10 yrs competitive analysis of lg balakrishnan

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10 yrs competitive analysis of lg balakrishnan

  1. 1. 10 YEAR COMPARATIVE ANALYSIS Presented to: Presented by: PROF. Manju Lamba Karmveer singh PGDM ”A”
  2. 2. MANAGEMENT • Management • Mr. B. Vijayakumar-Chairman Cum Managing Director • Mr. P.Prabakaran-Deputy Managing Director • Board of Directors: • 1. Mr. B. Vijayakumar • 2. Mr. P.Prabakaran • 3. Mr. P.Balasubramanian • 4. Mr. S.Sivakumar • 5. Mr. V.Govindarajulu • 6. Mr. P.Shanmugasundaram • 7. Smt. Rajsri Vijayakumar • 8 . Mr. R.Vidhya Shankar • 9. Dr.T.Balaji Naidu • 10. Mr.v.Rajvirdhan • General Manager and Company Secretary • Mr. M.Lakshmi Kanth Joshi • Key ExecutivesMr. P. Prabakaran Deputy Managing • Mr. N. Rengaraj Chief Financial Officer
  3. 3. Company Overview:- • The automobile industry largely comprises two wheeler, three wheeler and four wheeler vehicles. Four wheelers may be further segmented into passenger cars, utility vehicles (UV), commercial vehicles (CV) and tractors. • The manufacturers of these vehicles are often referred to Original Equipment (Vehicle) Manufacturers (OEM). The OEMs are responsible for providing the final shape to vehicles and making it viable for use. Initially, the OEMs manufactured vehicles from scratch i.e. including the components that are assembled to form a vehicle. • Over the years, the same model proved uneconomical for OEMs and hence the manufacturing of auto components was outsourced by them to companies that focused purely on manufacturing of automotive components. • Since then, the performance of auto components industry has been directly related to the OEMs preferences and sourcing patterns. Today, the auto components industry is segmented into Drive Transmission and steering parts, Engine parts, Suspension and braking parts, Equipment, Electrical Parts, Chassis and other interior / exterior components.
  4. 4. OBJECTIVES • The following are the objectives- • To study the financial position of the company • To apply marginal costing concept on companies financial data. • To analyze the company’s financial position before recession and after recession • To find out the magnitude of relationship between sales and profit, variable cost and profit, and, total cost and profit.
  5. 5. Research Methodology • Since source of primary data directly relevant was scare. It was decided that the analysis had to be secondary data analysis, collected directly from the Internet, News Paper, & Magazine. This is an exploratory research. • SAMPLE COMPANY: LG Balakrishnan & Brothers • SAMPLE SIZE: 10 years cost sheet statement of the company. • DATA COLLECTION: Data is collected from secondary sources like capitaline database, Internet, Newspaper, & Magazine. • SOFTWARE USED: Microsoft Excel, MS word. • ANALYSIS: The analysis is been done through table and Line Chart.
  6. 6. LG balakris hnan before recession recession period after recession Figures in Crs S.R.NO Particula r 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 Yr-2 Yr-3 Yr-4 Yr-5 Yr-6 Yr-7 Yr-8 Yr-9 Yr-10 yr-11 2 Gross Revenue 232.89 276.93 382.25 427.09 513.82 560.43 547.29 556.1 732.59 941.07 Revenue Growth % 0.00 0.19 0.38 0.12 0.20 0.09 -0.02 0.02 0.32 0.28 3 NET SALES (A) 229.75 270.6 368.92 416.13 475.58 549.87 507.6 552.38 709.52 905.13 Total 229.75 270.6 368.92 416.13 475.58 549.87 507.6 552.38 709.52 905.13
  7. 7. 4 VARIABLE COST (B) Raw Materials 109.96 131.72 194.45 207.95 250.37 279.89 255.6 271.77 374.94 498.65 Power & Fuel cost 9.14 9.98 14.45 17.08 20.18 23.52 17.1 16.3 24.71 31.99 Employe Cost 21.73 22.07 24.33 28.96 37.99 44.98 44.62 44.18 64.1 84.41 Other Manufactu ring Expenses 35 43.88 62.5 76.17 79.66 87.25 92.29 96.12 122.9 153.91 Selling & Administra tion Expenses 20.84 25.22 27.06 30.39 37.42 45.78 44.22 42.63 52.62 62.13 Miscellane ous Expenses 4.53 3.06 4.13 5.71 9.69 3.93 3.07 6.05 5.37 6.05 Interest 7.34 8.46 15.03 19.54 22.19 28.08 24.69 20.59 15.2 17.44 Total 208.54 244.39 341.95 385.8 457.5 513.43 481.59 497.64 659.84 854.58 5 CONTRIBU TION © 21.21 26.21 26.97 30.33 18.08 36.44 26.01 54.74 49.68 50.55 6 FIXED COST (D) Depreciatio n 10.59 12.51 16.23 19.15 25.16 28.95 20.69 21.72 25.45 28.32 Total 19.14 23.55 32.83 40.73 46.27 56.11 58.86 69.47 64.23 75.72
  8. 8. 7 PROFIT BEFORE TAX (E) 2.07 2.66 -5.86 -10.4 -28.19 -19.67 -32.85 -14.73 -14.55 -25.17 PBT Margin % 0.00 0.29 -3.20 0.77 1.71 -0.30 0.67 -0.55 -0.01 0.73 8 TAXES (F1) Tax 4.3 6.5 0 0 0 0 0 0 0 0 Fringe Benefit tax 0 0 0 0.44 0.48 0.49 0.4 0 0 0 Deferred Tax -0.09 -0.08 2.68 5.71 0.97 -1.75 -1.63 10.53 -7.93 -0.95 Total 4.21 6.42 2.68 6.15 1.45 -1.26 -1.23 10.53 -7.93 -0.95 (F2) Dividend 2.16 2.36 6.8 2.36 4.21 2.75 4.71 5.1 7.85 8.63 Preference Dividend 0 0 0 0 0 0 0 0 0 0 Extraordinar y Items 0.37 0.16 1.58 0.61 1.7 -0.5 25.82 0.75 0.03 0.05 Equity Dividend 55 30 80 30 50 35 60 65 100 110 Total 57.53 32.52 88.38 32.97 55.91 37.25 90.53 70.85 107.88 118.68 Total (F) 61.74 38.94 91.06 39.12 57.36 35.99 89.3 81.38 99.95 117.73
  9. 9. 9 PROFIT AFTER TAX (G) -59.67 -36.28 -96.92 -49.52 -85.55 -55.66 -122.15 -96.11 -114.5 -142.9 PAT Margin % 0 -0.3919893 1.6714443 -0.4890631 0.7275848 -0.3493863 1.1945742 -0.2131805 0.1913433 0.2480349 10 P/V Ratio 9.23% 9.69% 7.31% 7.29% 3.80% 6.63% 5.12% 9.91% 7.00% 5.58% 11 Contribution Per Unit (H) 12 BEP (Amount) 207.33 243.14 449.08 558.82 1217.10 846.69 1148.69 701.02 917.32 1355.81 BEP Ratio to Sales % 90.24% 89.85% 121.73% 134.29% 255.92% 153.98% 226.30% 126.91% 129.29% 149.79% BEP (Quantity) 13 MARGIN OF SAFETY 22.42 27.46 -80.16 -142.69 -741.52 -296.82 -641.09 -148.64 -207.80 -450.68 Margin of safety ratio to sales % 9.76% 10.15% -21.73% -34.29% -155.92% -53.98% -126.30% -26.91% -29.29% -49.79%
  10. 10. 0 100 200 300 400 500 600 700 800 900 1000 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 SALES SALES
  11. 11. -0.05 0 0.05 0.1 0.15 0.2 0.25 0.3 0.35 0.4 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 REVENUE GROWTH % REVENUE GROWTH %
  12. 12. CONTRIBUTION 0 10 20 30 40 50 60 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 Series1
  13. 13. PV Ratio 0 0.01 0.02 0.03 0.04 0.05 0.06 0.07 0.08 0.09 0.1 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 Series1
  14. 14. PBT -35 -30 -25 -20 -15 -10 -5 0 5 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 Series1
  15. 15. PBT margin % -3.5 -3 -2.5 -2 -1.5 -1 -0.5 0 0.5 1 1.5 2 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 Series1
  16. 16. BEP 0 200 400 600 800 1000 1200 1400 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 Series1
  17. 17. period 1 2002-03 2003-04 2004-05 2005-06 2006-07 Total Sales 229.75 270.6 368.92 416.13 475.58 Total variable cost 208.54 244.39 341.95 385.8 457.5 Contribution 21.21 26.21 26.97 30.33 18.08 Total fixed cost 19.14 23.55 32.83 40.73 46.27 Profit Before Tax 2.07 2.66 -5.86 -10.4 -28.19 Profit After Tax -59.67 -36.28 -96.92 -49.52 -85.55 P/V Ratio 0.092318 0.096859 0.073105 0.072886 0.038017 BEP (Amount) 207.3274 243.1374 449.0784 558.8188 1217.095 Margin of Safety 22.42256 27.46265 -80.1584 -142.689 -741.515
  18. 18. Mean Median 352.196 368.92 327.636 341.95 24.56 26.21 32.504 32.83 -7.944 -5.86 -65.588 -59.67 0.074637 0.073105 535.0915 449.0784 -182.895 -80.1584
  19. 19. Period 2 2007-08 2008-09 2009-2010 2010-11 2011-12 549.87 549.87 549.87 549.87 549.87 513.43 481.59 497.64 659.84 854.58 36.44 26.01 54.74 49.68 50.55 56.11 58.86 69.47 64.23 75.72 -19.67 -32.85 -14.73 -14.55 -25.17 -55.66 -122.15 -96.11 -114.5 -142.9 0.06627 0.051241 0.099098 0.070019 0.055848 846.6851 846.6851 846.6851 846.6851 846.6851 -296.815 -296.815 -296.815 -296.815 -296.815
  20. 20. Mean Median 549.87 549.87 601.416 513.43 43.484 49.68 64.878 64.23 -21.394 -19.67 -106.264 -114.5 0.068495 0.06627 846.6851 846.6851 -296.815 -296.815
  21. 21. CORRELATION YEAR SALES PROFIT 2002-03 229.75 -59.67 2003-04 270.6 -36.28 2004-05 368.92 -96.92 2005-06 416.13 -49.52 2006-07 475.58 -85.55 2007-08 549.87 -55.66 2008-09 507.6 -122.15 2009-10 552.38 -96.11 2010-11 709.52 -114.5 2011-12 905.13 -142.9 -0.76648
  22. 22. CORRELATION YEAR PV ratio PROFIT AFTER TAX 2002-03 0.092318 -59.67 2003-04 0.096859 -36.28 2004-05 0.073105 -96.92 2005-06 0.072886 -49.52 2006-07 0.038017 -85.55 2007-08 0.06627 -55.66 2008-09 0.051241 -122.15 2009-10 0.099098 -96.11 2010-11 0.070019 -114.5 2011-12 0.055848 -142.9 0.48223
  23. 23. SALES PROFIT 229.75 2.07 270.6 2.66 368.92 -5.86 416.13 -10.4 475.58 -28.19 549.87 -19.67 507.6 -32.85 552.38 -14.73 709.52 -14.55 905.13 -25.17 SUMMARY OUTPUT Regression Statistics Multiple R 0.651432366 R Square 0.424364128 Adjusted R Square 0.352409644 Standard Error 9.76411723 Observations 10 ANOVA df SS MS F Significance F Regression 1 562.2724077 562.2724 5.897675 0.041297946 Residual 8 762.7038823 95.33799 Total 9 1324.97629 Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0% Intercept 4.931538092 8.641464765 0.570683 0.583884 -14.99571537 24.85879156 -14.99571537 24.85879156 X Variable 1 -0.03931525 0.016189022 -2.42851 0.041298 -0.076647199 -0.001983296 -0.076647199 -0.001983296
  24. 24. PROFIT PV ratio 2.07 0.092317737 2.66 0.096858832 -5.86 0.07310528 -10.4 0.072885877 -28.19 0.038016737 -19.67 0.066270209 -32.85 0.051241135 -14.73 0.099098447 -14.55 0.070019168 -25.17 0.055848331 SUMMARY OUTPUT Regression Statistics Multiple R 0.826696881 R Square 0.683427733 Adjusted R Square 0.6438562 Standard Error 0.012015927 Observations 10 ANOVA df SS MS F Significance F Regression 1 0.002493585 0.002494 17.27069 0.003183506 Residual 8 0.00115506 0.000144 Total 9 0.003648645 Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0% Intercept 0.09168991 0.006155188 14.89636 4.07E-07 0.077496021 0.105883799 0.077496021 0.105883799 X Variable 1 0.001371855 0.000330106 4.155802 0.003184 0.000610629 0.00213308 0.000610629 0.00213308
  25. 25. CONCLUSION Finally after the study we have found that during 2001 to 2010 there are some fluctuations present in the net sales, variable cost, profit, and so on due to some economic, social, legal and environmental factors. Overall we can say that profit has changed during the period due to sales , change in variable cost. It shows that profit of company based on the sales etc.

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