Dlf-Sobha Report

Only available on StudyMode
  • Download(s) : 118
  • Published : January 5, 2013
Open Document
Text Preview
Financial Reporting Analysis Project
A report submitted in fulfillment of the project for
Financial Reporting & Analysis (FRA)
8 Jun 2012

Table of Contents
Executive summary ......................................................................................................................... 2 Industry overview ............................................................................................................................ 3 Firms studied ................................................................................................................................... 5 DLF Limited ................................................................................................................................ 5 Sobha Developers ........................................................................................................................ 5 Chapter 1: Sales Trend Analysis ..................................................................................................... 6 Chapter 2: Dupont Analysis & Profitability.................................................................................... 7 Extended Dupont analysis ............................................................................................................... 8 Chapter 3: Cost Structure ................................................................................................................ 8 Chapter 4: Liquidity ...................................................................................................................... 10 Chapter 5: Liabilities ..................................................................................................................... 12 Chapter 6: Firm’s Stock analysis .................................................................................................. 13 Chapter 7: Cash Flow Analysis ..................................................................................................... 14 Chapter 8: Firms’ Accounting Quality .......................................................................................... 18 Chapter 9: Comparison with directors' report and MD&A ........................................................... 19 Summary & Conclusion ................................................................................................................ 21 References: .................................................................................................................................... 21

1

Executive summary
The objective of this report is to study the annual reports of DLF and Sobha Developers from year 2006-07 to 2010-11 and do a complete financial analysis. The emphasis is given on finding the gaps in reporting and checking whether there are any deviations from the accounting policies issued by the ICAI.

Real estate industry is the corner stone of the Indian economy and contributes almost 5% to 6% of Indian GDP. DLF is the largest real estate developer with an annual turnover of Rs. 9600 Cr. and presence in 18 states. Sobha Developers on the other hand is the only backward integrated real estate player in India.

Chapter 1 provides an insight about the sales trend and analysis of the two firms over the period of 5 years and highlights specific details regarding the observed trends. Chapter 2 covers the Dupont analysis, where our team has demonstrated about the drivers of profitability for DLF and Sobha Developers.

Chapter 3 gives an overview of the cost structure of these two firms. A composition of fixed and variable costs of the two firms has been derived and details of various expenses are also provided.

Chapter 4 deals with the liquidity ratios of the two firms and look at the composition of Current Assets and current liabilities. Both the companies have acceptable liquidity ratios. Chapter 5 illustrates liabilities of the two firms which is an indicator of the debt position. As real estate industry is a capital intensive...
tracking img