A

PROJECT MAJOR

ON

“A Financial Performance of “NANDA AUTOMOBILES (GUJ)

PVT. LTD”
Student Name:

MARGI BRAHMBHATT

Enrollment No.

(137080585002)

PROJECT SUBMITTED IN PARTIAL FULFILLMENT FOR THE AWARD OF THE

DEGREE OF

INTEGRATED MASTER OF BUSINESS ADMINISTRATION

SUBMITTED TO

INSTITUTE CODE: 708

INSTITUTE NAME:

‘CHAUDHARI TECHNICAL INSTITUTE’

UNDER THE GUIDANCE OF

PRO. Dr.Bhumika Raval

Falguni prajapati

GUJARAT TECHNOLOGICAL UNIVERSITY

AHMEDABAD

Batch 2016-2017

1
Abstract:

As business is in our DNA, we elected the course of Integrated MBA Program related

with administration and management. It is a professional course rather than vocational and

the profession requires the situational how it exists in practical.

The Master in Applied Management Program is well structured five year integrated

Program organized by GTU (Gujarat Technological University) - Ahmadabad.

The Gujarat Technological University prescribes “The major project by I.M.B.A students

and then presents a report to them.

The main objective of Project Report at I.M.B.A level is to make students aware about

Industry, business as well as application of management concepts in practical words. And

also to develop skill and knowledge in a student by supplement to the theoretical study of

the business management in general. Only book knowledge and class-room discussion is

not enough for management student. The I.M.B.A Program provides student with a

fundamental functions and actives as well as an exposure to strategic thinking and

management.

2
ACKNOWLEDGEMENT

Every project is a master piece of hard work and sincere efforts of all those who are

Involved in the project. Hard work and success are the two sides of the same coin. We are

grateful to all of them who were a part of my hard work and definitely been inevitable part

of my success

To make a project of this magnitude is impossible without a dedicated effort and perfect

guidance. “The major project” is one of the Project of I.M.B.A Program. We are much

obliged to express our deep gratitude to all the personalities who give their co-operation and

guidance for this project.

This report is impossible without the cooperation of certain people. Let us first express

more thankful to our Gujarat Technological University – Ahmadabad and CHAUDHRI

TECHNICAL INSTITUTE (CTI) – Gandhinagar who have been providing us all

academic.

Any accomplishment requires the efforts of many people and this work is no different. With

deep sense of gratitude and humble submission, we owe our heartfelt thanks to our guide

Prof. Suresh Patel, all the faculties and director of the I.M.B.A department Prof. Amit

Patel for providing guidance and constructive suggestions and showing faith in our

abilities.

As we conclude, we would like to a state that just as a positive attitude pays off; our hard
efforts to bring this project to a successful end would also pay off. We hope that this project
would be one of the supreme significant stepping-stones of our career and would fulfill our
aspirations in every aspect. We thank all the respondents for showing co-operation with us.

3
DECLARATION

I, MARGI JAYESHKUMAR BRAHMBHATT, Here By Declare That The

Report For “Major Project” Entitled “the monetary work of “NANDA

AUTOMOBILES (GUJ) PVT. LTD”. Is A Result Of My Own Work And My

Indebtedness To Other Work Publication, References, If Any, Have Duly

Acknowledged.

Place: Gandhinagar (Signature)

Date: Margi brahmbhatt

4
 Table Of Contents

Sr.no CONTENTS Pg.no

List of table

List of figures

1. INTRODUCTION

2. TITLE INTRODUCTION

3. REVIEW OF LITERATURE

4. THE COMPANY

5. DATA STUDY & PRESENTATION

5.1 Presentation, Study And Interpretation

6. Summary & Conclusions

7. BIBLIOGRAPHY

8. APPENDICES

5
INTRODUCTION

6
Objectives:

• Objectives of this study is to find out the monetary work of the NANDA

AUTOMOBILS GUJ. PVT LTD.

• Our research is based on results that how monetary leverage effects the company’s

business operation.

• Study of methods of raising monetary leverage used by the companies.

• To examine the earningsability of the company.

Research Methodology:

Description of the problem:

• Nowadays businessmen have change their lookout in automobile sector. In this highly

competitive era , innovation is must and NANDA AUTOMOBILS GUJ. PVT LTD. is

7
 implementing the same which has led them to grow at peak level but it could not able to

make good earnings unlike other automobiles companies who fall under same business

category. There are many reasons behind that. First there are many loop holes in

government policies or instructions or procedures. . Further there is considerable delay

found to correct or minimize the issues associated in any policy or procedure. The

monetary work of the NANDA AUTOMOBILS GUJ. PVT LTD. should be investigated

to increase the earnings and to know how other companies are making earningss under

same environment. This will help the company to further increase its footprint in

market.

SCOPE OF LEARNING:

The study essentially endeavors to scrutinize the fiscal presentation of the company.

The monetary experts can utilize this for weighing the company’s work in forthcoming, which

will value to study monetary descriptions and to put on the resources of the firm correctly for

the growth. The current study attempts to improve a drift examination model for trades and

working capital and revenue and loss books.

METHOD OF DATA COLLECTION:

Secondary data;

Definition of secondary data

Secondary data is evidence that has been collected for a purpose other than your current

research project but has some relevance and utility for your research.
8
Sources of Secondary Data

We can break the sources of secondary data into internal sources and external sources. Internal

sources comprise data that exists and is deposited inside your organization. External data is data

which is collected by other people or establishments from your organization's external

environment.

Let's understand little deeper into each of these general categories. Illustrations of internal

sources of data include, but are surely not boundaryed to, the following:

• Earnings and loss descriptions

• Balance sheet

• Sales figures

• Inventory history

• Previous marketing research studies

The secondary data is designed from the yearly reports, finance website , journals and

the core inspecting books of NANDA AUTOMOBILES GUJ. PVT LTD

Monetary Description 5 Years:

The study covers the time cycle of 5 years from the monetary year 2010-2011 to2014-2015.

Implements and Practices used:

9
To explore and understand the fiscal description of study component, below tools are utilized in

the study.

1. Ratio study

2. Comparative description study

Research Area: Nanda Automobiles (Guj) Pvt Ltd, Gandhinagar

Research Type: Descriptive Research

Context of Descriptive Research:

Descriptive research is a study designed to describe the participants in an exact manner. More

simply put, descriptive research is all about describing people who take part in the study.

Descriptive research can be either quantitative or qualitative.

Research design: Quantitative Research

10
TITLE INTRODUCTION

11
Financial performance:

Financial performance Work in bigger sense states to the degree to which monetary purposes

being or has been accomplished and is a significant aspect of finance risk management. It is the

procedure of measuring the outcomes of a company's policies and operations in monetary

terminologies. It is used to quantity firm's overall monetarist health over a provided time and

can also be used to link similar firms across the same industry or to compare sectors in

aggregation.

The work of the firm can be measured by its economic results, i.e., by its magnitude of earnings

riskiness and earnings ability are two major aspects which jointly determinologyine the value of

the concern. Monetary verdicts which increase risks will cut the value of the firm and on the

other hand, monetary conclusions which increase the productivity will increase value of the

firm. Risk and earnings ability are two important ingredients of a business concern.

There has been a significant discussion about the eventual objective of firm work, whether it is

earnings or wealth expansion. It is witnessed that while seeing the firm work, the earnings and

wealth maximization are associated and are prompted by one-another.

A company’s monetary work therefore is typically arbitrated by a series of ratios or numbers,

however there are following three ratio parameters which can be used to calculate monetary

work, they are:

a) Price Earnings Ratio.

b) Earnings per Share and

c) Return on Equity
12
All three parameters are discussed in in depth along with various other ratios. However, it is to

be noted that primarily, the balance sheet indicates the monetary post of the organization as on

that point of time. However, earnings and loss account is a description, which is made for a

particular monetary year.

In Indian framework, where a specialist has to depend upon the audited monetary description

for a particular establishment, the work is to be arbitrated from the monetary description only.

This chapter however designates some of the techniques, which can be used for alike study of

monetary work.

Financial analysis:

Monetary study is the process of finding the monetary strengths and weakness of the firm by

property creating relationships between the item of the balance sheet and the earnings and loss

account. Monetary study can be assumed by management of the firm, or by parts outside the

firm.

Financial performance analysis:

Monetary work study contains study and interpretation of monetary reports in alike a way that

it undertakes entire diagnosis of the cost-effectiveness and monetary soundness of the business.

The monetary analyst program provides dynamic procedures of monetary study.

13
Areas of Monetary Work Study:

Monetary analysts often measure the firm's production and productivity work (total trade

work), working capital work, fund flow work, liquidity work, earnings ability work, fixed

resources work, and social work. Various monetary ratios study includes

1. Working capital Study

2. Activity Study

3. Monetary structure Study

4. Earningsability Study

Economic descriptions are indicators of two important aspects:

1. Viability

2. Monetary Accuracy

Investigation and explanation of monetary descriptions hence states to an act of evidence

involved in a revenue description and monetary resources so as to have entire authorizations of

the viability and monetary accuracy of the commerce.

The terminology “study” is systematic arrangement of the statistics provided in the fiscal

descriptions. The word “interpretation” is “clarifying the context and connotation of the history

so streamlined.

14
Types of financial analysis:

Monetary study can be characterized in to diverse category relying upon.

(a) Material

(b) Modus operand of study

According to this basis monetary study can be classified in two categories.

a) External Study

The outsider for a business do alike review. The enquirys include partners, government

offices, credit organizations and extra banks who have no contact to a center history of a firm.

These people chiefly relies on accessible monetary depictions. The locus of this review has

overhauled in current circumstances by excellence of created legislative control over

foundations and administrative standards requiring more point by point disclosures of material

by foundations in their money related depictions.

b) Internal study:

This study can be accomplished by people who have access to the books of account and

other evidence related to the trade. Representatives and staff members of the association or by

officers elected for this reason by the government or the court under commands vested in them

can therefore do alike an investigation. The examination is done relying upon the objective to

be accomplished through this study.

On the basis of modus operandi according to this, monetary study can also be

categorized in two types:

15
a) Horizontal Study

In this kind of study, fiscal proclamations for various years are considered and investigated.

The current year's measurements are connected with the standard or base year. The review

explanation normally contains records for at least two years and inconsistencies are indicated

with respect to everything from the base year generally extents, for example, investigation

given the administration considerable knowledge into levels and zones of quality and faintness.

Since this kind of study depends on the date from year to year as opposed to on one date, it is

additionally marked as 'Dynamic Analysis'.

b) Vertical Study:

In this examination, a study is made of the quantitative association of the few things in

the money related proclamations on a particular sort, alike a review is helpful in paralleling

presentation of a few partnerships in the proportionate gathering or branches in the same

organization. Since this examination relies on upon the data for one period, is nor exceptionally

conductive money related position. It is additionally named 'Static Examination's as it normally

used to relations created on one date or for one bookkeeping period. Apparatuses or Methods

utilized for alike examination are:

1. Ratio Study

2. Comparative description Study.

These are described in bring as follows.

1. Ratio Study:

Proportion Study is widely utilized instrument of fiscal review. It is portrayed as the organized

utilization of proportion to peruse the monetary portrayals so that the quality and faintness of a

firm and in addition it’s past execution and current money related circumstance can be resolved.

16
The wording proportion states to the numerical or quantitative association between two things

or variable. This connection can be communicated as

a. Percentages

b. Fractions

c. Proportion of numbers.

Bookkeeping proportions offered the connection in scientific terminology between two

interconnected bookkeeping measurements. This is the supreme essential instrument offered to

do fiscal review for their work. Proportion study is a technique of distinguishing the fiscal

qualities and delicateness of the firm. This might be come to either through a pattern

investigation of the association's proportion over a timeframe or through an appraisal of the

company's proportions with its closest rivals and with the business midpoints. The four supreme

extreme essential money related extensions which an organization jump at the chance to look at

are: liquidity, Power, Activity and Productivity.

Nature of Ratio Study:

A Monetary ratio is a linking between two accounting figures. Ratios assistance to make

a qualitative assessment about the firm’s fiscal show.

Monetary Ratio:

Monetary Ratio is a relationship between two monetary variables. It benefits to create

the monetary condition of a firm.

Types of financial Ratios:

Liquidity ratios

Leverages ratios

Activity ratios
17

Earning stability ratios

Liquidity Ratio:

Liquidity Ratio measure the firm’s capability to meet current responsibilities, and are

designed by creating connections between present resources and present accountabilities.

Leverage ratio:

Leverage proportions measures the fraction of unknown’s money in funding the firm’s

belongings, and is designed by establishing interactions between rented capital as well as equity

capital.

Activity Ratio:

Activity ratio describe the firm’s proficiency in using its properties in generating sales

and is designed by creating relations between sales and resources.

Earnings Stability Ratio:

Earning stability ratios measure the whole work of the firm by deterring the usefulness

of the firm in earning revenue, and are designed by founding relations between earnings data on

the one hard, and sales and resources on the other.

Utility of Ratio Study

Valuation of the firm’s monetary conditions and capabilities.

Diagnosis of the firm’s complications, weakness and strong point.

Credit study

Comparative study

Time series study

18
Attentions in using ratio study

Standards of comparisons

Company differences

Prices level

Different arrangement

Dynamic situations

Past data

Standard of Comparison:

Time series study

Inter-firm study

Industry study

Preformed monetary description study

Gains of Ratio Study:

1. It aids in study of the condition i.e. examination on the monetary circumstances and work.

2. Inter-firm and Intra-firm evaluation is both possible on the basis of accounting ratio

3. Accounting Ratio not only directs the existing post but they also state the root leading up to

the post of a large extent

4. It aids in gaining utmost outcome when measurement for a number of years are put in

tabular form so that the amount for one year can be effortlessly linked with those of other

year

5. It specifies the tendency of the change, which assistances in making of approximations for

the forthcoming.
19
6. They bring effortlessness to the complex accounting evidence presented by the monetary

descriptions

7. They are highly useful to newcomers as well as for core management.

8. It is effective to core managements, liberation of the basic managerial tasks.

9. It also aids in forecasting, policy making & monitoring the activities and useful in

generating the ordinary casting system.

10. They are extremely powerful to questions and for center administration.

11. It is advantageous to center administrations, release of the fundamental administrative

assignments.

12. It likewise aids with estimating, arrangement making and observing the exercises. They are

advantageous in forming the standard throwing framework.

Boundary of ratio study

1. Ratio conveys just systems to the administration they are just the methods. Be that as it may

they scratch surfaces and raise issue. The limitation of the proportion may compel the

administration to have thorough examination of the circumstance under enquiry.

2. Single bookkeeping proportion is not profitable at all aside from it is considered with other

bookkeeping proportions.

3. They are construct just in light of the process able actualities. Thus, subjective information

put limit on the proportions.

4. Ratios are subjected to arithmetical accuracy of the money related depictions. In addition

fiscal portrayal additionally include anticipated date like course of action for devaluation,

20
 terrible and farfetched obligations and so forth henceforward, result appeared by

proportions are subjected to alike conjectures.

5. Ratios are figured on the premise of money related declarations which are verifiable in

nature.

6. Knowledge of proportions just is trivial unless it is likewise discovered how it is made up.

7. Insufficiency of similarity of data, personal judgment, lack of consistency etc. are the

features which boundary the conclusion to be derived from accounting ratios.

2. COMPARATIVE DESCRIPTION STUDY :

Comparative description is those descriptions which have intended in a way, so as to

provide time perspective to the consideration of the various basics of monetary post embodied

in alike descriptions. In alike descriptions, statistics for two or more cycles are placed side by

side to facilitate assessment. The two descriptions are proposed for assessment. They are

comparative income description and comparative Balance Sheet.

The comparative monetary descriptions are descriptions of the monetary post at different cycles

of time. The essentials of monetary post are presented in a comparative form so as to provide a

knowledge of economic post at two or more stages. Any description arranged in a comparative

form will be enclosed in comparative descriptions.

21
From practical point of view, normally, two monetary descriptions (balance sheet and income

description) are equipped in proportionate form for monetary study purposes. Not only the

comparison of the evidences of two episodes but also be in connection between balance sheet

and income description permits an in depth study of monetary post as well as operative

outcomes.

The comparative description may illustrate :

(i) Absolute figures (rupee amounts).

(ii) Absolute data in terminologys of percentages

(iii). Changes in absolute figures i.e., increase or decrease in absolute figures.

(iv) Increase or decrease in terminologys of percentages.

The predictor is able to draw useful decisions when figures are provided in a proportional post.

The history of sales for a quarter, half -year or one year may describe only the existing situation

of sales efforts. When sales figures of former cycles are provided along with the measurements

of current cycles then the analyst will be able to study the styles of sales over different episodes

of time. Equally, relative figures will specify the tendency and direction of monetary post and

operating results.

The monetary data will be reasonable only when same accounting moralities are used in

making these descriptions. In case of any abnormality in the use of accounting principles this

info must be stated at the foot of monetary descriptions and the analyst should be alert in using

these descriptions.

22
Types of Comparative Descriptions:

There are two types of comparative descriptions

(i) Balance sheet, and

(ii) Income description.

(i) Comparative Balance Sheet:

The comparative balance sheet exploration is the study of the development of the like items,

group of items and computed items in two or more balance sheets of the identical commercial

enterprise on altered dates. The abnormalities in episodic balance sheet items replicate the

behavior of a business.

The variations can be perceived by evaluation of the balance sheet at the commencement and at

the end of a cycle and these changes can help in making an opinion about the development of

an enterprise. The comparative balance sheet has two columns for the data of unique balance

sheets. A third column is used to display increases in figures. The fourth column may be added

for giving proportions of increases or decreases.

(ii) Comparative Income Description:

The Income description provides the outcomes of the operations of a business. The comparative

income description gives an indication of the progress of a business over a cycle of time. The

fluctuations in absolute data in money values and percentages can be determinologyined to

explore the viability of the trade. Like comparative balance sheet, income description also has

four columns. First two columns deliver figures of various items for two years. Third and fourth

23
columns are used to show increase or decrease in figures in complete amounts and proportions

respectively.

Advantages of Comparative Monetary Description:

The following advantages may be advocated:

(a) Comparison:

The comparative descriptions show the history of various firms or number of years side by side

i.e. both for inter-firm comparison and intra-firm comparison.

(b) Horizontal Study:

The variables are organized horizontally for the purpose of study and interpretations of data

taken from monetary descriptions for measuring earningsability, overall competence and

monetary situation of a firm.

(c) Tendency Study:

The comparative monetary description assistances to ascertain the ‘tendency’ relating to sales,

cost of goods sold, operating expenditures etc. so that a proper assessment can effortlessly be

made which helps the analyst to recognize the overall work of a firm.

(d) Tendency and Directions:

The comparative monetary description provides essential detail for comparison of tendencys in

related items e.g. the analyst can match the tendency of sales with the tendency of accounts

24
receivable which gives very useful info. A 20% surge in accounts receivable and an increase of

sales by only 10% warrants inquiry into the reasons for this transformation in the rate of

increase.

(e) Evaluation of:

The comparative monetary description helps the analyst to compare work of one firm with

other similar firm in the industry and also equate the work of the challengers in the line. This

comparison helps to find out the softness or strength of a firm and to take suitable steps.

(f) Measuring Monetary:

Comparative fiscal descriptions aid to measure significant distress monetary ratios which are

used for forecasting monetary distress and corporate failure with the help of Multivariate

Model.

Disadvantages of Comparative Monetary Description:

Comparative monetary descriptions are not even allowed from snags.

Some of them are:

(a) Inter-firm Comparison:

Inter firm comparison will only be operative if both the firms follow the same accounting

ethics, technique of valuations of stocks, resources etc. i.e. all the accounting concepts and

conventions, which in actual world situation, are not identically followed by both the firms e.g.

Firm A pursue the FIFO method of valuing stock whereas Firm B persue LIFO method for the

same.

25
(b) Inflationary Effect:

Comparative monetary descriptions do not recognize the variation in prices level and, as alike,

it will be of no use.

(c) Ascertaining Correct Tendency:

It is very hard to ascertain the correct tendency if there is a structural changes in a firm which

are repeatedly happened.

(d) Supply Misleading Information:

Sometimes a proportional monetary description provides worthless detail, e.g. if a negative

amount comes in base year, and a positive amount in the next year, it is not possible to find out

the modification in percentage.

(e) Uniformity in Principle:

There must be a uniformity while following accounting principles, perceptions and convention.

But in practice, this is not done and as alike, multi-year study becomes impractical.

26
REVIEW OF LITERATURE

27
The use of monetary description study and interpretation in investment choice has been

addressed by a series of authors in one way or the other. In some instances, the sue of this study

to determinologyine earningsability of a company and specifically returns on investment and

optimal management decisions have been stated.

Long back (Year-1957) EF Donaldson point out to the fame of trade and monetary reporting.

He underlined that the economy depends on the commercial establishments for goods and

services. USA have faith in in corporate world. The fiscal activities of commercial enterprises

of creation and deal has extreme reputation. In his well-known newspaper, he has mentioned to

all vital constructions of business economics for example business structure, securities,

construction, capitalization, working capital, management of earnings, extension and mergers,

redeployment and rearrangements.

Basil Moore (Year-1968) denoted to the simple authenticity about the progression of trade. He

claimed that stockholders earnings not from a high level of revenues, but from upswings in the

level of incomes. They will predominantly be worried that wages and surpluses for a company

to develop over time, so as to produce a higher yield on the past value of their identifiable

share. Adding to these, in an increasing economy progression in crucial merely to conserve a

firm's competitive marketplace post vis-à-visits competitors. For both of these motives

shareholders are disturbed

Primarily about the progression predictions of their organizations han with the fixed turnover

boosting.

Singh and Hamid (Year -1992) Singh have evaluated the funding pattern of nine emerging

nations like India, Korea, Jordan, Pakistan, Thailand, , Turkey and Zimbabwe and found that in

28
all these evolving countries in general depends very heavily on external resources and new

disputes of stakes to money their progress of net resources. They have also resolved that there

were key transformations between the two clusters of establishments. Specifically, they

proposed that less established organizations used both external funding and supremely equity

funding to a much greater degree than their counterparts in progressive economies. Their

findings were virtually opposite of the Pecking Order configuration of funding detected for

advanced nation businesses. Corbett and Jenkins on (1994) have found that there is no market

based Anglo-US configuration of funding of industry. The establishments in Germany, the U.K

and the USA are internally funded with small or negative contributions from market sources,

while Japanese organizations are more externally funded with both banks and markets paying

larger portions than in the previous group. They also found that there is a proof to back the

view that Germany is a bank funded system and that the UK or US are market funded. Over

1980s, all republics, except Japan, have become more internally and less market funded.

John Myer (Year-1998) a distinguished consultant on monetary descriptions study has stated

that in the early years of 20th era, the financiers and securities interchange experts were

comprehensively relying on the fiscal descriptions of the corporations for study, detecting and

control of the activities and presentation of trades. The past, standards and monetary description

investigation has been referred by another authority also as well.

Doron Nissim & Stephen H Penman (Year-1999) in his review article on fiscal work, he has

pointed that this paper traces a money related depiction examination for use in value valuation.

Standard viability study is joined, and extended, and is supplemented with an investigation of

advance. The perspective is one of anticipating payouts to values. So monetary portrayal

29
examination is offered first as a substance of Performa investigation without bounds, with

anticipated extents saw as building pieces of gauges of settlements.

Kennedy and Muller (Year-1999) in his examination article on monetary work he has

pointed that the review and clarifications of fiscal depictions are a push to direct the size and

setting of monetary portrayals details so that the valuation might be finished of the

determinations for up and coming profit, capacity to pay intrigue and contribution maturates

(both existing and long phrasing) and efficiency and sound profit arrangement.

Meigs and Meigs (Year-2003) indicated that the rate of rate of profitability (ROI) is a trial of

administration's productivity in utilizing accessible resources.

Business choices are made on the premise of the utmost available evaluations of the result of

alike conclusions. As indicated by Meigs and Meigs (Year-2003), the terminology of money

related depiction study is to give data about a specialty unit for basic leadership reason and

alike info require not to be constrained to bookkeeping info. White proportions and different

connections in light of past work might be useful in anticipating the future profit work and

money related strength of an organization, we should be ready of the inalienable restrictions of

alike data. According to Meigs and Meigs (Year-2003), the key motivation behind fiscal review

are to determine organization's income work and the soundness and liquidity of its fiscal post.

We are basically intrigued by fiscal review as a prescient apparatus.

Elizabeth Duncan and Elliott (Year-2004) in his examination article on cash related

execution, he has communicated that the cash related clarifications cover data about the

monetary burdens and bases and occupations of money related resources, one should have the
30
ability to state whether the monetary condition of a firm is customary or dreadful; whether it is

refining or crashing and burning. One can depict the cash related elements given in fiscal

enunciations really which will suggest the exercises which one may need to begin to advance

affiliation's cash related condition.

According to Pandey (Year-2005) finished research on title income capacity which is the

capacity of a substance to gain income. It can be refereed by plotting different pertinent

measures including the proportion of net deals to resources, the rate earned on aggregate

resources etc.

Jonas Elmerraji (Year-2005) in his examination article on monetary work he has expressed

that he endeavors to state that extents can be an inestimable instrument for making a

speculation judgment. Indeed, even alike a variety of new fiscal specialists would preferably

leave their decisions to destiny than endeavor to manage the terrorizing of fiscal proportions.

Actually extents are not that debilitating regardless of the possibility that you don't have a

capability in exchange or back. Utilizing extents to make proficient decisions around an

advantage makes a ton of insight, once you know how to utilize them.

Love et. Al., (Year-2005) have concentrated the backing example of the Indian foundations

and found that while obligation to resource extents have been respectably steady, ostensible

obligation development has loosened down in current years. All through the time of study

(Year 1994-2003), bank sponsoring as a stake of aggregate obligation has redesigned, while

acquiring from non-bank monetary organizations fell extremely. In terminology of

modifications crosswise over firms, the finding is of that obligation levels ascend with firm

extent. Littler firms have supremely less obligation with respect to bigger firms on the off

31
chance that they are youthful. Moreover, while the proportion of obligation to resources has

been generally unfaltering for expansive firms, we see a critical rot for littler associations.

I.M.Pandey (Year 2007) in his examination article on monetary work, he has expressed that

the money related portrayals cover data about the fiscal stresses and bases and employments of

monetary resources, one ought to have the capacity to state whether the monetary circumstance

of a firm is conventional or terrible; whether it is refining or fizzling. One can portray the

money related factors gave in monetary portrayals context fully which will recommend the

activities which one may need to start to propel the company's fiscal condition.

Susan Ward (2008)13 in his exploration article on money related work he has pointed that

significance that monetary review utilizing proportions between key qualities help Investors

adapt to the gigantic measure of numbers in organization fiscal portrayals. For Example, they

can register the rate of net profit an organization is producing on the resources it has sent. Every

single other thing continuing as before, an organization that gets a higher rate of Earnings

contrasted with different organizations is a superior venture choice.

Rachchh Minaxi A (Year-2011) in his exploration article on monetary work he has expressed

and specified that the fiscal portrayal contemplate incorporates concentrate the money related

depictions to concentrate evidence that can permit decision making. It is the strategy for

judging the connecting between segment parts of the monetary portrayals to pick up a superior

comprehension of an element's post and work.

Priyaaks (Year 2012), in his examination article on fiscal work he has expressed that money

related portrayal study is the technique for investigating connections among monetary depiction

32
components and making correlations with proper proof. It is an apparatus in basic leadership

hones identified with stocks, bonds, and other monetary machines.

Previously mentioned about writing survey, it is clear that, the money related work portrays the

effectiveness of association. Alongside that monetary depictions are extremely valuable for

appraisal making in the foundation by Board of Directors and administration. It likewise knows

the wealth of the firm with the profitability.

33
Company History

34
Hero MotoCorp is the world's major two–wheeler motorcycle establishment. Hond Company

and the Hero Group move in a joint deal to form Hero Honda Motors Boundaryed in year 1984.

The joint deal between India's Hero Group and Honda Motor Establishment, Japan has not only

fashioned the world's leading two wheeler establishment but also one of the supreme operative

joint ventures worldwide.

In the 80s, Hero Honda befitted the principal establishment in India to display that it was

thinkable to drive a vehicle without contaminating the streets. The company familiarized new

group bikes that set industry ethics for fuel thrift and low radiation. An imaginary 'Fill it – Shut

it – Forget it' operation taken the thoughts of tourists across India, and Hero Honda sold

millions of bikes purely on the potential of increased mileage.

Over 20 million Hero Honda two wheelers step Indian ways currently. These are nearly as

many as the number of folks in Finland, Ireland and Sweden put together. The company has

consistently entire-fledged at double digits since foundation; and today, every second

motorcycle sold in the nation is a Hero Honda. Every 30 seconds, someone in India purchases

Hero Honda's top –selling motorcycle – Splendor. This joyful season, the firm sold half a

million two wheelers in a single month—a feat unparalleled in global automotive history.

Hero Honda end up being the main foundation in the republic to uncover four–stroke bikes and

set the standards for fuel viability, contamination control and quality. It has an exceptional

dissemination and administration organize victory the nation over.

Hweo Honda bicycles right away take off from its three all around benchmarked mechanical

offices. Two of these are situated at Dharuhera and Gurgaon in Haryana and the third best in

35
class mechanical office was initiated at Haridwar, Uttrakhand in April this year. These plants

together are fit for assembling out 4.4 million units for each year.

Having achieved an undisputable shaft put in the Indian bike commercial center, business is

perseveringly working towards amalgamation its post in the commercial center. The foundation

considers that moving statistic profile of India, developing improvement and the strengthening

of wide open India will add a great many new relatives to the monetary standard. This would

convey the development weight that would stand Hero Honda in anticipated years.

As Brijmohan Lall Munjal, the Chairman, Hero Honda Vehicles calls attention to, 'We

spearheaded India's bike industry, and it's our commitment now to take the generation to the

following level. We'll do all it takes to reach there.''

Product of the company includes:

• HF Dawn

36
• HF Deluxe

• Pleasure

37
• Splendor +

• Splendor NXG

38
• Passion PRO

• Passion Plus

39
• Super Splendor

• Glamour

40
• Glamour PGM FI

• CBZ Xtreme

41
• Hunk

• Karizma

42
 • Maestro

• Duet

43
 Milestones:

Year 1983

• Joint organization contract with Honda Motor Co. Ltd. Japan marked

• Stakeholders contract marked

Year 1984

• Hero Honda Motors Ltd. coordinated.

Year 1985

• First motor bike 'CD 100' presented

Year 1987

• 100,000th bikes framed

Year 1989

• New motorcycle model – 'Sleek' presented

Year 1991

• New motorbike display– 'CD 100 SS' announced

• 500,000th bike framed

44
 Year 1992

• Raman Munjal Vidya Mandir inaugurated a school in the remembrance of founder

Managing Director, Mr. Raman Kant Munjal

Year 1994

• New motorcycle model – 'Splendor' presented

• 1,000,000th motorcycle created

Year 1997

• New motorcycle model – 'Street' announced

• Hero Honda's 2nd manufacturing plant at Gurgaon installed

Year 1998

• 2,000,000th motorcycle made

Year 1999

• New motorbike model – 'CBZ' presented

• Environment Management System of Dharuhera Plant licensed with ISO–14001 by

DNV Holland

• Raman Munjal Memorial Hospital inaugurated a hospital in the remembrance of

founder Managing Director, Mr. Raman Kant Munjal

Year 2000
45
• 4,000,000th motorcycle formed

• Environment Management System of Gurgaon Plant licensed with ISO–14001 by DNV

Holland

• Splendor acknowledged 'World No. 1' – highest selling single two–wheeler model

• 'Hero Honda Passport Programme' – CRM Programme launched

Year 2001

• New motorcycle model – 'Passion' announced

• One million manufactured in one single year

• New motorcycle model – 'Joy' announced

• 5,000,000th motorcycle manufactured

Year 2002

• Became the first Indian Company to cross the cumulative 7 million sales mark

• Splendor has emerged as the World's largest marketing model for the third calendar year

in a row (2000, 2001, 2002)

• New motorcycle model – 'CD Dawn' presented, New motorcycle model – 'Splendor +'

presented, New motorcycle model – 'Passion Plus' presented, New motorcycle model –

'Karizma' presented

46
 Year 2004

• New motorcycle model – 'Ambition 135' announced

• Hero Honda became the World No. 1 Company for the third successive year.

• Crossed sales of over 2 million units in a single year, a worldwide record

• Splendor – World's leading selling motorcycle crossed the 5 million mark

• New motorcycle model – 'CBZ' announced

• Joint Technical Agreement reintroduced

• Total sales cross over a record of 10 million motorcycles

Year 2005

• Hero Honda is the World No. 1 for the 4th year in a row

• New motorcycle model – 'Super Splendor' presented, New motorcycle model – 'CD

Deluxe' presented New motorcycle model – 'Glamour' introduced, New motorcycle model –

'Achiever' introduced

• First Scooter model from Hero Honda – 'Pleasure' familiarized

Year 2006

• Hero Honda is the World No. 1 for the 5th year in a row

• 15 million manufacture milestone completed

47
 Year 2007

• Hero Honda is the World No. 1 for the 6th year in a row

• New 'Splendor NXG' introduced

• New 'CD Deluxe' introduced

• New 'Passion Plus' introduced

• New motorcycle model 'Hunk' introduced

• 20 million production milestone accomplished

Year 2008

• Hero Honda Haridwar Plant installation

• New 'Pleasure' introduced

• Splendor NXG launched with power start feature

• New motorcycle model 'Passion Pro' introduced

• New 'CBZ Xtreme' introduced

• 25 million production milestone accomplished

• CD Deluxe launched with power start feature

• New 'Glamour' introduced

48
• New 'Glamour Fi' introduced

Year 2009

• Hero Honda GoodLife Program introduced Hunk' (Boundaryed Edition) launched

• Splendor finished 11 million production landmark

• New motorcycle model 'Karizma – ZMR' introduced

• Silver jubilee celebrations

Year 2010

• New model Splendor Pro introduced

• Introduction of new Super Splendor and New Hunk

Year 2011

• New licensing arrangement contracted between Hero and Honda

• Launch of new refreshed versions of Glamour, Glamour FI, CBZ Xtreme, Karizma

• Crosses the benchmark figure of 5 million cumulative sales in a single year

• July 29, 2011 – Hero Honda Motors renamed to Hero MotoCorp following the exit of

its erstwhile Japanese promoter, Honda, from the company

Year 2012

49
• Movement of all products to Brand Hero

• Launch of Impulse, Maestro and Ignitor

Year 2013

• Neemrana Plant Foundation Stone placed

• 50 Million cumulative 2 wheelers assembly

Achievements/ recognition:–

Year 2001

• Bike Maker of the Year by Overdrive Magazine

• Winner of Three Leaves Award for performing Corporate Environment Responsibility

in the Automobile Sector by Centre for Science & Environment

• Business School Award for Corporate Work to Hero Honda Motors Ltd.

Year 2002

• Bike Maker of the Year by Overdrive Magazine

• Winner of the Review 200 Company of the Year of ET Awards for Corporate

Excellence.

50
 Year 2003

• Winner of the Review 200

• Supreme Esteemed Company in Automobile Sector by Business World

• Bike Manufacturer of the Year by Overdrive Magazine.

Year 2004

• Winner of the Review 200 – Asia's Top Companies Award (3rd Rank amongst the top

10 Indian companies)

• ICSI National Award for Excellence in Corporate Governance 2004 by The Institute of

Company Secretaries of India.

Year 2005

• Awaaz Consumer Awards 2005 Bike Maker of the Year Award by Overdrive Magazine

Year 2006

• CSR Award

51
• Top Indian company in the Automobile – Two Wheeler sector by Dun & Bradstreet –

American Express Corporate Medals 2006

• Hero Honda Splendor rated as India's supreme preferred two–wheeler brand at the

Awaaz Consumer Honors 2006

• NDTV Earnings Car India & Bike India Awards 2006

Year 2007

• The NDTV Earnings Car India & Bike India Awards 2007

Year 2008

• NDTV Earnings Business Leadership Award 2008

• TopGear Design Awards 2008

• NDTV Earnings Car India & Bike India Awards

• IndiaTimes Mindscape and Savile Row ( A Forbes Group Venture ) Loyalty Honors

• Asian Retail Congress Award for Retail Excellence (Strategies and Solutions of

business innovation and transformation)

• NDTV Earnings Car India & Bike India Honors

• Overdrive Magazine
52
• TNS Voice of the Customer Awards

Year 2009

• 'Two–wheeler Manufacturer of the Year' by NDTV Earnings Car & Bike Honors 2009

and Passion Pro adjudged as CNB Viewers' Choice two–wheeler

• Top Indian Company under the 'Automobile – Two–wheelers' sector bythe Dun &

Bradstreet–Rolta Corporate Honors

• Won Gold in the Reader's Digest Trusted Brand 2009 in the 'Motorcycles' category

NDTV Earnings Business Leadership Awards 2009 – two–wheeler category

Year 2010

• Rated as Top Indian Company in Automobile – Two Wheelers sector by Dun &

Bradstreet – Rolta Corporate Honors 2009

• Supreme favored Brand of Two–Wheelers' honor at the CNBC Awaaz Consumer

Awards.

• Adjudged at top of the two–wheeler category in the Brand Equity Supreme Trusted

Brands 2010 Survey

53
• Ranked No. 3 Supreme Favorite Brand across categories amongst Young Adult Males

• Company of the Year awarded by Economic Times Honors for Corporate Excellence

2008–09

• CNBC TV18 Overdrive Awards 2010 'Hall of Fame' to Splendor

• NDTV Earnings Car & Bike Honors 2010 – Two–wheeler Manufacturer of the Year,

CnB Viewers' Choice Two–wheeler of the Year (Karizma ZMR) and Bike Maker of the

Year by ET–ZigWheels Car & Bike of the Year Awards 2009'

Year 2011

• Two–wheeler Manufacturer of the Year award by Bike India journal

• Adjudged the 'Bike Manufacturer of the Year' at the Economic Times Zig Wheels Car

and Bike Rewards

Year 2012

• Business Leader in Automobiles (two–wheelers) at the NDTV Earnings Business

Leadership Honors 2012 (Conferred upon Mr. Pawan Munjal)

• Utmost value for Money Bike Maker and Utmost Advertising in Two Wheelers Class at

the Auto India Utmost Brand Honors 2012

• Digital Advertiser of the year at the Indian Digital Media Awards (IDMA) 2012

54
• Three honors (Launch Event of the year, Rural Engagement Progamme and Live Patron

Honor for Marketing Excellence) at the WOW Awards planned by EventFAQs Advertiser of

the year 2012 by Indian Digital Media Awards 2012

• Improvement in Loyalty Marketing Honor (Initiative: Hero GoodLife Utsav) by

Colloquy Loyalty Honors

• TPM Excellence Award 2012 by JIPM (Japan Institute of Plant Maintenance)

Year 2013

Green Pioneer Honor – 2013

• Business Leader of the Year' Honor by Hon'ble President of India, Shri. Pranab

Mukherjee, at the AlMA Managing India Awards 2013 on April 11, 2013 (Conferred on Mr.

Pawan Munjal)

• Business Leader of the Year' Honor in the Auto (Two Wheelers) category by Deputy

Chairman of the Planning Commission Mr. Montek Singh Ahluwalia, at the NDTV Business

Leadership Awards 2013 (Conferred on Mr. Pawan Munjal)CFO of the year Honor

(Conferred on Mr. Ravi Sud) “

55
Data analysis

56
1] Current Ratio:

It may be expressed as relationship between existing resources and present obligations.

It is the utsupreme common fraction for determining liquidity. It is derived by dividing present

properties by existing obligations. Recent resources and accountabilities are those quantity of

which can be comprehended within a cycle of one monetary year. A current ratio of 2: 1 is

substantial supreme.

Current ratio = Current Resources

Current liabilities

Current Current

year Resources(Rs.) liabilities(Rs.) Current ratio

2010-2011 38756224 18365268 2.110299942

2011-2012 64940765 44507024 1.459112723

2012-2013 64674654 40913931 1.580748963

2013-2014 77456913 57671527 1.343070264

2014-2015 80375354 58211076 1.380757057

57
Analyze;

Current ratio during the year 2010-2011 is the 2.11. In the next year 2011-2012 it was

decreased 1.46 and in the year2012-2013 it was increased to 1.58. And in the year 2013-2014

and 2014-2015 it was approximately same 1.34 and 1.38.

58
2] Cash Ratio:

Cash Ratio = Cash and bank balance + Current investment

Current liabilities

The cash ratio shows how well a company can pay off its current liabilities with only cash and

cash equivalents. This ratio shows cash and equivalents as a percentage of current liabilities.

A ratio of 1 means that the company has the same amount of cash and equivalents as it has

current debt. In other words, in order to pay off its current debt, the company would have to use

all of its cash and equivalents. A ratio above 1 means that all the current liabilities can be paid

with cash and equivalents. A ratio below 1 means that the company needs more than just its

cash reserves to pay off its current debt.

As with supreme liquidity ratios, a higher cash coverage ratio means that the company is more

liquid and can more effortlessly fund its debt. Creditors are particularly interested in this ratio

because they want to make sure their loans will be repaid. Any ratio above 1 is considered to be

a good liquidity measure.

59
 Current

year Cash and Bank balance (Rs.) liabilities(Rs.)(Rs.) Cash ratio

2010-2011 1036081 18365268 0.05641524

2011-2012 19432495 44507024 0.436616364

2012-2013 750565 40913931 0.018344974

2013-2014 1648837 57671527 0.028590139

2014-2015 705468 58211076 0.012119137

60
Analyze;

Cash ratio during the year 2010-2011 is the 0.05. In the next year 2011-2012 it was increased

0.44 and in the year2012-2013 , 2013-2014 and 2014-2015 it was approximately same 0.02.

61
3] Acid-test Ratio:

Acid-test Ratio = Quick resources

Current liabilities

The quick ratio or acid test ratio is a liquidity ratio that measures the ability of a company to

pay its current liabilities when they come due with only quick resources. Quick resources are

current resources that can be converted to cash within 90 days or in the short-terminology.

Cash, cash equivalents, short-terminology investments or marketable securities, and current

accounts receivable are considered quick resources.

The Acid-test Ratio is often called the quick ratio in reference to the historical use of acid to

test metals for gold by the early miners. If the metal passed the acid test, it was pure gold. If

metal failed the acid test by corroding from the acid, it was a base metal and of no value.

The acid test of finance shows how well a company can quickly convert its resources into cash

in order to pay off its current liabilities. It also shows the level of quick resources to current

liabilities.

62
 Current

year Quick Resources(Rs.) liabilities(Rs.) Acid-test ratio

2010-2011 19654820 18365268 1.07021689

2011-2012 30123145 44507024 0.676817776

2012-2013 6982823 40913931 0.170671036

2013-2014 36444124 57671527 0.631925768

2014-2015 19008457 58211076 0.326543646

63
Analyze;

Acid-test ratio during the year 2010-2011 is the 1.07. In the next year 2011-2012 it was

decreased 0.67 and in the year2012-2013 it was decreased to 0.17. And in the year 2013-2014 it

was increased to 0.63 and 2014-2015 it was 0.32.

64
4] Debt-Equity ratio:

Debt-Equity ratio = Debt

Equity

The debt to equity ratio is a monetary, liquidity ratio that compares a company's total debt to

total equity. The debt to equity ratio shows the percentage of company financing that comes

from creditors and investors. A higher debt to equity ratio indicates that more creditor financing

(bank loans) is used than investor financing (shareholders).

65
year Debt (Rs.) Equity(Rs.) Debt-Equity ratio

2010-2011 2284360 23817962 0.095909129

2011-2012 42419634 27696223 1.531603569

2012-2013 46021723 30327245 1.517504244

2013-2014 41798763 30802879 1.356975853

2014-2015 40438887 34586767 1.169201128

66
Analyze;

Debt-Equity ratio during the year 2010-2011 is the 0.10. In the next year 2011-2012 and 2012-

2013 it was approximately same 1.53. In the year 2013-2014 it was decreased to 1.35 and 2014-

2015 it was 1.16.

5] Debt-Resources ratio:

Debt-Resources ratio = Debt

Resources

Debt ratio is a solvency ratio that measures a firm's total liabilities as a percentage of its total

resources. In a sense, the debt ratio shows a company's ability to pay off its liabilities with its

resources. In other words, this shows how many resources the company must sell in order to

pay off all of its liabilities.

This ratio measures the monetary leverage of a company. Companies with higher levels of

liabilities compared with resources are considered highly leveraged and more risky for lenders.
67
This helps investors and creditors study the overall debt burden on the company as well as the

firm's ability to pay off the debt in future, uncertain economic times.

year Debt (Rs.) Resources(Rs.) Debt-Resources ratio

2010-2011 2284360 28033750 0.081486066

2011-2012 42419634 81257535 0.52203939

2012-2013 46021723 88037980 0.522748511

2013-2014 41798763 100147639 0.417371427

2014-2015 40438887 107585672 0.375876139

68
Analyze;

Debt-Resources ratio during the year 2010-2011 is the 0.08. In the next year 2011-2012 and

2012-2013 it was approximately same 0.52. In the year 2013-2014 it was decreased to 0.41 and

2014-2015 it was 0.37.

6] Interest coverage ratio:

Interest coverage ratio = Earnings before interest and taxes

Interest

69
The interest coverage ratio is a monetary ratio that measures a company’s ability to make

interest payments on its debt in a timely manner. Unlike the debt service coverage ratio, this

liquidity ratio really has nothing to do with being able to make principle payments on the debt

itself. Instead, it calculates the firm’s ability to afford the interest on the debt.

Creditors and investors use this computation to understand the earningsability and risk of a

company. For instance, an investor is mainly concerned about seeing his investment in the

company increase in value. A large part of this appreciation is based on earningss and

operational efficiencies. Thus, investors want to see that their company can pay its bills on time

without having to sacrifice its operations and earningss.

A creditor, on the other hand, uses the interest coverage ratio to identify whether a company is

able to support additional debt. If a company can’t afford to pay the interest on its debt, it

certainly won’t be able to afford to pay the principle payments. Thus, creditors use this formula

to calculate the risk involved in lending.

70
year PBIT (Rs.) Interest(Rs.) Interest coverage ratio

2010-2011 5016948 356142 14.08693162

2011-2012 7977295 2175284 3.66724299

2012-2013 7514903 3921373 1.916395864

2013-2014 4430188 3782135 1.171345814

2014-2015 11029534 5725693 1.92632298

71
Analyze:

Interest coverage ratio during the year 2010-2011 is the 1.07. In the next year 2011-2012 it was

decreased 0.67 and in the year2012-2013 it was decreased to 0.17. And in the year 2013-2014 it

was increased to 0.63 and 2014-2015 it was 0.32.

72
[7] Net Earnings Ratio:

Net earnings ratio (NP ratio) is a popular earningsability ratio that shows relationship between

net earnings after tax and net sales. It is computed by separating the net earnings by total sales.

For the purpose of this ratio, net earnings is equal to gross earnings minus operating expenses

and income tax. All non-operating revenues and expenses are not taken into account because

the purpose of this ratio is to evaluate the earningsability of the business from its primary

operations. Examples of non-operating revenues include interest on investments and income

from sale of fixed resources. Examples of non-operating expenses include interest on loan and

loss on sale of resources.

NET EARNINGS

YEAR NET EARNINGS TOTAL RESOURCES RATIO

2010-2011 4660806 421960531 0.011045597

2011-2012 5802011 492461327 0.011781658

2012-2013 3593530 455165014 0.007895005

2013-2014 648053 364927407 0.001775841

2014-2015 5303841 349442641 0.015178002

73
Analyze;

Net earnings ratio during the year 2010-2011 and 2011-2012 it was same 0.01 and in the

year2012-2013 And 2013-2014 it was decreased and 2014-2015 it was 0.1.

74
[8] Earning power:

Earning power = Earnings before interest and taxes

Average total resources

Average total

year PBIT (Rs.) resources(Rs.) Earning power

2010-2011 5016948 28029406 0.178988738

2011-2012 7977295 64970457 0.122783421

2012-2013 7514903 84647758 0.088778524

2013-2014 4430188 94026359.5 0.047116447

2014-2015 11029534 103800205.5 0.106257343

75
Analyze;

Earning power during the year 2010-2011 and 2011-2012 it was approximately same 0.17 and in

the year2012-2013 it was decreased to 0.08. And in the year 2013-2014 it was decreased to

0.04 and 2014-2015 it was 0.10.

76
 2) Comparative statement analysis:

A near portrayal is a record that contrasts which has specific money related depiction and

earlier cycle depictions or with the same fiscal report produced by another organization. Expert

and business directors utilize the wage portrayal, accounting report and income depiction for

relative purposes. The procedure uncovers tendency in the monetary and contrasts one

organization's work and another business.

Similar portrayal is those announcements, which have arranged as it were, in order to offer time

perspective to the thought of the various components of money related post typified in alike

depictions. In alike portrayals, measurements for at least two cycles are put one next to the

other to rearrange assessment. The two depictions are anticipated for evaluation. They are

relative pay depiction and similar resource report.

77
Comparative description for the year

Absolute % of
Particular 2010-2011 2011-2012
change change

Resources

fixed Resources 9927154 16316770 6389616 64.37

Current resources 38756224 64436155 25679931 66.26

Total 48683378 80752925 32069547 130.63

Liabilities

Current liabilities 12065187 44507024 32441837 268.89

Others liabilities 8584441 9054288 469847 5.47

total 20649628 53561312 32911684 274.36

78
Explanation:

From above table, it is observed that comparative description for the year is dynamic during

study cycle. In year 2010-11 to 2011-12 having fixed resources was enlarged to 64.37 %. and

current resources were improved to 66.26%. Further, in year 2010-11 to 2011-12 current

liabilities enlarged 268.89 % and other liabilities were 5.47 %.

79
2011-2012 to 2012-2013 :

Absolute % of
Particular 2011-2012 2012-2013
change change

Resources

fixed Resources 16316770 22807916 6491146 39.78

Current
64436155 64674654 238499 0.37
resources

Total 80752925 87482570 6729645 40.15

Liabilities

Current liabilities 44507024 40913931 -3593093 -8.07

85.51
Others liabilities 9054288 16796804 7742516

total 53561312 57710735 4149423 77.44

80
Explanation:

From above table it is evident that comparative description throughout the year has been

inconsistent during the study cycle. In the year 2011-12 to 2012-13 having fixed resources was

increased to 39.78 % and current resources were improved to 0.37 %. Further in year 2011-12

to 2012-13 current liabilities declined to 8.07 %.and other liabilities increased to 85.51%.

81
2012-2013 to 2013-2014 :

Absolute % of
Particular 2012-2013 2013-2014
change change

Resources

fixed Resources 22807916 22003797 -804119 -3.53

Current resources 64674654 77456913 12782259 19.76

Total 87482570 99460710 11978140 16.23

Liabilities

Current liabilities 40913931 57671527 16757596 40.96

Others liabilities 16796804 11540333 -5256471 -31.29

total 57710735 69211860 11501125 9.67

82
Explanation:

From above table, it is obvious that comparative description throughout the year has been

fluctuating during study cycle. In the year 2012-13 to 2013-14 having fixed resources was

decreased to 3.53 %. And current resources were increased to 19.76%. And in the year 2012-

2013 to 2013-2014 current liabilities increased 40.96%. And other liabilities it decreased 31.29

%.
83
2013-2014 to 2014-2015 :

Absolute % of
Particular 2013-2014 2014-2015
change change

Resources

fixed Resources 22003797 27210318 5206521 23.66

Current resources 77456913 80375354 2918441 3.76

Total 99460710 107585672 8124962 27.42

Liabilities

Current liabilities 57671527 58211076 539549 0.94

Others liabilities 11540333 14787827 3247494 28.14

total 69211860 72998903 3787043 29.08

84
Explanation:

From this table it is found that comparative description for the year has been fluctuating during

the study cycle. In the year 2013-2014 to 2014-2015 having fixed Resources was increased to

23.66%. And current resources were increased to 3.76 % and in year 2013-14 to 2014-15

current liabilities improved 0.94 % and other liabilities was 28.14%.

85
Finding:

Current ratio from the year 2010-2011 to 2014-2015 the ratio in decrease to from 2.11

to 1.38.suggesting that decrease in the resources and liabilities. From the year 2011-12

there two entities are separated out.

Company’s cash ratio moved in a rang of 0.1 to 0.5 except the year of 2011-2012 where

the ratio in 0.4 this is happened due to the increase in cash and bank balance in

comparison with other years, since the ratio remains bellow 1 company is less liquid

and company finds difficult to fulfill cash liabilities.

The Acid-test ratio ranges from 0.1 to 1 during the 2010-2015 in the supreme of the

year in bellow 1 with suggest that the company has less cash equivalent.

Except the year 2010-2011 dept equity ratio remains above 1 with suggest that company

is more finance by the creditors then by the investors.

The supreme of the years 2015 the remain around 0.5. the suggest that only half of the

debt resources can be entirefil by the resources.

In the year 2010-2011 in interest coverage ratio is highest suggesting that in this year

interest paid was low. How ever 2011 on word the ratio was come down to 3 to 1 . It

means that interest passion is rise in these particular year.

Company’s earning power has remain as range power during these five years cycle. It is

particularly low in during low in year 2012-2013 due to the increase the total resources.

86
CONCLUSION

• The study has been done on the topic monetary work using ratio study with five years

data in Nanda Automobiles (Guj) Pvt. Ltd.

• The current ratio specify the short terminology monetary post of the company whereas

debt equity displays the long terminology monetary post.

• The monetary work of the company for the five years is analyzed and it is demonstrated

that the company is monetarily sound.

• The study reveals that the monetary work is fair. It has been keeping good monetary

work and further it can recover if the company concentrates on its operating,

Administrative and selling expenses and by reducing expenses.

• The company should increase sales volume as well as gross earnings. Despite the price

drops in various products, the company has been able to preserve and grow its market

share to make strong foot prints in market, paying to the strong monetary post of the

company.

• The company was able to meet its entire necessities for capital expenditures and higher

level of working capital promise with higher volume of operations and from its

operating cash flows.

87
myaccountingcourse.com, 2016)

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