Capital Structure Analysis of Indian oil corporation limited (IOCL)

1. Capital structure analysis of
IOCL
Under the Guidance of
Dr. M. Basheer Ahmed khan

2. COMPANY PROFILE
-Established in 1964, IOCL is the 20th largest
Petroleum in the world.
-IOCL is headed by Mr. B. Ashok.
- No.1 petroleum company among Asia region.
-Indian Oil and its subsidiaries today accounts for
49% petroleum products market share in India.
-Turnover of financial year 2013-2014 was Rs
260420.40 crores.
-Paid up capital of 242 million.
- Market value is 660 million.

3. Objective of Study
• To understand the capital structure of Indian
Oil Corporation
• To identify the share capital and debt of the
company.
• To calculate the earning per share
• To calculate the leverage

4. Methodology
• Descriptive research design
• Source of data used was secondary
• The last five year balance sheet was studied

5. Capital structure

6. COMPONENTS OF CAPITAL
STRUCTURE
Shareholder’s
Funds
• Equity
Capital
• Preference
Capital (Nil)
Borrowed
Funds
•Debenture
(Nil)
• Term Loan

7. Capital Structure
2427.95 2427.95 2427.95
1192.37 1192.37
6000 6000 6000
2500 2500
7000
6000
5000
4000
3000
2000
1000
0
2014 2013 2012 2011 2010
ISSUED CAPITAL (CR)
AUTHORISED CAPITAL
(CR)

8. TOTAL DEBT
17865.99
13045.97
20379.65 18292.45 17565.13
62733.13
57277.96
32354.22
26273.8 27406.73
90000
80000
70000
60000
50000
40000
30000
20000
10000
0
2014 2013 2012 2011 2010
UNSECURED LOAN (CR)
SECURED LOAN (CR)

9. EARNING BEFORE INTEREST
AND TAX
13359.43
12050.65
EBIT
16773.88
11157.05
15057.96
18000
16000
14000
12000
10000
8000
6000
4000
2000
0
2014 2013 2012 2011 2010
EBIT

10. EARNING PER SHARE
28.91
20.61
EPS
16.29
30.67
42.1
45
40
35
30
25
20
15
10
5
0
2014 2013 2012 2011 2010
EPS

11. LEVERAGE
1.12 1.14 1.09 1.13
1.01
1.61
1.91
1.49
1.31
1.11
1.82
2.43
1.64
1.49
1.21
3
2.5
2
1.5
1
0.5
0
2014 2013 2012 2011 2010
Degree of operating
Leverage
Degree of Financial
Leverage
Total Leverage

12. Suggestions
• The company should utilize the debt funds
more efficiently to maximize shareholders’
return.
• Need to minimize the degree of financial
leverage .
• Need to minimize the secured loan.

13. Conclusion
• Preference share and Debenture not existent
in the industry
• The issued overall shareholder’s funds and
Borrowed funds are only limited.
• Increasingly firms are moving from secured
debt to unsecured debt in order to free their
assets

14. THANK YOU