Chapter – 1
Introduction of the Company:
Bata Bangladesh is affiliated to the Bata Shoe Organization, the world's largest footwear manufacturing and marketing organization. Started operation in Bangladesh in 1962, Incorporation in Bangladesh in 1972.
Currently, Bata Bangladesh operates 2 manufacturing plant Tongi and Dhamrai, Bata Bangladesh is producing around 110,000 pairs of shoes daily. It has a modern tannery with the latest technological facilities to process 5 million square feet of leather yearly. The Tannery is equipped with a high-tech effluent treatment plant ensuring a pollution free environment for both workers and locality where we operate. Bata Bangladesh sells all kinds of footwear which are classified in alignment with market sectors as follows:
Domestic market – under the trademarks of “Bata”, “Power”, “Weinbrenner” “Bubble gummers”, “North Star” and “Marie Claire”, through a countywide distribution network comprising retail stores, DSPs and independent dealers.
Overseas market – under the trademarks of its customers, and also markets its own brands to sister companies and the Middle East.
Our concern issue is to identify whether the company is performing better or not through analyzing book value and market value of the company from the year 2005 to 2009.
Book Value per Share is the accounting value of a share, equal to common equity divided by the number of shares outstanding.
Market value is current price of the stock. If the profitability, liquidity, asset and debt management is good market value will probably be as high as can be expected.
From the analysis of five years data we will try to find out the problems and reasons of changes in the Market value of from the price of Tk. 148.90 per share at the end of 2005, to Tk.528.30 at the end of 2009. Initially the book value of the share of the company is Tk. 54.60 per share and at the year 2009 it become 81.91
From the above data, it is evident that the Market value is substantially greater than the book value. So we can say for our concern company that,
PM : (528.30) > PB : (81.91)
To conclude, we can easily say that the Company is enjoying a healthy financial status. In our report we will diagnose all the data that will establish the reason behind the fact.
Objective of the Study:
To identify the financial strength of Bata Shoe Company (Bangladesh) Ltd. by analyzing their accounting statements is our main point of view. Regarding this, we consider a definite period and to compare their book value with the market value of the share and finding out the reason of the discrepancy about this issue. Have detail understanding about the instruments of finance.
• Make a thorough analysis of the company’s financial statements over the last 5 years with the aid of ratio analysis, cash flow and analysis of major components of the balance sheet. • Find out the financial strength of Bata Shoe Co. (BD.) Ltd. and the level of competency. • Find out where Bata Shoe Co. (BD.) Ltd stands against rivals. • Find out the strength and weaknesses of Bata Shoe Co. (BD.) Limited. 1.4
1.4.1 Statistical Technique:
Bar chart and line graph were our representing technique to processes the data. 1.4.2 Nature of Data:
Data we used to prepare the report is the secondary data.
1.4.3 Sources of Data:
This report was prepared mainly based on the secondary data available in the market. The secondary data was collected from the internet, newspapers and the company’s annual reports. The report prepared from the analysis of the raw data is of the formal type and the information from the secondary data was used to support the findings of the financial analysis. Primary data had been collected from the Dhaka Stock Exchange and is of little importance to the report. However these data have been helpful in providing us with some direction about how to approach...
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