This document discusses a financial analysis of Reliance Communication. It provides an overview of the Reliance Dhirubhai Ambani Group and its various business units including Reliance Communication. Financial ratios are calculated for Reliance Communication such as liquidity ratios, leverage ratios, and rates of return. Trend analyses are performed on fixed assets, current assets, and total liabilities. The findings suggest that sales are increasing each year but profits are not increasing proportionately due to rising expenditures. Recommendations include increasing sales and profits as well as reinvesting profits into business expansion.

1. Study on financial
analysis In
RELIANCE
COMMUNICATION
Name :CHARU SINGH
Roll no. - 49
Company LOGO

2. LOGO
COMPANY PROFILE
Reliance Dhirubhai Ambani Group

Reliance Dhirubhai Ambani is the flagship
company.

ADA group has a strong presence across a wide
array of high-growth customer-facing-business
ranging from telecom and financial services,
energy, power, media and entertainment to
healthcare.

3. LOGO











ADA BUSINESS UNITS
RELIANCE APEX
Reliance Communication
Reliance Big Entertainment
ADLAB’S FILMS
BIG 92.7 FM
BIG TV
ZAPAK
BIGADDA
BIG MOTION PICTURES
BIG ANIMATION (Ani Rights Infomedia)
BIG MUSIC AND HOME ENTERTAINMENT

4. LOGO

Reliance Communication
The flagship company of Reliane
ADA Group ,Reliance
Communications began

operations in 1999
Reliance Communications
Limited is India’s largest integrated
communications service provider in the
private sector with over 38 million individual
enterprise, and carrier customers.

5. LOGO

Current Issues
Financial Ratio Analysis
LIQUIDITY RATIOS
Current ratio = current assets / current liabilities
Quick ratio = (cash + marketable securities + net

receivables) / current liabilities
 LEVERAGE
Debt-to-asset ratio = total liabilities / total assets
Debt-equity ratio = long-term debt /
shareholder's equity

6. LOGO
CONT….
RATES OF RETURN
ROA = net income / total average assets
ROE = net income / total stockholders equity


7. LOGO

DATA ANALYSIS
Analysis of the data by Ratio Analysis
Ratio analysis is one of the techniques of financial
analysis to evaluate the financial condition and
performance of a business concern.

Research Approach
Descriptive approach

Primary Data
Structured snapshot.




Secondary Data
Journals
Websites
News papers

8. LOGO
Trend Analysis of Fixed
Interpretation

The fixed assets are increase in current year is
good for the company.

It seems that the company has good future plans
and they want to expand their business so they
have invested more and more funds in fixed
assets.

Fixed assets are efficiently utilized by the
company due to which the profit of the company
is increasing every year

9. LOGO


Trend Analysis of total current
assets
The current assets is shows the cash liquidity of
the company
Hear it is increase it year by year it means the
company has sufficient liquidity for

10. LOGO
Trend Analysis of Total
liabilities

The total liabilities is highest in 2005-06

Liabilities is increasing rate it mean company has
to developed business

11. LOGO
Ratio Analysis

Ratio analysis involves establishing a comparative
relationship between the components of financial
statements.

It presents the financial statements into various
functional areas

12. LOGO

classification of different
categories of Ratio
Liquidity Ratio
Liquidity refers to the existence of the assets in the
cash or near cash form.
This ratio indicates the ability of the company to
discharge the liabilities.
 Current Ratio
This ratio shows the proportion of Current Assets to
Current Liabilities
It’s a measure of short term financial strength of the
business.
It is also known as “Working Capital Ratio”
Current Ratio = Current Assets Current / liabilities

13. Quick Ratio
LOGO

Quick Ratio
This ratio is designed to show the amount of cash
available to meet immediate payments.
It is obtained by dividing the quick assets by
quick liabilities.
Quick Ratio = Quick AssetsCurrent Liabilities
Networking Captial Networking capital =
Current Assets – Current Liabilities
Interpretation

14. LOGO

Profitability Ratios
The profitability ratios are calculated to measure t
he operating efficiency of the company.
The profit margin ratio shows decline in current
year so that company should tray to increase
profit after tax.
Company should try its best to increase sales and
profit.

15. LOGO



Findings
Though the sales has been continuously
increased from past 3 years but the proportionate
expenditure is also rising so overall not
making any huge effect on net profit of this
company.
Company has enough cash in hand so that in any
condition company can take any Financial
decision easily.
GP Ratio shows how much efficient company is in
Production.
The total expenditure is near by 80% of total
income in every year.

16. LOGO

SUGGESTION
Company should try its best to increase sales and
profit.

The profit margin ratio shows decline in current
year so that company should tray to increase
profit after tax.

Current ratio is very good it is 2.13:1 so company
has fully utilize cash liquidity for business
development.

17. LOGO

Conclusion
Hear the in 2013 company has reinvest profit for
business expansion it is good shine for the company.

Fixed assets are efficiently utilized by the company
due to which the profit of the company is increasing
every year.

Liabilities is increasing rate it mean company has to
developed business. And purchase raw material on
credit basis.

18. LOGO