CONTENTS

S.No. Title Page No.

ACKNOWLDGEMENTS 3
List of Tables 4
Chapter . !"tro#$%tio" &
. Theoreti%al ba%'gro$"# (
.. )se a"# sig"ifi%a"%e of *atio A"al+sis (
.., Li-itatio"s
..3 Classifi%atio"s of ratios 3
., *esear%h Metho#olog+ 33
.,. Nee# for the st$#+ 33
.,., S%ope of the st$#+ 33
.,.3 Ob.e%ti/es of the st$#+ 33
.,.4 Data so$r%es 34
.,.& Li-itatio"s 34
Chapter ,. Profiles 3&
,. Co-pa"+ profile 30
Chapter 3. *e/ie1 of Literat$re &&
Chapter 4. Data A"al+sis &2
Chapter &. 3i"#i"gs (0
Chapter 0. S$ggestio"s ((
Chapter 4 5ibliograph+ 26
Sl. No Table
No
Title of the tables Page
No

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3
4
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4
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2
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3
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4
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4.
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4.3
4.4
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4.0
4.4
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4.2
4.6
4.
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4.3
4.4
4.&
4.0
4.4
4.(
4.2
4.,6
4.,
4.,,
C$rre"t *atio
7$i%' *atio
Cash *atio
Net1or'i"g %apital *atio
Debt *atio
Debt e8$it+ *atio
Capital E8$it+ *atio
!"terest %o/erage ratio
!"/e"tor+ t$r"o/er *atio
!"/e"tor+ %o"/ersio" Perio#
Debtor t$r"o/er ratio
Debt Colle%tio" of perio#
Net Assets T$r"o/er *atio
3i9e# assets t$r"o/er ratio"
C$rre"t assets t$r"o/er ratio
Total assets t$r"o/er ratio
Wor'i"g Capital T$r"o/er
*atio
Net profit ratio
Net profit 5ase# o" No PAT
*et$r" o" i"/est-e"t ratio
*et$r" of e8$it+ ratio
Ear"i"g per share ratio
06
0
03
04
0&
00
04
02
46
4,
43
44
4&
40
44
4(
42
(6
(,
(3
(4
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LIST OF TABLES
(i) 1.
*atio a"al+sis is a po1erf$l tool of fi"a"%ial a"al+sis. A ratio is
#efi"e# as :the i"#i%ate# 8$otie"t of t1o -athe-ati%al e9pressio"s; a"# :the
relatio"ship bet1ee" t1o or -ore thi"gs;. !" fi"a"%ial a"al+sis< a ratio is $se#
as a be"%h-ar' for e/al$atio" the fi"a"%ial positio" a"# perfor-a"%e of a fir-.
The absol$te a%%o$"ti"g fig$res reporte# i" the fi"a"%ial state-e"ts #o "ot
pro/i#e a -ea"i"gf$l $"#ersta"#i"g of the perfor-a"%e a"# fi"a"%ial positio"
of a fir-. A" a%%o$"ti"g fig$re %o"/e+s -ea"i"g 1he" it is relate# to so-e
other rele/a"t i"for-atio". 3or e9a-ple< a" *s.& %ore "et profit -a+ loo'
i-pressi/e< b$t the fir-=s perfor-a"%e %a" be sai# to be goo# or ba# o"l+ 1he"
the "et profit fig$re is relate# to the fir-=s !"/est-e"t.
The relatio"ship bet1ee" t1o a%%o$"ti"g fig$res e9presse#
-athe-ati%all+< is '"o1" as a fi"a"%ial ratio >or si-pl+ as a ratio?. *atios help
to s$--ari@e large 8$a"tities of fi"a"%ial #ata a"# to -a'e qualitative
judgment abo$t the fir-=s fi"a"%ial perfor-a"%e. 3or e9a-ple< %o"si#er
%$rre"t ratio. !t is %al%$late# b+ #i/i#i"g %$rre"t assets b+ %$rre"t liabilitiesA the
ratio i"#i%ates a relatio"shipB a 8$a"tifie# relatio"ship bet1ee" %$rre"t assets
a"# %$rre"t liabilities. This relatio"ship is a" i"#e9 or +ar#sti%'< 1hi%h per-its
a 8$a"titati/e .$#g-e"t to be for-e# abo$t the fir-=s li8$i#it+ a"# /i%e /ersa.
The poi"t to "ote is that a ratio refle%ti"g a 8$a"titati/e relatio"ship helps to
for- a 8$alitati/e .$#g-e"t. S$%h is the "at$re of all fi"a"%ial ratios.
Standards of comparison:
The ratio" a"al+sis i"/ol/es %o-pariso" for a $sef$l i"terpretatio" of the
fi"a"%ial state-e"ts. A si"gle ratio i" itself #oes "ot i"#i%ate fa/orable or
$"fa/orable %o"#itio". !t sho$l# be %o-pare# 1ith so-e sta"#ar#. Sta"#ar#s
of %o-pariso" -a+ %o"sist ofC
Past ratios< i.e. ratios %al%$late# for- the past fi"a"%ial state-e"ts of the
sa-e fir-A
Competitors ratios< i.e.< of so-e sele%te# fir-s< espe%iall+ the -ost
progressi/e a"# s$%%essf$l %o-petitor< at the sa-e pi"t i" ti-eA
Industry ratios< i.e. ratios of the i"#$str+ to 1hi%h the fir- belo"gsA a"#
Protected ratios, i.e.< #e/elope# $si"g the prote%te# or proforma<
fi"a"%ial state-e"ts of the sa-e fir-.
!" this pro.e%t %al%$lati"g the past fi"a"%ial state-e"ts of the sa-e fir- #oes
ratio a"al+sis.
1.1 Theoretical background:
1.1.1 se and significance of ratio analysis:!
The ratio is o"e of the -ost po1erf$l tools of fi"a"%ial a"al+sis.
!t is $se# as a #e/i%e to a"al+@e a"# i"terpret the fi"a"%ial health of e"terprise.
*atio a"al+sis sta"#s for the pro%ess of #eter-i"i"g a"# prese"ti"g the
relatio"ship of ite-s a"# gro$ps of ite-s i" the fi"a"%ial state-e"ts. !t is a"
i-porta"t te%h"i8$e of the fi"a"%ial a"al+sis. !t is the 1a+ b+ 1hi%h fi"a"%ial
stabilit+ a"# health of the %o"%er" %a" be .$#ge#. Th$s ratios ha/e 1i#e
appli%atio"s a"# are of i--e"se $se to#a+. The follo1i"g are the -ai" poi"ts
of i-porta"%e of ratio a"al+sisC
a" #anagerial uses of ratio analysis:!
1. $elps in decision making:!
3i"a"%ial state-e"ts are prepare# pri-aril+ for #e%isio"B-a'i"g. *atio
a"al+sis helps i" -a'i"g #e%isio" fro- the i"for-atio" pro/i#e# i" these
fi"a"%ial State-e"ts.
%. $elps in financial forecasting and planning:!
*atio a"al+sis is of -$%h help i" fi"a"%ial fore%asti"g a"# pla""i"g.
Pla""i"g is loo'i"g ahea# a"# the ratios %al%$late# for a "$-ber of +ears a
1or' as a g$i#e for the f$t$re. Th$s< ratio a"al+sis helps i" fore%asti"g a"#
pla""i"g.
&. $elps in communicating:!
The fi"a"%ial stre"gth a"# 1ea'"ess of a fir- are %o--$"i%ate# i" a
-ore eas+ a"# $"#ersta"#able -a""er b+ the $se of ratios. Th$s< ratios help i"
%o--$"i%atio" a"# e"ha"%e the /al$e of the fi"a"%ial state-e"ts.
'. $elps in co!ordination:!
*atios e/e" help i" %oBor#i"atio"< 1hi%h is of at -ost i-porta"%e i"
effe%ti/e b$si"ess -a"age-e"t. 5etter %o--$"i%atio" of effi%ie"%+ a"#
1ea'"ess of a" e"terprise res$lt i" better %oBor#i"atio" i" the e"terprise
(. $elps in control:!
*atio a"al+sis e/e" helps i" -a'i"g effe%ti/e %o"trol of b$si"ess.The
1ea'"esses are other1ise< if a"+< %o-e to the '"o1le#ge of the -a"agerial<
1hi%h helps< i" effe%ti/e %o"trol of the b$si"ess.
b" tility to shareholders)in*estors:!
A" i"/estor i" the %o-pa"+ 1ill li'e to assess the fi"a"%ial positio" of
the %o"%er" 1here he is goi"g to i"/est. Dis first i"terest 1ill be the se%$rit+ of
his i"/est-e"t a"# the" a ret$r" i" for- of #i/i#e"# or i"terest. *atio a"al+sis
1ill be $sef$l to the i"/estor i" -a'i"g $p his -i"# 1hether prese"t fi"a"%ial
positio" of the %o"%er" 1arra"ts f$rther i"/est-e"t or "ot.
C" tility to creditors: !
The %re#itors or s$ppliers e9te"t shortBter- %re#it to the %o"%er". The+
are i"/este# to '"o1 1hether fi"a"%ial positio" of the %o"%er" 1arra"ts their
pa+-e"ts at a spe%ifie# ti-e or "ot.

d" tility to employees:!
The e-plo+ees are also i"tereste# i" the fi"a"%ial positio" of the %o"%er"
espe%iall+ profitabilit+. Their 1age i"%reases a"# a-o$"t of fri"ge be"efits are
relate# to the /ol$-e of profits ear"e# b+ the %o"%er".
e" tility to go*ernment:!
Go/er"-e"t is i"tereste# to '"o1 o/erall stre"gth of the i"#$str+.
Eario$s fi"a"%ial state-e"t p$blishe# b+ i"#$strial $"its are $se# to %al%$late
ratios for #eter-i"i"g short ter-< lo"gBter- a"# o/erall fi"a"%ial positio" of the
%o"%er"s.
f" Ta+ audit re,uirements:!
Se%44A5 1as i"serte# i" the i"%o-e ta9 a%t b+ fi"a"%ial a%tA 2(4.Cal$se
3, of the i"%o-e ta9 a%t re8$ires that the follo1i"g a%%o$"ti"g ratios sho$l# be
gi/e"C
. Gross profitFt$r"o/er.
,. Net profitFt$r"o/er.
3. Sto%' i" tra#eFt$r"o/er.
4. Material %o"s$-e#Ffi"ishe# goo#s pro#$%e#.
3$rther< it is a#/isable to %o-pare the a%%o$"ti"g ratios for the +ear
$"#er %o"si#eratio" 1ith the a%%o$"ti"g ratios for earlier t1o +ears so that the
a$#itor %a" -a'e "e%essar+ e"8$iries< if there is a"+ -a.or /ariatio" i" the
a%%o$"ti"g ratios.

1.1.% -imitations:
*atio a"al+sis is /er+ i-porta"t i" re/eali"g the fi"a"%ial positio" a"#
so$"#"ess of the b$si"ess. 5$t< i"spite of its a#/a"tages< it has so-e li-itatio"s
1hi%h restri%t its $se. These li-itatio"s sho$l# be 'ept i" -i"# 1hile -a'i"g
$se of ratio a"al+sis for i"terpreti"g the fi"a"%ial the fi"a"%ial state-e"ts. The
follo1i"g are the -ai" li-itatio"s of ratio a"al+sisC
1. .alse results:!
*atios are base# $po" the fi"a"%ial state-e"t. !" %ase fi"a"%ial state-e"t
are i" %orre%t or the #ata of o" 1hi%h ratios are base# is i" %orre%t< ratios
%al%$late# 1ill all so false a"# #efe%ti/e. The a%%o$"ti"g s+ste- it self s$ffers
fro- -a"+ i"here"t 1ea'"esses the ratios base# $po" it %a""ot be sai# to be
al1a+s reliable.
%. -imited comparability:!
The ratio of the o"e fir- %a""ot al1a+s be %o-pare 1ith the perfor-a"%e
of other fir-< if $"ifor- a%%o$"ti"g poli%ies are "ot a#opte# b+ the-. The
#iffere"%e i" the -etho#s of %al%$latio" of sto%' or the -etho#s $se# to re%or#
the #epre%atio" o" assets 1ill "ot pro/i#e i#e"ti%al #ata< so the+ %a""ot be
%o-pare#.
&. /bsence of standard uni*ersally accepted terminology:!
Differe"t -ea"i"gs are gi/e" to a parti%$lar ter-< egg. So-e fir-s ta'e
profit before i"terest a"# ta9A others -a+ ta'e profit after i"terest a"# ta9. A
ba"' o/er#raft is ta'e" as %$rre"t liabilit+ b$t so-e fir-s -a+ ta'e it as "o"B
%$rre"t liabilit+. The ratios %a" be %o-parable o"l+ 1he" all the fir-s a#apt
$"ifor- ter-i"olog+.
'. Price le*el changes affect ratios:!
The %o-parabilit+ of ratios s$ffers< if the pri%es of the %o--o#ities i"
t1o #iffere"t +ears are "ot the sa-e. Cha"ge i" pri%e effe%t the %ost of
pro#$%tio"< sale a"# also the /al$e of assets. !t -ea"s that the ratio 1ill be
-ea"i"gf$l for %o-pariso"< if the pri%es #o "ot %ha"ge.
(. Ignoring ,ualitati*e factors:!
*atio a"al+sis is the 8$a"titati/e -eas$re-e"t of the perfor-a"%e of the
b$si"ess. !t ig"ores 8$alitati/e aspe%t of the fir-< ho1 so e/er i-porta"t it -a+
be. !t shoes that ratio is o"l+ a o"e si#e# approa%h to -eas$re the effi%ie"%+ of
the b$si"ess.
0. Personal bias:!
*atios are o"l+ -ea"s of fi"a"%ial a"al+sis a"# a" e"# i" it self. The ratio
has to be i"terprete# a"# #iffere"t people -a+ i"terpret the sa-e ratio i"
#iffere"t 1a+s.
1. 2indo3 dressingCB
3i"a"%ial state-e"ts %a" easil+ be 1i"#o1 #resse# to prese"t a better
pi%t$re of its fi"a"%ial a"# profitabilit+ positio" to o$tsi#ers. De"%e< o"e has to
be /er+ %aref$ll+ i" -a'i"g a #e%isio" fro- ratios %al%$late# fro- s$%h
fi"a"%ial state-e"ts.
4. /bsolute figures distorti*e:!
*atios #e/oi# of absol$te fig$res -a+ pro/e #istorti/e< as ratio a"al+sis is
pri-aril+ a 8$a"titati/e a"al+sis a"# "ot a 8$alitati/e a"al+sis.
1.1.& Classification of ratios:
Se/eral ratios< %al%$late# fro- the a%%o$"ti"g #ata %a" be gro$pe# i"to
/ario$s %lasses a%%or#i"g to fi"a"%ial a%ti/it+ or f$"%tio" to be e/al$ate#.
Ma"ge-e"t is i"tereste# i" e/al$ati"g e/er+ aspe%t of the fir-=s perfor-a"%e.
The+ ha/e to prote%t the i"terests of all parties a"# see that the fir- gro1s
profitabl+.!" /ie1 of thee re8ire-e"t of the /ario$s $sers of ratios< ratios are
%lassifie# i"to follo1i"g fo$r i-porta"t %ategoriesC
-i,uidity ratios B shortBter- fi"a"%ial stre"gth
-e*erage ratios B lo"gBter- fi"a"%ial stre"gth
Profitability ratios B lo"g ter- ear"i"g po1er
/cti*ity ratios B ter- of i"/est-e"t $tili@atio"
-i,uidity ratios -eas$re the fir-=s abilit+ to -eet %$rre"t obligatio"sA
-e*erage ratios sho1 the proportio"s of #ebt a"# e8$it+ i" fi"a"%i"g the fir-=s
assetsA
/cti*ity ratios refle%t the fir-=s effi%ie"%+ i" $tili@i"g its assetsA a"#
Profitability ratios -eas$re o/erall perfor-a"%e a"# effe%ti/e"ess of the fir-
-I5I6IT7 8/TI9S:
!t is e9tre-el+ esse"tial for a fir- to be able to -eet the obligatio"s as the+
be%o-e #$e. -i,uidity ratios -eas$re the abilit+ of the fir- to -eet its
%$rre"t obligatio"s >liabilities?. The liquidity ratios reflect the short-term
financial strength and solvency of a firm. !" fa%t< a"al+sis of li8$i#it+ "ee#s the
preparatio" of %ash b$#gets a"# %ash a"# f$"#s flo1 state-e"tsA b$t
li8$i#it+ ratios< b+ establishi"g a relatio"ship bet1ee" %ash a"# other %$rre"t
assets to %$rre"t obligatio"s< pro/i#e a 8$i%' -eas$re of li8$i#it+. A fir-
sho$l# e"s$re that it #oes "ot s$ffer fro- la%' of li8$i#it+< a"# also that it
#oes "ot ha/e e9%ess li8$i#it+. The fail$re of a %o-pa"+ to -eet its
obligatio"s #$e to la%' of s$ffi%ie"t li8$i#it+< 1ill res$lt i" a poor %re#it
1orthi"ess< loss of %re#it 1orthi"ess< loss of %re#itors= %o"fi#e"%e< or e/e"
i" legal ta"gles res$lti"g i" the %los$re of the %o-pa"+. A /er+ high #egree
of li8$i#it+ is also ba#A i#le assets ear" "othi"g. The fir-=s f$"#s 1ill be
$""e%essaril+ tie# $p i" %$rre"t assets. Therefore< it is "e%essar+ to stri'e a
proper bala"%e bet1ee" high li8$i#it+ a"# la%' of li8$i#it+.
The -ost %o--o" ratios 1hi%h i"#i%ate the e9te"t of li8$i#it+ are la%' of
it< areC
:i" Current ratio
:ii" 5uick ratio.
:iii"Cash ratio and
:i*";et3orking capital ratio.
1. Current 8atioC
C$rre"t ratio is %al%$late# b+ #i/i#i"g %$rre"t assets b+ %$rre"t liabilities.
C$rre"t assets
C$rre"t *atioG
C$rre"t Liabilities
C$rre"t assets i"%l$#e %ash a"# other assets that %a" be %o"/erte# i"to %ash
1ithi" i" a +ear< s$%h as -ar'etable se%$rities< #ebtors a"# i"/e"tories. Prepai#
e9pe"ses are also i"%l$#e# i" the %$rre"t assets as the+ represe"t the pa+-e"ts
that 1ill "ot be -a#e b+ the fir- i" the f$t$re. All obligatio"s -at$ri"g 1ithi"
a +ear are i"%l$#e# i" the %$rre"t liabilities. C$rre"t liabilities i"%l$#e %re#itors<
bills pa+able< a%%r$e# e9pe"ses< shortBter- ba"' loa"< i"%o-e ta9< liabilit+ a"#
lo"gBter- #ebt -at$ri"g i" the %$rre"t +ear.
The %$rre"t ratio is a -eas$re of fir-=s short!term sol*ency. !t
i"#i%ates the a/ailabilit+ of %$rre"t assets i" r$pees for e/er+ o"e r$pee of
%$rre"t liabilit+. A ratio of greater tha" o"e -ea"s that the fir- has -ore
%$rre"t assets tha" %$rre"t %lai-s agai"st the- C$rre"t liabilities.
%. 5uick 8atio:
7$i%' ratio also %alle# /cid!test ratio< establishes a relatio"ship
bet1ee" 8$i%'< or li8$i#< assets a"# %$rre"t liabilities. A" asset is a li8$i# if it
%a" be %o"/erte# i"to %ash i--e#iatel+ or reaso"abl+ soo" 1itho$t a loss of
/al$e. Cash is the -ost li8$i# asset. Other assets that are %o"si#ere# to be
relati/el+ li8$i# a"# i"%l$#e# i" 8$i%' assets are #ebtors a"# bills re%ei/ables
a"# -ar'etable se%$rities >te-porar+ 8$ote# i"/est-e"ts?. !"/e"tories are
%o"si#ere# to be less li8$i#. !"/e"tories "or-all+ re8$ire so-e ti-e for
reali@i"g i"to %ashA their /al$e also has a te"#e"%+ to fl$%t$ate. The 8$i%' ratio
is fo$"# o$t b+ #i/i#i"g 8$i%' assets b+ %$rre"t liabilities.

&. Cash 8atio:
Si"%e %ash is the -ost li8$i# asset< it -a+ be e9a-i"e# %ash ratio a"#
its e8$i/ale"t to %$rre"t liabilities. Tra#e i"/est-e"t or -ar'etable se%$rities
are e8$i/ale"t of %ashA therefore< the+ -a+ be i"%l$#e# i" the %o-p$tatio" of
%ash ratioC
'. Inter*al #easure
Het a"other< ratio< 1hi%h assesses a fir-=s abilit+ to -eet its reg$lar %ash
e9pe"ses< is the i"ter/al -eas$re. !"ter/al -eas$re relates li8$i# assets to
a/erage #ail+ operati"g %ash o$tflo1s. The #ail+ operati"g e9pe"ses 1ill be
e8$al to %ost of goo#s sol# pl$s selli"g< a#-i"istrati/e a"# ge"eral e9pe"ses
less #epre%iatio" >a"# other "o" %ash e9pe"#it$res #i/i#e# b+ "$-ber of #a+s
i" a +ear >sa+ 306?.
>7$i%' AssetsGC$rre"t AssetsG!"/e"tories?
7$i%' Assets
7$i%' *atioG
C$rre"t Liabilities
Cash I Mar'etable Se%$rities
Cash *atioG
C$rre"t Liabilities

C$rre"t assets B i"/e"tor+
!"ter/al -eas$re G
A/erage #ail+ operati"g e9pe"ses
(. ;et 2orking Capital 8atio
The #iffere"%e bet1ee" %$rre"t assets a"# %$rre"t liabilities e9%l$#i"g
short J ter- ba"' borro1i"gs i" %alle# "et 1or'i"g %apital >NWC? or "et
%$rre"t assets >NCA?. NWC is so-eti-es $se# as a -eas$re of fir-=s li8$i#it+.
!t is %o"si#ere# that bet1ee" t1o fir-=s the o"e ha/i"g larger NWC as the
greater abilit+ to -eet its %$rre"t obligatio"s. This is "ot "e%essaril+ soA the
-eas$re of li8$i#it+ is a relatio"ship< rather tha" the #iffere"%e bet1ee" %$rre"t
assets a"# %$rre"t liabilities. NWC< ho1e/er< -eas$res the fir-=s pote"tial
reser/oir of f$"#s. !t %a" be relate# to "et assets >or %apital e-plo+e#?C
Net 1or'i"g %apital >NWC?
NWC ratio G
>Net assets >or? Capital E-plo+e#?
0. -<=<8/>< 8/TI9:
The shortBter- %re#itors< li'e ba"'ers a"# s$ppliers of ra1 -aterials< are
-ore %o"%er"e# 1ith the fir-=s %$rre"t #ebtBpa+i"g abilit+. O" other ha"#<
li"gBter- %re#itors li'e #ebe"t$re hol#ers< fi"a"%ial i"stit$tio"s et% are -ore
%o"%er"e# 1ith the fir-=s lo"gBter- fi"a"%ial stre"gth. !" fa%t a fir- sho$l#
ha/e a stro"g short as 1ell as lo"gBter- fi"a"%ial stre"gth. !" fa%t a fir- sho$l#
ha/e a stro"g shortBas 1ell as lo"gBter- fi"a"%ial positio". To .$#ge the lo"gB
ter- fi"a"%ial positio" of the fir-< financial le*erage< or capital structure
ratios are %al%$late#. These ratios i"#i%ate -i9 of f$"#s pro/i#e# b+ o1"ers
a"# le"#ers. As a ge"eral r$le there sho$l# be a" appropriate -i9 of #ebt a"#
o1"ers e8$it+ i" fi"a"%i"g the fir-=s assets.
Le/erage ratios -a+ be %al%$late# fro- the bala"%e sheet ite-s to #eter-i"e the
proportio" of #ebt i" total fi"a"%i"g. Ma"+ /ariatio"s
of these ratios e9istA b$t all these ratios i"#i%ate the sa-e thi"g the e9te"t to
1hi%h the fir-s has relie# o" #ebt i" fi"a"%i"g assets. Le/erage ratios are also
%o-p$te# for- the profit a"# loss ite-s b+ #eter-i"i"g the e9te"t to 1hi%h
operati"g profits are s$ffi%ie"t to %o/er the fi9e# %harges.
1. 6<?T 8/TI9:
Se/eral #ebt ratios -a+ be $se# to a"al+se the lo"g ter- sol/e"%+ of the fir-
The fir- -a+ be i"tereste# i" '"o1i"g the proportio" of the i"terest beari"g
#ebt >also %alle# as f$"#e# #ebt? i" the %apital str$%t$re. !t -a+< therefore<
%o-p$te debt ratio b+ #i/i#i"g total #ebt b+ %apital e-plo+e# or "et assets.
Capital e-plo+e# 1ill i"%l$#e total #ebt a"# "et 1orth
Total #ebt >TD?
Debt ratio G
Total #ebt >TD? I Net 1orth >NW?


Total #ebt >TD?
Debt *atioG
Capital e-plo+e# >CE?
6ebt!<,uity 8atio:
The relatio"ship #es%ribi"g the le"#ers %o"trib$tio" for ea%h r$pee of
the o1"ers= %o"trib$tio" is %alle# #ebtBe8$it+ >DE? ratio is #ire%tl+ %o-p$te#
b+ #i/i#i"g total #ebt b+ "et 1orthC
Total #ebt >TD?
Debt B e8$it+ ratio G
Net 1orth >NW?
4. Capital <mployed to ;et 3orth 8atio
!t is a"other 1a+ of e9pressi"g the basi% relatio"ship bet1ee"
#ebt a"# e8$it+. O"e -a+ 1a"t to '"o1C Do1 -$%h f$"#s are bei"g
%o"trib$te# together b+ le"#ers a"# o1"ers for ea%h r$pee of o1"ers=
%o"trib$tio" K Cal%$lati"g the ratio of %apital e-plo+e# or "et assets to "et
1orth %a" fi"# this o$tC

Capital e-plo+e# >CE?
Capital e-plo+e# to "et 1orth *atio G
Net 1orth >NW?
C9=<8/>< 8/TI9:
Interest Co*erage 8atio:
Debt ratios #es%ribe# abo/e are stati% i" "at$re< a"# fail to i"#i%ate the
fir-=s abilit+ to -eet i"terest >a"# other fi9e# %harges? obligatio"s. The
interest co*erage ratio or the times interest!earned is $se# to test the
fir-=s #ebtBser/i%i"g %apa%it+. the i"terest %o/erage ratio is %o-p$te# b+
#i/i#i"g ear"i"gs before i"terest a"# ta9es>E5!T?b+ i"terest %hargesC
E5!T
!"terest %o/erage ratioG
!"terest
/CTI=IT7 8/TI9S:
3$"#s of %re#itors a"# o1"ers are i"tereste# i" /ario$s assets to
ge"erate sales a"# profits. The better the -a"age-e"t of assets< the larger the
a-o$"t of sales. A%ti/it+ ratios are e-plo+e# to e/al$ate the effi%ie"%+ 1ith
1hi%h the fir- -a"ages a"# $tili@es its assets. These ratios are also %alle#
t$r"o/er ratios be%a$se the+ i"#i%ate the spee# 1ith 1hi%h assets are bei"g
%o"/erte# or t$r"e# o/er i"to sales. A%ti/it+ ratios< th$s< i"/ol/es a relatio"ship
bet1ee" sales a"# assets. A proper bala"%e bet1ee" sales a"# assets ge"erall+
refle%ts that assets are -a"age# 1ell. Se/eral a%ti/it+ ratios are %al%$late# to
.$#ge the effe%ti/e"ess of asset $tili@atio".
1@. In*entory Turno*er 8atio:
!"/e"tor+ t$r"o/er i"#i%ates the effi%ie"%+ of the fir- i" pro#$%i"g a"# selli"g
its pro#$%t. !t is %al%$late# b+ #i/i#i"g the %ost of goo#s sol# b+ the a/erage
i"/e"tor+C
Cost of goo#s sol#
!"/e"tor+ t$r"o/er *atio G
A/erage i"/e"tor+
>O*?
Net sales
!"/e"tor+

The a/erage i"/e"tor+ is the a/erage of ope"i"g a"# %losi"g bala"%es of i"/e"tor+.
The %ost of goo#s sol# -a+ "ot be a/ailable so 1e %a" %o-p$te i"/e"tor+ t$r"o/er as
sales #i/i#e# b+ i"/e"tor+ !" a -a"$fa%t$ri"g %o-pa"+ i"/e"tor+ of fi"ishe# goo#s is
$se# to %al%$late i"/e"tor+ t$r"o/er. This i"/e"tor+ t$r"o/er ratio i"#i%ates 1hether
i"/est-e"t i" i"/e"tor+ is effi%ie"tl+ $tili@e# or "ot. !t< therefore< e9plai"s 1hether
i"/est-e"t i" i"/e"tor+ i" 1ithi" proper li-its or "ot. !t is %al%$late# b+ #i/i#i"g the
%ost of goo#s sales b+ the a/erage i"/e"tor+.
The i"/e"tor+ t$r"o/er sho1s ho1 rapi#l+ the i"/e"tor+ i" t$r"i"g i"to re%ei/able
thro$gh sales.
A high i"/e"tor+ t$r"o/er is i"#i%ati/e of goo# i"/e"tor+ -a"age-e"t.
A lo1 i"/e"tor+ t$r"o/er i-plies e9%essi/e i"/e"tor+ le/els tha" 1arra"te# b+
pro#$%tio" a"# sales a%ti/ities or a slo1 -o/i"g or obsolete i"/e"tor+.
In*entory Con*ersion Period:
!t -a+ also be of i"terest to see the a/erage ti-e ta'e" for %leari"g the sto%'.
This %a" be possible b+ %al%$lati"g the i"/e"tor+ %o"/ersio" perio#. This perio# is
%al%$late# b+ #i/i#i"g the "o. of #a+s b+ i"/e"tor+ t$r"o/er ratioC

No. of #a+s i" the +ear
!"/e"tor+ t$r"o/er ratioG
!"/e"tor+ t$r"o/er ratio
11. 6ebtors :/ccounts 8ecei*able" Turno*er 8atio:
A fir- sells goo#s for %ash a"# %re#it. Cre#it is $se# as a -ar'eti"g
tool b+ "$-ber of %o-pa"ies. Whe" the fir- e9te"#s %re#its to its %$sto-ers<
#ebtors >a%%o$"ts re%ei/able? are %reate# i" the fir-=s a%%o$"ts. Debtors are
%o"/ertible i"to %ash o/er a short perio# a"#< therefore< are i"%l$#e# i" %$rre"t
assets. The li8$i#it+ positio" of the fir- #epe"#s o" the 8$alit+ of #ebtors to a
great e9te"t. 3i"a"%ial a"al+st applies these ratios to .$#ge the 8$alit+ or
li8$i#it+ of #ebtors >a? Debtors T$r"o/er *atio >b? Debtors Colle%tio" Perio#
Debtors= t$r"o/er is fo$"# o$t b+ #i/i#i"g %re#it sales b+ a/erage #ebtorsC
Cre#it sales
Debtors t$r"o/er A
Debtors

Debtors= t$r"o/er i"#i%ates the "$-ber of ti-es #ebtors= t$r"o/er ea%h +ear
ge"erall+< the higher the /al$e of #ebtors= t$r"o/er< the -ore effi%ie"t is the
-a"age-e"t of %re#it.
To o$tsi#e a"al+st< i"for-atio" abo$t %re#it sales a"# ope"i"g a"# %losi"g
bala"%es of #ebtors -a+ "ot be a/ailable. Therefore< #ebtors= t$r"o/er %a" be
%al%$late# b+ #i/i#i"g Total sales b+ the +earBe"# bala"%es of #ebtorsC
Sales
Debtors t$r"o/er G
Debtors
/*erage Collection Period:
A/erage Colle%tio" Perio# is $se# i" #eter-i"i"g the %olle%tibles of
#ebtors a"# the effi%ie"%+ of %olle%tio" efforts. !" as%ertai"i"g the fir-s
%o-parati/e stre"gth a"# a#/a"tage relati/e to its %re#it poli%+ a"#
perfor-a"%e
The a/erage "$-ber of #a+s for 1hi%h the #ebtors re-ai" o$tsta"#i"g is
%alle# the A/erage Colle%tio" Perio#. The A/erage Colle%tio" Perio# -eas$res
the 8$alit+ of the #ebtors si"%e it is i"#i%ate# the spee# of their %olle%tio".
306
A/erage Colle%tio" Perio#G
Debtors T$r"o/er *atio
BorC
Debtors
G L 306
Sales
1&. ;et /ssets Turno*er 8atio:
Net assets t$r"o/er %a" be %o-p$te# si-pl+ b+ #i/i#i"g sales b+ "et sales
>NA?
Sales
Net Assets T$r"o/er G
Net assets
!t -a+ be re%alle# that "et assets >NA? i"%l$#e "et fi9e# assets >N3A? a"# "et
%$rre"t assets >NCA?< that is< %$rre"t assets >CA? -i"$s %$rre"t liabilities >CL?.
Si"%e "et assets e8$al %apital e-plo+e#< "et assets t$r"o/er -a+ also be %alle#
%apital e-plo+e#< "et assets t$r"o/er -a+ also be %alle# capital employed
turno*er.
Total /ssets Turno*er:
So-e a"al+sts li'e to %o-p$te the total assets turno*er i" a##itio" to or
i"stea# of the "et assets t$r"o/er. This ratio sho1s the fir-s abilit+ i"
ge"erati"g sales fro- all fi"a"%ial reso$r%es %o--itte# to total assets.
Th$sC

Sales
Total Assets T$r"o/er G
Total assets
Total Assets >TA? i"%l$#e "et fi9e# Asses >N3A? a"# %$rre"t assets >CA?
>TAGN3AICA?
1(. Current /ssets Turno*er
A fir- -a+ also li'e to relate %$rre"t assets >or "et 1or'i"g gap? to
sales. !t -a+ th$s %o-plete "et1or'i"g %apital t$r"o/er b+ #i/i#i"g sales b+
"et 1or'i"g %apital.

Sales
C$rre"t assets t$r"o/er G
C$rre"t assets
10. .i+ed /ssets Turno*er:
The fir- to '"o1 its effi%ie"%+ of $tili@i"g fi9e# assets separatel+. This
ratio -eas$res sales i" r$pee of i"/est-e"t i" fi9e# assets. A high ratio
i"#i%ates a high #egree of $tili@atio" i" assets a"# lo1 ratio refle%ts the
i"effi%ie"t $se of assets

Sales
3i9e# Assets T$r"o/er G
3i9e# Assets
11. 2orking Capital Turno*er 8atioC
Wor'i"g Capital of a %o"%er" is #ire%tl+ relate# to sales. The %$rre"t assets li'e
#ebtors< bills re%ei/able< %ash< a"# sto%' et%. %ha"ge 1ith the i"%rease or #e%rease i"
sales. The Wor'i"g Capital is ta'e" asC
Wor'i"g Capital G C$rre"t Assets J C$rre"t Liabilities
This *atio i"#i%ates the /elo%it+ of the $tili@atio" of "et 1or'i"g %apital. This
*atio i"#i%ates the "$-ber of ti-es the 1or'i"g %apital is t$r"e# o/er i" the %o$rse of a
+ear. This *atio -eas$res the effi%ie"%+ 1ith 1hi%h the 1or'i"g %apital is bei"g $se#
b+ a fir-. A higher ratio i"#i%ates the effi%ie"t $tili@atio" of 1or'i"g %apital a"# the
lo1 ratio i"#i%ates i"effi%ie"t $tili@atio" of 1or'i"g %apital.
Sales
Wor'i"g %apital t$r"o/er G
Net 1or'i"g %apital
P89.IT/?I-IT7 8/TI9S
A %o-pa"+ sho$l# ear" profits to s$r/i/e a"# gro1 o/er a lo"g
perio# of ti-e. Profits are esse"tial< b$t it 1orl# be 1ro"g to ass$-e that e/er+
a%tio" i"itiate# b+ -a"age-e"t of a %o-pa"+ sho$l# be ai-e# at -a9i-i@i"g
profits< irrespe%ti/e of %o"%er"s for %$sto-ers< e-plo+ees< s$ppliers or so%ial
%o"se8$e"%es. !t is $"fort$"ate that the 1or# profit is loo'e# $po" as a ter- of
ab$se si"%e so-e fir-s al1a+s 1a"t to -a9i-i@e profits ate the %ost of
e-plo+ees< %$sto-ers a"# so%iet+. E9%ept s$%h i"fre8$e"t %ases< it is a fa%t that
s$ffi%ie"t profits -$st be able to obtai" f$"#s fro- i"/estors for e9pa"sio" a"#
gro1th a"# to %o"trib$te to1ar#s the so%ial o/erhea#s for 1elfare of the
so%iet+.
Profit is the #iffere"%e bet1ee" re/e"$es a"# e9pe"ses o/er a perio#
of ti-e >$s$all+ o"e +ear?. Profit is the $lti-ate o$tp$t of a %o-pa"+< a"# it
1ill ha/e "o f$t$re if it fails to -a'e s$ffi%ie"t profits. Therefore< the fi"a"%ial
-a"ager sho$l# %o"ti"$o$sl+ e/al$ate the effi%ie"%+ of the %o-pa"+ i" ter-s of
profit. The profitabilit+ ratios are %al%$late# to -eas$re the operati"g
effi%ie"%+ of the %o-pa"+. 5esi#es -a"age-e"t of the %o-pa"+< %re#itors a"#
o1"ers are also i"tereste# i" the profitabilit+ of the fir-. Cre#itors 1a"t to get
i"terest a"# repa+-e"t of pri"%ipal reg$larl+. O1"ers 1a"t to get a re8$ire#
rate of ret$r" o" their i"/est-e"t. This is possible o"l+ 1he" the %o-pa"+
ear"s e"o$gh profits.
Ge"erall+< t1o -a.or t+pes of profitabilit+ ratios are %al%$late#C
Profitabilit+ i" relatio" to sales.
Profitabilit+ i" relatio" to i"/est-e"t.
10. ;et Profit #argin
Net profit is obtai"e# 1he" operati"g e9pe"sesA i"terest a"# ta9es are
s$btra%te# for- the gross profit -argi" ratio is -eas$re# b+ #i/i#i"g profit
after ta9 b+ salesC
Net Profit
Net profit *atio G L 66
Sales
Net profit ratio establishes a relatio"ship bet1ee" "et profit a"# sales a"#
i"#i%ates a"# -a"age-e"t=s i" -a"$fa%t$ri"g< a#-i"istrati"g a"# selli"g the
pro#$%ts. This ratio is the o/erall -eas$re of the fir-=s abilit+ to t$r" ea%h
r$pee sales i"to "et profit. !f the "et -argi" is i"a#e8$ate the fir- 1ill fail to
a%hie/e satisfa%tor+ ret$r" o" sharehol#ers= f$"#s. This ratio also i"#i%ates the
fir-=s %apa%it+ to 1ithsta"# a#/erse e%o"o-i% %o"#itio"s.A fir- 1ith high "et
-argi" ratio 1o$l# be a#/a"tageo$s positio" to s$r/i/e i" the fa%e of falli"g
pri%es< selli"g pri%es< %ost of pro#$%tio" .
11. ;et #argin ?ased on ;9P/T
The profit after ta9 >PAT? fig$re e9%l$#es i"terest o" borro1i"g.
!"terest is ta9 #e#$%ts able< a"# therefore< a fir- that pa+s -ore i"terest pa+s
less ta9. Ta9 sa/e# o" a%%o$"t of pa+-e"t of i"terest is %alle# i"terest ta9
shiel#. Th$s the %o"/e"tio"al -eas$re of "et profit -argi"BPAT to sales ratioB
is affe%te# b+ fir-=s fi"a"%ial poli%+. !t %a" -islea# if 1e %o-pare t1o fir-s
1ith #iffere"t #ebt ratios. 3or a tr$e %o-pariso" of the operati"g perfor-a"%e
of fir-s< 1e -$st ig"ore the effe%t of fi"a"%ial le/erage< /i@.< the -eas$re of
profits sho$l# ig"ore i"terest a"# its ta9 effe%t. Th$s "et profit -argi" >for
e/al$ati"g operati"g perfor-a"%e? -a+ be %o-p$te# i" the follo1i"g 1a+C
E5!T >BT? NOPAT
Net profit -argi" G G
Sales Sales
14. 9perating <+pense 8atio:
The operati"g e9pe"se ratio e9plai"s the %ha"ges i" the profit -argi"
>E5!T to sales? ratio. This ratio is %o-p$te# b+ #i/i#i"g operati"g e9pe"ses
viz., %ost of goo#s sol# pl$s selli"g e9pe"se a"# ge"eral a"# a#-i"istrati/e
e9pe"ses >e9%l$#i"g i"terest? b+ sales.
Operati"g e9pe"ses
Operati"g e9pe"ses ratioG
Sales
1D. 8eturn on In*estment :89I?
The ter- i"/est-e"t -a+ refer to total assets or "et assets. The
f$"#s e-plo+e# i" "et assets i" '"o1" as %apital e-plo+e#. Net assets e8$al
"et fi9e# assets pl$s %$rre"t assets -i"$s %$rre"t liabilities e9%l$#i"g ba"'
loa"s. Alter"ati/el+< %apital e-plo+e# is e8$al to "et 1orth pl$s total #ebt.
The %o"/e"tio"al approa%h of %al%$lati"g ret$r" of i"/est-e"t
>*O!? is to #i/i#e PAT b+ i"/est-e"ts. !"/est-e"t represe"ts pool of f$"#s
s$pplie# b+ sharehol#ers a"# le"#ers< 1hile PAT represe"t resi#$e i"%o-e of
sharehol#ersA therefore< it is %o"%ept$all+ $"so$"# to $se PAT i" the %al%$latio"
of *O!. Also< as #is%$sse# earlier< PAT is affe%te# b+ %apital str$%t$re. !t is<
therefore< -ore appropriate to $se o"e of the follo1i"g -eas$res of *O! for
%o-pari"g the operati"g effi%ie"%+ of fir-sC

5!T >BT? E5!T >BT?
*O! G *OTA G G
Total assets TA
E5!T >BT? E5!T >BT?
*O! G *ONA G G
Net assets NA
Si"%e ta9es are "ot %o"trollable b+ -a"age-e"t< a"# si"%e fir-=s opport$"ities
for a/aili"g ta9 i"%e"ti/es #iffer< it -a+ be -ore pr$#e"t to $se before ta9 to
-eas$re *O!. Ma"+ %o-pa"ies $se E5!TDA >Ear"i"gs before Depre%iatio"<
!"terest< Ta9 a"# A-orti@atio"? i"stea# of E5!T to %al%$late *O!. Th$s the
ratio isC
E5!T
*O!G
Total Assets >TA?
%@. 8eturn on <,uity :89<"
Co--o" or or#i"ar+ sharehol#ers are e"title# to the resi#$al
profits. The rate of #i/i#e"# is "ot fi9e#A the ear"i"gs -a+ be #istrib$te# to
sharehol#ers or retai"e# i" the b$si"ess. Ne/ertheless< the "et profits after ta9es
represe"t their ret$r". A ret$r" o" sharehol#ers e8$it+ is %al%$late# to see the
profitabilit+ of o1"ers= i"/est-e"t. The sharehol#ers e8$it+ or "et 1orth 1ill
i"%l$#e pai#B$p share %apital< share pre-i$-< a"# reser/es a"# s$rpl$s less
a%%$-$late# losses. Net 1orth also be fo$"# b+ s$btra%ti"g total liabilities
fro- total assets. The ret$r" o" e8$it+ is "et profit after ta9es #i/i#e# b+
sharehol#ers e8$it+< 1hi%h is gi/e" b+ "et 1orthC
Profit after ta9es PAT
*OE G G
Net 1orth >E8$it+? NW
*OE i"#i%ates ho1 1ell the fir- has $se# the reso$r%es of o1"ers. !"
fa%t< this ratio is o"e of the -ost i-porta"t relatio"ships i" fi"a"%ial a"al+sis.
The ear"i"g of a satisfa%tor+ ret$r" is the -ost #esirable ob.e%ti/e of b$si"ess.
The ratio of "et profit to o1"ers= e8$it+ refle%ts the e9te"t to 1hi%h this
ob.e%ti/e has bee" a%%o-plishe#. This ratio is< th$s< of great i"terest to the
prese"t as 1ell as the prospe%ti/e Sharehol#ers a"# also of great %o"%er" to
-a"age-e"t< 1hi%h has the respo"sibilit+ of -a9i-i@i"g the o1"ers= 1elfare.
The ret$r" o" o1"ers= e8$it+ of the %o-pa"+ sho$l# be %o-pare# 1ith
the ratios of other si-ilar %o-pa"ies a"# the i"#$str+ a/erage. This 1ill re/eal
the relati/e perfor-a"%e a"# stre"gth of the %o-pa"+ i" attra%ti"g f$t$re
i"/est-e"ts.
%1. <arnings per Share :<PS"
The profitabilit+ of the sharehol#ers i"/est-e"ts %a" also be -eas$re#
i" -a"+ other 1a+s. O"e s$%h -eas$re is to %al%$late the ear"i"gs per share.
The ear"i"gs per share >EPS? are %al%$late# b+ #i/i#i"g the profit after ta9es b+
the total "$-ber of or#i"ar+ shares o$tsta"#i"g.
Profit after ta9
EPS G
N$-ber of share o$tsta"#i"g
%%. 6i*idends per Share :6PS or 6I="
The "et profits after ta9es belo"g to sharehol#ers. 5$t the
i"%o-e< 1hi%h the+ 1ill re%ei/e< is the a-o$"t of ear"i"gs #istrib$te# as %ash
#i/i#e"#s. Therefore< a large "$-ber of prese"t a"# pote"tial i"/estors -a+ be
i"tereste# i" DPS< rather tha" EPS. DPS is the ear"i"gs #istrib$te# to or#i"ar+
sharehol#ers #i/i#e"# b+ the "$-ber of or#i"ar+ shares o$tsta"#i"g.

Ear"i"gs pai# to sharehol#ers >#i/i#e"#s?
DPSG
N$-ber of or#i"ar+ shares o$tsta"#i"g
%&. 6i*idend E Payout 8atio
The Di/i#e"# J pa+o$t *atio or si-pl+ pa+o$t ratio is DPS > or total
e8$it+ #i/i#e"#s? #i/i#e# b+ the EPS > or profit after ta9?C
E8$it+ #i/i#e"#s
Di/i#e"# Pa+o$t *atio G
Profit after ta9
Di/i#e"#s per share DPS
G G
Ear"i"gs per share EPS
1.% 8<S</8C$ #<T$969-9>7
1.%.1;eed for the study:
The proble-s< 1hi%h are %o--o" to -ost of the p$bli% se%tors $"#er
ta'i"g< are -aterials s%ar%it+. Capa%it+ $tili@atio" a"# -ai"l+ 1or'i"g %apital
re8$ire-e"ts a"# Es1ar r$bber P/t.Lt#. are "o e9%eptio". Th$s the i-porta"%e
of the st$#+ re/eals as to ho1 effi%ie"tl+ the 1or'i"g %apMital has bee" $se# so
far i" the orga"i@atio".
1.%.% SC9P< 9. T$< ST67:
The s%ope of the st$#+ is li-ite# to %olle%ti"g fi"a"%ial #ata p$blishe# i"
the a""$al reports of the %o-pa"+ e/er+ +ear. The a"al+sis is #o"e to s$ggest
the possible sol$tio"s. The st$#+ is %arrie# o$t for &+ears>,663B64?.
1.%.& 9bFecti*es of the study:
To e9a-i"e the fi"a"%ial perfor-a"%e of the =iFai <lectricals -td.
for the perio# of ,663 to ,664.
To a"al+ses i"terpret a"# to s$ggest the operatio"al effi%ie"%+ of the
=iFai <lectricals -td. b+ %o-pari"g the bala"%e sheetN profit N loss
AO%
To %riti%all+ a"al+ses the fi"a"%ial perfor-a"%e of the =iFai
<lectricals -td. With Delp of the ratios.
1.%.' 6ata sources:
The st$#+ is base# o" se%o"#ar+ #ata. Do1e/er the pri-ar+ #ata is also
%olle%te# to fill the gap i" the i"for-atio"..
Pri-ar+ #ata 1ill be thro$gh reg$lar i"tera%tio" 1ith the offi%ials
of =iFai <lectricals -td..
Se%o"#ar+ #ata %olle%te# fro- a""$al reports a"# also e9isti"g
-a"$als a"# li'e %o-pa"+ re%or#s bala"%e sheet a"# "e%essar+
re%or#s.
1.%.( -I#IT/TI9;SC

The st$#+ is base# o" o"l+ se%o"#ar+ #ata.
The perio# of st$#+ 1as ,663B64 fi"a"%ial +ears o"l+.

2.
=IG/I <-<CT8IC/-S -I#IT<6
$76<8/?/6, I;6I/
C9#P/;7 P89.I-<
The %o-pa"+ 1as pro-ote# b+ Shri D P *a-esh< a first ge"eratio"
e"trepre"e$r a"# its prese"t Chair-a" N Ma"agi"g Dire%tor< i" the +ear 243
for the -a"$fa%t$re of Distrib$tio" a"# Po1er Tra"sfor-ers. Shri D P *a-esh
hol#s a Master #egree i" Ele%tri%al E"gi"eeri"g spe%ialisi"g i" Tra"sfor-er
#esig". Dis professio"al approa%h to orga"isatio"al iss$es< re-ar'able
b$si"ess a%$-e" %o$ple# 1ith abilit+ to fore%ast b$si"ess s%e"ario ahea#< the
stro"g #eter-i"atio" to p$rs$e the e9%elle"%e ha/e all bee" his %hief
%hara%teristi%s of his perso"alit+ that 1ere i"str$-e"tal i" bri"gi"g the
orga"isatio" to a stat$re of a global pla+er.
Cateri"g to the "ee#s of Ele%tri%it+ 5oar#s a"# Pri/ate E"terprises 1ithi" the
%o$"tr+< the %o-pa"+ /er+ soo" be%a-e o"e of the lea#i"g -a"$fa%t$rers of
Tra"sfor-ers i" the %o$"tr+. !ts 1orl# %lass #esig" s$pple-e"te# b+ StateBofB
theBart te%h"olog+< establishe# a"# -a"age# professio"all+ 1ith rob$st 8$alit+
s+ste-s a"# -o#er" -a"$fa%t$ri"g a"# testi"g fa%ilities< sta"# testi-o"+ to the
rep$te of the %o-pa"+.
T$< 298HS
Of the Se/e" -ost -o#er" -a"$fa%t$ri"g pla"ts of the Co-pa"+< o"e is
sit$ate# at 5ala"agar i" D+#eraba#< A"#hra Pra#esh< the first Pla"t of Ei.ai
Ele%tri%als< 1hi%h has the re8$isite o$tfit to %ater "ot o"l+ to -a"$fa%t$re
Distrib$tio" Tra"sfor-ers of /ario$s rati"gs b$t also to $"#erta'e ser/i%i"g.
C$rre"tl+ this $"it is bei"g $se# to $"#erta'e ser/i%i"g .obs.
The Pla"t , at *$#rara-< Me#a' Distri%t< A"#hra Pra#esh has a h$ge set of
1i#e ra"gi"g fa%ilities a%ross the /ario$s #is%ipli"es 1ith %apa%it+ to -eet the
e/er gro1i"g "ee#s of the %$sto-ers i" ter-s of their e9a%ti"g #esig"
spe%ifi%atio" a"# stri"ge"t 8$alit+ re8$ire-e"ts. While the -a.or portio"s of
operatio"s %e"tre ro$"# the Distrib$tio" a"# Po1er Tra"sfor-ers of /ario$s
rati"gs $pto 6 MEA< the pla"t has also the fa%ilit+ to -a"$fa%t$re Cast *esi"
Dr+ T+pe Tra"sfor-ers< a pro#$%t bei"g pro#$%e# o"l+ b+ a fe1 re"o1"e#
-a"$fa%t$rers i" the %o$"tr+.
The Pla"t 3 b$ilt e9%l$si/el+ for the -a"$fa%t$re of si"gle a"# three phase
E"erg+ Effi%ie"t A-orpho$s Metal Distrib$tio" Tra"sfor-ers of Co"/e"tio"al
a"# Co-pletel+ Self Prote%te# >CSP? t+pes< sta"#s o$t as a #isti"g$ishable
-a"$fa%t$ri"g Pla"t 1ith the -ost -o#er" e8$ip-e"t< hiBte%h fa%ilities a"#
pra%ti%es. The pla"t e"gage# i" 1orl# %lass -a"$fa%t$ri"g pra%ti%es is the o"l+
o"e of its 'i"# i" the %o$"tr+ a"# the 1orl# o$tsi#e )SA.

The Pla"t 4 is a %apti/e Co"#$%tor Pla"t %ateri"g to the "ee#s of all the )"its of
the Co-pa"+ for all t+pes of %oate# a"# %o/ere# %opper a"# al$-i"$-
%o"#$%tors. Co"ti"$o$sl+ Tra"spose# Co"#$%tors >CTC? -a"$fa%t$ri"g
fa%ilit+ is +et a"other a#.$"%t to the Pla"t a"# has the %apa%it+ to %ater to the
"ee#s of the gia"t $sers i" the %o$"tr+.
The other )"its are ba%'1ar# i"tegratio" pro.e%ts %ateri"g to s$ppl+ of -aterial
to the %o-pa"+ a"# also a Pa%'i"g 1oo# $"it of e9port 8$alit+ a"# sta"#ar#s.

P896CTS
The product range of VEL covers the entire gamut of Transformers,
some of the major ones being:
A-orpho$s Metal Distrib$tio" Tra"sfor-ers $pto 666 KEA< Si"gle
phase a"# Three phase.
Si"gle Phase Oil 3ille# Tra"sfor-ers $pto 3333 KEA< 30 'E Class.
Three Phase Oil 3ille# Tra"sfor-ers $pto 6666 KEA< 00 'E Class.
Si"gle Phase Dr+ T+pe Cast *esi" Tra"sfor-ers $pto 004 KEA< 30
'E Class.
Three Phase Dr+ T+pe Cast *esi" Tra"sfor-ers $pto (666 KEA< 30
'E QClass.
Co-pletel+ SelfBProte%te# Tra"sfor-ers $pto &66 KEA.
Do$ble Paper Co/ere#< M$ltiple Paper Co/ere#< S$per E"a-ele#<
3iber Glass Co/ere# Copper a"# Al$-i"$- Co"#$%tors.
Co"ti"$o$sl+ Tra"spose# Co"#$%tors >CTC?
Mo"oblo% P$-p Sets.
A$to Tra"sfor-ers.
CL* N C7* 5rea'ers
T<C$;IC/- H;92 $92
The company has the most modern technical know how absorbed from
world leaders and some of it indigenously developed over a period of 3
decades since the inception of the company. Following is the summary
of technical know how absorbed from leading companies:
Single hase !ound "ore
#istribution Transformers
- $%s. !estinghouse "orporation&
'S(
")* +reakers. - $%s. !estinghouse "orporation&
'S(
(morphous $etal "ore
#istribution Transformers
- $%s. #aihen "orporation& ,apan
>89P C9#P/;I<S
S/#8/HS$/;/ <-<CT8IC/-S -I#IT<6
Ma"$fa%t$res CSP Cir%$it 5rea'ers for $se i" Distrib$tio" Tra"sfor-ers
a"# -eets the re8$ire-e"ts of the Co-pa"+< #o-esti% "ee#s a"# e9ports to
)SA. !t also -a"$fa%t$res !"s$late# Copper a"# Al$-i"$- %o"#$%tors<
Distrib$tio" Tra"sfor-ers a"# Digh Effi%ie"%+ Si"gle Phase Mo"oblo% P$-p
Sets for the Agri%$lt$re Se%tor of the %o$"tr+.
>892T$
!" its -a"ifol# stages of gro1th< the earl+ brea'thro$gh 1as -a#e 1he"
the %o-pa"+ bagge# a -assi/e or#er for the s$ppl+ of Distrib$tio"
Tra"sfor-ers fro- A"#hra Pra#esh State Ele%tri%it+ 5oar#. 3ollo1i"g this<
"e1er approa%hes to a%hie/e higher sta"#ar#s of Pro#$%t 7$alit+< e"ha"%e#
Pro#$%ti/it+ 1ere a#opte# i" 8$i%' s$%%essio" 1ith bright prospe%ts for higher
gro1th a"# progress. Most -o#er" a##itio"al fa%ilities 1ere a##e# for #esig"
a"# -a"$fa%t$re< s$pporte# b+ 1ellBestablishe# s+ste-s a"# DiBte%h pra%ti%es
i" all the f$"%tio"s a%ross the e"tire orga"isatio"< a"# the perfor-a"%e rea%he#
"e1er heights.
The Co-pa"+ e-bar'e# o" a "e1 /e"t$re to -a"$fa%t$re Si"gle Phase
Wo$"# Core Tra"sfor-ers a"# to#a+ the %o-pa"+ has a#-irabl+ %re#ite# itself
1ith bei"g the sole -a"$fa%t$rer i" the %o$"tr+< %ar/i"g o$t a "i%he for itself i"
the #esig" a"# -a"$fa%t$re of Si"gle Phase Wo$"# Core Tra"sfor-ers i" the
1orl#.
At this .$"%t$re< the %o-pa"+ 1it"esse# a %li-ate of highl+ -oti/ate#
a"# e-po1ere# 1or' for%e 1illi"g to gi/e f$rther i-pet$s to the gro1th a"#
this triggere# off a -a.or e9pa"sio"< %$l-i"ati"g i" the establish-e"t of the
e9%l$si/e A-orpho$s Metal Tra"sfor-ers Pla"t %o-prisi"g of -ost -o#er"
i"tegrate# -a"$fa%t$ri"g fa%ilities.
The s$bse8$e"t phase 1it"esse# the begi""i"g of a" era of e9port 1ith
the %o-pa"+ e9e%$ti"g the firstBe/er e9port or#er 1hi%h rapi#l+ e"ha"%e#
%$l-i"ati"g i" a "e1er height 1ith a 1hoppi"g e9port t$r"o/er of )S R ,2
-illio" #$ri"g the +ear 220B24. Efforts to a$g-e"t this share i" the 1orl#
-ar'et are top-ost i" the age"#a of the Co-pa"+=s 5$si"ess Pla".
$#/; 8<S98C<
To#a+ the orga"isatio" #ra1s its stre"gth fro- the highl+ -oti/ate#
1or'for%e 1hi%h %o"sists of 8$alifie#< trai"e# a"# e9perie"%e# Ma"agers<
E"gi"eers< S$per/isors a"# Wor'-e"< e/er 1illi"g to -eet the e9a%ti"g a"#
%ha"gi"g #e-a"#s of the e"lighte"e# %$sto-ers< a"# 1holl+ %o--itte# to
1or'i"g to1ar#s the %o-pa"+=s /isio" of lea#ership i" the Tra"sfor-er
!"#$str+.
While the Wor'-e" a"# S$per/isors $"#ergo the i"#$%tio" trai"i"g<
the Gra#$ate E"gi"eers $"#ergo a /igoro$s o"eB+ear trai"i"g progra--e to
gai" s'ill< '"o1le#ge a"# %o-pete"%e< i" or#er that the+ %a" -eas$re $pto the
%halle"gi"g tas's a"# ass$-e higher respo"sibilities.
3or a%hie/i"g Ma"agerial e9%elle"%e< i"#i/i#$als i#e"tifie# for ta'i"g
$p /ital Ma"agerial positio" $"#ergo lo"gBter- trai"i"g i" the rep$te# Pre-ier
Ma"age-e"t !"stit$tes of the %o$"tr+.
E-plo+ees at /ario$s le/els a"# fro- #i/erse f$"%tio"s are e9pose# to
/ario$s Te%h"i%al a"# 5eha/ioral trai"i"g progra--es base# o" the i#e"tifie#
"ee#s for selfB#e/elop-e"t a"# for the e"ha"%e-e"t of orga"isatio"al
effe%ti/e"ess.
5/-IT7
The Co-pa"+ has 1ellBestablishe# 7$alit+ s+ste-s to e"s$re 8$alit+ at
all stages a"# i" all f$"%tio"s i" a %li-ate of Total 7$alit+ Wor' C$lt$re< 1here
parti%ipatio" b+ e/er+o"e reig"s s$pre-e. 7$alit+ is a 1at%h1or# a%ross the
e"tire orga"isatio" a"# has pro/e# to be a %or"er sto"e for the Co-pa"+=s
s$stai"e# gro1th a"# s$%%ess.
The three -a.or Pla"ts of the Co-pa"+ ha/e their i"#epe"#e"t !SO 266 J
,666 %ertifi%atio" a"# ha/e bee" s$%%essf$ll+ passi"g thro$gh the %ertifi%atio"
of S$r/eilla"%e a"# re"e1al a$#its si"%e the +ear 224. A%hie/i"g C$sto-er
Satisfa%tio" is the 8$alit+ poli%+ of the %o-pa"+ a"# to this e"# the %o-pa"+
has bee" a#opti"g progressi/e -eas$res /is$alisi"g 8$alit+ as a 'e+ strateg+ to
sta+ %o-petiti/e i" the b$si"ess.
-/;6#/8HS
Shi"i"g E9a-ples of E9%eptio"al E"trepre"e$rial Spirit
The "a-e Ei.ai Ele%tri%als Lt#. has bee" asso%iate# 1ith a large "$-ber of
sig"ifi%a"t a%%o-plish-e"tsC
243 Establish-e"t of the Orga"i@atio"
2(3 !"tro#$%tio" of CSP Tra"sfor-ers i" the %o$"tr+
2(4 Te%h"i%al Collaboratio" 1ith MFs Westi"gho$se Corporatio"< )SA
for Si"gle Phase Wo$"# Core Tra"sfor-ers
2(( Co--e"%e-e"t of Cast *esi" Tra"sfor-ers Pro#$%tio".
2(2
Co--e"%e-e"t of E9ports.
Te%h"i%al Collaboratio" 1ith MFs Daihe" Corporatio"< Papa" for
-a"$fa%t$re of AMDT=s.
224
*e%og"itio" b+ Go/er"-e"t of !"#ia as :E9port Do$se;.
Ma"$fa%t$re of Earth8$a'e *esista"t Tra"sfor-ers for the first ti-e
i" !"#ia.
!SO 266 Certifi%atio"
22&
Se%$re# a" e9port or#er 1orth )S R 2., Millio" fro- Philippi"es< the
largest e/erBsi"gle e9port or#er of Tra"sfor-er i" the %o$"tr+.
220
Co--e"%e-e"t of Pro#$%tio" for A-orpho$s Metal Distrib$tio"
Tra"sfor-ers i" the e9%l$si/e AMDT Pla"t
224 *e%og"itio" b+ Go/er"-e"t of !"#ia as :Tra#i"g Do$se;
22(
S$%%essf$l T+pe testi"g of 666 KEA A-orpho$s Metal Distrib$tio"
Tra"sfor-ers.
222 Se%$re# SWorl# 5a"'= or#er 1orth abo$t )S R , Millio".
,666
Obtai"e# )S pate"t for TCo"ti"$o$s A""eali"g 3$r"a%eT i" A-orpho$s
Metal Tra"sfor-er Pla"t
,66
E9porte# a %o"sig"-e"t of *s . Millio" to Ger-a"+
S$%%essf$l T+pe Testi"g for /e"#or registratio" i" Papa"
,66,
E9ports %ross )S R 66 -illio"
E"tr+ i"to t$r"'e+ ele%trifi%atio" N s$bstatio" pro.e%ts.
S$%%essf$l %o-pletio" of Ar% Proof Test o" 36 'EA Si"gleBPhase
Tra"sfor-ers as per P!S >Papa"ese Sta"#ar#s? for the first ti-e i"
!"#ia.
,663
!SO 266 J ,666 series Certifi%atio".
Co--issio"i"g of e9%l$si/e a"# %o-plete Corr$gatio" Li"e.
,664 *e%or#s highest e/er t$r"o/er of *s.,24 %rores i" the 3H ,663B64.
Te%h"i%al Collaboratio" 1ith Daihe" Corp. Papa" for Large Po1er
Tra"sfor-ers $p to &66 MEA< &66 KE Class.
Co--issio"i"g of Por%elai" Pla"t.
Co--issio"i"g of *a#iator Pla"t.
Co--issio"i"g of *oboti% Wel#i"g.
,66&
Co--issio"i"g of Plas-a Ar% C$tti"g fa%ilities.
A%%re#itatio" to all Testi"g laboratories /i@.< Tra"sfor-er Testi"g
Laboratories )"itsB 6, N 63< Co"#$%tor Testi"g Laborator+ J )"itB
64 a"# Tra"sfor-er Oil Testi"g laborator+ i" )"it B,< fro- Natio"al
A%%re#itatio" 5oar# for Testi"g a"# Calibratio" Laboratories
>NA5L?.
,660
!"%orporatio" of 5ra@ilia" S$bsi#iar+ of Ei.ai Ele%tri%als Lt#. !"#ia.

,664
!"%orporatio" of the Me9i%a" 1i"g of Ei.ai Ele%tri%als Lt#. !"#ia.
S$%%essf$l SC testi"g of the first &6 MEA Tra"sfor-ers pro#$%e# b+
the EDE 1i"g i" the first atte-pt.
T$< /2/86S
The Co-pa"+ 1as 8$i%' "ot o"l+ to se"se the e-ergi"g tre"#s i"
te%h"olog+ 1orl# o/er< b$t alo"gsi#e pla+e# %o"siste"tl+ a sig"ifi%a"t role i"
e9peri-e"ti"g< i""o/ati"g a"# pio"eeri"g "e1er %o"%epts. E"erg+ Sa/i"g a"#
Cost Effe%ti/e"ess be%a-e the t1i" pri"%iples of the Co-pa"+=s -issio" a"#
beari"g e/i#e"%e to this %o--itte# effort< Ei.ai Ele%tri%als i"tro#$%e# E"erg+B
Effi%ie"t< CostBEffe%ti/e A-orpho$s Metal Tra"sfor-ers< the firstBe/er
pro#$%e# i" the %o$"tr+.
The Orga"isatio" is o" a perpet$al %a-paig" a#/o%ati"g the $se of
A-orpho$s Metal Tra"sfor-ers< tirelessl+ #ri/i"g ho-e the -essage of the
i-perati/e a"# the $rge"t "ee# for sa/i"g of E"erg+ to -eet the e/erBgro1i"g
#e-a"#s of Po1er i" the %o$"tr+.
The s$%%essf$l .o$r"e+ perfor-e# 1ith #+"a-is-< /isio" a"#
i"#efatigable e"erg+ i" the path of e9%elle"%e o/er a perio# of t1o a"# a half
#e%a#es< has ope"e# $p "e1 hori@o"s for a prospero$s a"# /i%torio$s e"tr+ i"to
the "e1 -ille""i$-. Cro1"i"g all these efforts< the Co-pa"+ has re%ei/e#
se/eral A1ar#s< Trophies a"# Shiel#s i" re%og"itio" of its perfor-a"%e a"#
lea#i"g roles i" the #o-ai"s of Do-esti% a"# E9port -ar'ets a"# to 8$ote a
sig"ifi%a"t fe1<
In 8ecognition of 9utstanding <+cellence:
)#+og Patra A1ar# fro- Ei%e Presi#e"t of !"#ia i" the +ear 2(,.
)#+og *at"a A1ar# fro- the the" )"io" Mi"ister of E"erg+< Go/t.
of !"#ia i" the +ear 2(4.
Certifi%ate of Merit fro- EEPC for o$tsta"#i"g E9port for the +ears
22,< 223 a"# 224.
All !"#ia A1ar# for E9port E9%elle"%e b+ EEPC for the +ears 224B
2&< 22&B20 a"# 220B24.
*olli"g Trophies for E9port b+ Co"fe#eratio" of !"#ia" !"#$stries
>C!!?< %o"ti"$all+ for fo$r +ears begi""i"g fro- 224 to 224.
*e%og"i@e# as SE9port Do$se= i" 223B24 b+ the Go/t. of !"#ia.
*e%og"ise# as STra#i"g Do$seT i" 224B2( b+ the Go/er"-e"t of !"#ia
EEPC *egio"al A1ar# for the o$tsta"#i"g E9port Perfor-a"%e
#$ri"g the +ear 222B,666 >)"#er the Categor+ Ele%tri% Po1er
Ma%hi"er+< S1it%hgear a"# Co"trol Gear?.
Natio"al Citi@e"=s A1ar# for the +ear 22( re%ei/e# b+ o$r
Chair-a" for o$tsta"#i"g %o"trib$tio" i" the fiel# of !"#$str+.
)#+og P+oti A1ar# fro- the the" Mi"ister of Labor N E-plo+-e"t<
Go/t. of !"#ia. i" the +ear ,666.
A1ar# for the 5est E9port Effort i" the State >S$ra"a )#+og Sil/er
*olli"g Troph+? #$ri"g ,66B6, fro- the 3APC!!.
!T!D >!"stit$te of Tra#e a"# !"#$strial De/elop-e"t? 7$alit+
E9%elle"%e A1ar# ,66, a1ar#e# i" re%og"itio" of 7$alit+ Pro#$%t
>A-orpho$s Metal Tra"sfor-ers? b+ !T!D< Ne1 Delhi.
4th 5est E9porter A1ar# for the +ear ,66B,66, fro- Co"tai"er
Corporatio" of !"#ia< Mi"istr+ of *ail1a+s< Go/t. of !"#ia.
5harat *at"a Dr. M.Eis/es/ara+a !"#$strial A1ar# ,663 for 5est
!-port S$bstit$tio" Effort fro- All !"#ia Ma"$fa%t$rers
Orga"i@atio"< A.P.
EEPC *egio"al A1ar# for the o$tsta"#i"g E9port Perfor-a"%e
#$ri"g the +ear ,666B,66.
EEPC *egio"al A1ar# for the o$tsta"#i"g E9port Perfor-a"%e
>Co"ti"$o$s e9%elle"%e? #$ri"g the +ear ,66B,66,.
EEPC *egio"al A1ar# for the o$tsta"#i"g E9port Perfor-a"%e >Ne1
F Diffi%$lt Mar'et? #$ri"g the +ear ,66,B,663.
EEPC *egio"al A1ar# for the o$tsta"#i"g E9port Perfor-a"%e
#$ri"g the +ear ,66&B,660.
CST9#<8 S<8=IC<
The Orga"isatio" has a" e9%l$si/e C$sto-er Ser/i%e Wi"g -a""e# b+ a
%o-ple-e"t of highl+ s'ille# E"gi"eers a"# Te%h"i%ia"s to pro/i#e pro-pt a"#
effi%ie"t ser/i%e to the %$sto-ers.
Perio#i% a"al+sis of the fee#ba%' is -a#e a"# appropriate %orre%ti/e a"#
pre/e"ti/e -eas$res are ta'e" to e"s$re "ot o"l+ 8$alit+ b$t also reliabilit+<
#o1"ti-e re#$%tio" a"# life %+%le e9te"sio". The staff re-ai"s i" %o"sta"t
to$%h 1ith the %$sto-ers a"# ass$res Total C$sto-er Ser/i%e thro$gh
i"tera%tio"< pro-pt ser/i%e a"# effe%ti/e fee#ba%' s+ste-.
CST9#<8S
The Co-pa"+ e".o+s the pro$# pri/ilege of bei"g a 1ell '"o1" s$pplier
to all State Ele%tri%it+ 5oar#s i" the %o$"tr+ a"# Ele%tri%it+ Ge"erati"g
%o-pa"ies a"# "$-ber of Pri/ate !"#$stries. With its a%%e"t o" e9port< it has
%$sto-ers i" a "$-ber of %o$"tries a%ross the 1orl# a"# the %o-pa"+ has pla"s
to fora+ i"to E$rope a"# North A-eri%a for a higher Global Mar'et share.
The %$sto-ers fro- 1ithi" the %o$"tr+ i"%l$#e the follo1i"g
69#<STIC
All State Ele%tri%it+ 5oar#s i" !"#ia< i" parti%$lar the APT*ANSCO< KE5<
G*!DCO< MSE5< et%.
Other Ele%tri% )tilities a"# !"#$strial Do$ses i"%l$#eC
MFs ABU Co"s$lta"ts.
Ah-e#aba# Ele%tri%it+ Co-pa"+ Lt#.
Assa- State Ele%tri%it+ 5oar#.
5o-ba+ S$b$rba" Ele%tri% S$ppl+ Li-ite#< M$-bai
5o-ba+ Ele%tri% S$ppl+ a"# Tra"sport )"#erta'i"g< M$-bai
5ihar State Ele%tri%it+ 5oar#
Delhi Ei#+$t 5oar#
Depart-e"t of Ato-i% E"erg+< M$-bai
Gri#%o< 5h$ba"esh1ar
Go/t. of Pa--$ a"# Kash-ir
G$.arat Ele%tri%it+ 5oar#
Dar+a"a State Ele%tri%it+ 5oar#
Di-a%hal Pra#esh State Ele%tri%it+ 5oar#
!"#ia" *ail1a+s
D$bli Ele%tri%it+ S$ppl+ Co-pa"+ Li-ite#.
Kalpatar$ Po1er Tra"s-issio" Li-ite#.
Kerala State Ele%tri%it+ 5oar#
Larse" N To$bro Lt#.
Ma#h+a Pra#esh Ele%tri%it+ 5oar#
Maharashtra D!SCOM
Ne1 Delhi M$"i%ipal Co$"%il
N$%lear Po1er Corporatio"
*a.astha"D!SCOM
a? AEENL b? PEENL
Sie-e"s Lt#.
Ta-il Na#$ Ele%tri%it+ 5oar#.
)ttar Pra#esh State Ele%tri%it+ 5oar#.
Po1er Gri# Corporatio" of !"#ia Lt#.
Natio"al Ther-al Po1er Corporatio".
<IP98T
E/er si"%e Ei.ai Ele%tri%als e"tere# the e9port -ar'et i" 2(2< it has
establishe# a sig"ifi%a"t prese"%e i" se/eral e9port -ar'ets li'e Philippi"es<
5a"gla#esh a"# )AE. The %o-pa"+ has also %o/ere# other %o$"tries li'e
5ra@il< Gha"a a"# Nepal. So-e of the %o$"tries ha/e pla%e# repeat or#ers 1ith
the %o-pa"+ #$e to perfor-a"%e of the pro#$%t. !t e-erge# as the largest
e9porter of Tra"sfor-ers i" the %o$"tr+ #$ri"g 220B24 1he" its e9port
t$r"o/er rea%he# *s 24.23 Crores.
D$ri"g ,66B6, it also e"tere# i"to the E$ropea" -ar'et 1ith a" i"itial
%o"sig"-e"t of *s . -illio" e9porte# to Ger-a"+.
The %$sto-ers fro- abroa# i"%l$#e the follo1i"g
*$ral Ele%trifi%atio" 5oar#< 5a"gla#esh
3aso"s Metal !"#$stries< 5a"gla#esh
Ge"eral Ele%tri% Ma"$fa%t$ri"g Co-pa"+< 5a"gla#esh
Se"a Kal+a" Sa"gstha< 5a"gla#esh
Natio"al Ele%trifi%atio" A#-i"istratio"< Philippi"es
D$bai Ele%tri%it+ a"# Water A$thorit+< D$bai
Ele%tri%it+ A$thorit+< C+pr$s
Ele%tri%it+ Corporatio" of Gha"a< Gha"a
Ele%tro Pa$lo Ele%tri%i#a#o< Saopa$lo< 5ra@il
Do Chi Mi"h Cit+ Po1er Corporatio"< Eiet"a-
Mi"istr+ of Ele%tri%it+ a"# Water< O-a"
Nepal Ele%tri%it+ A$thorit+< Nepal
Water a"# Ele%tri%it+ Depart-e"t< Al Ai"< )AE
WESCOSA< Sa$#i Arabia
Ui-bab1e Ele%tri%it+ S$ppl+ A$thorit+< Ui-bab1e.
MNC< Ger-a"+
S%h"ei#er Corporatio" J ).K.
$I>$-I>$TS 9. T$< .I;/;CI/- 7</8 %@@&!@':
*e%or#e# highest e/er gross t$r"o/er of *s.,23 %rores.
Se%$re# si"gle largest or#er e/er i" the #istrib$tio" tra"sfor-er seg-e"t
i" o$r %o$"tr+ fro- G$.arat Ele%tri%it+ 5oar# >GE5? to1ar#s s$ppl+ of
A-orpho$s Metal Distrib$tio" Tra"sfor-er >AMDTs? /al$i"g *s.46
%rores.
E9e%$te# prestigio$s or#er /al$i"g *s.( %rores fro- !ra8< 1ith $"i8$e
pro#$%t spe%ifi%atio"s< i" a re%or# ti-e of 4& #a+s.
E"tere# i"to strategi% part"eri"g agree-e"t 1ith MFs S%h"ei#er Ele%tri%
Corporatio"< ).K. for s$ppl+ of tra"sfor-ers.
!-ple-e"te# 5aa" E*P S+ste- for effe%ti/e reso$r%e pla""i"g. We"t
li/e o" 36.2.,664.
E"tere# i"to o"e -ore te%h"i%al %ollaboratio" agree-e"t 1ith MFs
Daihe" Coropartio"< Papa" for tra"sfer of te%h"olog+.
T$r"'e+ Pro.e%ts #i/isio" e9pa"#e#.
$I>$-I>$TS 9. T$< .I;/;CI/- 7</8 %@@'!@(:
*e%or#e# highest e/er "et sales of *s.44.0( %rores #$ri"g the ele/e"
-o"ths perio# i" a +ear si"%e i"%eptio".
S$pplie# & Nos 36 KEA tra"sfor-ers to PAPAN< a %o$"tr+ '"o1" for
7$alit+< Pre%isio" a"# *eliabilit+ for the pro#$%ts. Ge"eral phe"o-e"o"
is that if 1e are able to s$ppl+ o$r pro#$%t to Papa" a"# E$rope< it
establishes that o$r pro#$%t is a%%eptable i" a"+ part of the 1orl#.
!"%rease# the a/erage pro#$%tio" pla"t %apa%it+ fro- *s.,& %rores per
-o"th to *s.&6 %rores per -o"th b+ a##i"g li"e bala"%i"g e8$ip-e"ts i"
respe%t of Tra"sfor-er Di/isio" a"# also 1ith the help of 5aaN
pro#$%tio" s%he#$ler.
!"stalle# a"# %o--issio"e# t1o *O5OT Wel#i"g -a%hi"es of 3AN)C<
Papa" -a'e i" 3abri%atio" ba+. !t is first of its 'i"# i" tra"sfor-er
i"#$str+. This 1ill fa%ilitate higher pro#$%ti/it+< 8$alit+< pre%isio" a"#
re#$%tio" i" -a" po1er.
Stre"gthe"e# ba%'1ar# i"tegratio" fa%ilities /i@.< a? De/elope# b$shi"gs
for all Si"gle a"# Three phase #istrib$tio" tra"sfor-ers e9%ept e9port
Po1er Tra"sfor-ers. b? !"#ige"o$sl+ #e/elope# s$bstit$tio" for i-porte#
Tap s1it%h for S%h"ei#er Pobs. %? De/elope# press boar#s for all t+pes of
tra"sfor-ers i"%l$#i"g i"tro#$%tio" of Press boar# sheari"g li"e $p to
3--. #? Epo9+ #otte# paper for all rati"gs of tra"sfor-ers t+pes i" the
1i"#i"g se%tio". e? Wi#e"e# the fabri%atio" %apa%it+ b+ i"tro#$%i"g
fabri%atio" of 3i" T+pe *a#iators for the tra"sfor-er rati"gs $p to 6
MEA et%.
Se%$re# si"gle largest or#er 1orth *s.6,.(, %rores fro- *elia"%e
E"erg+ Lt# #$ri"g %$rre"t fi"a"%ial +ear a"# se%o"# largest i" the
tra"sfor-er i"#$str+ i" !"#ia. 3irst bei"g GE5 or#er 1orth *s.46 %rores
se%$re# b+ $s o"l+.
E"teri"g i" a big 1a+ for s$ppl+ of #istrib$tio" tra"sfor-ers to Wi"#
E"erg+ Se%tor. MFs.E"er%o" has alrea#+ pla%e# or#er o" $s a"# e9pe%ti"g
-ore or#ers fro- MFs. E"er%o" a"# MFs.S$@lo" et%.
!#e"tifie# pote"tial e9port -ar'et i" the %o$"tries s$%h as Ethiopia<
Ta"@a"ia< Nigeria< Ke"+a< Ua-bia< )ga"#a et%.<
S$%%essf$ll+ %o-plete# o"e +ear of 5aa" E*P s+ste-. The %o-pa"+ is
bei"g be"efite# 1ith better pro#$%tio" pla""i"g i" ter-s of pro#$%t -i9
1hi%h +iel#s high ret$r"s a"# effe%ti/e $tilisatio" of -a%hi"er+
-i"i-isi"g the i-bala"%es i" %apa%ities of -a%hi"er+ res$lti"g i" high
o$tp$t as -$%h as *s.066 %rores per a""$-.
Te%h"i%al '"o1 absorptio" $"#er progress fro- MFs. Daihe"
Corporatio"< Papa" to1ar#s tra"sfer of te%h"olog+ i" respe%t of Po1er
Tra"sfor-ers Desig" a"# Ma"$fa%t$ri"g.
$I>$-I>$TS 9. T$< .I;/;CI/- 7</8 %@@0!@1:
Pro.e%t #i/isio" is the first i" the %o$"tr+ to ha/e all the E*P
f$"%tio"alities.
E!PA! goes ahea# i" 3o$"#atio" of its o1" e9%l$si/e Corr$gatio"
Ta"' Li"e.
S$%%essf$ll+ %o"#$%te# Ar% Proof Test for the first ti-e i" !"#ia.
Sets $p a "e1 pla"t i" )ttara"%hal for the -a"$fa%t$re of Si"gle
Phase Distrib$tio" Tra"sfor-ers.
E"ters i"to Te%h"i%al Collaboratio" 1ith Daihe" Corporatio"< Papa"
for -a"$fa%t$re of EDE Po1er Tra"sfor-ers $p to &66 MEA< &66
KE %lass. This StateBofBtheBart -a"$fa%t$ri"g fa%ilit+ is lo%ate# at
*$#rara-< "ear D+#eraba#.
*e/e"$e is a 1hoppi"g !N* 3,4 %rores >)S R 336 Millio"? i" the
%$rre"t fi"a"%ial +ear of ,660B64.
Set $p e9%l$si/e -a"$fa%t$ri"g fa%ilities of Copper foils a"# Kraft
paper.
3abri%atio" fa%ilit+ ho$ses hite%h pro%esses s$%h as Plas-a ar%
%$tti"g a"# *oboti% 1el#i"g.
Deplo+s E*P to opti-ise the a/ailable reso$r%es a"# re#$%e the
respo"se ti-e to the %$sto-ers.
E9plori"g possibilities to /e"t$re i"to Wi"# a"# D+#el po1er
pro.e%ts.
Pla"s for setti"g $p Massi/e Ser/i%e Ce"tre a%ross #iffere"t parts of
!"#ia.
!"tro#$%es the "e1 VDelta Core Tra"sfor-ersV.
Pla"s for setti"g $p a" e9%l$si/e -a"$fa%t$ri"g pla"t i" Me9i%o for
e"erg+ effi%ie"t A-orpho$s Metal Core Distrib$tio" Tra"sfor-ers.
.T8< P-/;S
The Co-pa"+ has e-bar'e# $po" -a.or e9pa"sio" a"# #i/ersifi%atio"
pro.e%ts i"%l$#i"g Po1er Tra"sfor-ers< Me#i$- Distrib$tio" Tra"sfor-ers<
5ioBMass Po1er Pla"t< a"# other ba%'1ar# i"tegratio" pro.e%ts to 1i#e" its
%$sto-er base a"# %apt$re "e1 gro1th possibilities a"# re#$%e -a"$fa%t$ri"g
%osts a"# has also pla"s to la$"%h "e1er /ersio"s of Tra"sfor-ers 1hi%h sho$l#
pro/e "ot o"l+ e%o"o-i%al i" ter-s of %ost a"# e"erg+ b$t as allBti-e s$perior
pro#$%t to pro/i#e. Total Satisfa%tio" to the e"# $sers< be the+ Ele%tri%it+
5oar#s< Po1er Ge"erati"g Co-pa"ies or Pri/ate E"terprises.
E9port 1o$l# %o"ti"$e to be a thr$st area b$t 1ith the greater a%%e"t o"
e9pa"#i"g the 1orl# -ar'et espe%iall+ fora+i"g i"to E$rope a"# )S.
The Co-pa"+< 1hi%h has a" e"tr+ i"to Distrib$tio" S+ste- !-pro/e-e"t
Pro.e%ts< 1o$l# %o"ti"$e to loo' for gree"er past$res to progressi/el+ %apt$re
si-ilar %o"tra%ts of Pro.e%ts< #o-esti% as 1ell as foreig"< i" the i--e#iate
f$t$re.
3.
3i"a"%ial state-e"ts ha/e t1o -a.or $ses i" fi"a"%ial a"al+sis .first< the+ are
$se# to prese"t a histori%al re%o/er of the fir-=s fi"a"%ial #e/elop-e"t. Se%o"#<
the+ are $se# for a %o$rse of a%tio" for the fir-.
A perfor-a"%e fi"a"%ial state-e"t is prepare# for a f$t$re perio#. !t is the
fi"a"%ial -a"ager=s esti-ate of the fir-=s f$t$re perfor-a"%e.
The operatio" a"# perfor-a"%e of a b$si"ess #epe"#s o" -a"+ i"#i/i#$als are
%olle%ti/e #e%isio"s that are %o"ti"$all+ -a#e b+ its -a"age-e"t tea-. E/er+
o"e of these #e%isio"s $lti-atel+ %a$ses a fi"a"%ial i-pa%t< for better or 1or's
o" the %o"#itio" a"# the perio#i% res$lts of the b$si"ess. !" esse"%e< the pro%ess
of -a"agi"g i"/ol/es a series of e%o"o-i% %hoi%es that a%ti/ates -o-e"ts of
fi"a"%ial reso$r%es %o""e%te# 1ith the b$si"ess.
So-e of the #e%isio"s -a#e b+ -a"age-e"t o"e 1ill be the -a.or< s$%h as
i"/est-e"t i" a "e1 fa%ilit+< raisi"g large a-o$"ts of #ebts or a##i"g a "e1 li"e
of pro#$%ts or ser/i%es. Most other #e%isio"s are part of the #a+ to #a+ pro%ess
i" 1hi%h e/er+ f$"%tio"al area of the b$si"ess is -a"age#. The %o-bi"e of
effe%t of all #e%isio"s %a" be obser/e# perio#i%all+ 1he" the perfor-a"%e of the
b$si"ess is .$#ge# thro$gh /ario$s fi"a"%ial state-e"ts a"# spe%ial a"al+sis.
These %ha"ges ha/e profo$"#l+ affe%te# all o$r li/es a"# it is i-porta"t
for %orporate -a"agers< share hol#ers< te"#ers< %$sto-ers a"# s$ppliers to
i"/est-e"t a"# the perfor-a"%e of the %orporatio"s o" 1hi%h the" rela+. All
1ho #epe"# o" a %orporatio" for pro#$%ts< ser/i%es< or a .ob -$st be -e# abo$t
their %o-pa"+=s abilit+ to -eet their #e-a"#s ti-e a"# i" this %ha"gi"g 1orl#.
The gro1th a"# #e/elop-e"t of the %orporate e"terprises is refle%te# i" their
fi"a"%ial state-e"t.
-I5I6IT7 /;6 P89.IT/?I-IT7:
Li8$i#it+ a"# profitabilit+ are t1o i-porta"t #e-a"#ers i" #eter-i"i"g the
so$"#"ess of a" e"terprise.
Li8$i#it+ -ea"s abilit+ of a fir- to -eet its %$rre"t obligatio"s 1he" the+
be%o-e #$e for pa+-e"t. !t has t1o aspe%ts J 8$a"titati/e a"# 8$alitati/e.
7$alitati/e aspe%t i-plies the 8$a"t$- of %$rre"t assets a fir- possesses
irrespe%ti/e of -a'i"g a"+ #iffere"%e bF1 /ario$s t+pes of %$rre"t assets s$%h
as i"/e"tories< %ash a"# so o". 7$alitati/e aspe%t refor-s the 8$alit+ of %$rre"t
i" ter-s of their reali@atio" i" to %ash %o"si#eri"g ti-e #i-e"sio" i"/ol/e# i"
-at$ri"g #iffere"t %o-po"e"ts of %$rre"t assets.
Profitabilit+ is the %apa%it+ of ear"i"g profits a"# #$e -ost i-porta"t
-eas$re of perfor-a"%e of affir-s. !t is ge"erall+ ass$-e# that there is
"egati/e relatio"ship bF1 li8$i#it+ a"# profitabilit+ i.e. higher li8$i#it+ res$lts
i" lo1er profitabilit+ a"# /i%eB/ersa.

The obFecti*es of the study:
To st$#+ the gro1th a"# #e/elop-e"t of the %o-pa"+.
To st$#+ the beha/ior of li8$i#it+ a"# profitabilit+ of the
%o-pa"ies.
To a"al+@e the fa%tors #eter-i"i"g the li8$i#it+ a"# profitabilit+.
To %o-parati/e st$#+ of sele%te# %o-pa"ies o" the basis of
sele%te# ratios.
Statement of the problem:
De/elop-e"t of i"#$stries #epe"#s o" se/eral fa%tors s$%h as fi"a"%ial
perso""el< te%h"olog+< a"# 8$alit+ of the pro#$%t a"# -ar'eti"g art of these.
3i"a"%ial aspe%ts ass$-e a sig"ifi%a"t role i" #eter-i"i"g the gro1th of
i"#$stries. All of the %o-pa"+=s operatio"s /irt$all+ affe%t its "ee# for %ash.
Most of these #ata %o/eri"g operatio"s areas are ho1e/er o$tsi#e the #ire%t
respo"sibilit+ of the fi"a"%ial e9e%$ti/es. Eal$es top -a"age-e"t appre%iates
the /al$e of goo# fi"a"%ial e9e%$ti/es to '"o1 the profitabilit+ a"# li8$i#it+ of
the %o"%er". The fir- 1hose prese"t operatio"s are i"here"tl+ #iffi%$lt sho$l#
tr+ to -a'es its fi"a"%ial a"al+sis to e"able its -a"age-e"t to sta+ o" top of its
1or'i"g positio". !" this %o"te9t the resear%her is i"tereste# i" $"#erta'i"g a"
a"al+sis of the fi"a"%ial perfor-a"%e of %o-pa"ies to e9a-i"e a"# to
$"#ersta"# ho1 -a"age-e"t of fia"%W pla+s a %r$%ial role of the fi"a"%ial
perfor-a"%e a"al+sis of sele%te# %o-pa"ies i" !"#ia has bee" $"#erta'e".
5.
-I5I6IT7 8/TI9S:
Current 8atioC
C$rre"t ratio is %al%$late# b+ #i/i#i"g %$rre"t assets b+ %$rre"t liabilities.
C$rre"t assets
C$rre"t *atioG
C$rre"t Liabilities
T/?-< '!1
7ear Current /ssets Current
-iabilities
Current 8atio
,663 (33.64 ,(04.2 ,.(4
,664 4442., 043&.24 ,.,&
,66& ,&4&2.0 ,433.4 ,.6&
,660 &&3,.6, ,44,,.44 ,.,3
,664 (3404.,4 34402.2, ,.,3
>So$r%eC A""$al *eports?
"urrent ratio
-../
-.-0
-.10
-.-3 -.-3
1
1.0
2
2.0
-
-.0
3
-113 -11/ -110 -113 -114
"urrent ratio
I;.<8/;C<: !" abo/e table sho1" the %$rre"t ratio of fi/e +ears >,663B
,664?. The C$rre"t *atio of Ei.ai Ele%tri%als Lt#. Earie# fro- ,.(4 to ,.,3 1ith
a" a/erage of ,.3, #$ri"g the st$#+ perio#. The sol/e"%+ positio" of Ei.ai
Ele%tri%als Lt#. !" ter-s of %$rre"t ratio 1as abo/e the sta"#ar# "or- /ol$-e
of ,C for the e"tire perio#. The %$rre"t *atio i" the +ear ,66,B63 1as ,.(4.
This %a-e #o1" to ,.,3 i" the last , +ears This sho1s $tili@atio" of i#le f$"#s
i" the %o-pa"+
5uick8atioC
T/?-< '!%
7ear 5uick /ssets Current
-iabilities
5uick 8atio
,663 &026. ,(04.2 .22
,664 (26,.42 043&.24 .3(
,66& 44&&.40 ,433.4 .2
,660 3430&.(, ,44,,.44 .32
,664 43442.6& 34402.2, .0
>So$r%eCA""$al*eports?
>7$i%' AssetsGC$rre"t AssetsB!"/e"tories?
7$i%' Assets
7$i%' *atioG
C$rre"t Liabilities
5uick *atio
2.66
2.3.
2.26
2.36
2.23
1
1.0
2
2.0
-
-.0
-113 -11/ -110 -113 -114
5uick *atio
I;.<8/;C<C The !#eal *atio is C e9%ept i" the first +ear the fir-=s has a
goo# %apa%it+ to pa+ of %$rre"t obligatio"s i--e#iatel+ a"# is a test of
li8$i#it+. The high 7$i%' *atio i"#i%ates that the fir- has the abilit+ to -eet its
%$rre"t liabilities. The abo/e table sho1s the 7$i%' *atio of fi/e +ears >,663B
,664?. The 7$i%' *atio of Ei.ai Ele%tri%als Lt#./arie# fro- .22 to .0 1ith
a" a/erage of .4,. !t 1as abo/e the sta"#ar# "or- of C for the e"tire perio#.
!t %o"fir-s that the li8$i#it+ positio" of this Ei.ai Ele%tri%als Lt#. i" ter-s of
8$i%' ratio 1as -ore tha" the sta"#ar#.
Cash ratioC
T/?-< '!&
7ear Cash J ?ank Current Cash 8atio
Cash I Mar'etable Se%$rities
Cash *atio G
C$rre"t Liabilities
?alances -iabilities
,663 ,4&.00 ,(04.2 6.44&4
,664 ,34.(3 043&.24 6.2,3
,66& 342.(4 ,433.4 6.36&6
,660 436.(3 ,44,,.44 6.,2&3
,664 (306.42 34402.2, 6.,,3
>So$r%eC A""$al *eports?

"ash *atio
1.//0/
1.26-3
1.310
1.-603
1.--32
1
1.2
1.-
1.3
1./
1.0
-113 -11/ -110 -113 -114
"ash *atio
I;.<8<;C<C This Cash *atio i"#i%ates that the %apa%it+ of the %o-pa"+ to
reali@e %$rre"t liabilities 1ith its li8$i#it+ positio". !" the abo/e Table the Cash
Positio" *atio of 3i/e Hears >,663B,664?. The Cash *atio of Ei.ai Ele%tri%als
Lt#.has has $"#ergo"e -a"+ fl$%t$atio"s. !t starte# 1ith high ratio at first b+
6.4& i" the +ear ,663A it 1as #e%rease# to 6.2 b+ "e9t +ear it 1as slightl+
i"%rease# i" "e9t +ear i.e.,66& to 6.36.agai" falle" #o1" to 6.,2& i" the +ear
,660 a"# #e%rease# to 6.,, i" the +ear ,664.
;et 3orking capital 8atio:
Net 1or'i"g %apital >NWC?
NWC ratio G
>Net assets >or? Capital E-plo+e#?
T/?-< '!'
7ear ;et3orking
capital
;etassets
:./K2C"
8atio
,663 &,0(.(2 03.,& 6.44,
,664 (60.0 &334.,( 6.&,0
,66& 36,0.44 ,4(3.&0 6.060
,660 36462.,3 &6(30.&6 6.&2(
,664 4&224.3, (44(2.46 6.&4
>So$r%eC A""$al *eports?
!orking "apital *atio
1./4-
1.0-3
1.313
1.06.
1.0/
1
1.2
1.-
1.3
1./
1.0
1.3
1.4
-113 -11/ -110 -113 -114
!orking "apital *atio
I;.<8<;C<C Net 1or'i"g %apital has i"%rease fro- 6.44 i" ,663 to 6.060 i"
,66& a"# #e%rease# to 6.&4i" ,664. so this %learl+ sho1s that the fir- has
s$ffi%ie"t a-o$"t of 1or'i"g %apital

-<=<8/>< 8/TI9S:
6<?T 8/TI9:
Total #ebt >TD?
Debt ratio G
Total #ebt >TD? I Net 1orth >NW?

T/?-< '!(
year Total debt :a" ;et3orth
:b"
Capital
employed:aKb"
ratio
,663 02,&.&3 3&(6.42 6&60.3, 6.0&4
,664 (006.(2 &42(.(4 44&2.40 6.&22
,66& 6334.,, 6,,.4, ,6&&&.24 6.&63
,660 36443.&2 264(.43 4242,.3, 6.04
,664 4332&.3 4,346.2( (&430.,2 6.&60
>So$r%eC A""$al *eports?

#ebt *atio
1.304
1.066
1.013
1.324
1.013
1
1.2
1.-
1.3
1./
1.0
1.3
1.4
-113 -11/ -110 -113 -114
ear
#ebt *atio
I;.<8<;C<: The *atios i"#i%ates that the %o-pa"+ 1as ta'e" -ore #ebt i"
the first t1o +ears a"# the+ re#$%e# their #ebt ta'e" for f$rther +ears. Table
sho1s the Debt *atio of fi/e +ears >,663B,664?.The Debt *atio of Ei.ai
Ele%tri%als Lt#. is starte# 1ith 6.00 i" the +ear ,663 a"# it 1as slightl+
#e%rease# to 6.&22 i" the "e9t +ear a"# #e%rease# #$ri"g the +ear ,66& to 6.&6
a"# rea%he# 6.&60 i" ,664.
6ebt E e,uity ratio:
Total #ebt >TD?
Debt J e8$it+ ratio G
Net 1orth >NW?
T/?-< '!0
7ear Total debt ;et3orth ratio
,663 02,&.&3 3&(6.42 .234
,664 (006.(2 &42(.(4 .424
,66& 6334.,, 6,,.4, .6
,660 36443.&2 264(.43 6.04
,664 4332&.3 4,346.2( .6,&
>So$r%eC A""$al *eports?

#ebt-7quity *atio
2.63/
2./6/
2.122
1.32/
2.1-0
1
1.0
2
2.0
-
-.0
-113 -11/ -110 -113 -114
!ear
#ebt-7quity *atio
I;.<8<;C<: The sta"#ar# "or- for the ratio is ,C. The a%t$al #ebtBe8$it+ ratio
i" the abo/e table sho1s< the first t1o +ears less tha" the sta"# ratio after the
ratio has #e%rease# fro- .234 i" ,663 to .424 i" ,664. After that the ratio
starts #e%li"i"g tre"# fro- .6 i" ,66& to 6.04 i" ,660. a"# agai" raises to
.6,& i" ,664 This i"#i%ates fro- the st$#+ that the fir- tries to re#$%e the #ebt
a"# re#$%i"g fi"a"%ial ris' of the fir- 1he" both ratios of the +ears ,663 a"#
,664 are %o-pare#.
Capital <,uity 8atio:
Capital E-plo+e#
Capital E-plo+e# To Net Worth *atioG
Net Worth
T/?-< '!1
7ear Capital<mployed ;et 3orth 8atio
,663 6&60.3, 3&(6.42 ,.234
,664 44&2.40 &42(.(4 ,.423
,66& ,6&&&.24 6,,.4, ,.6
,660 4242,.3, 264(.43 ,.03
,660 (&430.,2 4,346.2( ,.6,&
>so$r%eC A""$al *eports?

"apital 7mployed To 8et!orth *atio
-.63/
-./63
-.122
-.323
-.1-0
1
1.0
2
2.0
-
-.0
3
3.0
-113 -11/ -110 -113 -114
"apital 7mployed To 8et!orth *atio
I;.<8<;C<:The abo/e table sho1s the Capital E8$it+ *atio of fi/e
+ears>,663B,664? . The Capital E8$it+ *atio of Ei.ai Ele%tri%als Lt#. Sho1s
fl$%t$atio" i" the perio# of st$#+. The ratio goes #o1" fro- ,.23 i" ,663 to
,.6 i" the +ear ,660 a" agai" raises to ,.63 i" ,660 a"# rea%hes to ,.6,& i"
,664.
C9=<8/>< 8/TI9S:
Interest Co*erage 8atio:
E5!T
!"terest Co/erage *atioC
!"terest
T/?-< '!4
7ear <?IT interest ratio
,663 324.,& ((3.30 4.43
,664 &,(,.36 43(.0( 4.&
,66& 2&33.(, 32.40 (.30
,660 04&3.44 3,2.36 ,.3(
,664 ,06(3.36 3432.43 4.&(
>So$r%eC A""$al *eports?

9nterest "overage *atio
/./3
4.20
..33
2-.3.
4.0.
1
-
/
3
.
21
2-
2/
-113 -11/ -110 -113 -114
9nterest "overage *atio
I;.<8<;C<C !"terest %o/erage ratio 4 to ( per%e"t is %o"si#ere# a" i#eal. .The
i"terest %o/erage ratio is highl+ i"%rease# #$ri"g the st$#+ perio# fro- 4.43 i"
,663 to ,.3( i" ,660 a"# go"e #o1" to 4.&( i" ,664.5$t these fig$res is
i"#i%ates /er+ high.
/CTI=IT7 8/TI9S:
In*entory turno*er 8atioC

Cost of goo#s sol#
!"/e"tor+ t$r"o/er G
A/erage i"/e"tor+
>or?

Net sales

!"/e"tor+
T/?-< '!D
7ear ;et sales in*entory ratio
,663 444.4 43.64 4,.4
,664 ,0434.(6 4&&.( 3&.46
,66& &4332.0 3&((.0& &.4
,660 (&6,.43 4303.4, 2.4(
,664 3,44.33 066(.26 ,.22
>So$r%eC A""$al *eports?

9nventory Turnover *atio
/-.24
30./
20.2/
26./.
-2.66
1
21
-1
31
/1
01
-113 -11/ -110 -113 -114
9nventory Turnover *atio
I;.<8<;C<: The !"/e"tor+ T$r"o/er *atio i"%rease# a"# #e%rease# o" the
b$+s of sales that sales i"%rease#. The ratio i"%rease# be%a$se the +ear sales are
i"%rease#. The ratio is #e%rease# be%a$se the +ear sales are #e%rease#. !" the
abo/e Table sho1s the !"/e"tor+ T$r" o/er *atio of fi/e +ears >,663B
,664?.The i"/e"tor+ ratio of Ei.ai Ele%tri%als Lt#. 1as starte# fro- 4,.4 i" the
+ear ,663 a"# it 1as slightl+ #e%rease# to 3&.4 i" the "e9t +ear. !t 1as
#e%rease# to &.4 i" the +ear ,66&< it i"%rease# slightl+ b+ "e9t t1o +ears.
In*entory con*ersion period:

No. of #a+s i" the +ear
!"/e"tor+ %o"/ersio" perio#G
!"/e"tor+ t$r"o/er ratio

T/?-< '!1@
7ear 6ays :&0@
days"
In*entory
turno*er ratio
Con*ersion
days
,663 306 4,.4 2
,664 306 3&.46 6
,66& 306 &.4 ,4
,660 306 2.4( (
,664 306 ,.22 0
>So$r%eC A""$al *eports?

9nventory "onversion eriod
6
21
-/
2.
23
1
0
21
20
-1
-0
31
-113 -11/ -110 -113 -114
!ear
n
o
.
o
f

d
a
!
s
9nventory "onversion eriod
6ebtor turno*er 8atio:
Cre#it sales
Debtors t$r"o/er A
Debtors
T/?-< '!11
7ear Sales debtors ratio
,663 444.4 332.2 &.3&
,664 ,0434.(6 &243.&2 4.2(
,66& &4332.0 4446.,4 4.6,
,660 (&6,.43 ,6262.0( 4.64
,664 3,44.33 466(.62 3.36
>So$r%eC A""$al *eports?

#ebtors Turnover *atio
0.230
/.6.
4.1-
/.14
3.3
1
-
/
3
.
-113 -11/ -110 -113 -114
!ear
#ebtors Turnover *atio
I;.<8<;C<C Debtors T$r"o/er *atio sho$l# be /er+ high the" o"l+ the
%o-pa"+ 1ill be re%ei/i"g its #ebts 1ith i" a short perio#. !t i"#i%ates the
%o-pa"+ has ta'e" less ti-e to %o"/ert the %re#it sales i"to %ash. !" the abo/e
Table sho1s the Debtors t$r"o/er ratio of fi/e +ears >,663B,664?.
The #ebtors t$r"o/er ratio of Ei.ai Ele%tri%als Lt#. 1as starte# 1ith &.3&
i" the +ear ,663 a"# it i"%rease# to 4.6, i" the +ear ,66&< it 1as #e%rease#
to4.64 i" "e9t +ear ,660< a"# it 1as #e%rease# to 3.3 b+ the e"# of +ear ,66&.
6ebtors Collection of period:
306
Colle%tio" of perio# G
DE5TO*S T)*N OEE*
T/?-< '!1%
7ear days 6ebtors turno*er
ratio
Collection
period
,663 306 &.3& 46
,664 306 4.2( (6
,66& 306 4.6, &
,660 306 4.64 ((
,664 306 3.36 62
>So$r%e C A""$al *eports?

"ollection eriod
41
.1
02
..
216
1
-1
/1
31
.1
211
2-1
-113 -11/ -110 -113 -114
!ear
n
o
.

o
f

d
a
!
s
"ollection eriod
I;.<8<;C<C
!f the Debtors T$r" o/er *atio i"%reases the #ebtors %olle%tio" perio# 1ill
be short. !f the #ebtors t$r"o/er ratio #e%reases the #ebtors %olle%tio" perio#
1ill ta'e lo"g ti-e. !" the abo/e Table sho1s the Debtors Colle%tio" Perio#
>Da+s? of fi/e +ears >,663B,664?. D$ri"g the +ear ,663 the perio# of #a+s is 46
#a+s. !t rose to (6 #a+s i" ,664. !t is #e%rease# to & #a+s i" ,66&. !t agai"
i"%rease# to (( #a+s i" the +ear ,660< it raise# to /er+ high i" the +ear ,664.
;et /ssets Turno*er 8atio:
Net assets t$r"o/er %a" be %o-p$te# si-pl+ b+ #i/i#i"g sales b+ "et sales
Sales
Total Assets T$r"o/er G
Net assets

T/?-< '!1&
7ear sales ;et assets ratio
,663 444.4 03.,& .&0
,664 ,0434.(6 &334.,( .44
,66& &4332.0 ,4(3.&0 ,.&3
,660 (&6,.43 &6(30.&6 .04
,664 3,44.33 (44(2.46 .&0
>So$r%eC A""$al *eports?

8et (ssets Turnover *atio
2.03
2.4/
-.03
2.34
2.03
1
1.0
2
2.0
-
-.0
3
-113 -11/ -110 -113 -114
!ear
"
a
t
i
o
8et (ssets Turnover *atio
I;.<8<;C<C Net assets t$r"o/er ratio 1as .&0 i" ,663 a"# .44 i" ,664< ,.&3
i" ,66& a"# .04 i" ,660 a"# .&0 i" ,664.so this %o-pa"+ ear"e# least
t$r"o/er ratio i" the +ear ,663 a"# ,664
.i+ed /ssets Turno*er 8atio:
Sales
3i9e# Assets T$r"o/er *atio G
3i9e# Assets
T/?-< '!1'
7ear sales ;et fi+ed assets ratio
,663 444.4 &(24.30 ,.2&
,664 ,0434.(6 4,43., 3.0(
,66& &4332.0 (4&4.62 0.43
,660 (&6,.43 ,64,4.,& 4.0
,664 3,44.33 3(42,.3( 3.4
>So$r%eC A""$al *eports?

Fi:ed (ssets Turnover *atio
-.60
3.3.
3./3
/.23
3./2
1
2
-
3
/
0
3
4
-113 -11/ -110 -113 -114
!ear
"
a
t
i
o
Fi:ed (ssets Turnover *atio

I;.<8<;C<C 3i9e# assets t$r"o/er ratio 1as ,.2&< 3.0(< 0.43< 4.0< 3.4 i"
respe%ti/e +ears of ,663< ,664< ,66&< ,660< a"# ,664 so the %o-pa"+ a%hie/e#
-a9i-$- fi9e# asset t$r"o/er ratio i" ,66&.
Current assets turno*er 8atioC

Sales
C$rre"t assets t$r"o/er G
C$rre"t assets

T#$LE %&'(
7ear sales Current assets ratio
,663 444.4 (33.64 ,.4
,664 ,0434.(6 4424., .(4
,66& &4332.0 ,&4&2.0 ,.3
,660 (&6,.43 &&3,.6, .&4
,664 3,44.33 (3404.,4 .&(
>So$r%eC A""$al *eports?

"urrent (ssets Turnover *atio
-.2/
2../
-.23
2.0/ 2.0.
1
1.0
2
2.0
-
-.0
-113 -11/ -110 -113 -114
!ear
"
a
t
i
o
"urrent (ssets Turnover *atio
I;.<8<;C<C !" this %hart it sho1s the %$rre"t assets t$r" o/er ratio b+ 1hi%h
%o-pa"+ is %$rre"tl+ rotati"g the assets for b$si"ess p$rpose. !t 1as highl+
p$r%hase# %$rre"t assets b+ the e"# of the +ear ,66&. The C$rre"t Assets
T$r"o/er *atio for the fi/e +ears >,663B,664?. C$rre"t assets t$r"o/er ratio 1as
,.4< .(4< ,.3< .&4 a"# .&( i" respe%ti/e +ear of ,663< ,664< ,66&< ,660 a"#
,664 so the %o-pa"+ a%hie/e# -a9i-$- C$rre"t assets t$r"o/er ratio i" ,66&.
Total /ssets Turno*er 8atio:
Sales
Total Assets T$r"o/er *atioG
Total Assets
T/?-< '!10
7ear sales Total assets ratio
,663 444.4 4633.,4 .,4
,664 ,0434.(6 ,44&.(4 .,3
,66& &4332.0 332,4.33 .06
,660 (&6,.43 4&&00.26 .,
,664 3,44.33 33436.0, 6.32
>So$r%eC A""$al *eports?

Total (ssets Turnover *atio
2.-/ 2.-3
2.3
2.2-
1.36
1
1.0
2
2.0
-
-113 -11/ -110 -113 -114
!ear
"
a
t
i
o
Total (ssets Turnover *atio
I;.<8<;C<: Total Assets T$r"o/er *atio of the %o-pa"+ is rotati"g their
assets i"to b$si"ess p$rpose. !t sho1s that the %o-pa"+ %a" able to rotate the
total assets i" the b$si"ess. Abo/e Table sho1s the Total Assets T$r"o/er *atio
for the perio# of fi/e +ears >,663B,664?. Total assets t$r"o/er ratio 1as .,4 i"
,663 a"# .,3 i" ,664< .0 i" ,66&< ., i" ,66& a"# 6.32i" the +ear ,664.so
this %o-pa"+ ear"e# last t$r"o/er ratio i" the +ear ,664.
2orking Capital Turno*er 8atio:
Sales
Wor'i"g Capital T$r"o/er *atioG
Wor'i"g Capital

T/?-< '!11
7ear sales 2orking capital ratio
,663 444.4 &,0(.(2 3.3
,664 ,0434.(6 (60.0 3.3,
,66& &4332.0 36,0.44 4.4
,660 (&6,.43 36462.,3 ,.(6
,664 3,44.33 4&224.3, ,.(4
>So$r%eC A""$al *eports?
!orking "apital Turnover *atio
3.32 3.3-
/.24
-..
-..4
1
2
-
3
/
0
-113 -11/ -110 -113 -114
!ear
"
a
t
i
o
!orking "apital Turnover *atio
I;.<8<;C<: !" the abo/e Table a"# Chart the /elo%it+ of the $tili@atio" of
Net Wor'i"g Capital. !t has bee" obser/e# that the 1or'i"g %apital t$r"o/er
ratio of Ei.ai Ele%tri%als Lt#. !" the abo/e Table sho1s the Wor'i"g Capital
T$r"o/er *atio of fi/e +ears >,663B,664?. !" the +ear ,66& Ei.ai Ele%tri%als
Lt#. hol#s 1ith effi%ie"t 1or'i"g %apital. After +ears ratio is #e%li"e#.
P89.IT/?I-IT7 8/TI9S:
;et Profit 8atio:
Net Profit
Net profit *atio G L 66
Sales

T/?-< '!14
7ear P/T sales ratio
,663 &,2.2, 444.4 (.4(
,664 ,466.26 ,0434.(6 (.2(
,66& 4064.0& &4332.0 (.4(
,660 (244.04 (&6,.43 6.&0
,664 3&&2.(3 3,44.33 6.,0
>So$r%eC A""$al *eports?

8et rofit *atio
..4.
..6.
../.
21.03
21.-3
1
-
/
3
.
21
2-
-113 -11/ -110 -113 -114
!ear
"
a
t
i
o
8et rofit *atio
I;.<8<;C<C Net profit ratio 1as (.4(< (.2(< (.4(< 6.&0< a"# 6.,0 i" respe%ti/e
+ear of ,663< ,664< ,66&< ,660 a"# ,664 so the %o-pa"+ a%hie/e# -a9i-$-
Net profit ratio i" ,660 a"# ,664.
;et Profit ?ased 9n ;o P/T:
E5!T>Bt? No PAT
Net Profit 5ase# O" No PATG G
Sales Sales
>or?
E5!T
Sales
T/?-< '!1D
7ear <?IT sales ratio
,663 33(.0& 444.4 ,,.44
,664 434,.36 ,0434.(6 2.40
,66& (434.4, &4332.0 4.&&
,660 &6&&.(2 (&6,.43 2.3&
,664 ,4,,.402 3,44.33 2.44
>So$r%e C A""$al *eports?

8et rofit +ased ;n 8o (T
--./4
26.43
24.00
26.30
26.4/
1
0
21
20
-1
-0
-113 -11/ -110 -113 -114
ear
"
a
t
i
o
8et rofit +ased ;n 8o (T
8eturn on In*estment 8atio:
E5!T E5!T
*O! G *OTA G G
Total assets TA



T/?-< '!%@
7ear <?IT Total assets 8atio PercentageL
,663 33(.0& 4633.,4 6.,4 ,4.6
,664 434,.36 ,44&.(4 6.,6 ,6.6(
,66& (434.4, 332,4.33 6.,& ,4.(4
,660 &6&&.(2 4&&00.26 6.,6 2.2,
,664 ,4,,.402 33436.0, 6.64 4.(
>So$r%eC A""$al *eports?

*eturn ;n 9nvestment
-/.2
-1.1.
-/..4
26.6-
4.2.
1
0
21
20
-1
-0
31
-113 -11/ -110 -113 -114
!ear
p
e
r
c
e
n
t
a
g
e
)
*
+
*eturn ;n 9nvestment
I;.<8<;C<C *et$r" o" i"/est-e"t ratio 1as ,4.< ,6.6(< ,4.(4<2.2, a"# 4.( i"
respe%ti/e +ear of ,663< ,664< ,66&< ,660 a"# ,664 so the %o-pa"+ a%hie/e#
-a9i-$- *et$r" o" i"/est-e"t ratio i" ,66&.
8eturn on e,uity ratioC
Profit after ta9es PAT
*OE G G
Net 1orth >E8$it+? NW
T/?-< '!%1
7ear P/T ;et 3orth 8atioL
,663 &,2.2, 3&(6.42 4,.43
,664 ,466.26 &42(.(4 4.46
,66& 4064.0& 6,,.4, 4&.6(
,660 (244.04 264(.43 44.3
,664 3&&2.(3 4,346.2( 3,.63
>So$r%eC A""$al *eports?

*eturn on 7quity
/-.43
/2./
/0.1.
/4.23
3-.13
1
21
-1
31
/1
01
-113 -11/ -110 -113 -114
ear
P
e
r
c
e
n
t
a
g
e
*eturn on 7quity
I;.<8<;C<C *et$r" o" e8$it+ ratio 1as 4,.43< 4.4< 4&.6(< 44.3 a"# 3,.63 i"
respe%ti/e +ear of ,663< ,664< ,66&< ,660 a"# ,664 so the %o-pa"+ a%hie/e#
-a9i-$- *et$r" o" e8$it+ ratio i",660.

<arning per share ratio:
Profit after ta9
EPS G
N$-ber of share o$tsta"#i"g

T/?-< '!%%
7ear P/T ;o of e, shares 8atioL
,663 &,&420( 4(4(06 2.30
,664 ,3204632 4(4(06 36.4,
,66& 40640440 (00&2406 &.3
,660 (244046 (46(42&0 6.36(4
,664 3&&2(36 (20(36( &.24
>So$r%eC A""$al *eports?

7arnings er Share
26.33
31./-
0.32
21.31.4
20.2264
1
0
21
20
-1
-0
31
30
-113 -11/ -110 -113 -114
ear
P
e
r
c
e
n
t
a
g
e
7arnings er Share
I;.<8<;C<: Ear"i"g per share ratio 1as 2.30< 36.4,< &.3< 6.36 a"# &. i"
respe%ti/e +ear of ,663< ,664< ,66&< ,660< a"# ,664 so the %o-pa"+ a%hie/e#
-a9i-$- ear"i"g per share ratio i" ,664.
6.
O" the o/erall e/al$atio" at ea%h a"# e/er+ aspe%t< the follo1i"g
fi"#i"gs are fo$"#.

Li8$i#it+ ratios ha/e %o"ti"$o$sl+ go"e $"#er /ario$s fl$%t$atio"s i" the
last fi/e +ears. Do1 e/er the ratios are -ore tha" the i"#$str+ sta"#ar#.
This i"#i%ates e9%ess %ash is -ai"tai"e# i" the orga"i@atio".
Le/erage ratios are as per the i"#$str+ "or- of 3C a"# it is -ore or less is
-ai"tai"e# stea#il+ i" &+ears.
T$r"o/er ratios are also i" li"e 1ith the sta"#ar#s.
Altho$gh a "et profit ratio has bee" -ai"tai"e# %o"sta"tl+ i" the last three
+ears ie ,663< ,664< ,66& it has sho1" stea#+ i-pro/e-e"t i" the "e9t ,
+ears.
*et$r" o" i"/est-e"ts >*O!? a"# *et$r" o" e8$it+ >*OE? ha/e #e%li"e#
#rasti%all+ #$ri"g the last t1o +ears.
7.
The %o-pa"+ has a goo# re%or# of 8$alit+ of goo#s i" the -ar'et 1ith best
of -+ e"8$ir+ a"# i"/estigatio"s.
The+ sho$l# see that the #ebtors sho$l# be %olle%te# 1ith i" a spe%ifie#
ti-e b+ the %o-pa"+. So< that the+ %a" #is%harge so-e of its %re#itors or
%$rre"t liabilities a"# a/oi# pa+-e"t of i"terest.
*atio a"al+sis are i--e"sel+ helpf$l i" -a'i"g a %o-parati/e of the
fi"a"%ial state-e"t for se/eral +ears.
The %o-pa"+ fi"a"%ial positio" is /er+ se%$re. !t is obser/e#
that -ost of the ratios are as per the i"#$str+ sta"#ar#.

Co-pa"+ a#opts proper i"/e"tor+ %o"trol te%h"i8$es to
properl+ -a"age-e"t i"/e"tor+.


!.M Pa"#e+< ,664< 3!NANC!AL MANAGEMANT< 2
th
E#itio"< Ei'as
p$blishi"g Do$se pri/ate Li-ite#< Ne1 Delhi.
Prasa""a Cha"#ra ,66,< 3!NANC!AL MANAGEMENT< &th

E#itio"
<
TATAB M%Gra1 D!LL< Ne1 Delhi.
S.P. Pai"< K.L Nara"g< ,663< ADEANCED ACCO)NTANCH< EOL)ME
!! < 3
th
E#itio"< Kal+a"i p$blishers< L$#hia"a.
2<? SIT<S :

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