Financial Analysis

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ACKNOWLEDGEMENT

This project has given me a perfect opportunity to see and know how the concepts of finance are applied in the Industry. The project has been a big learning experience for me and I would like to express my gratitude towards all the people who have guided me throughout, and without whose guidance and support this project would not have been completed successfully.

I would also like to express my deepest gratitude and sincere regards to Mr. Ajay Joshi, Vice President (Finance & Accounts) for allowing me to undergo my internship in Hindalco Industries Limited, Renukoot.

It was great to have the opportunity to work under the guidance of Mr. Vimal Raheja, Deputy Manager (Finance & Accounts), Hindalco Industries Limited. I would like to extend my thanks to him for helping me carry out the project and for his valuable feedback.

Above all, the kind of support and help that my institute and faculty guide Ms. Nahid Parveen extended during the project was invaluable. Without her help this project would not have been completed.

To sum up, my experience with HIL has been a valuable one. The value addition was enormous and the impact, long lasting. I thank everyone once again.

TABLE OF CONTENTS

Ch.No.TopicPage No.
1Executive Summary5
2Group Overview6-7
3Industry Profile8-12
4Company ProfileØProduction profileØProduct profile13-27 5Introduction To Project28-30
6Objectives Of The Study31
7Literature Review32-33
8Research Methodology34-35
9Financial Highlights36-37
10List Of Ratios38-68
11Inter Company Analysis69-77
12Growth Equilibrium78-79
13Multi DiscriminantAnalysis80-81
14Conclusions82
15Recommendations83
16Limitations 84
17Bibliography85-86
CHAPTER - 1
EXECUTIVE SUMMARY

The purpose of this project is to analyse the financial position of Hindalco Industries Ltd. and compare it with domestic competitor i.e. Nalco for the FY 2007-08. To analyse the financial position of a firm one of the method is Ratio Analysis, which uses data from the balance sheet and income statement to produce values that have easily interpreted financial meaning.

There are different financial ratios that have proven useful for assessing financial condition of the company. Results showed that Hindalco is more profitable than Nalco in the FY 2007-08 but due to increase in cost of sales the profit margin decreases. Also the liquidity position of the Hindalco is better and all ratios are ideal as compared to Nalco.

Hindalco provides better return to its shareholders and are having more equity than debt. Therefore, the company remains in the safety range and is maintaining a balance. Also, Hindalco provides higher security to lenders for extending long-term loans to the business.

Company has proved itself strong on all parameters like market valuation, liquidity, solvency, but fails on the aspects of turnover. The company rate of turnover is less as comparison to Nalco, this tells that company lacks ground on production frontier.

On the whole we can say that Hindalco is very strong player in the Aluminium industry and is having tremendous potential for growth.

CHAPTER - 2
GROUP OVERVIEW

The Aditya Birla Group, a US $29.2 billion corporation, is in the league of Fortune 500. It is anchored by an extraordinary force of 130,000 employees, belonging to 30 different nationalities. In India, the Group has been adjudged "The Best Employer in India and among the top 20 in Asia" by the Hewitt-Economic Times and Wall Street Journal Study 2007. Over 50 per cent of its revenues flow from its overseas operations.

The Group operates in 25 countries — India, UK, Germany, Hungary, Brazil, Italy, France, Luxembourg, Switzerland, Australia, USA, Canada, Egypt, China, Thailand, Laos, Indonesia, Philippines, Dubai, Singapore, Myanmar, Bangladesh, Vietnam, Malaysia and Korea.

Globally the Aditya Birla Group is:

ØA metals powerhouse, among the world's most...
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