, Importance & Objective 19
03 Research Methodology 45
04 Data Analysis & Interpretations 49
05 Findings, Conclusions, Limitations, Recommendations &
Suggestions
72
06 Bibliography & Appendix (Questionnaire) 83
CHAPTER-1
ABOUT THE COMPANY
Super house India Limited, formerly known as Super house Udyog Limited, is an
automobile manufacturer in India. It is a 56.21%-owned subsidiary of Japanese automobile
and motorcycle manufacturer Super house Motor Corporation. As of January 2017, it had a
market share of 51% of the Indian passenger car market. Super housemanufactures and sells
popular cars such as the Ciaz, Ertiga, Wagon R, Alto, Swift, Celerio, Swift Dzire, Omni,
Baleno and Baleno RS, Ignis.The company is headquartered at New Delhi. In February 2012,
the company sold its ten millionth vehicle in India
History
Logo of Super house Udyog
Super house was established in February 1981 by Sanjay Gandhi on Background of
Government of India though the actual production commenced only in 1983. It started with
the Super house 800, based on the Super house Alto kei car. As of May 2007, the Government

of India, through Ministry of Disinvestment, sold its complete share to Indian financial
institutions and no longer has any stake in Super house Udyog
Chronology
Under the Super house name
In 1970, a private limited company named Surya Ram Super house technical services private
limited (MTSPL) was launched on November 16, 1970The stated purpose of this company
was to provide technical know-how for the design, manufacture and assembly of "a wholly
indigenous motor car". In June 1971, a company called Super house limited was incorporated
under the Companies Act. Super house Limited went into liquidation in 1977. Super house
Udyog Ltd was incorporated through the efforts of Dr V. Krishnamurthy.
Affiliation with Super house
In 1982, a license & Joint Venture Agreement (JVA) was signed between Super house Udyog
Ltd, and Super house of Japan. At first, Super housewas mainly an importer of cars. In India's
closed market, Super house received the right to import 40,000 fully built-up Super house in
the first two years, and even after that the early goal was to use only 33% indigenous parts.
This upset the local manufacturers considerably. There were also some concerns that the
Indian market was too small to absorb the comparatively large production planned by Super
house Super house, with the government even considering adjusting the petrol tax and
lowering the excise duty in order to boost sales. Finally, in 1983, the Super house 800 was
released. This 796 cc hatchback was based on the SS80 Super house Alto and was India’s first
affordable car. Initial product plan was 40% saloons, and 60% Super house Van. Local
production commenced in December 1983. In 1984, the Super house Van with the same three-
cylinder engine as the 800 was released and the installed capacity of the plant in Gurgaon
reached 40,000 units.
In 1985, the Super house SJ410-based Gypsy, a 970 cc 4WD off-road vehicle, was launched.
In 1986, the original 800 was replaced by an all-new model of the 796 cc hatchback Super
house Alto and the 100,000th vehicle was produced by the company. In 1987, the company
started exporting to the West, when a lot of 500 cars were sent to Hungary. By 1988, the
capacity of the Gurgaon plant was increased to 100,000 units per annum.
Market liberalisation
In 1989, the Super house 1000 was introduced and the 970 cc, three-box was India’s first
contemporary sedan. By 1991, 65 percent of the components, for all vehicles produced, were
indigenized. After liberalization of the Indian economy in 1991, Super house increased its
stake in Super house to 50 percent, making the company a 50-50 JV with the Government of
India the other stake holder.

In 1993, the Zen, a 993 cc, hatchback was launched and in 1994 the 1298 cc Esteem was
introduced. Super house produced its 1 millionth vehicle since the commencement of
production in 1994. Super house's second plant was opened with annual capacity reaching
200,000 units. Super house launched a 24-hour emergency on-road vehicle service. In 1998,
the new Super house 800 was released, the first change in design since 1986. Zen D, a 1527 cc
diesel hatchback and Super house's first diesel vehicle and a redesigned Omni were
introduced. In 1999, the 1.6 litre Super house Baleno three-box saloon and Wagon R were
also launched.
In 2000, Super house became the first car company in India to launch a Call Center for
internal and customer services. The new Alto model was released. In 2001, Super house True
Value, selling and buying used cars was launched. In October of the same year the Super
house Versa was launched. In 2002, Esteem Diesel was introduced. Two new subsidiaries
were also started: Super house Insurance Distributor Services and Super house Insurance
Brokers Limited. Super house Motor Corporation increased its stake in Super house to 54.2
percent.
In 2003, the new Super house Grand Vitara XL-7 was introduced while the Zen and the
Wagon R were upgraded and redesigned. The four millionth Super house vehicle was built
and they entered into a partnership with the State Bank of India. Super house Udyog Ltd was
Listed on BSE and NSE after a public issue, which was oversubscribed tenfold. In 2004, the
Alto became India's best selling car overtaking the Super house 800 after nearly two decades.
The five-seater Versa 5-seater, a new variant, was created while the Esteem was re-launched.
Super house Udyog closed the financial year 2003-04 with an annual sale of 472,122 units, the
highest ever since the company began operations and the fiftieth lakh (5 millionth) car rolled
out in April 2005. The 1.3 L Super house Swift five-door hatchback was introduced in 2005.
In 2006 Super house and Super house set up another joint venture, "Super houseAutomobiles
India", to build two new manufacturing plants, one for vehicles and one for engines. Cleaner
cars were also introduced, with several new models meeting the new "Bharat Stage III"
standards. In February 2012, Super housesold its ten millionth vehicle in India. For the Month
of July 2014, it had a Market share of >45 %.
JOINT VENTURENRELATED ISSUES
Relationship between the Government of India, under the United Front (India) coalition and
Super house Motor Corporation over the joint venture was a point of heated debate in the
Indian media until Super house Motor Corporation gained the controlling stake. This highly
profitable joint venture that had a near monopolistic trade in the Indian automobile market and
the nature of the partnership built up till then was the underlying reason for most issues. The
success of the joint venture led Super house to increase its equity from 26% to 40% in 1987,
and to 50% in 1992, and further to 56.21% as of 2013.In 1982, both the venture partners
entered into an agreement to nominate their candidate for the post of Managing Director and
every Managing Director would have a tenure of five years.
MANUFACTURING FACILITIES
Super househas three manufacturing facilities in India. All manufacturing facilities have a
combined production capacity of 1,700,000 vehicles annually. The Gurgaon manufacturing
facility has three fully integrated manufacturing plants and is spread over 300 acres (1.2 km2
).
The Gurgaon facilities also manufacture 240,000 K-Series engines annually. The Gurgaon
Facilities manufactures the Alto 800, WagonR, Omni, Gypsy King, Ertiga, S-Cross, Vitara
Brezza, Ignis and Eeco.

The Manesar manufacturing plant was inaugurated in February 2007 and is spread over 600
acres (2.4 km2
). Initially it had a production capacity of 100,000 vehicles annually but this was
increased to 300,000 vehicles annually in October 2008. The production capacity was further
increased by 250,000 vehicles taking total production capacity to 800,000 vehicles annually.
The Manesar Plant produces the Alto 800, Alto K10, Swift, Swift DZire, Ciaz, Baleno, Baleno
RS and Celerio. On 25 June 2012, Haryana State Industries and Infrastructure Development
Corporation demanded Super houseto pay an additional Rs 235 crore for enhanced land
acquisition for its Haryana plant expansion. The agency reminded Super house that failure to
pay the amount would lead to further proceedings and vacating the enhanced land acquisition.
The launch of the Desire was happened in the month of May 2017 and the variant is said to
have good milage.
The Gujarat manufacturing plant became operational in February 2017. The plant current
capacity is about 250,000 units per year. But with new investments Super househas plan to
take it to 450,000 units per year.
In 2012, the company decided to merge Super house Powertrain India Limited (SPIL) with
itself. SPIL was started as a JV by Super house Motor Corp. along with Super house Super
house. It has the facilities available for manufacturing diesel engines and transmissions. The
demand for transmissions for all Super housecars is met by the production from SPIL.
INDUSTRIAL RELATION
Since its founding in 1983, Super house Udyog Limited has experienced problems with its
labour force. The Indian labour it hired readily accepted Japanese work culture and the
modern manufacturing process. In 1997, there was a change in ownership, and Super house
became predominantly government controlled. Shortly thereafter, conflict between the United
Front Government and Super house started. In 2000, a major industrial relations issue began
and employees of Super house went on an indefinite strike, demanding among other things,
major revisions to their wages, incentives and pensions
Employees used slowdown in October 2000, to press a revision to their incentive-linked pay.
In parallel, after elections and a new central government led by NDA alliance, India pursued a
disinvestment policy. Along with many other government owned companies, the new
administration proposed to sell part of its stake in Super housein a public offering. The
worker's union opposed this sell-off plan on the grounds that the company will lose a major
business advantage of being subsidised by the Government, and the union has better
protection while the company remains in control of the government.
The standoff between the union and the management continued through 2001. The
management refused union demands citing increased competition and lower margins. The
central government privatized Super house in 2002 and Super house became the majority
owner of Super house Udyog Limited.
MANNESAR VIOLENCE
On 18 July 2012, Super house's Manesar plant was hit by violence. According to Super house
management. The production workers at one of its auto factories attacked supervisors and
started a fire that killed a company General Manager of Human Resources Avineesh Dev and
injured 100 other managers, including two Japanese expatriates. The workers also allegedly
injured nine policemen. However Super houseWorkers Union (MSWU) President Sam Meher
alleged that management ordered 300 hired security guards to attack the workforce during the
violence. The incident is the worst-ever for Super house since the company began operations
in India in 1983.
Since April 2012, the Manesar union had demanded a three-fold increase in basic salary, a
monthly conveyance allowance of 10,000, a laundry allowance of 3,000, a gift with every₹ ₹

new car launch, and a house for every worker who wants one or cheaper home loans for those
who want to build their own houses. According to the Super houseWorkers Union a
supervisor had abused and made discriminatory comments to a low-caste worker, Jiya Lal,.
These claims were denied by the company and the police. Super house said the unrest began,
not over wage discussions, but after the workers' union demanded the reinstatement of Jiya
Lal who had been suspended for allegedly beating a supervisor. The workers claim harsh
working conditions and extensive hiring of low-paid contract workers which are paid about
$126 a month, about half the minimum wage of permanent employees. On 27 June, 2013, an
international delegation from the International Commission for Labor Rights (ICLR) released
a report alleging serious violations of the industrial right of workers by the Super
housemanagement . Company executives denied harsh conditions and claim they hired entry-
level workers on contracts and made them permanent as they gained experience. Super house
employees currently earn allowances in addition to their base wage.
The police, in its First Information Report (FIR), claimed on 21 July that Manesar violence is
the result of a planned violence by a section of workers and union leaders and arrested 91
people. Super house in its statement on the unrest, announced that all work at the Manesar
plant has been suspended indefinitely. The shut down of Manesar plant is leading to a loss of
about Rs 75 crore per day. On 21 July 2012, citing safety concerns, the company announced a
lockout under The Industrial Disputes Act, 1947 pending results of an inquiry the company
has requested of the Haryana government into the causes of the disorder. Under the provisions
of The Industrial Disputes Act for wages, the report claimed, employees are expected to be
paid for the duration of the lockout. On 26 July 2012, Super house announced employees
would not be paid for the period of lock-out in accordance with Indian labour laws. The
company further announced that it will stop using contract workers by March 2013. The report
claimed the salary difference between contract workers and permanent workers has been
much smaller than initial media reports – the contract worker at Super house received about ₹
11,500 per month, while a permanent worker received about 12,500 a month at start, which₹
increased in three years to 21,000-22,000 per month. In a separate report, a contractor who₹
was providing contract employees to Super house claimed the company gave its contract
employees the best wage, allowances and benefits package in the region.
Shinzo Nakanishi, managing director and chief executive of Super house India, said this kind
of violence has never happened in Super house Motor Corp's entire global operations spread
across Hungary, Indonesia, Spain, Pakistan, Thailand, Malaysia, China and the Philippines.
Mr. Nakanishi apologised to affected workers on behalf of the company, and in press
interview requested the central and Haryana state governments to help stop further violence by
legislating decisive rules to restore corporate confidence amid emergence of this new 'militant
workforce' in Indian factories. He announced, "we are going to de-recognise Super
houseWorkers’ Union and dismiss all workers named in connection with the incident. We will
not compromise at all in such instances of barbaric, unprovoked violence." He also announced
Super house plans to continue manufacturing in Manesar, that Gujarat was an expansion
opportunity and not an alternative to Manesar.
The company dismissed 500 workers accused of causing the violence and re-opened the plant
on 21 August, saying it would produce 150 vehicles on the first day, less than 10% of its
capacity. Analysts said that the shutdown was costing the company 1 billion rupees ($18
million) a day and costing the company market share. In July 2013, the workers went on
hunger strike to protest the continuing jailing of their colleagues and launched an online
campaign to support their demands.
A total of 148 workers were charged with the murder of Human Resources Manager Avineesh
Dev. The court dismissed charges against 117 of the workers. On 17 March 2017, 31 workers
were found guilty of variety of offences. 18 were convicted on charges of rioting, trespassing,
causing hurt and other related offences under Indian Penal Code sections. The remaining 13
workers were sentenced to life in imprisonment after being found guilty of the murder of
General Manager of Human Resources Avineesh Dev. Twelve of the thirteen sentenced were
office-bearers of the Super house Workers Union at the time of the alleged offences. The
prosecution had sought the death penalty for the thirteen.

Both prosecution and defence have announced they will appeal the sentences. Defence
counsel Vrinda Grover stated, “We will file appeals against all convictions in the HC. The
evidence, as it stands, cannot withstand legal scrutiny. There is no evidence to link these
workers to the murder. The 13 who have been convicted, it’s important to remember that they
were the leaders of the union. Therefore, it is clear that this is targeted framing of these
persons. We hope for justice in the superior court.”
The Super houseWorkers Union is continuing to organise industrial action and protests calling
for the workers to be released and criticising the judgement and sentences an unjust. An
international appeal for the release of the workers has been made by the International
Committee for the Fourth International (ICFI) and other organisations such as the Peoples
Alliance for Democracy and Secularism.
PRODECTS AND SERVICE
Current models
Model Launched Category Image
Omni 1984 Minivan
Gypsy King 1985 SUV
WagonR 1999 Hatchback
Swift 2005 Hatchback
Swift DZire 2008 Sedan

Eeco 2009 Minivan –
K10 2010 Hatchback
Ertiga 2012 Mini MPV
Alto 800 2012 Hatchback
Celerio 2014 Hatchback
Ciaz 2014 Sedan
Baleno 2015 Hatchback
S-Cross 2015 Mini SUV
Vitara Brezza 2016 Mini SUV
Ignis 2017 Hatchback

Baleno RS 2017 Hatchback
Discontinued models
Model Launched Discontinued Category Image
800 1983 2012 Hatchback
Gypsy E 1985 2000 SUV
1000 1990 2000 Sedan
Zen Zen Classic 1993 2006 Hatchback
Esteem 1994 2008 Sedan
Baleno 1999 2007 Sedan
Alto 2000 2012 Hatchback
Versa 2001 2010 Minivan

Grand Vitara XL7 2003 2007 Mini SUV
Grand Vitara 2007 2015 Mini SUV
Zen Estilo 2007 2013 Hatchback
A-star 2008 2014 Hatchback
SX4 2008 2014 Sedan
Ritz 2009 2016 Hatchback
Kizashi 2011 2014 Sedan
Sales and service network
Car showroom near Eluru

Super househas 1,820 sales outlets across 1,471 cities in India. The company aims to double
its sales network to 4,000 outlets by 2020. It has 3,145 service stations across 1,506 cities
throughout India. Super house’s dealership network is larger than that of Hyundai, Mahindra,
Honda, Tata, Toyota and Ford combined. Service is a major revenue generator of the
company. Most of the service stations are managed on franchise basis, where Super
housetrains the local staff. Other automobile companies have not been able to match this
benchmark set by Super house Super house. The Express Service stations help many stranded
vehicles on the highways by sending across their repair man to the vehicle.
NEXA
In 2015 Super houselaunched NEXA, a new dealership format for its premium cars.
Super house currently sells the Baleno, Baleno RS, S-Cross, Ciaz and Ignis through NEXA
outlets. S-Cross was the first car to be sold through NEXA outlets. Several new models will
be added to both channels as part of the Company’s medium term goal of 2 million annual
sales by 2020.
SUPER HOUSE SERVICE
Launched in 2002 Super houseprovides vehicle insurance to its customers with the help of the
National Insurance Company, Bajaj Allianz, New India Assurance and Royal Sundaram. The
service was set up the company with the inception of two subsidiaries Super house Insurance
Distributors Services Pvt. Ltd and Insurance Brokers Pvt. Limited
This service started as a benefit or value addition to customers and was able to ramp up easily.
By December 2005 they were able to sell more than two million insurance policies since its
inception.
SUPER HOUSE FINANCE
To promote its bottom line growth, Super houselaunched Super house Finance in January
2002. Prior to the start of this service Super househad started two joint ventures Citicorp
Super house and Super house Countrywide with Citi Group and GE Countrywide respectively
to assist its client in securing loan. Super housetied up with ABN Amro Bank, HDFC Bank,
ICICI Limited, Kotak Mahindra, Standard Chartered Bank, and Sundaram to start this venture
including its strategic partners in car finance. Again the company entered into a strategic
partnership with SBI in March 2003 Since March 2003, Super house has sold over 12,000
vehicles through SBI-Super house Finance. SBI-Super house Finance is currently available in
166 cities across India.
Citicorp Super house Finance Limited is a joint venture between Citicorp Finance India and
Super house Udyog Limited its primary business stated by the company is "hire-purchase
financing of Super housevehicles". Citi Finance India Limited is a wholly owned subsidiary of
Citibank Overseas Investment Corporation, Delaware, which in turn is a 100% wholly owned
subsidiary of Citibank N.A. Citi Finance India Limited holds 74% of the stake and Super
households the remaining 26%. GE Capital, HDFC and Super housecame together in 1995 to
form Super house Countrywide. Super house claims that its finance program offers most
competitive interest rates to its customers, which are lower by 0.25% to 0.5% from the market
rates.

SUPER HOUSE TRUE VALUE
Super house True service offered by Super houseto its customers. It is a market place for used
Super houseVehicles. One can buy, sell or exchange used Super housevehicles with the help
of this service in India. As of 1 July 2016 there are 1040 outlets.
N2N FLEET MANAGEMENT
N2N is the short form of End to End Fleet Management and provides lease and fleet
management solution to corporates. Clients who have signed up of this service include Gas
Authority of India Ltd, DuPont, Reckitt Benckiser, Doordarshan, Singer India, National Stock
Exchange of India and Transworld. This fleet management service include end-to-end
solutions across the vehicle's life, which includes Leasing, Maintenance, Convenience services
and Remarketing.
SUPER HOUSE ACCESSORIES
Many of the auto component companies other than Super housestarted to offer components
and accessories that were compatible. This caused a serious threat and loss of revenue to
Super house Super house. Super housestarted a new initiative under the brand name Super
house Genuine Accessories to offer accessories like alloy wheels, body cover, carpets, door
visors, fog lamps, stereo systems, seat covers and other car care products. These products are
sold through dealer outlets and authorized service stations throughout India.
SUPER HOUSE DRIVING SCHOOL
A Super house Driving School in Bangalore
As part of its corporate social responsibility Super houselaunched the Super house Driving
School in Delhi. Later the services were extended to other cities of India as well. These
schools are modelled on international standards, where learners go through classroom and
practical sessions. Many international practices like road behaviour and attitudes are also
taught in these schools. Before driving actual vehicles participants are trained on simulators.
At the launch ceremony for the school Jagdish Khattar stated "We are very concerned about
mounting deaths on Indian roads. These can be brought down if government, industry and the
voluntary sector work together in an integrated manner. But we felt that Super house should
first do something in this regard and hence this initiative of Super house Driving Schools."

AWARDS AND RECOGNITION
The Brand Trust Report published by Trust Research Advisory, a brand analytics company,
has ranked Super housein the thirty seventh position in 2013 and eleventh position in 2014
among the most trusted brands of India.
Viewers' Choice Car of the Year published by CNBC-TV18 OVERDRIVE, Overdrive is
Indias No.1 Auto Publication for Cars and Bikes in India, has awarded Super houseBaleno the
Viewers' Choice Car of the Year 2016
UMA MOTORS PVT LTD IN MATHURA CITY,
MATHURA
Uma Motors Pvt Ltd in Mathura. Car Dealers-super housewith Address, Contact Number, Photos, Maps.
View Uma Motors Pvt Ltd, Mathura on Justdial.
An authorised sales and service dealership, Uma Motors Pvt Ltd in Mathura has been in the business
ever since the year 2010. In a short span of time, the place made a name for itself as well as increased its
patrons base tremendously. Ever since its inception, the showroom has always ensured that it maintains a
high standard when it comes to servicing its guests. The establishment endeavours to achieve the highest
level of customer satisfaction and improving the buying experience for its customers. During its time in
the business, the company has constantly made evident effort to keep abreast with the needs of the
customers alongside the growing market. Understanding that options are galore, this showroom makes
the researching, buying and selling as well as post sales engagements easy and uncomplicated. The
dealer showroom is located at 68/1, Maholi in Mathura City. Locating it is as easy as it gets as it stands
National Highway 2 - a major landmark in the area. Undoubtedly this is one of the best Car Dealers at
Mathura City, Mathura.
SERVICES OFFERED BY UMA MOTORS PVT LTD
Uma Motors Pvt Ltd at Mathura City meets all the requirements that one can possibly have in terns of
four-wheeler vehicles. Apart from ensuring the sales of these vehicles, the outlet also offers post sale
services. The sales staff employed here pays keen attention to the requirements of the potential buyers
and makes appropriate suggestions by explaining the features, specifications and pricing of the vehicles.
Those looking to change or replace parts of their cars can approach the center as they also deal with
various authentic car accessories. It undertakes repairs and services for a majority of the car models.
Open from 09:00 - 19:00, It can be contacted on +(91)-565-3981500.
Please scroll up for the address and the contact number of Uma Motors Pvt Ltd at Mathura City,
Mathura.

CHAPTER-2
INTRODUCTION
TO
THE
TOPIC,OBJECTIVE,SCOPE AND
IMPORTANCE

FINANCIAL ANALYSIS: -
RATIO ANALYSIS: -
Financial analysis is the process of identifying the financial strengths and
weaknesses of the firm and establishing relationship between the items of the balance sheet
and profit & loss account.
Financial ratio analysis is the calculation and comparison of ratios, which
are derived from the information in a company’s financial statements. The level and historical
trends of these ratios can be used to make inferences about a company’s financial condition,
its operations and attractiveness as an investment. The information in the statements is used by
• Trade creditors, to identify the firm’s ability to meet their claims i.e. liquidity
position of the company.
• Investors, to know about the present and future profitability of the company and its
financial structure.
• Management, in every aspect of the financial analysis. It is the responsibility of the
management to maintain sound financial condition in the company.
RATIO ANALYSIS:-
The term “Ratio” refers to the numerical and quantitative relationship between two
items or variables. This relationship can be exposed as
• Percentages
• Fractions
• Proportion of numbers
Ratio analysis is defined as the systematic use of the ratio to interpret the financial
statements. So that the strengths and weaknesses of a firm, as well as its historical performance and
current financial condition can be determined. Ratio reflects a quantitative relationship helps to form a
quantitative judgment.

STEPS IN RATIO ANALYSIS:-
• The first task of the financial analysis is to select the information relevant to the decision under
consideration from the statements and calculates appropriate ratios.
• To compare the calculated ratios with the ratios of the same firm relating to the past or with the
industry ratios. It facilitates in assessing success or failure of the firm.
• Third step is to interpretation, drawing of inferences and report writing conclusions are drawn
after comparison in the shape of report or recommended courses of action.
BASIS OR STANDARDS OF COMPARISON:-
Ratios are relative figures reflecting the relation between variables. They enable
analyst to draw conclusions regarding financial operations. They use of ratios as a tool of financial
analysis involves the comparison with related facts. This is the basis of ratio analysis. The basis of ratio
analysis is of four types.
• Past ratios, calculated from past financial statements of the firm.
• Competitor’s ratio, of the some most progressive and successful competitor firm at the same
point of time.
• Industry ratio, the industry ratios to which the firm belongs to
• Projected ratios, ratios of the future developed from the projected or pro forma financial
statements
NATURE OF RATIO ANALYSIS:-
Ratio analysis is a technique of analysis and interpretation of financial statements. It
is the process of establishing and interpreting various ratios for helping in making certain decisions. It is
only a means of understanding of financial strengths and weaknesses of a firm. There are a number of
ratios which can be calculated from the information given in the financial statements, but the analyst has
to select the appropriate data and calculate only a few appropriate ratios. The following are the four steps
involved in the ratio analysis.
• Selection of relevant data from the financial statements depending upon the objective of the
analysis.
• Calculation of appropriate ratios from the above data.

• Comparison of the calculated ratios with the ratios of the same firm in the past, or the ratios
developed from projected financial statements or the ratios of some other firms or the
comparison with ratios of the industry to which the firm belongs.
INTERPRETATION OF THE RATIOS:-
The interpretation of ratios is an important factor. The inherent limitations of ratio
analysis should be kept in mind while interpreting them. The impact of factors such as price level
changes, change in accounting policies, window dressing etc., should also be kept in mind when
attempting to interpret ratios. The interpretation of ratios can be made in the following ways.
• Single absolute ratio
• Group of ratios
• Historical comparison
• Projected ratios
• Inter-firm comparison
GUIDELINES OR PRECAUTIONS FOR USE OF RATIOS:-
The calculation of ratios may not be a difficult task but their use is not easy.
Following guidelines or factors may be kept in mind while interpreting various ratios are
• Accuracy of financial statements
• Objective or purpose of analysis
• Selection of ratios
• Use of standards
• Caliber of the analysis
LIMITATIONS OF RATIO ANALYSIS :-
• Differences in definitions
• Limitations of accounting records
• Lack of proper standards
• No allowances for price level changes
• Changes in accounting procedures
• Quantitative factors are ignored

• Limited use of single ratio
• Background is over looked
• Limited use
• Personal bias
CLASSIFICATIONS OF RATIOS:-
The use of ratio analysis is not confined to financial manager only. There are
different parties interested in the ratio analysis for knowing the financial position of a firm for different
purposes. Various accounting ratios can be classified as follows:
1. Traditional Classification
2. Functional Classification
3. Significance ratios
1. Traditional Classification-
It includes the following.
• Balance sheet (or) position statement ratio: They deal with the relationship between two
balance sheet items, e.g. the ratio of current assets to current liabilities etc., both the items
must, however, pertain to the same balance sheet.
• Profit & loss account (or) revenue statement ratios: These ratios deal with the relationship
between two profit & loss account items, e.g. the ratio of gross profit to sales etc.,
• Composite (or) inter statement ratios: These ratios exhibit the relation between a profit & loss
account or income statement item and a balance sheet items, e.g. stock turnover ratio, or the
ratio of total assets to sales.
2. Functional Classification-
These include liquidity ratios, long term solvency and leverage ratios, activity ratios
and profitability ratios.
3. Significance ratios-
Some ratios are important than others and the firm may classify them as primary and
secondary ratios. The primary ratio is one, which is of the prime importance to a concern. The other
ratios that support the primary ratio are called secondary ratios.
IN THE VIEW OF FUNCTIONAL CLASSIFICATION THE RATIOS ARE:
1. Liquidity ratio
2. Leverage ratio
3. Activity ratio

4. Profitability ratio
1. LIQUIDITY RATIOS-
Liquidity refers to the ability of a concern to meet its current obligations as & when
there becomes due. The short term obligations of a firm can be met only when there are sufficient liquid
assets. The short term obligations are met by realizing amounts from current, floating (or) circulating
assets The current assets should either be calculated liquid (or) near liquidity. They should be convertible
into cash for paying obligations of short term nature. The sufficiency (or) insufficiency of current assets
should be assessed by comparing them with short-term current liabilities. If current assets can pay off
current liabilities, then liquidity position will be satisfactory.
To measure the liquidity of a firm the following ratios can be calculated
• Current ratio
• Quick (or) Acid-test (or) Liquid ratio
• Absolute liquid ratio (or) Cash position ratio
(a) CURRENT RATIO:
Current ratio may be defined as the relationship between current assets and
current liabilities. This ratio also known as Working capital ratio is a measure of general liquidity and is
most widely used to make the analysis of a short-term financial position (or) liquidity of a firm.
Current assets
Current ratio =
Current liabilities

Components of current ratio
CURRENT ASSETS CURRENT LIABILITIES
Cash in hand Out standing or accrued expenses
Cash at bank Bank over draft
Bills receivable Bills payable
Inventories Short-term advances
Work-in-progress Sundry creditors
Marketable securities Dividend payable
Short-term investments Income-tax payable
Sundry debtors
Prepaid expenses
(b) QUICK RATIO:
Quick ratio is a test of liquidity than the current ratio. The term liquidity refers to
the ability of a firm to pay its short-term obligations as & when they become due. Quick ratio may be
defined as the relationship between quick or liquid assets and current liabilities. An asset is said to be
liquid if it is converted into cash with in a short period without loss of value.
Quick or liquid assets
Quick ratio =
Current liabilities
Components of quick or liquid ratio
QUICK ASSETS CURRENT LIABILITIES
Sundry debtors Short-term advances
Marketable securities Sundry creditors

Temporary investments Dividend payable
Income tax payable
(c) ABSOLUTE LIQUID RATIO:
Although receivable, debtors and bills receivable are generally more liquid than
inventories, yet there may be doubts regarding their realization into cash immediately or in time. Hence,
absolute liquid ratio should also be calculated together with current ratio and quick ratio so as to exclude
even receivables from the current assets and find out the absolute liquid assets.
Absolute liquid assets
Absolute liquid ratio =
Current liabilities
Absolute liquid assets include cash in hand etc. The acceptable forms for this ratio is
50% (or) 0.5:1 (or) 1:2 i.e., Rs.1 worth absolute liquid assets are considered to pay Rs.2 worth current
liabilities in time as all the creditors are nor accepted to demand cash at the same time and then cash may
also be realized from debtors and inventories.
Components of Absolute Liquid Ratio
ABSOLUTE LIQUID ASSETS CURRENT LIABILITIES
Interest on Fixed Deposit Bills payable
Short-term advances
Sundry creditors
Dividend payable
Income tax payable

2. LEVERAGE RATIOS-
The leverage or solvency ratio refers to the ability of a concern to meet its long term
obligations. Accordingly, long term solvency ratios indicate firm’s ability to meet the fixed interest and
costs and repayment schedules associated with its long term borrowings.
The following ratio serves the purpose of determining the solvency of the concern.
• Proprietory ratio
(a) PROPRIETORY RATIO:
A variant to the debt-equity ratio is the proprietory ratio which is also known as
equity ratio. This ratio establishes relationship between share holders funds to total assets of the firm.
Shareholders funds
Proprietory ratio =
Total assets

SHARE HOLDERS FUND TOTAL ASSETS
Share Capital Fixed Assets
Reserves & Surplus Current Assets
Cash in hand & at bank
Bills receivable
Inventories
Marketable securities
Short-term investments
Sundry debtors
Prepaid Expenses
3. ACTIVITY RATIOS-
Funds are invested in various assets in business to make sales and earn profits. The
efficiency with which assets are managed directly effect the volume of sales. Activity ratios measure the
efficiency (or) effectiveness with which a firm manages its resources (or) assets. These ratios are also
called “Turn over ratios” because they indicate the speed with which assets are converted or turned over
into sales.
• Working capital turnover ratio
• Fixed assets turnover ratio
• Capital turnover ratio
• Current assets to fixed assets ratio
(a) WORKING CAPITAL TURNOVER RATIO
Working capital of a concern is directly related to sales.
Working capital = Current assets - Current liabilities
It indicates the velocity of the utilization of net working capital. This indicates the
no. of times the working capital is turned over in the course of a year. A higher ratio indicates efficient
utilization of working capital and a lower ratio indicates inefficient utilization.
Working capital turnover ratio=cost of goods sold/working capital.

Components of Working Capital
CURRENT ASSETS CURRENT LIABILITIES
Inventories Short-term advances
Work-in-progress Sundry creditors
Marketable securities Dividend payable
Short-term investments Income-tax payable
Sundry debtors
Prepaid expenses
(b) FIXED ASSETS TURNOVER RATIO:
It is also known as sales to fixed assets ratio. This ratio measures the efficiency and
profit earning capacity of the firm. Higher the ratio, greater is the intensive utilization of fixed assets.
Lower ratio means under-utilization of fixed assets.
Cost of Sales
Fixed assets turnover ratio =
Net fixed assets
Cost of Sales = Income from Services
Net Fixed Assets = Fixed Assets - Depreciation
(c) CAPITAL TURNOVER RATIOS :
Sometimes the efficiency and effectiveness of the operations are judged by
comparing the cost of sales or sales with amount of capital invested in the business and not with assets
held in the business, though in both cases the same result is expected. Capital invested in the business
may be classified as long-term and short-term capital or as fixed capital and working capital or Owned
Capital and Loaned Capital. All Capital Turnovers are calculated to study the uses of various types of
capital.

Cost of goods sold
Capital turnover ratio =
Capital employed
Cost of Goods Sold = Income from Services
Capital Employed = Capital + Reserves & Surplus
(d) CURRENT ASSETS TO FIXED ASSETS RATIO:
This ratio differs from industry to industry. The increase in the ratio means that
trading is slack or mechanization has been used. A decline in the ratio means that debtors and stocks are
increased too much or fixed assets are more intensively used. If current assets increase with the
corresponding increase in profit, it will show that the business is expanding.
Current Assets
Current Assets to Fixed Assets Ratio =
Fixed Assets
Component of Current Assets to Fixed Assets Ratio
CURRENT ASSETS FIXED ASSETS
Cash in hand Machinery
Cash at bank Buildings
Bills receivable Plant
Inventories Vehicles
Work-in-progress
Marketable securities
Short-term investments
Sundry debtors
Prepaid expenses
4. PROFITABILITY RATIOS -

The primary objectives of business undertaking are to earn profits. Because profit is
the engine, that drives the business enterprise.
• Net profit ratio
• Return on total assets
• Reserves and surplus to capital ratio
• Earnings per share
• Operating profit ratio
• Price – earning ratio
• Return on investments
(a) NET PROFIT RATIO:
Net profit ratio establishes a relationship between net profit (after tax) and sales and
indicates the efficiency of the management in manufacturing, selling administrative and other activities
of the firm.
Net profit after tax
Net profit ratio =
Net sales
Net Profit after Tax = Net Profit (–) Depreciation (–) Interest (–) Income Tax
Net Sales = Income from Services
It also indicates the firm’s capacity to face adverse economic conditions such as
price competitors, low demand etc. Obviously higher the ratio, the better is the profitability.
(b) RETURN ON TOTAL ASSETS:
Profitability can be measured in terms of relationship between net profit and assets.
This ratio is also known as profit-to-assets ratio. It measures the profitability of investments. The overall
profitability can be known.
Net profit
Return on assets =

Total assets
Net Profit = Earnings before Interest and Tax
Total Assets = Fixed Assets + Current Assets
(c) RESERVES AND SURPLUS TO CAPITAL RATIO:
It reveals the policy pursued by the company with regard to growth shares. A very
high ratio indicates a conservative dividend policy and increased ploughing back to profit. Higher the
ratio better will be the position.
Reserves& surplus
Reserves & surplus to capital =
Capital
(d) EARNINGS PER SHARE
Earnings per share is a small verification of return of equity and is calculated by
dividing the net profits earned by the company and those profits after taxes and preference dividend by
total no. of equity shares.
Net profit after tax
Earnings per share =
Number of Equity shares
The Earnings per share is a good measure of profitability when compared with EPS of similar other
components (or) companies, it gives a view of the comparative earnings of a firm.
(e) OPERATING PROFIT RATIO:

Operating ratio establishes the relationship between cost of goods sold and other
operating expenses on the one hand and the sales on the other.
Operating cost
Operation ratio =
Net sales
However 75 to 85% may be considered to be a good ratio in case of a manufacturing
under taking.
Operating profit ratio is calculated by dividing operating profit by sales.
Operating profit = Net sales - Operating cost
Operating profit
Operating profit ratio =
Sales
(f) PRICE - EARNING RATIO:
Price earning ratio is the ratio between market price per equity share and earnings
per share. The ratio is calculated to make an estimate of appreciation in the value of a share of a
company and is widely used by investors to decide whether (or) not to buy shares in a particular
company.
Generally, higher the price-earning ratio, the better it is. If the price earning ratio
falls, the management should look into the causes that have resulted into the fall of the ratio.
Market Price per Share
Price – Earning Ratio =
Earnings per Share
Capital + Reserves & Surplus
Market Price per Share =
Number of Equity Shares

Earnings before Interest and Tax
Earnings per Share =
Number of Equity Shares
(g) RETURN ON INVESTMENTS:
Return on share holder’s investment, popularly known as Return on investments (or)
return on share holders or proprietor’s funds is the relationship between net profit (after interest and tax)
and the proprietor’s funds.
Net profit (after interest and tax)
Return on shareholder’s investment =
Shareholder’s funds
The ratio is generally calculated as percentages by multiplying the above with 100.
.

RESEARCH
OBJECTIVES
– OBJECTIVES
The major objectives of the recent study are to know about financial strengths and
weakness of WASAN & COMPANY through FINANCIAL RATIO ANALYSIS.
The main objectives of recent study aimed as:
To evaluate the performance of the company by using ratios as a yardstick to
measure the efficiency of the company. To understand the liquidity, profitability and efficiency positions

of the company during the study period. To evaluate and analyze various facts of the financial
performance of the company. To make comparisons between the ratios during different periods.
OBJECTIVES
1. To study the present financial system at Genting WASAN &
COMPANY.
2. To know the financial performance of the company through
Profitability ratios.
3. To study the Financial Performance of the through Liquidity
Ratios.
4. To analyze the capital structure of the company with the help of
Leverage ratio.
5. To offer appropriate suggestions for the better performance of
the organization
SCOPE
OF

THE
STUDY
SCOPE OF THE STUDY
1. The study has great significance and provides benefits to various parties whom
directly or indirectly interact with the company.
2. It is beneficial to management of the company by providing crystal clear picture
regarding important aspects like liquidity, leverage, activity and profitability.
3. The study is also beneficial to employees and offers motivation by showing how
actively they are contributing for company’s growth.
4. The investors who are interested in investing in the company’s shares will also get
benefited by going through the study and can easily take a decision whether to invest or not to
invest in the company’s shares.

USEFULNESS
&
IMPORTANCE OF
THE STUDY

IMPORTANCE OF RATIO ANALYSIS
• Aid to measure general efficiency
• Aid to measure financial solvency
• Aid in forecasting and planning
• Facilitate decision making
• Aid in corrective action
• Aid in intra-firm comparison
• Act as a good communication
• Evaluation of efficiency
• Effective tool
CHAPTER 3

RESEARCH
METHODOLOGY
Methodology
This project is an analytical research where in the researcher has to use the
available facts as information and analyze these to make a critical evaluation of
materials. This is also an applied research with an aim to find a solution for
immediate problems facing industry or the firm. The study is based upon the financial
data of five year of WASAN & COMPANY. From old prospectus.
3.1 Purpose of the study

 The purpose of doing this project is mainly to make a thorough study of the
ratio analysis of the company.
 To access the company’s trends for the last five years with regard to liquidity
performance.
 The purpose also includes assessing the impact of ratio analysis on liquidity
strength of the company
3.2 Sources of data collection
1. Primary data: The data required for the project was collected minor
through primary data. That is through interviewing & discussion with
concerned authorities in the company.
2. Secondary data: The major source of data for this project was collected
from annual reports, profit and loss account, manuals & some more
information collected through the internet.
Plan of analysis0
This study is conducted with the help of statistics figures & techniques like
Graphs & charts for better comparison and interpretation.
Tools and techniques used for analysis
The following are the methods of financial analysis used in general.
1. ratio analysis:
2)
3)
4)
5) 5.7 Hypothesis
Profitability ratios
Solvency ratios
Liquidity ratios
Turnover ratios
FINANCIAL PERFORMANCE

The information is collected through secondary sources during the project. That information was utilized
for calculating performance evaluation and based on that, interpretations were made.
Sources of secondary data:
1. Most of the calculations are made on the financial statements of the company
provided statements.
2. Referring standard texts and referred books collected some of the information
regarding theoretical aspects.
3. Method- to assess the performance of he company method of observation of the
work in finance department in followed.

CHAPTER 4
DATA ANALYSIS
&
INTERPRETATION
LIQUIDITY RATIO
1. CURRENT RATIO

(Amount in Rs.)
Current Ratio
Year Current Assets Current Liabilities Ratio
2010 58,574,151 7,903,952 7.41
2011 69,765,346 31,884,616 2.19
2012 72,021,081 16,065,621 4.48
2013 91,328,208 47,117,199 1.94
2014 115,642,068 30,266,661 3.82
Interpretation
As a rule, the current ratio with 2:1 (or) more is considered as satisfactory position of
the firm.
When compared with 2012, there is an increase in the provision for tax, because the
debtors are raised and for that the provision is created. The current liabilities majorly included WASAN
& COMPANY Group of company for consultancy additional services.
The sundry debtors have increased due to the increase to corporate taxes.
In the year 2012, the cash and bank balance is reduced because that is used for
payment of dividends. In the year 2013, the loans and advances include majorly the advances to
employees and deposits to government. The loans and advances reduced because the employees set off
their claims. The other current assets include the interest attained from the deposits. The deposits
reduced due to the declaration of dividends. So the other current assets decreased.
The huge increase in sundry debtors resulted an increase in the ratio, which is above
the benchmark level of 2:1 which shows the comfortable position of the firm.

GRAPHICAL REPRESENTATION
7.41
2.19
4.48
1.94
3.82
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
Ratio
2010 2011 2012 2013 2014
Years
CURRENT RATIO
Ratio

2. QUICK RATIO
(Amount in Rs.)
Quick Ratio
Year Quick Assets Current Liabilities Ratio
2010 58,574,151 7,903,952 7.41
2011 52,470,336 31,884,616 1.65
2012 69,883,268 16,065,620 4.35
2013 89,433,596 47,117,199 1.9
2014 115,431,868 30,266,661 3.81
Interpretation
Quick assets are those assets which can be converted into cash with in a short period
of time, say to six months. So, here the sundry debtors which are with the long period does not include in
the quick assets.
Compare with 2010, the Quick ratio is increased because the sundry debtors are
increased due to the increase in the corporate tax and for that the provision created is also increased. So,
the ratio is also increased with the 2011.

7.41
1.65
4.35
1.90
3.81
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
Ratio
2010 2011 2012 2013 2014
Years
QUICK RATIO
Ratios

3. ABOSULTE LIQUIDITY RATIO
(Amount in Rs.)
Absolute Cash Ratio
Year Absolute Liquid Assets Current Liabilities Ratio
2010 31,004,027 7,903,952 3.92
2011 10,859,778 31,884,616 0.34
2012 39,466,542 16,065,620 2.46
2013 53,850,852 47,117,199 1.14
2014 35,649,070 30,266,661 1.18
Interpretation
The current assets which are ready in the form of cash are considered as absolute
liquid assets. Here, the cash and bank balance and the interest on fixed assts are absolute liquid assets.
In the year 2012, the cash and bank balance is decreased due to decrease in the
deposits and the current liabilities are also reduced because of the payment of dividend. That causes a
slight increase in the current year’s ratio.

LEVERAGE RATIOS
4. PROPRIETORY RATIO
3.92
0.34
2.46
1.14 1.18
0
0.5
1
1.5
2
2.5
3
3.5
4
Ratios
2010 2011 2012 2013 2014
Years
ABSOLUTE CASH RATIO
Ratios

(Amount in Rs.)
Proprietory Ratio
Year Share Holders Funds Total Assets Ratio
2010 67,679,219 78,572,171 0.86
2011 53,301,834 88,438,107 0.6
2012 70,231,061 89,158,391 0.79
2013 56,473,652 106,385,201 0.53
2014 97,060,013 129,805,102 0.75
INTERPRETATION
The proprietary ratio establishes the relationship between shareholders funds to total
assets. It determines the long-term solvency of the firm. This ratio indicates the extent to which the
assets of the company can be lost without affecting the interest of the company.
There is no increase in the capital from the year2009. The share holder’s funds
include capital and reserves and surplus. The reserves and surplus is increased due to the increase in
balance in profit and loss account, which is caused by the increase of income from services.
Total assets, includes fixed and current assets. The fixed assets are reduced because
of the depreciation and there are no major increments in the fixed assets. The current assets are increased
compared with the year 2013. Total assets are also increased than precious year, which resulted an
increase in the ratio than older.

ACTIVITY RATIOS
5. WORKING CAPITAL TURNOVER RATIO
(Amount in Rs.)
Working Capital Turnover Ratio
Year Income From Services Working Capital Ratio
2010 36,309,834 50,670,199 0.72
2011 53,899,084 37,880,730 1.42
2012 72,728,759 55,355,460 1.31
0.86
0.60
0.79
0.53
0.75
0.00
0.10
0.20
0.30
0.40
0.50
0.60
0.70
0.80
0.90
Ratios
2010 2011 2012 2013 2014
Years
PROPRIETORY RATIO
Ratios

2013 55,550,649 44,211,009 1.26
2014 96,654,902 85,375,407 1.13
INTERPRETATION
Income from services is greatly increased due to the extra invoice for Operations &
Maintenance fee and the working capital is also increased greater due to the increase in from services
because the huge increase in current assets.
The income from services is raised and the current assets are also raised together
resulted in the decrease of the ratio of 2013 compared with 2012.

0.72
1.42 1.31
1.26
1.13
0.00
0.20
0.40
0.60
0.80
1.00
1.20
1.40
1.60
Ratio
2010 2011 2012 2013 2014
Years
WORKING CAPITAL TURNOVER RATIO
Ratio

6. FIXED ASSETS TURNOVER RATIO
(Amount in Rs.)
Fixed Assets Turnover Ratio
Year Income From Services Net Fixed Assets Ratio
2010 36,309,834 28,834,317 1.26
2011 53,899,084 29,568,279 1.82
2012 72,728,759 17,137,310 4.24
2013 55,550,649 15,056,993 3.69
2014 96,654,902 14,163,034 6.82
INTERPRETATION
Fixed assets are used in the business for producing the goods to be sold. This ratio
shows the firm’s ability in generating sales from all financial resources committed to total assets. The
ratio indicates the account of one rupee investment in fixed assets.
The income from services is greaterly increased in the current year due to the
increase in the Operations & Maintenance fee due to the increase in extra invoice and the net fixed assets
are reduced because of the increased charge of depreciation. Finally, that effected a huge increase in the
ratio compared with the previous year’s ratio.

GRAPHICAL REPRSENTATION
1.26
1.82
4.24 3.69
6.82
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
Ratios
2010 2011 2012 2013
2014
Years
FIXED ASSETS TURNOVER RATIO
Ratios

7. CAPITAL TURNOVER RATIO
(Amount in Rs.)
Capital Turnover Ratio
Year Income From Services Capital Employed Ratio
2010 36,309,834 37,175,892 0.98
2011 53,899,084 53,301,834 1.01
2012 72,728,759 70,231,061 1.04
2013 55,550,649 56,473,652 0.98
2014 96,654,902 97,060,013 1.00
INTERPRETATION
This is another ratio to judge the efficiency and effectiveness of the company like profitability
ratio.
The income from services is greaterly increased compared with the previous year and the total
capital employed includes capital and reserves & surplus. Due to huge increase in the net profit the capital employed
is also increased along with income from services. Both are effected in the increment of the ratio of current year.

6
0.98
1.01
1.04
0.98
1.00
0.94
0.95
0.96
0.97
0.98
0.99
1.00
1.01
1.02
1.03
1.04
Ratios
2010 2011 2012 2013 2014
Years
CAPITAL TURNOVER RATIO
Ratios

8. CURRENT ASSETS TO FIXED ASSETS RATIO
(Amount in Rs.)
Current Assets To Fixed Assets Ratio
Year Current Assets Fixed Assets Ratio
2010 58,524,151 19,998,020 2.93
2011 69,765,346 18,672,761 3.74
2012 72,021,081 17,137,310 4.20
2013 91,328,208 15,056,993 6.07
2014 115,642,068 14,163,034 8.17
INTERPRETATION
Current assets are increased due to the increase in the sundry debtors and the net
fixed assets of the firm are decreased due to the charge of depreciation and there is no major increment
in the fixed assets.
The increment in current assets and the decrease in fixed assets resulted an increase
in the ratio compared with the previous year

2.93
3.74
4.20
6.07
8.17
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
9.00
Ratios
2010 2011 2012 2013 2014
Years
CURRENT ASSETS TO FIXED ASSETS RATIO
Ratios

PROFITABILITY RATIOS
GENERAL PROFITABILITY RATIOS
9. NET PROFIT RATIO
(Amount in Rs.)
Net Profit Ratio
Year Net Profit After Tax Income from Services Ratio
2010 21,123,474 36,039,834 0.59
2011 16,125,942 53,899,084 0.30
2012 16,929,227 72,728,759 0.23
2013 18,259,580 55,550,649 0.33
2014 40,586,359 96,654,902 0.42
INTERPRETATION
The net profit ratio is the overall measure of the firm’s ability to turn each rupee of
income from services in net profit. If the net margin is inadequate the firm will fail to achieve return on
shareholder’s funds. High net profit ratio will help the firm service in the fall of income from services,
rise in cost of production or declining demand.
The net profit is increased because the income from services is increased. The
increment resulted a slight increase in 2013 ratio compared with the year 2012.

0.59
0.30
0.23
0.33
0.42
0.00
0.10
0.20
0.30
0.40
0.50
0.60
Ratios
2010 2011 2012 2013 2014
Years
NET PROFIT RATIO
Ratios

10. OPERATING PROFIT
(Amount in Rs.)
Operating Profit
Year Operating Profit Income From Services Ratio
2010 36,094,877 36,309,834 0.99
2011 27,576,814 53,899,084 0.51
2012 29,540,599 72,728,759 0.41
2013 31,586,718 55,550,649 0.57
2014 67,192,677 96,654,902 0.70
INTERPRETATION
The operating profit ratio is used to measure the relationship between net profits and
sales of a firm. Depending on the concept, it will decide.
The operating profit ratio is increased compared with the last year. The earnings are
increased due to the increase in the income from services because of Operations & Maintenance fee. So,
the ratio is increased slightly compared with the previous year.

0.99
0.51
0.41
0.57
0.70
0.00
0.10
0.20
0.30
0.40
0.50
0.60
0.70
0.80
0.90
1.00
Ratios
2010 2011 2012 2013 2014
Years
OPERATING PROFIT RATIO
Ratios

CHAPTER 5
FINDINGS,
SUGGESTION,
CONCLUSIONS &
LIMITATIONSOF
THE STUDY
FINDINGS

FINDINGS OF THE STUDY
1. The current ratio has shown in a
fluctuating trend as 7.41, 2.19, 4.48, 1.98, and 3.82 during 2010 of which indicates a
continuous increase in both current assets and current liabilities.
2. The quick ratio is also in a
fluctuating trend through out the period 2010 – 14resulting as 7.41, 1.65, 4.35, 1.9, and 3.81.
The company’s present liquidity position is satisfactory.
3. The absolute liquid ratio has been
decreased from 3.92 to 1.18, from 2010 – 14.
4. The proprietory ratio has shown a
fluctuating trend. The proprietory ratio is increased compared with the last year. So, the long
term solvency of the firm is increased.
5. The working capital increased
from 0.72 to 1.13 in the year 2010 – 14.
6. The fixed assets turnover ratio is in
increasing trend from the year 2010 – 14(1.26, 1.82, 4.24, 3.69, and 6.82). It indicates that the
company is efficiently utilizing the fixed assets.
7. The capital turnover ratio is
increased form 2010 – 11(0.98, 1.01, and 1.04) and decreased in 2011 to 0.98. It increased in
the current year as 1.00.
8. The current assets to fixed assets
ratio is increasing gradually from 2010– 14as 2.93, 3.74, 4.20, 6.07 and 8.17. It shows that the
current assets are increased than fixed assets.
9. The net profit ratio is in fluctuation
manner. It increased in the current year compared with the previous year form 0.33 to 0.42.
10. The net profit is increased
greaterly in the current year. So the return on total assets ratio is increased from 0.17 to 0.31.
11. The Reserves and Surplus to
Capital ratio is increased to 4.19 from 2.02. The capital is constant, but the reserves and
surplus is increased in the current year.
12. The earnings per share was very
high in the year 2010 i.e., 101.56. That is decreased in the following years because number of
equity shares are increased and the net profit is decreased. In the current year the net profit is
increased due to the increase in operating and maintenance fee. So the earnings per share is
increased.
13. The operating profit ratio is in
fluctuating manner as 0.99, 0.51, 0.41, 0.57 and 0.69 from 2010 – 14 respectively.

14. Price Earnings ratio is reduced
when compared with the last year. It is reduced from 3.09 to 2.39, because the earnings per
share is increased.
15. The return on investment is
increased from 0.32 to 0.42 compared with the previous year. Both the profit and shareholders
funds increase cause an increase in the ratio.

RECOMMENDATION
&
SUGGESTIONS
RECOMMENDATION
After the analysis of Financial Statements, the company status is better, because the Net working capital of the company is doubled
from the last year’s position.

1) The company profits are huge in the current year; it is better to declare the dividend to
shareholders.
2) The company is utilising the fixed assets, which majorly help to the growth of the organisation.
The company should maintain that perfectly.
3) The company fixed deposits are raised from the inception, it gives the other income i.e.,
Interest on fixed deposits.

CONCLUSION
CONCLUSION
The company’s overall position is at a good position. Particularly the current year’s
position is well due to raise in the profit level from the last year position. It is better for the organization
to diversify the funds to different sectors in the present market scenario.

Limitations of Ratios Analysis:
Ratio analysis is a widely used and useful technique to evaluate the financial position and
performance of any business unit but it suffers from a number of limitations. These limitations
must be kept in mind by the analyst while using this technique.
Reliability is Linked with Accounting Data:
Ratios are calculated on the basis of accounting information. Accounting system has certain in built
limitations like historical cost, going concern value, stable monetary value, etc. So, limitations of
accounting data affect the quality of ratios also. After, all ratios can't be more reliable than the reliability
of data itself.
Qualitative Factors are Ignored:
Ratio analysis is only a quantitative analysis. Sometimes qualitative factors may be important.
For example, management may be justified in making huge purchases of raw material in
anticipation of large demand of its product for the coming period. But ratios are not capable of
considering qualitative factors.
Isolated Ratios is Meaningless:
Ratios assume significance only when studied in proper context and if compared with norms or
over a period. Ratio in itself does not convey any sense.

Ratio Analysis is Historical:
Ratios are based on the facts contained in financial statements. These statements containpast
records. Past may be less important or irrelevant for the management than present and future.
Different Accounting Practice Render Ratios Incomparable:
Accounting permits alternative treatment of many items like depreciation, valuation of tock,
deferred expenses etc. Ratios based on statements prepared by following different practices are
not comparable.
Price Level Changes Affect the Utility of Ratio Analysis:
Comparison of ratios over a period of time relating to same unit may be misleading. For
example, sales may be static in quantity but higher in dollar value due to inflation.
Incompetence or Bias of Analyst:
Much depends upon the skill, integrity and competence of the analyst to use ratios judiciously.
Lack of Adequate Standards:
There are no well-accepted standards or rule of thumb for all ratios which might be expected as
norms for comparison. It renders interpretation of ratios difficult and to some extent arbitrary.
WINDOW DRESSING:
Financial statements can easily be "window dressed" to depict better than real picture of the
enterprise. Moreover the analyst depending only upon published financial statements will not
be in a position to get inside information. Ratio analysis can be done using what is present in
the financial statements of a company. Financial statements can easily be fudged or window-
dressed to hide or misrepresent facts. Ratio analysis is no way equipped to detect this. If you
analyze a manipulated balance sheet or income statement, you are bound to get wrong
information. Window dressing is in no way an accepted practice but many companies do
indulge in such malpractices to give a false impression to their investors.
E.g., a company may delay paying its creditors at the end of a financial year. This way, the

company can show more cash balance on its balance sheet. This is the simplest form of
window dressing.

BIBLIOGRAPHY
BIBLIOGRAPHY
REFFERED BOOKS
• FINANCIAL MANAGEMENT - I. M. PANDEY
• MANAGEMENT ACCOUNTANCY - PILLAI & BAGAVATI
• MANAGEMENT ACCOUNTING – SHARMA & GUPTA
• FINANCIAL MANAGEMENT – KHAN & JAIN
• FINANCIAL MANAGEMENT – PRASANNA CHANDRA
INTERNET SITE
• www.ercap.org
• www.wikipedia.com
• www.gooogle.co.in

• APPENDIX
Balance Sheet of Super houseIndia
------------------- in Rs. Cr. -------------------
Mar '17 Mar '16 Mar '15 Mar '14 M
12 mths 12 mths 12 mths 12 mths 1
Sources Of Funds
Total Share Capital 151.00 151.00 151.00 151.00 1
Equity Share Capital 151.00 151.00 151.00 151.00 1
Reserves 36,020.10 26,856.10 23,553.20 20,827.00 1
Networth 36,171.10 27,007.10 23,704.20 20,978.00 1
Unsecured Loans 483.60 77.40 180.20 1,685.10 1
Total Debt 483.60 77.40 180.20 1,685.10 1
Total Liabilities 36,654.70 27,084.50 23,884.40 22,663.10 1
Mar '17 Mar '16 Mar '15 Mar '14 M
12 mths 12 mths 12 mths 12 mths 1
Application Of Funds
Gross Block 18,440.00 28,910.80 26,084.60 22,435.00 1
Less: Accum. Depreciation 5,150.80 16,143.00 13,825.30 11,644.60 9
Net Block 13,289.20 12,767.80 12,259.30 10,790.40 9
Capital Work in Progress 0.00 0.00 1,882.80 2,621.40 1
Investments 28,228.40 17,785.70 12,814.00 10,117.90 7
Inventories 3,262.20 3,132.10 2,615.00 1,705.90 1
Sundry Debtors 1,199.20 1,298.60 1,069.80 1,413.70 1

Cash and Bank Balance 13.10 39.10 18.30 629.70 7
Total Current Assets 4,474.50 4,469.80 3,703.10 3,749.30 4
Loans and Advances 3,748.90 3,165.40 2,891.80 3,256.70 3
Total CA, Loans & Advances 8,223.40 7,635.20 6,594.90 7,006.00 7
Current Liabilities 13,867.70 9,974.60 8,013.60 6,996.90 5
Provisions 470.90 2,136.50 1,653.00 875.70 8
Total CL & Provisions 14,338.60 12,111.10 9,666.60 7,872.60 6
Net Current Assets -6,115.20 -4,475.90 -3,071.70 -866.60 1
Total Assets 35,402.40 26,077.60 23,884.40 22,663.10 1
Contingent Liabilities 9,640.50 10,496.90 9,232.50 7,210.20 8
Book Value (Rs) 1,197.40 894.04 784.70 694.45 6
Parameter MAR'17
( Cr.)₹
MAR'16
( Cr.)₹
YoY
%Change
EQUITY AND LIABILITIES
Share Capital 151.00 151.00 0.00%
Share Warrants & Outstandings
Total Reserves 36,020.10 29,733.20 21.14%
Shareholder's Funds 36,171.10 29,884.20 21.04%
Long-Term Borrowings 0.00 0.00 0.00%
Secured Loans 0.00 0.00 0.00%
Unsecured Loans 0.00 0.00 0.00%
Deferred Tax Assets / Liabilities 464.00 194.30 138.81%
Other Long Term Liabilities 1,105.00 807.50 36.84%

Long Term Trade Payables 0.00 0.00 0.00%
Long Term Provisions 21.90 14.80 47.97%
Total Non-Current Liabilities 1,590.90 1,016.60 56.49%
Current Liabilities
Trade Payables 8,367.30 7,407.30 12.96%
Other Current Liabilities 3,127.80 2,360.00 32.53%
Short Term Borrowings 483.60 77.40 524.81%
Short Term Provisions 1,252.60 1,194.50 4.86%
Total Current Liabilities 13,231.30 11,039.20 19.86%
Total Liabilities 50,993.30 41,940.00 21.59%
ASSETS
Non-Current Assets 0.00 0.00 0.00%
Gross Block 18,655.80 15,321.80 21.76%
Less: Accumulated Depreciation 5,366.60 2,811.80 90.86%
Less: Impairment of Assets 0.00 0.00 0.00%
Net Block 13,289.20 12,510.00 6.23%
Lease Adjustment A/c 0.00 0.00 0.00%
Capital Work in Progress 1,252.30 1,006.90 24.37%
Intangible assets under development 0.00 0.00 0.00%
Pre-operative Expenses pending 0.00 0.00 0.00%
Assets in transit 0.00 0.00 0.00%
Non Current Investments 26,214.70 18,875.40 38.88%
Long Term Loans & Advances 428.40 534.90 -19.91%

Other Non Current Assets 1,198.80 1,166.80 2.74%
Total Non-Current Assets 42,383.40 34,094.00 24.31%
Current Assets Loans & Advances
Currents Investments 2,013.70 1,056.80 90.55%
Inventories 3,262.20 3,132.10 4.15%
Sundry Debtors 1,199.20 1,322.20 -9.30%
Cash and Bank 13.10 39.10 -66.50%
Other Current Assets 173.70 234.90 -26.05%
Short Term Loans and Advances 1,948.00 2,060.90 -5.48%
Total Current Assets 8,609.90 7,846.00 9.74%
Net Current Assets (Including Current
Investments)
-4,621.40 -3,193.20 44.73%
Total Current Assets Excluding Current
Investments
6,596.20 6,789.20 -2.84%
Miscellaneous Expenses not written off 0.00 0.00 0.00%
Total Assets 50,993.30 41,940.00 21.59%
Contingent Liabilities 8,932.40 8,513.80 4.92%
Total Debt 483.60 230.90 109.44%
Book Value (in )₹ 1,197.72 989.54 21.04%
Adjusted Book Value (in )₹ 1,197.72 989.54 21.04%

finanancial analysis report file

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Similar to finanancial analysis report file

Similar to finanancial analysis report file (20)

Recently uploaded

Recently uploaded (20)

finanancial analysis report file