CURRENT RATIO:-Bajaj = 5204.19 / 4664.37 =1.12Tata Motors = 64461.47 / 73268.07 = 0.879 Bajaj has better liquidity than Tata motors but overall both the company has far lower liquidity than standard ratio.
ACID TEST RATIO:-Bajaj = 4500.58 / 4664.37 =0.965Tata Motors = 46245.45 / 73268.07 =0.631 Bajaj has a good acid ratio than Tata and also close to standard ratio. That means Bajaj has 96.5 rs acid assets for 100 rs of liabilities
INVENTORY TURNOVERRATIO:-Bajaj = 14126.02 / 639.93 =22.07Holding Period =17 daysTata Motors = 109467.58 / 16143.265 =6.78Holding Period = 54 daysInventory holding period of Tata motors is very high
Cash conversion cycle As both the companies have long time period of payment from their suppliers they have negative cash conversion cycle Tata motors has better suppliers payment period than Bajaj
FIXED ASSET TURNOVERRATIOBajaj = 18945.52 / 5958.22 = 3.18Tata Motors = 165654.49 / 80469.74 = 2.06Bajaj is able to use its assets more efficiently to produce sales
TOTAL ASSET TURNOVERRATIOBajaj =18945.52 / 11162.41 =1.697Tata =165654.59 / 64461.47 =2.57But over all Tata is more able to use its total assets to produce sales
DEBT EQUITY RATIOBajaj =254.55 / 6081.72 =0.0418Tata Motors =30421.06 / 33149.06 =0.918Bajaj has lesser debt than Tata motors but both the companies has lower debt equity ratio than standard ratio.
INTEREST COVERAGERATIOBajaj = 4234.58 / 22.79 =185.81Tata Motors = 22084.06 / 2982.22 =7.405Bajaj is able to repay the interest rate 185 times which is higher than Tata because Tata has huge long term liabilities.
RETURN ON EQUITYBajaj = 3045.4 / 6081.72 = 50.07%Tata Motors =13516.5 / 33149.93 = 40.7%Bajaj has greater return on equity than Tata.
GROSS PROFIT MARGINBajaj = 4466.1 / 18945.52 = 23.58%Tata Motors = 48905.99 / 165654.49 = 29.52%Gross profit of Tata is greater than Bajaj that shows that Tata has greater efficiency in manufacturing.
PRICE EARNING RATIOBajaj =1677.9 / 105.2 =15.92Tata Motors = 275.7 / 212.94 =1.294Bajaj has a higher p/e ratio that shows that investor has ready to invest at higher price.
PAY-OUT RATIOBajaj = 45 / 105.2 = 0.427Tata Motors = 40.50 / 212.94 = 0.19Bajaj is paying greater part of their earning as dividend
DIVIDEND YIELD RATIOBajaj = 45 / 1677.9 = 0.0268Tata Motors = 40.50 / 275.7 = 0.146It shows the real return to the investors as a percent of current market price. Tata has better return.
Price fluctuationPrice changes of Bajaj’s share 1680-1460/1460=15.07%Price changes of Tata’s share275.70- 249.5/249.5=10.5%As Bajaj is paying higher dividend and has better profitability ratios and lesser risk therefore they have more growth in market price,