Martin Construction is a family-owned construction subcontractor that has experienced significant revenue growth but declining profit margins on projects. There are several challenges impacting its financial performance and operations, including leadership turmoil, ineffective project estimation, procurement issues, and unclear roles. Strategies are proposed to address these concerns, such as appointing decisive leadership, diversifying estimation, streamlining procurement, defining roles, improving communication, and implementing KPIs and training. Financial analysis of Martin Construction's balance sheet and key ratios from 2011 to 2020 shows revenue growth but deteriorating ratios.

1. National Institute of Construction Management and Research
(NICMAR), Pune
Executive Development Program in Project Management (EDP-PM)
Submitted to: Dr. T. K. Ganguli
Submitted by:
Mr Himanshu Sharma (Reg. No: 223-06-53-51470-2241)
Mr Jaspreet Singh (Reg. No: 223-05-53-51472-2241)
Mr Jagat Singh (Reg. No. 223-04-53-51447-2241)
Mr Ram Naresh (Reg. No. 223-06-53-51481-2241)
Mr Saurabh (Reg. No. 223-06-53-70001-2241)
Mr Akash Malik (Reg. No. 223-05-53-51464-2241)
ASSIGNMENT-1
CASELET – MARTIN CONSTRUCTION
&
Challenges Facing Martin Construction's Profit Margins and Operations

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Contents
1 Challenges Facing Martin Construction's Profit Margins and Operations: .........................................................2
2 Numerous Key Concerns and Hurdles Impacting the Firm's Operations and Financial Performance: ...............3
A. Leadership Turmoil and Struggles for Authority: ............................................................................................3
B. Ineffectual Project Estimation:........................................................................................................................3
C. Procurement Predicaments:............................................................................................................................3
D. Role Ambiguity and Site Oversight:.................................................................................................................3
3 Strategies to Revitalize Martin Construction's Operations: ................................................................................4
A. Financial Performance:....................................................................................................................................4
B. Leadership Enhancement:...............................................................................................................................4
C. Estimation Reinforcement:..............................................................................................................................4
D. Efficient Procurement: ....................................................................................................................................4
E. Roles and Responsibilities Clarity:...................................................................................................................4
F. Enhanced Communication: .............................................................................................................................4
G. Training and Skill Development:......................................................................................................................5
H. Key Performance Indicators (KPIs): .................................................................................................................5
4 Martin Construction Balance Sheet (Assumed data as of December 31, 2011 & 2020).....................................6
5 Financial Health and Performance for December 2011 & 2020:.........................................................................6
Current Ratio = Current Assets / Current Liabilities................................................................................................6
Liquid Ratio (Quick Ratio) = (Current Assets - Inventory) / Current Liabilities........................................................6
Debt-to-Equity Ratio = Total Liabilities / Total Equity.............................................................................................6
6 Standalone Balance Sheet GRIL as at 31 March 2022 .........................................................................................7
7 Standalone Statement of Profit and Loss for the year ended 31 March 2022 ....................................................8
8 Standalone Statement of Changes in Equity for the year ended March 31, 2022..............................................9
A EQUITY SHARE CAPITAL..................................................................................................................................9
B OTHER EQUITY ................................................................................................................................................9
9 Standalone Cash Flow Statement for the year ended March 31, 2022.............................................................10
10 StandaloneCashFlowStatement(contd.) for the year ended March 31, 2022.................................................11
A. NOTES:...........................................................................................................................................................11
11 Current Ratio, Liquid Ratio and Debt-Equity Ratio............................................................................................12
A. Current Ratio .................................................................................................................................................12
B. Liquid Ratio....................................................................................................................................................12
C. Debt-Equity Ratio ..........................................................................................................................................12
12 Financial Ratios Comparison: Martin Construction vs. GRIL (as of March 31, 2022)........................................13

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1 Challenges Facing Martin Construction's Profit Margins and
Operations:
Martin construction was a family owned fabrication subcontractor business that had grown
from $5 million in 2011 to $25 million in 2020. Overall profits of the company were
increasing however the concern was that the margins on projects were decreasing.
a) Since Martin senior died in July of 2018, Martin junior has tried unsuccessfully to
convince the family to let him sell the business. marti junior, as a company president,
has taken an average of eight days’ vacation per month for past year, although the
project managers are supposed to report to Martin, they appear to be calling their shots
and are in continuous struggle to power
b) The estimating department consists of one man, john who estimated all jobs. The
success rate of getting a project is 1 in 7. Once a job is won, a project manager is
selected and is told that he must perform the job within the proposed estimates. Project
managers are not involved in proposal estimates. They are required however to provide
feedback to the estimator so that standards can be updated. This very seldom happens
because of the struggle for power. The project managers are afraid that the estimator
might be next in line for executive promotion since he is a god friend of Martin.
c) The procurement function reports to Martin junior. Once the items are ordered, the
project manager assumes procurement responsibility. Several times in the past, the
project manager has been forced to spend hour after hour trying to overcome
shortages or simply to track down raw materials. Most project managers estimate that
approximately 35% of their time involves procurement.
d) Site superintendents believe they are the true project managers, or a least at the same
level. The superintendents are very unhappy about not being involved in procurement
function and therefore look for ways to annoy the project managers. it appears that the
more time the project manager spends at the site the longer the work takes the
feedback of information to the home office is also distorted.
Comment on following reading above:
1 Although the gross profit had increased the profit margin per project is declining
what is going wrong in Martin construction?
2 Suggest remedied to put Martin construction on track.
Martin Construction is a family-owned subcontractor business that experienced significant
revenue growth from $5 million in 2011 to $25 million in 2020. However, despite the
increase in overall profits, there is a concern about declining profit margins on individual

4. 3 | P a g e
projects.
2 Numerous Key Concerns and Hurdles Impacting the Firm's
Operations and Financial Performance:
A. Leadership Turmoil and Struggles for Authority:
The passing of Martin senior in 2018 has left a void in leadership, and Martin junior's
unsuccessful efforts to divest the company signal a lack of clear direction.
Martin junior's frequent absences from his role as company president have created a void
in leadership, resulting in project managers taking matters into their own hands and
embarking on an ongoing contest for control.
B. Ineffectual Project Estimation:
The estimating department relies exclusively on a single estimator, John, with a meager
success rate of 1 in 7 in securing projects.
Project managers are excluded from the proposal estimation process but are responsible
for executing projects within the provided estimates.
The power struggle and concerns of favoritism towards the estimator have impeded
constructive feedback and communication between project managers and the estimating
department.
C. Procurement Predicaments:
The procurement function, initially overseen by Martin junior and subsequently delegated
to project managers, has resulted in inefficiencies.
Project managers invest a significant portion of their time in procurement-related tasks,
including surmounting material shortages and monitoring raw materials, diverting their
focus from project execution.
D. Role Ambiguity and Site Oversight:
Site superintendents perceive themselves as the primary project managers or at least
operating at an equal level, leading to role ambiguity and coordination issues.
This ambiguity has engendered disputes concerning procurement responsibilities, with
superintendents seeking to undermine project managers.
The time project managers dedicate to on-site activities negatively impacts project
timelines and hinders communication with the home office.
In summary, despite the substantial revenue growth that Martin Construction has
experienced over time, there exist significant challenges concerning leadership, authority
struggles, project estimation, procurement, and role definition that are adversely affecting

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the company's financial performance and operational efficiency. Addressing these
concerns is imperative for ensuring the company's long-term success and viability."
3 Strategies to Revitalize Martin Construction's Operations:
A. Financial Performance:
Adhere to Industry Standards: Align profit margins with industry benchmarks, considering
market conditions and project complexities.
B. Leadership Enhancement:
Appoint a Decisive Leader: Empower Martin junior or Appoint a decisive leader to
resolve internal power struggles and enhance decision-making.
Executive Coaching: Consider providing executive coaching to Martin Junior to equip
him with the skills needed to lead effectively.
C. Estimation Reinforcement:
Diversify Estimation: Expand the estimating department by hiring more estimators or
utilizing estimation software to enhance bid accuracy and success rates.
Collaborative Estimation: Incorporate inputs from project managers into the estimation
process to improve cost accuracy, following industry standards.
D. Efficient Procurement:
Establish a Dedicated Procurement Division: Create a dedicated procurement
department or assign procurement responsibilities to a designated role.
Streamlined Procurement: Implement efficient procurement procedures, foster vendor
relationships, and employ inventory management systems to free up project managers'
time.
E. Roles and Responsibilities Clarity:
Define and Communicate Roles: Clearly articulate and communicate the roles and
responsibilities of project managers, estimators, and site superintendents.
Focus on Expertise: Ensure project managers concentrate on project execution and
reporting, while estimators handle estimation duties, adhering to industry norms.
F. Enhanced Communication:
Foster Regular Communication: Encourage consistent communication and feedback
loops among project managers, estimators, and procurement staff to enhance project
management and minimize conflicts.
Corporate Communication Standards: Institute corporate communication standards

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and maintain project information management throughout the project lifecycle, as per
industry standards.
G. Training and Skill Development:
Invest in Training: Provide training and development opportunities for project managers
to enhance their expertise in project execution, cost control, and effective communication.
Corporate HR Function: Assign the responsibility for training and employee skill
development to a dedicated corporate HR function, in line with industry practices.
H. Key Performance Indicators (KPIs):
KPI Implementation: Introduce Key Performance Indicators (KPIs) to monitor the
performance and health of each project, aligning with industry best practices.
By implementing these strategic measures, Martin Construction can regain control over its
projects, enhance profit margins, and cultivate a more efficient and collaborative work
environment. This approach will foster sustainable growth and competitiveness within the
construction industry."

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4 Martin Construction Balance Sheet (Assumed data as of
December 31, 2011 & 2020)
Items 2011 ($ Million) 2020 ($ Million)
A. Assets
Current Assets $2.5 $12.5
- Cash $0.5 $2.5
- Accounts Receivable $1 $5
- Inventory $1 $5
Non-Current Assets $2.5 $12.5
- Property, plant, and equipment $2 $10
- Long-term investments $0.5 $2.5
Total Assets $5 $25
B. Liabili es
Current Liabili es $1 $5
- Accounts Payable $0.5 $2.5
- Short-term debt $0.5 $2.5
Long-Term Liabili es $1 $5
- Long-term debt $1 $5
Total Liabili es $2 $10
C. Shareholders' Equity
Owner’s Equity (adjusted for 2020) $3 $9
Total Equity $3 $9
5 Financial Health and Performance for December 2011 & 2020:
Year Current Ratio Liquid Ratio (Quick
Ratio)
Debt-to-Equity
Ratio
2011 2.5 1.5 0.67
2020 2.5 1.5 1.11
Current Ratio = Current Assets / Current Liabilities
Liquid Ratio (Quick Ratio) = (Current Assets - Inventory) / Current Liabilities
Debt-to-Equity Ratio = Total Liabilities / Total Equity

8. 7 | P a g e
6 Standalone Balance Sheet GRIL as at 31 March 2022
` in Lakhs
Ref
Note No.
As at
31 March 2022
As at
31 March 2021
Assets
Non-current assets
(a) Property, plant and equipment 4 1,45,282.08 1,31,337.41
(b) Capital work-in-progress 4 5,937.05 5,547.79
(c) Other intangible assets 4 227.55 383.81
(d) Right of use assets
(e) Financial assets
32 2,953.76 2,793.34
(i) Investments 5 30,550.06 24,560.73
(ii) Loans 6 99,948.92 99,292.23
(iii) Other financial assets 7 2,188.67 2,379.35
(f) Tax assets 8 2,285.27 2,016.41
(g) Other non-current assets 9 6,931.79 5,971.88
Total Non-Current Assets 2,96,305.15 2,74,282.95
Current assets
(a) Inventories
(b) Financial assets
10 1,02,179.84 1,05,842.20
(i) Investments 5 1,812.44 11,803.95
(ii) Trade receivables 11 71,553.66 89,755.40
(iii) Cash and cash equivalents 12 10,858.64 16,596.65
(iv) Bank balances other than (iii) above 12 33,644.32 37,558.51
(v) Loans 6 - 74.73
(vi) Other financial assets 7 3,825.80 3,206.19
(c) Other current assets 9 1,51,156.06 96,323.29
Total Current Assets 3,75,030.76 3,61,160.92
Assets classified as held for sale 49 - 330.70
Total Assets 6,71,335.91 6,35,774.57
Equity and liabilities
Equity
(a) Equity share capital 13 4,834.46 4,834.46
(b) Other equity 14 4,31,520.84 3,55,608.20
Total Equity 4,36,355.30 3,60,442.66
Liabilities
Non-current liabilities
(a) Financial liabilities
(i) Borrowings 15 62,161.62 60,770.98
(ii) Lease liabilities 32 2,137.93 2,189.52
(iii) Other financial liabilities 16 33.81 188.56
(b) Deferred tax liabilities (net) 31 4,384.45 6,378.86
Total Non-Current Liabilities 68,717.81 69,527.92
Current liabilities
(a) Financial liabilities
(i) Borrowings 17 48,037.00 74,340.06
(ii) Lease liabilities 32 1,025.64 795.34
(iii) Trade payables 18
(a) Total outstanding dues of micro enterprises and small enterprises 7,664.59 5,266.15
(b) Total outstanding dues of creditors other than micro and small enterprises 64,021.84 67,019.23
(iv) Other financial liabilities 16 24,623.48 23,033.91
(b) Other current liabilities 19 15,475.68 31,705.93
(c) Provisions 20 4,742.62 2,827.32
(d) Current tax liabilities (net) 21 671.95 816.05
Total Current Liabilities 1,66,262.80 2,05,803.99
Total Liabilities 2,34,980.61 2,75,331.91
Total Equity and Liabilities 6,71,335.91 6,35,774.57
Summary of significant accounting policies 2.2
The accompanying notes are an integral part of these standalone financial statements
As per our report of even date

9. 8 | P a g e
7 Standalone Statement of Profit and Loss for the year ended 31
March 2022
` in Lakhs
Particulars
Ref
Note No.
Year ended
31 March 2022
Year ended
31 March 2021
I Income
(a) Revenue from operations 22 7,91,917.53 7,24,445.50
(b) Other income 23 13,240.21 12,748.84
Total income 8,05,157.74 7,37,194.34
II Expenses
(a) Cost of materials consumed 24 31,506.81 11,129.80
(b) Construction expenses 25 5,62,191.14 5,27,875.07
(c) Changes in inventories 26 (618.22) (436.96)
(d) Employee benefits expense 27 58,641.57 45,481.85
(e) Finance costs 28 12,686.69 13,957.59
(f) Depreciation and amortisation expenses 29 28,163.01 22,683.88
(g) Other expenses 30 12,090.74 9,357.93
Total expenses 7,04,661.74 6,30,049.16
III Profit before exceptional item and tax (I-II) 1,00,496.00 1,07,145.18
IV Exceptional item 49 308.29 -
V Profit before tax (III-IV) 1,00,187.71 1,07,145.18
VI Tax expense: 31
(a) Current tax 26,647.62 28,885.01
(b) Adjustment of tax related to earlier periods (554.60) 252.63
(c) Deferred tax (credit) (1,986.85) (53.38)
Total tax expenses 24,106.17 29,084.26
VII Net profit for the year (V-VI) 76,081.54 78,060.92
VIII Other comprehensive income ("OCI")
Items that will not be reclassified to profit or loss in subsequent
periods (net of tax)
(a) Remeasurements (loss) on the defined benefit plans 34 (194.58) (354.45)
(b) Fair valuation gain on equity instruments through OCI 18.12 82.23
(c) Income tax relating to above 31 7.56 30.09
Net other comprehensive income not to be reclassified to profit or
loss in subsequent periods
(168.90) (242.13)
IX Total Comprehensive Income for the year, net of tax (VII+VIII) 75,912.64 77,818.79
Earnings per share [Face value of share ` 5 (31 March 2021 : ` 5) each]
Basic and Diluted earnings per share (in `) 33 78.69 80.51
Summary of significant accounting policies 2.2
The accompanying notes are an integral part of these standalone financial statements
As per our report of even date

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8 Standalone Statement of Changes in Equity for the year ended
March 31, 2022
A EQUITY SHARE CAPITAL
Equity shares of ` 5 each issued, subscribed and fully paid (refer note 13)
` in Lakhs
As as at 1 April 2020 9,69,62,220 4,848.12
Add/(Less): Changes in Equity Share Capital due to prior period errors - -
Add/(Less): Changes during the year (2,73,210) (13.66)
As at 31 March 2021 9,66,89,010 4,834.46
As at 1 April 2021 9,66,89,010 4,834.46
Add/(Less): Changes in Equity Share Capital due to prior period errors - -
Add/(Less): Changes during the year - -
As at 31 March 2022 9,66,89,010 4,834.46
B OTHER EQUITY ` in Lakhs
Reserves and surplus
Items of Other
Particulars
Securities
Capital
Retained
Premium
Redemption
Earnings (refer
Comprehensive
Income (OCI)
Total
(refer note 14)
Reserve (refer
note 14)
note 14)
(refer note 14)
Balance as at 1 April 2020 5,655.87 412.19 2,71,750.00 33.50 2,77,851.56
Changes in accounting policy or prior period errors - - - - -
Profit for the year - - 78,060.92 - 78,060.92
Remeasurements (loss) on the defined benefit plans - - (324.30) - (324.30)
Fair valuation gain on equity instruments through OCI - - - 82.17 82.17
Transfer to capital redemption reserve on buy back of (137.97) 137.97 - - -
equity shares (refer note 14)
Total comprehensive income for the year (137.97) 137.97 77,736.62 82.17 77,818.79
Transactions with owners, recorded directly in equity
Reversal of Securities premium amount utilised for
Issue of equity shares as bonus shares to GRIL
Welfare Trust during the year ended 31 March 2017,
due buy back of these shares (refer note 14)
(62.15) - - - (62.15)
Total transactions with owners (62.15) - - - (62.15)
As at 31 March 2021 5,455.75 550.16 3,49,486.62 115.67 3,55,608.20
Balance as at 1 April 2021 5,455.75 550.16 3,49,486.62 115.67 3,55,608.20
Changes in accounting policy or prior period errors - - - - -
Profit for the year - - 76,081.54 - 76,081.54
Remeasurements (loss) on the defined benefit plans - - (145.61) - (145.61)
Fair valuation gain on equity instruments through OCI - - - (23.29) (23.29)
Total comprehensive income for the year - - 75,935.93 (23.29) 75,912.64
As at 31 March 2022 5,455.75 550.16 4,25,422.55 92.38 4,31,520.84
The accompanying notes are an integral part of these standalone financial statements
As per our report of even date
Particulars
Number of
shares
Amount

11. 10 | P a g e
9 Standalone Cash Flow Statement for the year ended March 31,
2022
` in Lakhs
Particulars
Year ended
31 March 2022
Year ended
31 March 2021
A. Cash flows from operating activities
Profit before tax 1,00,187.71 1,07,145.18
Adjustment to reconcile profit before tax to net cash flows:
Depreciation and amortisation expenses 28,163.01 22,683.88
Provision for doubtful debts 2,183.10 -
Liabilities no longer payable written back (96.18) (712.18)
Exceptional items 308.29 -
Interest income (10,873.43) (10,110.19)
Gain on sale of liquid investments (165.95) (42.81)
Fair value on financial assets measured at FVTPL (18.71) (195.39)
Unrealised foreign exchange loss / (gain) (net) (108.78) (493.43)
Loss/(profit) on sale of items of property, plant and equipment (net) (7.22) 344.45
Finance costs 12,686.69 13,957.59
Operating Profit before Working Capital changes 1,32,258.53 1,32,577.10
Working capital adjustments :
(Increase) in financial and non-financial assets (55,100.73) (29,749.30)
Decrease / (increase) in inventories 3,662.36 (29,005.11)
Decrease / (increase) in trade receivables 16,018.63 (7,571.03)
(Decrease) / increase in trade payables (598.95) 16,584.46
(Decrease) in provisions, financial and non-financial liabilities (13,676.01) (13,959.27)
Cash generated from operating activities 82,563.83 68,876.85
Direct tax paid (net, of refunds) (26,505.98) (26,888.74)
Net Cash generated from operating activities 56,057.85 41,988.11
B. Cash Flows from Investing Activities
Payments for purchase of items of property, plant and equipment and other
intangible assets
(43,464.25) (51,484.11)
Proceeds from sale of items of property, plant and equipment and other intangible assets 1,198.06 748.66
Loans given (31,605.38) (40,642.96)
Loans received (including subordinate debt) 39,592.04 11,268.77
Investment in subsidiary companies (6,304.00) (953.00)
Proceeds from sale of investment in subsidiary companies 22.41 -
Investment in liquid mutual funds (net) 10,165.93 (9,926.36)
(Redemptions) / Investments in bank deposits (net) 3,957.28 (4,561.94)
Interest received 2,710.16 3,029.43
Net Cash (used in) investing activities (23,727.75) (92,521.51)
C. Cash Flows from Financing Activities
Payment to shareholders due to buy-back of equity shares - (137.97)
Proceeds from non-current borrowings 45,400.00 52,400.00
Repayment of non-current borrowings (48,820.77) (50,187.61)
Proceeds / (repayment) of current borrowings (net) (23,335.79) 26,067.46
Repayment of lease liabilities (1,644.31) (1,304.18)
Interest paid (9,667.24) (10,914.75)
Net cash (used in) / generated from financing activities (38,068.11) 15,922.95
Net (Decrease) in cash and cash equivalents (A+B+C) (5,738.01) (34,610.45)
Cash and cash equivalents at the beginning of the year 16,596.65 51,207.10
Cash and cash equivalents at the end of the year 10,858.64 16,596.65

12. 10 Standalone Cash Flow Statement (contd.) for the year ended
March 31, 2022
A. NOTES:
Components of cash and cash equivalents (refer note 12)
` in Lakhs
Particulars
As at
31 March 2022
As at
31 March 2021
Cash on hand 57.62 74.42
Balance with banks 8,195.20 11,736.17
in current account 1,983.73 4,739.12
Demand drafts on hand 0.50 16.15
Deposits with original maturity of less than three months 621.59 30.79
Cash and cash equivalents at end of the year 10,858.64 16,596.65
The above Standalone Statement of Cash Flows has been prepared under the “Indirect
Method” as set out in Indian
Accounting Standard (Ind AS) - 7 “Statement of Cash Flows”.
Changes in liabilities arising from financing activities in terms of Ind AS 7:
` in Lakhs
Particulars
As at
01 April 2021
Net cash flow Others
As at
31 March 2022
Non-current borrowings (including current 1,06,300.07 (12,223.26) 10,646.63 1,04,723.44
maturities and interest)
Current borrowings (including interest) 28,810.97 (24,200.54) 864.75 5,475.18
Lease liabilities 2,984.86 (1,644.31) 1,823.02 3,163.57
Total 1,38,095.90 (38,068.11) 13,334.40 1,13,362.19
` in Lakhs
Particulars
As at
01 April 2020
Net cash flow Others
As at
31 March 2021
Other represent interest accrued, other borrowing cost and lease liabilities addition
during the year.
1 Interest paid includes interest payment on lease obligation `506.49 lakhs (March 31, 2021 : `
278.80 lakhs).
2 Figures in brackets represent outflows.

13. 11 Current Ratio, Liquid Ratio and Debt-Equity Ratio.
From the above attached Financial Statement of GRIL we will calculate Some
Comparing the ratios to compare the both companies. We will calculate Current Ratio,
Liquid Ratio and Debt-Equity Ratio.
A. Current Ratio
The current assets for the year ended March 31, 2022 is ₹3,75,030.76 lakhs and the
current liabilities is ₹1,66,262.80 lakhs.
Current Ratio = ₹3,75,030.76 lakhs / ₹1,66,262.80 lakhs = 2.26
Therefore, the current Ratio is 2.26.
B. Liquid Ratio
To calculate the Liquid Ratio, we need the values of liquid assets and current liabilities.
Liquid Ratio = Liquid Assets / Current Liabilities
From the given information in [5], the cash and cash equivalents at the end of the year
is ₹10,858.64 lakhs.
Liquid Assets = Cash and Cash Equivalents = ₹10,858.64 lakhs
Using the same value for current liabilities from the previous calculation, the Liquid
Ratio can be calculated as:
Liquid Ratio = ₹10,858.64 lakhs / ₹1,66,262.80 lakhs = 0.0654
Therefore, the Liquid Ratio is 0.0654
C. Debt-Equity Ratio
To calculate the Debt-Equity Ratio, we need the values of total liabilities and total equity.
Debt-Equity Ratio = Total Liabilities / Total Equity
From the given information in , the total liabilities for the year ended March 31, 2022 is
₹2,34,980.61 lakhs and the total equity is ₹4,36,355.30 lakhs.
Debt-Equity Ratio = ₹2,34,980.61 lakhs / ₹4,36,355.30 lakhs = 0.539
Therefore, the Debt-Equity Ratio is 0.539

14. 12 Financial Ratios Comparison: Martin Construction vs. GRIL (as
of March 31, 2022)
Comparing these data points and ratios against industry benchmarks or piers we can
provide valuable insights into a company's financial performance, stability, and growth
prospects in comparative prospect.
Comparing the ratios:
Ratio Martin
Construction
(2020)
Martin
Construction
(2011)
GRIL (2022)
Current Ratio 2.5 2.5 2.26
Liquid Ratio 1.5 1.5 0.0654
Debt-Equity Ratio 1.11 0.67 0.54
 Current Ratio: The other company has a higher current ratio (2.26)
compared to Martin Construction in both 2020 (2.5) and 2011 (2.5). A higher
current ratio indicates better short-term liquidity and ability to cover current
obligations.
 Liquid Ratio: Martin Construction has higher liquid ratios in both 2020 (1.5)
and 2011 (1.5) compared to the other company (0.0654). A higher liquid ratio
suggests a better ability to meet short-term liabilities using the most liquid
assets. On the other hand, GRIL's liquid ratio is significantly lower at 0.0654,
indicating a potential liquidity issue, especially when excluding inventory from
current assets.
 Debt-Equity Ratio: Comparing these ratios, it's evident that Martin
Construction increased its reliance on debt between 2011 and 2020. This
increase might have been due to various factors.
Both companies have a relatively low debt-equity ratio, indicating a conservative
approach to financing. Martin Construction's debt-equity ratio is 1.11 in 2020, while
GRIL's ratio is 0.54, suggesting that GRIL has a higher proportion of debt in its capital
structure compared to Martin Construction.
"In summary, based on the assumed data points, Martin Construction seems to have a
stronger liquidity position and a slightly higher debt burden compared to GRIL.
However, it's crucial to note that these calculations are assumed. For a more accurate
and comprehensive comparison, it is essential to conduct a thorough analysis
considering other financial metrics, industry benchmarks, and the companies' overall
strategies and market conditions. Furthermore, if Martin Construction's actual financial
data were provided with the case study, it would allow for a more in-depth analysis,
providing valuable insights to understand the company's position better."