Project Report On

Financial
Management
Submitted to:-
Prof. G.S Khera

Submitted By:-
Vishnu Porwal
MBA 2nd Sem
 Comparison
of
P r o f i t a b i l i t y & S o l v e n c y r ati o
( Automobile company ’ s )

•Index Slide No .
ØHINDUSTAN MOTORS
3-8
ØTATA MOTORS
9 - 13
HINDUSTAN MOTORS
 INTRODUCTION
• Hindustan Motors is an automobile
manufacturer from India. It is part of the
Birla Technical Services industrial group.
The company was the largest car
manufacturer in India before the rise of
Maruti Udyog.
• It is the producer of the Ambassador car,
widely used as a taxicab and as a
government limousine. This car is based on
the Morris Oxford, a British car that dates
back to 1954.
• One of the original three car manufacturers
in India, founded in 1942 by Mr. B.M. Birla,
it was a leader in car sales until the
1980s, when the industry was opened up from
protection. It began in Port Okha near
 Models
•

• Models manufactured by Hindustan Motors are :

• Hindustan Ambassador - The Ambassador design is
based on the British 1954 Morris Oxford.
• Hindustan Contessa - based on the British
Vauxhall Victor, which ceased production in 1978,
but with an Isuzu engine.
• Lancer - in collaboration with Mitsubishi.
• Pajero - an SUV in collaboration with Mitsubishi.
• Hindustan Pushpak, Trekker and Porter -
Multiutility Vehicles.
• MASCOT T-480 FC - commercial truck.
• RTV - trucks made in collaboration with
OKA Motor Company, Australia. This truck can be
adapted for school bus, ambulance, etc.
 PLANT
•

• Uttarpara, West Bengal (near Kolkata)

• Pithampur, Madhya Pradesh (near Indore)
• Thiruvallur, Tamil Nadu (near Chennai)
• Hosur, Tamil Nadu (near Bangalore)
•
 Key Financial Ratios
Ø
•

Ø Profitability ratios MAR

09 MAR 08 MAR 07 MAR 06 MAR 05
• Operating margin (%) -8.96
-3.36 -3.76 -4.25 2.56
• Gross profit margin (%) -12.26
-6.36 -7.24 -8.19 -2.01
• Net profit margin (%)
-6.164 .341 .98-9 .555 .32
• Adjusted cash margin (%) -10.41
-7.54 -5.71 -7.31 -2.35
• Adjusted return on net worth (%) -133.85 -70.32
-69.74 -74.50 -70.22
• Reported return on net worth (%) -55.18
 Liquidity ratios
•
•

• Current ratio
0.87 1.04 1.14 0.89 1.07
• Current ratio (inc. st loans) 0.65
0.88 0.81 0.72 0.91
• Quick ratio
0.41 0.59 0.67 0.50 0.72
• Inventory turnover ratio 10.60
10.81 8.09 6.77 17.94
•
TATA MOTORS
 HISTORY
• Tata Motors is a part of the Tata Group
manages its share-holding through
Tata Sons. The company was established in
1945 as a locomotive manufacturing unit
and later expanded its operations to
commercial vehicle sector in 1954 after
forming a joint venture with Daimler-Benz
AG of Germany. Despite the success of its
commercial vehicles Tata realized his
company had to diversify and he began to
look at other products. Based on consumer
demand, he decided that building a small
car would be the most practical new
venture. So in 1998 it launched Tata
• the Indica became an instant hit in the
Indian market. It was also exported to
Europe namely the UK and Italy. Since
then it has never looked back. In 2004 it
acquired Tata Daewoo Commercial Vehicle
and in late 2005 it acquired 21%
Aragonese Hispano Carrocera giving it
controlling rights of the company.
• It has formed a Joint Venture with
Marcopolo of Brazil and introduced low-
floor buses in the Indian Market.
Recently it had acquired British Jaguar
Land Rover (JLR) business, which also
includes Daimler and Lanchester brand
 Key Financial Ratios
Ø
Ø Profitability ratios MAR
09 MAR 08 MAR 07 MAR 06 MAR 05
•
• Operating margin (%) 6.71
10.53 9.70 10.68 11.62
• Gross profit margin (%) 3.30 8.26
7.50 8.09 9.01
• Net profit margin (%) 3.77
6.96 6.94 7.35 7.02
• Adjusted cash margin (%) 6.97 8.13 8.55
9.41 9.94
• Adjusted return on net worth (%) 7.45 21.18
24.67 24.77 30.12
• Reported return on net worth (%) 8.09 25.98
28.00 27.81 30.21
 Liquidity ratios
•

MAR 09 MAR 08 MAR 07 MAR 06 MAR

05
•
• Current ratio 0.84
0.89 1.24 1.24 0.99
• Current ratio (inc. st loans) 0.43 0.64
0.85 1.07 0.98
• Quick ratio 0.58 0.66 0.91
0.96 0.76
• Inventory turnover ratio 13.47 14.44 13.26
12.63 14.06
•