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A study on financial ratio
analysis Salem District co-
operative milk producer
union Ltd., Salem.
L.S. Shyamraj,
351131054...
Objectives of the Study
• To determine the financial condition
and financial performance of the
firm.
• To compare balance...
Problem of study
• Ratios are tools of quantitative
analysis, which ignore qualitative
point of view.
• Ratios give false ...
Industry profile
• Dairy is place where handling of milk and
milk products done.
• Handling of milk in cooperative milk un...
Company profile
• The Salem District Co- op Milk producers’
Union Ltd,. has been registered on
10.07.1978 and started func...
Data collection method
• Primary data
• Personal contacts were made with the
executives and officials of the finance
divis...
Data collection method
• SECONDARY DATA
The secondary data are collected from
Company reports, institute magazines,
depart...
Data analysis tool
• Profitability Ratios
• Return on investment ratio
• Return on capital employed ratio
• Return on tota...
Data analysis tool
• Turnover ratios
• Inventory turnover ratio
• Debtors turnover ratio
• Debtors collection period
• Cre...
Data analysis tools
• Solvency ratios
• Current ratio
• Liquid ratio
• Absolute liquid ratio
Findings
– Based on operating ratio the financial
performance of the company is not satisfactory
since the operating cost ...
suggestions
• It has found that those the profitability ratio of
the company is passives but the operating
expenses ratio ...
Conclusion
• The Salem district co-op milk producer’s
union Ltd. has been performing well in the
milk and milk product goo...
THANK YOU
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  1. 1. A study on financial ratio analysis Salem District co- operative milk producer union Ltd., Salem. L.S. Shyamraj, 3511310542, II-MBA-J, SRM university.
  2. 2. Objectives of the Study • To determine the financial condition and financial performance of the firm. • To compare balance sheets for the financial year of 2008-2009 to 2012- 2013. • To find solution to unfavorable financial statements.
  3. 3. Problem of study • Ratios are tools of quantitative analysis, which ignore qualitative point of view. • Ratios give false result, if they are calculated form incorrect accounting data. • Ratios are calculated on the basis of post data. Therefore, they do not provided complete information for future forecasting.
  4. 4. Industry profile • Dairy is place where handling of milk and milk products done. • Handling of milk in cooperative milk unions established all over the country on a small scale in the early stages. • About 95% of world buffalo milk (45.3 million tons) is produced in Asia & pacific, while 64.4% is produced in India.
  5. 5. Company profile • The Salem District Co- op Milk producers’ Union Ltd,. has been registered on 10.07.1978 and started functioning from 07-10-1978. • Average 13,000 Liters of pure milk is supplied for Chennai metro sales from Salem diary. • The company has ISO 9001-2000 certified and ISI certified for the skimmed milk powder production and the Salem diary ghee is sold with AGMARK certificate.
  6. 6. Data collection method • Primary data • Personal contacts were made with the executives and officials of the finance division of “The Salem District Co-Op Milk Producers” Union Ltd in the form of personal discussion.
  7. 7. Data collection method • SECONDARY DATA The secondary data are collected from Company reports, institute magazines, department manuals, brochures mainly from the balance sheet, income and expenditure and periodicals etc.
  8. 8. Data analysis tool • Profitability Ratios • Return on investment ratio • Return on capital employed ratio • Return on total assets ratio • Gross profit ratio • Net profit ratio • Operating ratio • Operating profit ratio • Operating expenses ratio • Non-Operating expenses ratio • Financial expenses ratio
  9. 9. Data analysis tool • Turnover ratios • Inventory turnover ratio • Debtors turnover ratio • Debtors collection period • Creditors turnover ratio • Creditors payment period • Working capital turnover ratio • Fixed assets Turnover ratio • capital turnover ratio
  10. 10. Data analysis tools • Solvency ratios • Current ratio • Liquid ratio • Absolute liquid ratio
  11. 11. Findings – Based on operating ratio the financial performance of the company is not satisfactory since the operating cost is closer to not sales. The operating ratio of the firm – Based on gross profit ratio the financial performance of the company since to be satisfactory. Because the gross profit ratio has soon continues improvement. – Based on financial expanses ratio the financial performance the company is found to be good because in the financial expanses dramatically improved
  12. 12. suggestions • It has found that those the profitability ratio of the company is passives but the operating expenses ratio was not satisfactory. The operating expenses ratio is very closer to the knot sales therefore the company should censer on ways and means to reduce to cost. • Both the current ratio and liquid ratio fill below the industry standard 2:1 to 1:1. This indication that the company has to pay serious attains towards its as current asset management.
  13. 13. Conclusion • The Salem district co-op milk producer’s union Ltd. has been performing well in the milk and milk product goods being one of the union of the Salem district co-op milk producer’s union Ltd. has been showing an increasing trend in its profitability position for the past 5 years which deficits a good sign.
  14. 14. THANK YOU

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