Sainsbury Ratio Analysis

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FIN4501
FINANCIAL REPORTING
COURSEWORK

GROUP MEMBERSMISIS
SYED ALI AOUSAJA M00190925 MOHD OVASE BUDA M00380435
SYED ZAIN HASSAN M00375419
ZOHAIB KAMRAN M00384153

TUTORS NAME: FIROOZEH GHAFFARI
SUBMISSION DATE: 19TH JANUARY 2012
WORDS COUNT:

J Sainsbury PLC

List of content
Introduction ------------------------------------------------------------------------ 3 Justification for the selection -------------------------------------------------- 4 Review ------------------------------------------------------------------------------- 5 * Strengths ------------------------------------------------------------------- 5 * Weakness ------------------------------------------------------------------ 5 * Future potentials --------------------------------------------------------- 5 Evaluation --------------------------------------------------------------------------- 6 * Profitability ratio ---------------------------------------------------------- 6 * Liquidity ratio -------------------------------------------------------------- 9 * Gearing ratio --------------------------------------------------------------- 11 * Debt ratio ------------------------------------------------------------------- 12 * Investment ratio ---------------------------------------------------------- 13 Limitation ---------------------------------------------------------------------------- 18 Conclusion --------------------------------------------------------------------------- 19 Recommendation ------------------------------------------------------------------ 19 Contributions ----------------------------------------------------------------------- 20 Bibliography ------------------------------------------------------------------------- 23 Appendix ----------------------------------------------------------------------------- 24

Introduction
Sainsbury is one of the leading supermarkets present today since it was established in the year 1869. Currently there are 934 stores comprising of 557 supermarkets and 377 convenience stores. Only food retail is serving over 20 million customers per week and this number is increasing day by day. There are more than 30 thousand products in following main categories * Food and grocery product

* Delicatessen
* Meat and fish
* Alcoholic beverages
* Pharmaceutical drugs
* Books
* Gifts
* Computer accessories
* Coffee shop
Finance segment of Sainsbury includes a bank which is providing following major services * Health coverage products
* Life coverage products
* Instant access saving accounts
* Direct saving accounts
* Visa credit cards
* Personal loans
* Car financing packages
* Car insurance
* Home insurance
* Travel insurance
* Pet care insurance

Justification for the selection
For research purpose, mainly there are following reason to select any particular company * Interest
* Experience
* Selection
Reference

Reference
Experience
Interest

After considering the above points, it can be said that the reason for the selection of Sainsbury supermarkets is the level of interest in this field. Keen observation is present for this company considering its steep growth and exponential increase in its profitability. There are some other trademarks in the same business but not as rapidly progressing as Sainsbury. The micro level analysis will illustrate the statement above shortly.

Review
Business of Sainsbury will be reviewed in term of its strengths, weaknesses and its future potentials. 1) Strengths
* Sainsbury can be classified in one of the powerful retail brands. It gives convenience, value of money. Wide range of products is present in one store at a time. * The information technology core step up is providing the strengths of online access...
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