Table of Contents
1-Return on Equity:2
2-Return on Assets:3
3-Equity Multiplier:4
4-Asset Utilization Ratio:5
5-Tax Ratio:6
6-Efficiency Ratio:6
7-Expense Ratio:7
8-Spread:8
9-Burden:9

1-Return on Equity:

ROE = Net Income/Average Total Equity
YEAR| 2006| 2007| 2008|
Net Income| 12700315| 10084037| 15614020|
Average Total Equity| 38949430.5| 50120394.5| 63172013.5| | 0.032 | 0.020| 0.024|

Analysis: This trend of return of asset is similar to return on equity. Its basic reason is that the numerator that is net income is the same. The ROA has almost decreasing trend. In the year 2006 the ROA should decrease due to increase in denominator, contrary to this the ratio was decreased due to increase in Net income. Net Income = NII-Burden-PLL+SG-T

2-Return on Assets:
ROA = Net Income/Average Total Assets
YEAR| 2006| 2007| 2008|
Net Income| 12700315| 10084037| 15614020|
Average Total Assets| 559592686.5| 641141494.5| 724959955| | 2.27%| 1.57%| 2.15%|

Analysis: Return on assets decreased in 2007 and 2008 and it was maximum in 2006. This is because HBL used more debt financing in 2006 as compared to 2007 and 2008 which resulted in more interest cost and brought the Net income down.

3-Equity Multiplier:
EQ = Average Total Assets/ Average Total Equity
YEAR| 2006| 2007| 2008|
Average Total Assets| 559592686.5| 641141494.5| 724959955| Average Total Equity| 38949430.5| 50120394.5| 63172013.5| | 14.37| 12.88| 11.48|

Analysis: This decreasing trend shows that the dependence of banks on deposits was decreasing during the period.

4-Asset Utilization Ratio:
AU = Total Revenue/Average Total Assets
YEAR| 2006| 2007| 2008|
Total Revenue| 52175236| 60504185| 79683844|
Average Total Assets| 559592686.5| 641141494.5| 724959955| | 9.32%| 9.44%| 10.99%|

...Financial ratioanalysis
A reading prepared by Pamela Peterson Drake
OUTLINE
1.
2.
3.
4.
5.
1.
Introduction
Liquidity ratios
Profitability ratios and activity ratios
Financial leverage ratios
Shareholder ratios
Introduction
As a manager, you may want to reward employees based on their performance. How do you know
how well they have done? How can you determine what departments or divisions have performed
well? As a lender, how do decide the borrower will be able to pay back as promised? As a manager of
a corporation how do you know when existing capacity will be exceeded and enlarged capacity will be
needed? As an investor, how do you predict how well the securities of one company will perform
relative to that of another? How can you tell whether one security is riskier than another? We can
address all of these questions through financial analysis.
Financial analysis is the selection, evaluation, and interpretation of financial data, along with other
pertinent information, to assist in investment and financial decision-making. Financial analysis may be
used internally to evaluate issues such as employee performance, the efficiency of operations, and
credit policies, and externally to evaluate potential investments and the credit-worthiness of
borrowers, among other things.
The analyst draws the financial data needed in financial...

...
RATIOANALYSIS
Financial ratios are useful indicators of a firm's performance and financial situation. Most ratios can be calculated from information provided by the financial statements. Financial ratios can be used to analyze trends and to compare the firm's financials to those of other firms. In some cases, ratioanalysis can predict future bankruptcy.
Financial ratios can be classified according to the information they provide. The following types of ratios frequently are used:
1. Liquidity ratios
2. Capital Structure and Solvency
3. Return On Investment
4. Operating Performance
5. Asset Utilization
6. Market Measures
The ratios measure the short term ability of the company to pay its current short-term liabilities.
1. Liquidity Ratio
Liquidity ratios provide information about a firm's ability to meet its short-term financial obligations. They are of particular interest to those extending short-term credit to the firm. Two frequently-used liquidity ratios are the current ratio (or working capital ratio) and the quick ratio.
i. Current ratio:
The current ratio is the ratio of current assets to current liabilities
The company have decreasing trend in current ratio...

...RATIOANALYSIS (ALL VALUES IN Rs. MILLION)
1. GROSS PROFIT MARGIN (%):
GROSS PROFIT = NET SALES – COGS
= TOTAL REVENUE – (Employee Benefit Expense + Operating and Other Expenses + Finance Costs)
= 53107 – (22510+21598+1025) = 7974
GROSS PROFIT MARGIN = (NET SALES – COGS)/NET SALES = (7974/ 53107)*100 = 15.01497%
2. RETURN ON ASSET(RoA)
RETURN ON ASSET = (PAT/TOTAL ASSET)*100
= (4606/63454)*100 = 7.258%
This indicates that around 7.3% of all assets have been utilized by Tech Mahindra to generate revenue & profit.
3. RETURN ON SHAREHOLDER’S FUNDS(RoS)
RETURN ON SHAREHOLDER’S FUNDS = (PAT/ SHAREHOLDER’S FUNDS)*100
= (4606/34432)*100 = 13.377%
This indicates that, shareholders can expect a profitability of around 13.4% if invested in Tech Mahindra.
4. RETURN ON INVESTMENT (RoI)
CAPITAL EMPLOYED (CE) = SHARE CAPITAL + RESERVES & SURPLUS + LONG TERM LOANS – NON OPERATING ASSETS – FICTITIOUS ASSETS
= 34432 + 6000 = 40432
RETURN ON INVESTMENT = (OPBT/CE)*100
= (5790/40432)*100 = 14.32%
Where, OPBT is Operating Profit Before Tax.
This ratio gives the overall performance of the company, Tech Mahindra.
TURNOVER RATIOS:
These ratios tell the effectiveness of utilization of resources & assets in generating revenue.
5. ASSET TURNOVER RATIO
ASSET TURNOVER RATIO = NET SALES/ TOTAL ASSET = 53107/63454 = 0.837 = 4:5
This...

...
RatioAnalysis
Cynthia Nelson
HCS/571
September 2 2013
Joseph Rudd
RatioAnalysis
Financial ratioanalysis is the calculation and comparison of ratios pulled from the information in a company’s financial statements (Cleverly & Song, 2011). The financial report is used by organization to determine the financial health and stability of an organization. The ratiosanalysis data are found on the business Profit and Loss Statement and the balance sheet (Loth, 2013). These financial documents provide data for a specific time usually fiscal year (Cleverly & Song, 2011). The ratios are then obtained through formula divided into categories that address the different focus areas of management (Suarez & Lesneski, 2011). The company WW Enterprises uses the four major areas Liquidity, Solvency, Profitability; and Efficiency that measure how well the organization is using its resources (Loth, 2013).
Liquidity ratio is a quick look at organizations ability to meet current financial obligations (Staff, 2013). The Liquidity ratio data for WW Enterprise includes the current ratio, the quick ratio and the operating cash flow ratio (Loth, 2013)
LIQUIDITY RATIOS.
Current Assets/Current Liabilities
=52,100/30834=1.725(1.73)
The ratio results...

...RatioAnalysisRatioanalysis is used to evaluate relationships among financial statement items. The ratios are used to identify trends over time for one company or to compare two or more companies at one point in time. Financial statement ratioanalysis focuses on three key aspects of a business: liquidity, profitability, and solvency.
Liquidity Ratios
Liquidityratios measure the ability of a company to repay its short‐term debts and meet unexpected cash needs.
Current ratio
The current ratio is also called the working capital ratio, as working capital is the difference between current assets and current liabilities. This ratio measures the ability of a company to pay its current obligations using current assets.
Current Ratio = Current Assets / Current Liability
Quick ratio
Current Ratio = Quick Assets / Current Liability
Inventory turnover
The inventory turnover ratio measures the number of times the company sells its inventory during the period. It is calculated by dividing the cost of goods sold by average inventory. Average inventory is calculated by adding beginning inventory and ending inventory and dividing by 2.
Inventory Turnover ratio = Cost of Goods Sold / Average inventory
Debtors...

... Section III: Financial Analysis—RatioAnalysis
Profitability Ratios
When evaluating the company’s profitability, we pay attention to the following ratios which are commonly analyzed: Net Profit Margin, Accounts Receivables Turnover, Return on Assets and Return on Equity. From the tables and figures, all the ratios have increased over the past five years except for 2012. This means UPS is overall a healthy company and does a good job at generating profits.
Net Profit Margin Ratio
It measures how much net profit a company can earn from every dollar of sales. As shown in Table 1, net profit margin for UPS keeps consistent for each year. The profit fell in 2012 for several reasons, mostly due to the prohibition decision issued by the European Commission to stop the acquisition of TNT Express. The termination fee and related expenses are $284 million, which has a big impact the International Package segment (10-K: UNITED PARCEL SERVICE INC,Annual Report,28-Feb-2014). Also chief executive officer Scott Davis attributes this result to a cheaper and slower modes of transport in a slower growth environment that affects the profitability. In 2013, the ratio has been increased to 7.89%, this indicates UPS becomes more profitable and has better control over its expenses compared to previous years.
Accounts Receivables Turnover
This ratio...

...
Ratioanalysis – Shinepukur Ceramics Versus RAK Ceramics
Current ratio
Shinepukur: From 2009 to 2010, current ratio of Shinepukur has increased by 0.24 because of increase in total current assets and decrease in total current liabilities. The increase in total current has occurred for increase in accounts-and-other-receivables, advances-deposits-and-prepayments and cash. Among these elements, the increase in advances-deposits-and-prepayments is significant (from 82182270 to 278773841). On the other hand, the element that has decreased total current liabilities is long-term loan with current maturity (from 386928629 to 243718941). From 2010 to 2011, current ratio of Shinepukur has decreased by 0.14 because of decrease in total current assets and increase in total current liabilities. The decrease in total current assets has incurred for decrease in both advances-deposits-and-prepayments and cash. Among these two elements, the decrease in advances-deposits-and-prepayments is significant (from 278773841 to 112190532). And, total-current-liabilities has increased for the increase in short-term loan from bank and creditors-accruals-and-other-payables among which short-term loan from bank has played key role (from 955808744 to 1147673708). From 2011 to 2012, current liability of Shinepukur has increased by 0.03 because of more increase in total current assets and less increase in total current...

...Use and significance of RatioAnalysis 8
1.1.2 Limitations 11
1.1.3 Classifications of ratios 13
1.2 Research Methodology 33
1.2.1 Need for the study 33
1.2.2 Scope of the study 33
1.2.3 Objectives of the study 33
1.2.4 Data sources 34
1.2.5 Limitations 34
Chapter 2. Profiles 35
2.1 Company profile 36
Chapter 3. Review of Literature 55
Chapter 4. Data Analysis 59
Chapter 5. Findings 86
Chapter 6. Suggestions 88
Bibliography 90
[pic]
|Sl. No |Table No |Title of the tables |Page No |
|1 |4.1 |Current Ratio |60 |
|2 |4.2 |Quick Ratio |61 |
|3 |4.3 |Cash Ratio |63 |
|4 |4.4 |Networking capital Ratio |64 |
|5 |4.5 |Debt Ratio...