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The objective of this analysis is to study the balance sheet of
two giants of Paint Industry in India Asian Paints and Kansai
Nerolac and give a comparative outlook since 2011 till current
FY available data i.e. 2015. With the motive to generate:
 To analyse the profit and loss, balance sheet in last five
years from their annual report.
 To analyse the financial health in their comparison to each
other with the help of calculation of different categories of
 Based on the derived values of the ratios, logical
deduction as interpretation over the trend.

 Liquidity and Coverage Ratio:
On a span of five years, the current ratio for Asian
paints has been growing under a healthy and a steady
rate, with 1.464 in 2011 to 1.51 in 2015 thus showing a
good comfort rate in the liquidity of the assets, since they
are under an industry in which inventory count shall exist
the main task is to smartly maintain and monitor the
inventory expenditure which is reflected in the quick
ratio or the acid test ratio as in Asian paints it has
been under a steady count from an value of 0.82 to 0.85
in 2011 to 2015 respectively, thus displaying not any
drastic variation of the impact of inventory or potential
asset conversion upon the comfort of liquidity of the
assets. But if seen the current and the quick ratio gap
displays that the check upon this aspect is required by
Asian paints. At a same platform when Kansai Nerolac is
checked for its current ratio it goes at PAR against Asian
Paints with a current ratio of 2.22 to 2.14 in 2011 to 2015
respectively, which is equally supported by a higher
Quick ratio or the acid test ratio at 1.42 to 1.24 in

but at the same time current assets have inclined up.31 to 15.01 in 2011 to 2015 respectively.9. this shows that the borrowings have gone up. since 2011 at 3855 to 7233 during 2015. for Asian Paints. This derives Kansai Nerolac has shown a better conversion of inventory than Asian Paints.  Profitability REVENUE BASED PROFITABILITY: In case of revenue based profitability. this stable trend on all . on the other hand for Kansai Nerolac interest coverage ratio has been on a positive uprising scale this shows that although borrowings have gone up but Kansai Nerolac high revenue generation has handled this case efficiently.2015. which is a good sign. in addition to it. Similarly.95 in 2015. this shows that the turnover of current assets has been up to the mark thus inventory turnover is at a healthy rate for Asian Paints. but at the same time there has been healthy increase in the total revenue too thus it doesn’t acts as much of a matter of concern.21 in 2011 to 2015 respectively. thus showing a better inventory conversion by Kansai Nerolac. similarly. net profit margin have been on a marginal stable scale at 12. gross profit margin too has been on a marginal stable scale at 16. for Kansai Nerolac at an inventory being stable from a count of 354 to 542 in 2011 to 2015 respectively. of Asian paints which is not a good sign.4 in 2011 to -47. as it means increased obligations. Asian Paints has been marginally on an uprising scale in case of interest coverage ratio since -49. On the other hand.  Inventory Inventory count has gone up from a count of 1072 in 2011 to 1872 in 2015.09 to 11. the operating profit too has been on a stable scale at 16.

7in 2015. Overall Asian Paints pars above in case of Revenue based profitability against Kansai Nerolac. On the other hand in this segment Kansai Nerolac lags behind Asian Paints by lesser and declining net profit margin ratio at 9.1 to 19. here too Asian Paints have a better Asset based profitability than kansai Nerolac. gross profit margin is shared under a same platform of stability. which is satisfactory in terms of Asian paints. vis-a-vis Return on Operating profit has followed the same trend of stability at 47. on asset turnover ratio.6 in 2011. for any organisation. The same gets reflected in revenue generation from operations has shown an increasing trend at 6411 crores to 11836 crores from 2011 to 2015 respectively. return on total assets has declined drastically for Kansai Nerolac from 27. Asset turnover ratio is being maintained at steady levels.69 in 2015 which is a good sign.52 in 2011 to 7. Asset turnover is another Kink for Nerolac against Asian Paints as it has decreased drastically from .66 in 2011 to 1. it is ideal to look into asset turnover on fixed and total asset turnover basis. Contrary to that.revenue based profitability derives that revenue based profitability is at an ideal condition and driving at a healthy rate with better futuristic promises.9 in 2011 to 11. If seen. Thus.02 in 2015.  EFFICIENCY For efficiency. it has been on an increasing stable trend at 1. ASSET BASED PROFITABILITY: Return on total assets has been on a stable state for Asian Paints since 2011 at 20. And operating profits too on the other hand have shown a stable trend which is a good sign for futuristic promises for Asian Paints.81 because of lesser margin of increase in Profit after tax from 2011 to 2015 where average total assets have increased at a higher rate for Nerolac. The contributing reason to this stable trend has been due to increase in average total assets.

which is not a good sign for Kansai Nerolac. Efficiency and Profitability.2.55.e. Capital Structure Leverage.93 in 2011 to 1. Thus. which is due to lesser revenue generation rate against average total assets increment rate. For Kansai Nerolac return on equity has been under a declining state. the asset turnover ratio too has faced has drastic decline as compared to Asian Paints. .  Return on Equity It can be said as the master ratio or the main ratio as its trend cannot be determined individually on the basis of static value. Kansai Nerolac lags against Asian Paints in terms of efficiency too. but the capital structure is at a comparable rate for Kansai Nerolac against Asian Paints. In case of Asian paints Return on equity has been at a healthy but a declining state with a steady and efficient asset turnover ratio as mentioned above in efficiency along with a better Capital Structure leverage derived from Asset to Total equity. Each of these factors is equally responsible for the state of return on equity. as it consists of three components in major i. On the whole Asian paints carry a better return on equity against Kansai Nerolac.