STOCK MARKET AND OPERATIONS MGT959

TERM PAPER TOPIC:MARUTI
Submitted to: GEETIKA MADAN submitted by: PRASHANT KUMAR RSE156A05 10905632

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ACKNOWLEDGEMENT
I take this opportunity to present my votes of thanks to all those guidepost who really acted as lightening pillars to enlighten our way throughout this project that has led to successful and satisfactory completion of this study. We are really grateful to our HOD for providing us with an opportunity to undertake this project in this university and providing us with all the facilities. We are highly thankful to Mrs GEETIKA MADAN for her active support, valuable time and advice, whole-hearted guidance, sincere cooperation and pains-taking involvement during the study and in completing the assignment of preparing the said project within the time stipulated. Lastly, We are thankful to all those, particularly the various friends , who have been instrumental in creating proper, healthy and conductive environment and including new and fresh innovative ideas for us during the project, their help, it would have been extremely difficult for us to prepare the project in a time bound framework.

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EXECUTIVE SUMMARY
Maruti was incorporated in 1981 as a Government company. They started production in December 1983 with collaboration from Suzuki of Japan. Initially Suzuki had 26% equity which has since increased to 40%.

The original model was replaced in the 2nd year itself with a new streamlined model with more leg room and better fuel efficiency. A van (now called Omni) in two types of roof and a Jeep type vehicle Gypsy, were also introduced in quick succession.

The various cars proved extremely popular and production has already crossed 100,000 nos. which is 60% of the total production of passenger car. The company has an up to date manufacturing facility and absorbed the technology successfully. The foreign equity and presence of a number of Japanese experts has helped in the stabilisation of production.

In the initial stages Maruti set up a limited R&D department for absorbing the technology that was being imported. Even at this stage Maruti made certain modifications in the imported technology on market considerations e.g. Application engineering to develop special bodies for school van,taxi, delivery van, executive van, ambulance.

Improved suspension and seating for OMNI, which was used more as a car than a commercial vehicle. Modifications in Gypsy and Maruti 800 to meet export requirements of various countries.

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O.CONTENTS CHAPTER:1 INTRODUCTION Automobile industry Company Profile S.W.T. Analysis Competitors Information CHAPTER:2 FUNDAMENTAL ANALYSIS CLASSIFICATION OF RATIO ACTIVITY / TURN OVER RATIO LIQUIDITY RATIO 4 .

the Indian automobile industry also and can be seen clearly in the sales figures of the last financial year.CHAPTER:-1 INTRODUCTION AUTOMOBILE INDUSTRY Indian automobile industry has grown leaps and bounds since 1898. Tata Motors produces maximum numbers of mid and large size commercial vehicles. Bajaj by far is the number one manufacturer of three wheelers in India. Global recession has impacted. three wheelers and two wheelers. Reasons of Growth Economic liberalization. it may not be an exaggeration to say that this industry in the coming years will soon touch a figure of 10 million units per year. Automobile companies of India. increase in per capita income. easy accessibility of finance. with two wheelers having a maximum market share of more than 75%. various tax relief policies. holding more that 60% of the market share. Passenger vehicle section is majorly ruled by the car manufacturers capturing over 82% of the total market share. as banks have reduced loan interest rates and the major chuck of automobile customers belong to the middle income group who are becoming economically stronger with every passing day. a time when a car had touched the Indian streets for the first time. 5 . Maruti since long has been the biggest car manufacturer and holds more that 50% of the entire market. Korea. MARKET SHARE Automobile industry of India can be broadly classified under passenger vehicles. Even then this industry has high hopes in 2009-2010. Europe and Japan have a significant hold on the Indian market share. commercial vehicles. At present it holds a promising tenth position in the entire world with being # 2 in two wheelers and # 4 in commercial vehicles. Motorcycles top the charts of two wheelers with Hero Honda being the key player. launch of new models and exciting discount offers made by dealers all together have resulted in to a stupendous growth of India automobile industry. Withstanding a growth rate of 18% per annum and an annual production of more than 2 million units.

Four Wheelers BSE . y Within two-wheelers. motorcycles contribute 80% of the segment size. y India is the largest two-wheeler manufacturer in the world." Automotive .Code: MARUTI Bloomberg: MUL@IN Reuters: MRTI. Baleno. Industry Listings & its codes Joint Venture 6 . of Japan in October 1982. Swift. It is said that the company takes only 14 hours to make a car. (MUL) is the first automobile company in the world to be honoured with an ISO 9000:2000 certificate. y Foreign players are adding to their investments in Indian auto industry.recently crossed the 1 million mark. now Suzuki Motor Corporation. y India is the fourth largest car market in Asia .y The first automobile in India rolled in 1897 in Bombay. y India is being recognized as potential emerging auto market. y India is the largest three-wheeler market in the world. Few of the popular models of MUL are Alto.BO With Suzuki Motor Company.Code: 532500 NSE . COMPANY PROFILE Maruti Udyog Ltd. y The number one global motorcycle manufacturer is in India. Creating Customer Delight and Shareholder's Wealth. y India is the fifth largest commercial vehicle manufacturer in the world. y India is the second largest tractor manufacturer in the world. QUICK FACTS Year of Establishment Vision February 1981 "The Leader in The Indian Automobile Industry. A pride of India. Wagon-R and Zen. y 2/3rd of auto component production is consumed directly by OEMs. The company has a joint venture with Suzuki Motor Corporation of Japan.

Registered & Corporate Office

11th Floor, Jeevan Prakash 25, Kasturba Gandhi Marg New Delhi - 110001, India Tel.: +(91)-(11)-23316831 (10 lines) Fax: +(91)-(11)-23318754, 23713575 Telex: 031-65029 MUL IN Palam Gurgaon Road Gurgaon -122015 Haryana, India Tel.: +(91)-(124)-2340341-5, 2341341-5 www.marutiudyog.com

Works

Website

MILESTONES 1981 1982 1983

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Maruti Udyog Ltd. was incorporated. Steped into a JV with SMC of Japan. Maruti 800, a 796 cc hatchback, India's first affordable car was produced. Installed capacity reached 40,000 units. Omni, a 796 cc MUV was in production. Launch of Maruti Gypsy (970cc, 4WD off-road vehicle). Produced 100,000 vehicles (cumulative production).
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1985 1986 1987 1988 1992 1994

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Exported first lot of 500 cars to Hungary.

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Installed capacity increased to 100,000 units. SMC increases its stake to 50 per cent. Produced the 1 millionth vehicle since the commencement of

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production. 1995
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Second plant launched, the installed capacity reached 200,000 units. Launch of 24-hour emergency on-road vehicle service. Produced the 2 millionth vehicle since the commencement of production. Launch of website as part of CRM initiatives. Launch of Maruti - Suzuki innovative traffic beat in Delhi and Chennai as social initiatives. IDTR (Institute of Driving Training and Research) launched jointly with Delhi government to promote safe driving habits. Launch of customer information centers in Hyderabad, Bangalore, and Chennai. SMC increases its stake to 54.2 per cent. Launch of Maruti Finance with 10 finance companies in Mumbai. Start of Maruti True value in Mumbai. Production of 4 millionth vehicle. Listed on BSE and NSE after a public issue oversubscribed 10 times. Maruti closed the financial year 2003-04 with an annual sale of 472122 units, the highest ever since the company began operations 20 years ago. The fiftieth lakh car rolls out in April, 2005.

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1. Maruti 800: Launched - 1983 2. Maruti Omni: Launched - 1984 3. Maruti Gypsy: Launched - 1985 4. Maruti Alto: Launched - 2000 5. Maruti Wagon-R: Launched - 2002 6. Maruti Versa: Launched - 2003 7. Maruti Grand Vitara Launched - 2004 8. Maruti Suzuki Swift: Launched - 2005 9. Maruti Suzuki SX4: Launched - 2007 10. Maruti Swift Dzire: Launched - 2008 11. Maruti Suzuki A-STAR: Launched - 2008 12. Maruti Suzuki Ritz: Launched - 2009 13. Maruti Suzuki Estilo: Launched ± 2009

Company overview
Maruti Udyog Limited (MUL), established in 1981, had a prime objective to meet the growing demand of a personal mode of transport, which is caused due to lack of efficient public transport system. The incorporation of the company was through an Act of Parliament. Suzuki Motor Company of Japan was chosen from seven other prospective partners worldwide. Suzuki was due not only to its undisputed leadership in small cars but also to commitments to actively bring to MUL contemporary technology and Japanese management practices (that had catapulted Japan over USA to the status of the top auto manufacturing country in the world). at Maruti Udyog Ltd. A license and a Joint Venture agreement were signed between Government of India and Suzuki Motor Company (now Suzuki Motor Corporation of Japan) in Oct 1982. 9

28% of the company was owned by the Indian government. Production of fuel-efficient vehicles to conserve scarce resources. both in terms of volume of vehicles sold and revenue earned. The MUL plant has already rolled out 4. Through 2004. globally.000 cars annually. Maruti Suzuki India Limited. MUL became one of the first automobile companies. More than a million units of this car have been sold worldwide so far. Maruti Alto tops the sales charts and Maruti Swift is the largest selling in A2 segment. Maruti Suzuki fits every car-buyer's budget and any dream. was associated to the Maruti 800 model. The Indian government held an initial public offering of 25% of the company in June 2003. Govt. the term "Maruti" is commonly used to refer to this compact car model. 2007. 18. on an average two vehicles roll out of the factory in every single minute. Till recently the term "Maruti". to be honoured with an ISO 9000:2000 certificate. The fact says that. The production/ R&D is spread across 297 acres with 3 fully-integrated production facilities. in popular Indian culture. was the India's largest selling compact car ever since it was launched in 1983. and 54. then are as cited below: y y y Modernization of the Indian Automobile Industry.the Hindustan Ambassador and Premier Padmini were both around 25 years out of date at that point. with range of 11 models in 50 variants. As of May 10. of India sold its complete share to Indian financial institutions. a subsidiary of Suzuki Motor Corporation of Japan. though the actual production commenced in 1983 with the Maruti 800. The company takes approximately 14 hours to make a car. of India no longer has stake in Maruti Udyog. With this. In 2001.3 million vehicles. Maruti has produced over 5 Million vehicles. 10 . its' only competitors. only this. Maruti 800. Production of large number of motor vehicles which was necessary for economic growth. The company annually exports more than 50. Maruti Udyog Limited (MUL) was established in February 1981. Currently. has been the leader of the Indian car market for over two decades. Govt. based on the Suzuki Alto kei car which at the time was the only modern car available in India.2% by Suzuki of Japan. Due to the large number of Maruti 800s sold in the Indian market. till 2004. Until recently.The objectives of MUL. Cars similar to Marutis (but not manufactured by Maruti Udyog) are sold by Suzuki and manufactured in Pakistan and other South Asian countries.000 cars and has an extremely large domestic market in India selling over 730. depending upon export orders. Marutis are sold in India and various several other countries. Maruti Suzuki is one of India's leading automobile manufacturers and the market leader in the car segment.

1983. Alto. Manesar and Gurgaon facilities have a combined capability to produce over 700. Wagon R. SX4. Swift Dzire.000 people are employed directly by Maruti and its partners. The company vouches for customer satisfaction. Over the years. Swift dzire. launched in February 2007 comprise a vehicle assembly plant with a capacity of 100. the product range has widened. Nearly 75.000 units annually. Gypsy. Zen Estilo. Suzuki¶s technical superiority lies in its ability to pack power and performance into a compact. During 2007-08.024 were exported. ownership has changed hands and the customer has evolved. the parent company.000 engines and transmissions. 11 . In all. is a global leader in mini and compact cars for three decades. Grand Vitara is imported from Japan as a completely built unit (CBU). Grand Vitara. The rest is owned by the public and financial institutions. Maruti¶s Gurgaon facility has an installed capacity of 350. Suzuki Motor Corporation. For its sincere efforts it has been rated (by customers)first in customer satisfaction among all car makers in India for nine years in a row in annual survey by J D Power Asia Pacific. Swift. Maruti Suzuki sold 764. A star and SX4 are maufactured in Manesar. Maruti Suzuki was born as a government company. A Star. Japan. Maruti is clearly an ³employer of choice´ for automotive engineers and young managers from across the country. More than half the cars sold in India are Maruti cars. over six million Maruti cars are on Indian roads since the first car was rolled out on December 14. The company is a subsidiary of Suzuki Motor Corporation. Omni. Maruti 800.2 per cent of Maruti.It¶s manufacturing facilities are located at two facilities Gurgaon and Manesar south of New Delhi. of which 53. Swift. which owns 54. Versa.000 units per annum. is Maruti¶s mission to motorise India. Maruti Suzuki offers 12 models. remaining all models are manufactured in Maruti Suzuki's Gurgaon Plant. What remains unchanged. lightweight engine that is clean and fuel efficient. The Manesar facilities.842 cars. with Suzuki as a minor partner to make a people's car for middle class India. It is listed on the Bombay Stock Exchange and National Stock Exchange in India.000 units per year and a Diesel Engine plant with an annual capacity of 100. then and now.

12 .5 billion. which it exercised in 1987. outside Japan and Korea. Suzuki further increased its equity to 50% turning Maruti into a non-government organization managed on the lines of Japanese management practices. Suzuki was preferred for the joint venture because of its track record in manufacturing and selling small cars all over the world.COMPETITORS INFORMATION :MARUTI UDYOG LIMITED ± Managing competition successfully Maruti Udyog Limited (MUL) was established in Feb 1981 through an Act of Parliament. producing fuel efficient vehicles to conserve scarce resources and producing indigenous utility cars for the growing needs of the Indian population. Maruti is the highest volume car manufacturer in Asia. It was established with the objectives of modernizing the Indian automobile industry. by which Suzuki acquired 26% of the equity and agreed to provide the latest technology as well as Japanese management practices. Maruti created history by going into production in a record 13 months. Five years later. A license and a Joint Venture agreement were signed with the Suzuki Motor Company of Japan in Oct 1983. in 1992. There was an option in the agreement to raise Suzuki¶s equity to 40%. although Maruti generated operating profits on an income of Rs 92. having produced over 5 million vehicles by May 2005. high depreciation on new model launches resulted in a book loss. and has made profits every year since inception till 2000-01. to meet the growing demand of a personal mode of transport caused by the lack of an efficient public transport system. In 2000-01. Maruti is one of the most successful automobile joint ventures.

Fiat is coming up with Panda and new Fiat Palio. Skoda is launching Fabia. There is a threat to Maruti models ageing. and Suzuki's decision to pick India as one of the first markets for this radically different-looking car gave this endeavor a new thrust.Ford is launching Focus and Fiesta. Maruti wants to change it for a more aggressive image. Honda and Fiat are planning to come out with small segment cars in near future. Maruti models like Maruti 800 which is in market for the last twenty years and others like Zen and Esteem which have also entered the decline phase are the other threats. Ford. Hyundai is launching its new compact car in 2006. Maruti has also changed its logo at the front grill. There is also a threat to Suzuki from R&D investment by Toyota and Honda in Hybrid cars. All this will pose a major threat to Maruti leadership in compact cars. GM is has reduced prices of its Corsa. Companies like Toyota.FUTURE CHALLENGES Maruti has always been identified as a traditional carmaker producing value-for-money cars and right now the biggest hurdle Maruti is facing is to shed this image. Maruti is looking forward to bring about a perception change about the company and its cars. This could be of concern to Maruti which is low cost provider of passenger cars. Hybrid cars could run on both petrol and gaseous fuels.20000 and Bharat Stage 4 which is coming into force in 2007 will contribute in increasing car prices further. Maruti Baleno has failed due to one of the major reasons being that customers could not identify Maruti with a car as sophisticated as Maruti Baleno. As Swift and Wagon R are replacing the Zen market. Maruti started the exercise with the new-look Zen. Rise in petrol prices and growing popularity of other substitute fuels like CNG will be another threat to Maruti. Maruti is planning phasing out Zen in 2007 and there were rumors of phasing out Maruti 800 also. It¶s a style statement from Maruti to Indian market. Maruti will have to keep on making modifications in its present models or its models will face extinction 13 . This all makes Suzuki to replace these brands with new launches . Honda is launching Jazz in 2006. New emission norms like Bharat Stage 3 which has come into effect from April 2005 has increased car prices by Rs. It has replaced the traditional Maruti logo on grill µstylish µM¶ with S¶. GM is launching Aveo in 2006. The next threat Maruti faces is the growing competition in compact cars.3 litre Swift. The major thrust in the facelift endeavour is with the launch of 1. Chevrolet is launching Spark in 2006.

S. Creating Customer Delight1 and Shareholder's Wealth2.Production of fuel-efficient vehicles to conserve scarce resources. after sales service and customer support are best and beyond expectation. Fleet Management and Car Financing. hence goes company¶s brand line: COUNT ON US! Mission: Mission is the statement of an organization¶s purpose. purchase and sale of Motor Vehicles and Spare parts. . The Government of India remains a significant equity stakeholder (10%).O. he can change the fortune of any company. Vision: Visions of any company are those values on which company works. what it want to accomplish in the larger environment and its goals which are specific.INDIA¶s finest and Asia¶s largest automobile industry was established in 1981 by an act of parliament. The Group has operations in over 100 cities with more than 150 outlets and also exports cars to other countries.With its early mover advantage in Indian market. but on the other hand Suzuki¶s participation ensures not only need of the profit. the first automobile company of the world to be honored with an ISO 9000:2000 certificate. The other activities of the Group comprises of facilitation of PreOwned Car Sales.Modernization of the Indian Automobile Industry.MUL knows this and understands ³customer is king´.W. realistic and motivating. eventually become a pride of India´ Customer Delight1 is making sure that performance. maintenance management. 14 . The Group also provides services like framing of customized car policies. Maruti retains a dominant Market share despite increasing competition. The main objectives/Missions of MUL are: . The product range includes ten basic models with more than 50 variants.T.was to maximize profit and reducing cost by maximizing output and sales Hence MUL declared its Vision as³The Leader in the Indian Automobile Industry. As the MUL is started by Governmental initiatives it tends to be more consumer oriented and hence cost effective. Business Portfolio: The Group's principal activity is to manufacture. registration and insurance management. Shareholder¶s wealth2 is the prime concern for running business smoothly. Missions are described over visions and visions demand certain objectives. emergency assistance and accident management. economical leasing of cars. is a subsidiary of Suzuki Motor Corp (holds a 54% equity stake).Developing cars faster and selling them for less.MUL. but of the need of maximum profit. . ANALYSIS OF THE COMPANY Company¶s Portfolio: Maruti Udyog Limited (MUL). The only way for this Nora¶s dilemma of selecting principals for company¶s working vision .

Japanese Management practices (that had captured Japan over USA to the status of top Auto manufacturing country in the world) Early mover advantages.Production of large number of motor vehicles which was necessary for economic growth. Value delivery network . Japan For tech. 10% components are manufactured outsideIndia. . SWOT ANALYSIS: Consists of analysis of internal environment (Strength and weakness) and external environments (Opportunity and Threat). diversification. Sell directly to consumers Keep costs below competitors¶ costs WEAKNESS: Still depends upon SUZUKI COPORATION. after sale services . distribution.Market Penetration.¶s Proposal of new ethanol (renewable) mixed fuel. support. 15 . Technological disadvantages. Market Development Similarly Product Development and Diversification. Other companies¶ lacks economy of scale. Though MUL has launched luxury cars as well it¶s still considered as poor man¶s brand. Diversification is not supported with all India presence of Manufacturing Units. . so there is plenty of untapped market and with increase in Income scale. Recruitment is done in very tedious manner ensuring talent and best professionals. Demand is rising.. Decades of isolation. Value chain. Working culture. STRENGTH: Contemporary technology. Importing new technology is controlled by Govt. so market is still open. Bureaucracy.Partner relationship management. inertia and subservience to the whims of government bureaucrats have made MUL unaccustomed to international standards or keen competitors No strong relationships with computer retailers OPPURTUNITY: first company to roll out suitably designed cars before 2008 as per Govt.

There are several possible objectives:  to conduct a company stock valuation and predict its probable price evolution. Economic analysis 2. but with the goal of making financial forecasts.FUNDAMENTAL ANALYSIS: Fundamental analysis is performed on historical and present data. If it is equal to market price hold the share and if it is less than the market price sell the shares. If the intrinsic value is higher than the market price it is recommended to buy the share . This is considered as the true value of the share. 16 .   Fundamental analysis includes: 1. to evaluate its management and make internal business decisions Fundamental analysis maintains that markets may misprice a security in the short run but that the "correct" price will eventually be reached. to make a projection on its business performance. Profits can be made by trading the mispriced security and then waiting for the market to recognize its "mistake" and reprice the security. Company analysis On the basis of these three analyses the intrinsic value of the shares are determined. Industry analysis 3.

25% GDP growth rate of India Mar Year 2010 8.80 percent in the last reported quarter.50 percent in December of 2004. From 2004 until 2010.37 percent reaching an historical high of 10.80 Sep Dec 17 . reducing poverty by about 10 percentage points. Country Interest Rate Growth Rate Inflation Rate India 5.80% 11.60 Jun 8.10 percent in September of 2006 and a record low of 5. India's average quarterly GDP Growth was 8.00% 8. The economy has posted an average growth rate of more than 7% in the decade since 1997.Macroeconomic Analysis GDP The Gross Domestic Product (GDP) in India expanded at an annual rate of 8.

80 8.50 6.80 8.09 1159.50 6.2009 2008 5.50 6.60 7.17 18 .00 7.10 India¶s GDP Year 2009 2008 Value 1296.

0150 India¶s Inflation rate 19 . dollars.Foreign direct investment Foreign direct investment are the net inflows of investment to acquire a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor. reinvestment of earnings. Global Development Finance. Source International Monetary Fund.68 percent in September of 1974 and a record low of -11.242 34. From 1969 until 2010.64.59.25.31 percent in May of 1976.99 percent reaching an historical high of 34.S.16.852 41.47.80% 11.70.33.86.71.12.57.55.25% 8.242 20. This series shows net inflows (new investment inflows less disinvestment) in the reporting economy from foreign investors.000 Inflation: The inflation rate in India was last reported at 11. Data are in current U. and World Bank.00% -13 45.00% 8. and short-term capital as shown in the balance of payments. International Financial Statistics and Balance of Payments databases. the average inflation rate in India was 7.25 percent in July of 2010. other long-term capital.05. 2005 2006 2007 2008 2009 7.448 25. It is the sum of equity capital.60. Country Interest Rate Growth Rate Inflation Rate Jobless Rate Current Account Exchange R India 5.00.

03 7.45 De 14. 9.77 Oct 11.25 11.7 Considering the data for the past five years.2 65.All Commodities Base Year 2004-05 1993-94 1.5 per cent .45 Nov 13.2 5.2 4.70 7.8 13.49 10.1 7.47 Mar 14.81 May 13.0 20. Fuel & Power 2004-05 1993-94 3.6 19.5 13.72 9.1 22.9 4.51 10.63 7.2 8.7 Average2005.0 63.0 14.45 5.3 16.9 14.63 5.87 Apr 13. Manufactured Products Memo items a. Primary Articles 2004-05 1993-94 2.0 100.22 10.75 Jun 13.64 9.8 10.9 55. 2005-06 to 2009-10.201006 to 2009-10 11* 5.33 8.1 4.7 3.9 5.4 9. Food Articles & Food Products b.5 5.86 9.6 6.Year 2010 2009 2008 Jan 16.02 Sep 11.29 7. it is seen that there is not much difference in average inflation rate between the new series and the old series which is about 5.2 10. Table 1 : Annual WPI Inflation: New vis-à-vis Old Series (per cent) Items WPI.7 4.33 Aug 11.0 52.73 9. Non-Food Manufactured Products 2004-05 1993-94 2004-05 1993-94 24.0 10.69 Jul 11.2 14.89 8.2 7.3 26.5 7.8 20 .51 Feb 14.2 2004-05 1993-94 Weight 100.6 5.86 8.91 8.

. The official interest rate benchmark repurchase rate.From 2000 until 2010.1990s. Finally. since the mid-1990s. interes decisions are taken by the Reserve Bank of India's Central Board of Directors. tolerance for high inflation has come down. page includes: India Interest Rate chart.82 percent reachi historical high of 14. In India.00% 8. historical data and news. Country Interest Rate Growth Rate Inflation Rate Jobless Rate Current Account Exchange R India 5.25 percent in April of 2009.50 percent in August of 2000 and a record low of 3. with the reduction in average inflation and inflation volatility.0150 21 . its persistence necessitates monetary policy responses to bring the inflation rate back to its trend and anchor inflationary expectations.00 percent. The moderation of inflation trend has had several beneficial effects in terms of lower nominal interest rate and high GDP growth rate Given the remarkable stability in the inflation rate since the mid. it is important to persevere with appropriate policy responses so that the high inflation seen in the recent months does not get entrenched.25% 8.80% 11. India's average interest rate was 5. Rates: The benchmark interest rate (reverse repo) in India was last reported at 5.00% -13 45. Even if the trigger for inflation is from supply side.* Relates to the period April-August.

easy accessibility of finance.31% in FY09 . said the Economic Survey 2008-09 Passenger car sales grew by 0. launch of new models and exciting discount offers for the growth in car sales in the last one year There was not a marked impact of recession ‡Sales of automobiles fluctuate across the year ‡The Mid size & Premium segment were affected ‡The decline in sales were in the range of 15%-20% ‡Now the market have recovered with a sales increase of 20 % The Small car segment or Economy segment showed consistent sales as those people who prefer these segments were either purchasing because of need ‡The Mid Sized Segment showed a drop as the customers for these segments are those who actually have a car for their utility and are looking for a new 22 . production and exports of the sector went up last fiscal.various tax relief policies.Sector analysis It contributes 4% in India¶s GDP & 5% in India¶s Industrial Production Despite economic slowdown that has affected the automobile industry.

Honda. weather it is wise to spend money on luxury ‡Luxury segment showed no drop as customers of this segment are those who have money and are capable of spending Automotive manufacturer looking at exploring new markets in Southeast Asia and South America.698 units were reported sold. On account of its huge market potential. the Indian automobile market has once again picked up a remarkable momentum witnessing a buoyant sale for the first time in its history in the month of September 2009. have declared significant expansion plans. to boost revenues According to SIAM. Volkswagen. Now the expectations are there by the industry experts that the total domestic industry will end the current financial year at over 11 million units. according to the data released by SIAM. the total automobile sales in the domestic market was reported 1114157 units in January . Following a temporary setback on account of the global economic recession. which will be a growth of 22. today the automobile industry in the country can produce a diverse range of vehicles 23 . increasing by 44. Analysts also said fear of a hike in taxes in the Union Budget also aided the growth. Empowered by its present growth.car that will satisfy their status requirement.6% over 2008-09. the automotive giants of India including General Motors (GM). a very low base of car ownership in the country estimated at about 25 per 1. Car sales in January saw a growth of 32% as it was reported 145000 units in the first month of 2010. The data for car sales surprised the analysts as it beats the previous best of 133000 sales recorded in November 2009. Recently.000 people. While analysts in the industry see the low interest rates for car loans and economic recovery as important factors for this growth.68. At the point of recession people began to rethink. and a rapidly surging economy.9% while for the same period last year 7. the nation is firmly set on its way to become an outsourcing platform for a number of global auto companies One can say that the automobile industry in the country has occupied a solid space in the platform of Indian economy. and Hyundai.

The rest is owned by public and financial institutions. It is largely credited for having brought in an automobile revolution to India. More than half the cars sold in India are Maruti Suzuki cars. is India's largest passenger car company. Estillo and sedans DZire. Maruti Suzuki Alto tops the sales charts and Maruti Suzuki Swift is the largest selling in A2 segment. Nearly 75. The company offers a complete range of cars from entry level Maruti-800 and Alto. It is the market leader in India and on 17 September 2007.000 people are employed directly by Maruti Suzuki and its partners. was the India's largest selling compact car ever since it was launched in 1983. Currently.842 cars. Maruti Suzuki sold 764. During 2007-08. It has been rated first in customer satisfaction among all car makers in India from 1999 to 2009 by J D Power Asia Pacific 24 . to stylish hatchback Ritz. till 2004. A star. It is listed on the Bombay Stock Exchange and National Stock Exchange in India. of which 53. Maruti 800. The company is a subsidiary of Suzuki Motor Corporation. Japan. accounting for over 45% of the domestic car market. Maruti Udyog Limited was renamed Maruti Suzuki India Limited. Swift. over six million Maruti Suzuki cars are on Indian roads since the first car was rolled out on 14 December 1983. The company's headquarters are located in Delhi. More than a million units of this car have been sold worldwide so far. which owns 54.Company Analysis Maruti Suzuki India Limited a partial subsidiary of Suzuki Motor Corporation of Japan.000 cars annually.024 were exported. In all. SX4 and Sports Utility vehicle Grand Vitara It was the first company in India to mass-produce and sell more than a million cars.000 cars and has an extremely large domestic market in India selling over 730. Maruti Suzuki has been the leader of the Indian car market for over two decades. Wagon-R. The company annually exports more than 50.2 per cent of Maruti Suzuki.

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94 2.77 5.68 0.11 0.33 30.47 Term Funds(%) Liquidity And Solvency Ratios Current Ratio Quick Ratio 1.15 Turnover Ratio Debtors 19.82 26 .4 1.12 28.38 2.21 Turnover Ratio Asset Turnover 2.48 30.37 13.35 9.09 0.59 Turnover Ratio Total Assets 2.34 27.12 10.47 2.74 9.38 30.07 0.66 10.8 Mar '07 Mar '08 Mar '09 Mar '10 1.46 Ratio 21.51 1.46 Employed(%) Return On Net 21.32 2.27 21.13 0.89 21.46 26.78 Turnover Ratio Fixed Assets 6.93 25.74 14.18 5.46 2.82 2.79 30.53 Margin(%) Return On Capital 33.32 1.09 0.06 1.98 2.88 16.41 22.47 33.48 12.34 26.77 1.04 17.91 0.1 28.01 Ratio Management Efficiency Ratios Inventory 14.06 2.65 22.92 30.18 20.66 0.76 6.29 30.48 1.97 9.01 Ratio Long Term Debt Equity 0.31 14.26 0.81 Worth(%) Return on Long 33.04 Debt Equity 0.91 0.07 0.93 8.Ratios Mar '06 Profitability Ratios Operating Profit 15.56 27.45 Turnover Ratio Investments 18.72 17.76 22.29 Margin(%) Gross Profit 16.07 0.95 Margin(%) Net Profit 9.93 2.

897.497.60 1.628.60  SALES ANALYSIS The company vouches for customer satisfaction.45 409.70 2.10 1.70 1.562.65 Mar '06 Operating Profit Reported Net Profit Mar '07 Mar '08 Mar '09 Mar '10 1.23 291.60 3.256.Mar '06 Earnings Per Share Book Value P/L account details 41.45 188. Maruti Suzuki India Limited.80 1.73 237.218. For its sincere efforts it has been rated (by customers) first in customer satisfaction among all car makers in India for ten years in a row in annual survey.00 1.824.18 Mar '10 86.189.10 2.70 2.91 Mar '09 42. a subsidiary of Suzuki 27 .730.976.07 Mar '08 59.16 Mar '07 54.28 323.

has been the leader of the Indian car market for over two decades. over six million Maruti cars are on Indian roads since the first car was rolled out on 14 December 1983. of which 53.Motor Corporation of Japan.  MARKET SHARE 28 . And finally in 2009-10.024 were exported.842 cars. when it became the first automobile company in India to produce one million (10 lakh) cars in a year. During 2007-08. In all. the nation's number one car manufacturer joined a select club of global automobile makers. Maruti Suzuki sold 764.

the company's exports in 2009-10 are expected to be higher and cover its imports. down 29.MARUTI SUZUKI FINANCIALS FOR 2008-09 Total Income up 14.8 Crore. largely contributed by the company's popular hatch-back Swift and premium sedan Swift Dzire (Diesel and Petrol variants).8 12015.3 2279. Premium compacts and sedan segment drive top line growth Fiscal 2008-09 The company's Total Income (Net of Excise) (Income from Operations plus Other Income) for the financial year 2008-09 climbed to Rs 21. Highlights of 2008-09 FINANCIAL HIGHLIGHT: Particulars Net Sales (In x10M Rs) Profit Before Tax (In x10M Rs) 2009 20530.4 Crore.7 Crore.1 282.6 per cent over 2007-08.9 2004 9104. and marks a growth of 14.8 FINANCIAL HIGHLIGHTS 2008 2007 2006 17891. Net Profit during the year stood at Rs 1.9 1750 2005 10923.453. This is the highest Total Income (Net of Excise) ever in the company's history. Forex fluctuations were also adverse and impacted the bottom-line significantly.1 1675. commodity prices have eased.4 769. In recent months.28 per cent over 2007-08.433.28 per cent.8 1304.218. commodity prices went up sharply and remained high for most part of the year. a fall of about 22 per cent over the previous year. With regard to foreign currency exposure.6 2503 14696. The growth in Total Income (Net of Excise) included higher realizations. During the year. The company's EBDITA for the year stood at Rs 2.1 29 .8 2003 7180.

The company's sales included exports of 70.65 29. These include: ‡ Focus on R&D: Manpower strength to 730 engineers from 460 in end March 2008.Reported Net Profit (In x10M Rs) Earnings Per Share-Unit Curr ( In Rs) 1218. Maruti Suzuki's Alto continued to be the preferred vehicle for the great Indian middle class crossing the 1 million-mark in cumulative sales in domestic market.1 853. Fiscal 2008-09 marked Maruti Suzuki's Silver Jubilee year in India.1 per cent over sales of 53.8 1562 1189. was led by A-star. the highest ever by the company.000 units of A-star exported to Europe including United Kingdom.25 18.842 units in 2007-08.4 41. Italy. Netherlands. Additionally. ‡ Annual capacity to manufacture expanded from 800.an alternate fuel option that runs on LPG and petrol.023 units in 2008-09. The annual sales in 2008-09 is the highest ever by the company in its 25 year history.000 engineers in R&D by 2010. ‡ Launching new models: A-star launched.000 to one million units (Gurgaon plus Manesar plants). Maruti Suzuki Swift crossed the 3 lakh-sales mark cumulative domestic sales since launch and became the quickest vehicle model to do so.6 542.56 4.7 1730. Denmark and Switzerland.03 53. The 2008-09 export numbers. 30 . The previous highest annual sales were 764.167 vehicles.88 In the fiscal 2008-09 Maruti Suzuki sold a total of 792.57 59.024 recorded in 2007-08. the fuel efficient compact car launched in Europe during the year as Suzuki Alto. the company continued its focus on long term initiatives. despite the challenging market situation. up by 32. During the year. Introduced Maruti 800 Duo . The export tally includes around 19. France. over half a million cars made by Maruti Suzuki have been exported world-over. During the fiscal. Germany. ‡ New technology engine: Brand new facility for K-series engine launched on schedule. Over these 25 years the company has sold over 7 million (70 lakh) cars in the domestic market.1 146.29 40. Company plans 1. During the fiscal.

The network of Maruti Driving Schools further expanded and crossed 50 schools. o True Value cities) : From 600 sales outlets (in 393 cities) last year to 681 outlets (in : From 2.23 lakh units in 2008-09 ‡ National Road Safety Mission launched .767 (in : From 265 outlets (in 166 cities) last year to 315 outlets (181 ‡ Increased Pre-owned car sales from 1. The objective is such that company¶s profitability. Profit Trend for 7 years: 31 .through innovative programs. Finance is the very typical aspect in course of management. liquidity and capacity by such analysis we can interpret the position of the company.‡ Reached out to new segments of customers .a nation-wide Corporate Social Responsibility (CSR) initiative to train 500. ‡ Network expansion: o Sales 454 cities) o Service 1314 cities).government employees and rural customers . ‡ Export of A star (as Suzuki Alto) to Europe commenced as per schedule.628 service outlets (1220 cities) last year to 2. MEANING OF ANALYSIS AND OBJECTIVE OF STUDY : Financial statement namely the statement of the profit & loss account and the balance sheet are indication of two signify-cant factors profitability and financial soundness analysis of statements means such a treatment of the information contained to afford a diagnosis of the profitability and financial statements analysis as the process of methodical classification comparison with other co-rising question and then seeking answer for them. The main objective behind the study is to get precisely. It also helps us to study the present finance scenario. used for A-star shipment. So it is very important to study.01 lakh units in 2007-08 to 1. ‡ Dedicated export port facilities for cars at Mundra completed.000 people in safe driving in three years.

1 1264.8 2035.3 1675. IMPORTANCE OF CASH PROFIT: The cash profit is an important measure of profitability as well as liquidity.9 604.Particulars Operating Profit (EBDIT) Gross Profit (EBDT) Profit Before Tax (EBT) Adjusted Net Profit (EAT) PROFIT COMPARISION (IN x10M Rs) 2009 2008 2007 2006 2005 2433.2 282. sources of cash which are at the disposable at the firm and outflows of the fire that is the use of the firm.9 860.1 129. wages salaries etc. which excludes working capital movements.71 2588.3 2382. Only cash from operating activities is included in this report.7 1761.72 IMPORTANCE OF CASH PROFIT THEORY: MEANING Cash flow means inflows that is. When the cash profit differs from the profit is shown in the profit and loss account or profit and loss statement.29 2055. The difference between inflows and outflows is either net inflow or net outflow. It indicates liquidity and signals for appropriate cash management.07 1797.8 621.82 2003 656.4 1750 1197.8 1535. Adjusting depreciation arrives at the cash profit. commission etc. rent. The Accounting standard (A53) classifies cash flows as under: 1) Cash from operating activities 2) Cash from investing activities 3) Cash from financing activities The operating activities include receipts from sale of goods or Rendering of services receipts from royalty.8 3071. Outflow is the resulting from payment to creditors for goods and services. power. A cash outflow statement deals with the cash fund flow. payment for expenses such as lighting. The net cash from operations can be calculated through adjustment of non- 32 .1 2004 1308.63 3130.8 2551.7 769. amortize action of capital expenses etc.2 2279. fees. The cash profit is much less or negative compared to the profit declared in the profit and loss account.7 1304.2 2503 1669.8 1072.

but they are only the starting point for successful financial management.cash items like depreciation. If relationships between various related items in these financial statements are established. 33 . UTILITY OF RATIO ANALYSIS: It is very important to find the ratio of liquidity. The gross profit ratio. creditors and even management. and progress of your business. changes in inventory and receivable and payables. MEANING & IMPORTANCE OF RATIO: The Balance Sheet and the Statement of Income are essential. Ratio analysis may provide the all-important early warning indications that allow you to solve your business problems before your business is destroyed by them. On the basic of this ratio. Ratio is a figure showing. logical relationship between any two items taken from financial statement as prepared and presented annually are of little use for guidance of prospective investors. Apply Ratio Analysis to Financial Statements to analyze the success. failure. profitability etc. Because the ratio analysis provides useful data to the management. investors get an idea about overall efficiency of managers and bank as well as other creditors draw useful conclusion about repaying capacity of the borrowers. Ratio Analysis enables the business owner/manager to spot trends in a business and to compare its performance and condition with the average performance of similar businesses in the same industry. The relation between in two related items of financial statements is known ratio. they can provide useful dues to garage accurately the financial health and ability of business to make profit. and or other items for which cash offers the investing and financing activities. To do this compare your ratios with the average of businesses similar to yours and compare your own ratios for several successive years. important uses of it are given as below:  PROFITABLITY : Useful information about the trend of profitability is from profitability ratio. watching especially for any unfavorable trends that may be starting. net profit ratio and ratio of return on investment give a good idea of the profitability of the business.

If this ratio is low. the selling price is reduced but there are may be no corresponding reduction. It expresses in percent. LIQUIDITY : In fact the use of ratio was made initially to ascertain the Liquidity of business. However it must be enough to cover its operating expenses. acid test ratio will tell whether the firm will be able to meet its current liabilities and when they nature. there are more or less recognized gross profit ratios and the business should strive to maintain this standard. the management must investigate the causes and try to bring up this ratio. Banks and other leaders will be able to conclude from these ratios whether the firm will be able to pay regularly the interest and loan installments. Alternatively. a ratio shows that for a sale of every Rs. the selling price is reduced but there may be no corresponding reduction in cost of sales. It is a significant indicator of the profitability of business. Classification of ratio Profitability ratio Gross Profit Ratio: Meaning: It is expresses relationship between Gross Profit earned to net sales. In many industries. There is no calibration against reasonability of gross profit ratio.  EFFCIENCY : The turnover ratios are excellent guide to measure the efficiency of managers. In such a case. 1000 a margin of 250 rupees is available from which operating expenses of business are recovered. All such ratio related to sales present a good picture of the success on the business. it may also mean that due to depression. The ratio shows whether the mark up obtained on cost of production is sufficient or not. it indicates that the cost of sales is high or that the purchasing is inefficient. For example. The current ratio. 34 .

damage and so on in the case of those firms which follow the policy of fixed gross profit margin in pricing their product.1 11.359471 1761. The gross margin represents the limit beyond which fall in sales price are outside the tolerance limit.4 13.2 17891. The gross profit ratio can also be used in determining the extent of loss caused by theft.8 16.3 17. spoilage.3 20530.891 0856 INTERPRETATION: As mentioned above the gross profit ratio indicates the relationship between gross profit and net sales.7 12015.2 14696.1271 719 9104. Formula: Particulars Gross Profit (EBDT) (In x10M Rs) Net Sales (In x10M Rs) Gross Profit Ratio 2009 2382. Here from the table we can judge the financial position of Maruti Suzuki year wise.7 2003 604.Implementation: Gross profit is result of the relation between price. Here 6 consecutive years from 2004 to 2009 are taken into consideration.165597 2551.9 16.603937 FOR GROSS PROFIT RATIO 2008 2007 2006 3071.6 17.2 7180. sales volume and costs. The changes in the gross profit ratio in percent are as follows.4149 2458 10923. 35 . A change in the gross margin can be brought about by changes in any of these factors.1 8.939222 2005 2004 1264.

the expenses of operating the business and the cost of the borrowed funds. It indicates better financial position of the company. The higher the ratio. In order to have a better idea of profitability. the gross profit ratio and net profit ratio may be simultaneously considered. Formula: Net Profit Sales X 100 36 . A high net profit margin would ensure adequate return to the owners as well as enable a firm to withstand adverse economic conditions when selling price is declaiming. Net Profit Ratio: Meaning: Net profit ratio is valuable for the purpose of ascertaining the over-all profitability of business and shows the efficiency of operating the business. It indicates the portion of sales revenue is left to the proprietors after all operating expenses are paid.Here. the better will be the profitability. cost of production raising and a low net profit margin has the opposite implication. Implementation: The net profit ratio is indicative of management¶s ability to operate the business with sufficient success not only to recover from revenue of the period the cost of merchandise or services. but also to leave a margin of reasonable compensation to the owners for providing their capital at risk. while positive sign indicates that the percent is decreased in the gross profit compare to immediate previous year. negative sign indicates that the percent is decreased compare to immediate previous year. it indicates that administrative expenses are slowly rising. The ratio of net profit ratio to sales essentially expresses the cost price effectiveness of the operation. If the gross profitability increases over the five years but net profit is declining. For consecutive four years the gross profit ratio is positive.

29 14696.8066 6007 Interpretation: Here 6 consecutive years from 2004 to 2009 are taken into consideration. If the administration department is not sufficient then net profit ratio goes down or the control mechanism is not efficient at all check points then also it affects net profit of the company.82 9104.446779 1197.1 5.9 9. higher the ratio yields higher profit.8298 8445 2003 129.1 1.Particulars Net Profit (In x10M Rs) Net Sales (In x10M Rs) Net Profit Ratio 2009 1072.43 increases in the net profit ratio which gives signal of better financial position of the company.8 7.1 10923.3323682 1535. Due to various reasons this ratio goes down. For the year 2008-09 there is 2. 37 .9623831 2005 860. Higher the net profit ratio shows better financial position of the company. The changes in the net profit ratio in percent are as follows.2246701 FOR NET PROFIT RATIO 2008 2007 2006 1669. Net profit is the profit that is available to the proprietors of the firm after clearing all outstanding and expenses.72 7180.64 % the increase in 2005 ± 06 up to 89.3 10.71 17891.4 6.23% that indicates there is increase in operating expenses for the year 2006 ± 07 it is 92.63 20530. Above table shows that for the year 2004 ± 05 it was 88.6 9.87363 372 2004 621. Expenses Ratio: Meaning: This ratio shows relationship between expanses to sales. Thus.03% and it is higher than previous year which shows increase in operating expenses.07 12015.

8 14696. Formula: Expenses Sales X 100 Particulars Total Expenditure (In x10M Rs) Net Sales (In x10M Rs) Net Profit Ratio 2009 18738.380 315 INTERPRETATION: This ratio shows relationship between expanses to sales.2 17891.274275 FOR EXPENSES RATIO 2008 2007 2006 15934.4 89.814 8148 2003 6704.1 9104.1. gross as well as net. Implementation: Some accountants calculate expenses ratio in respected of raw ± material consumed. [6.3 84. Here negative sign shows decrease in operating expenses.1 93.8 7180.5314 634 2004 8177.9 88.1 91.427000 2005 9671 10923.64 % the increase in 2005 ± 06 up to 89.23% that indicates there is increase in operating expenses for the year 2006 ± 07 it is 92.3 12015.059670 12462. 38 . Here negative sign shows decrease in operating expenses.This operating expense may be due to growth in the organization or it may reflect inefficacy of administrative control on expenses. This operating expense may be due to growth in the organization or it may reflect inefficacy of administrative control on expenses.4] OPERATING RATIO: Meaning: Operating Ratio is computed by dividing expenses by sales. It is closely related to the profit margin.802297 10625.6 89.8 88. Above table shows that for the year 2004 ± 05 it was 88. direct wages and factory expenses.7 20530.03% and it is higher than previous year which shows increase in operating expenses.

8 9104. Implementation: Some accountants calculate expenses ratio in respected of raw ± material consumed. direct wages and factory expenses.1 27.90 % that indicates there is increase in operating expenses for the year 2006 ± 07 it is 83. This is may be due to inefficient operation management and also there may be some other expenses for sales or promotion may incur during this year. dividends and extraordinary losses due to theft of goods. Above table shows that for the year 2004 ± 05 it was 87.15 2506.35 12015.64 1168.54 2004 786. Formula: C O G S + Operating expenses Net sales X 100 Particulars Operating Expense COGS Net Sales Operating Ratio 2009 2114.4 7180. It is closely related to the profit margin.5 17891.9 28.3499 2005 801. good destroyed by fire and so on.1 27.3 30.6 29.33 % the increase in 2005 ± 06 up to 86.3708 1244.22 900.The term µoperating ratio¶ includes (1) COGS (2) administrative expenses (3) selling expenses and (4) financial expenses but excludes taxes.88 2160.3423 OPERATION RATIO 2008 2007 2006 1510.0219 27. 39 .58 10923.01 14696. In the year 2008-09 there is 28% increase in the operating expenses.04 1673. gross as well as net.6 20530.21 3197.8 3498.1113 27.54 2003 840.4 3744.89 % and it is lower than previous year which shows increase in operating expenses.9865 INTERPRETATION: This ratio shows relationship between COGS + operating expanses to sales.

40 .4930497 INTERPRETATION: This ratio shows relationship between E B I T to CAPITAL EMPLOYED.3289 807 4378.49499 73 6853.216 6407 3098 19.502 9051 25. Formula: EBIT Capital employed X 100 FOR RETURN ON INVESTMENT / CAPITAL EMPLOYED Particulars 2009 2008 2007 2006 2005 Gross Profit (EBIT) (In 2382. Implementation: Return on investment indicates the profitability of business and is very much in use among financial analysis. The ultimate interest of any business is the rate of return on invested capital. The ratio is an indicator of the measure of the success of a business from the owners¶ point of view.7 2003 604.222 6032 5452.4 36.9 8415.232 4838 2004 1264.9 37.6 37. reserves and long term loans such as debentures. It determines whether a certain goal has been achieved or whether an alternative use of capital is justified. It may be measured by the ratio of income to equality capital.8 40.7 x10M Rs) Capital Employed ( Share capital + Reserves and surplus) (In x10M Rs) Return on Investment 9344.2 2035.4 1761.2 35.Return on investment / Capital employed: Meaning: The profitability ratio can be computed by relating the profits of a firm to its investment.2 3591. Capital includes share capital.3 3071.2 2551. It is an index of profitability of business and is obtained by comparing net profit with capital employed.

It is of great practical importance to the perspective of investors.2 17. It also indicates whether the return on proprietor¶s fund is enough in relation to the risk that they undertake. Proprietor¶s equity or Proprietors¶ funds include share capital and reserves.15 percent in the gross profit of the company.84112 22.315 1036 2003 129.72 3098 4.9 8415.1 Net Profit (In x10M Rs) Capital Employed ( Share 9344. In order to judge the efficiency with which the proprietors¶ funds are employed in business.9541 19. Formula: Net profit X Share holders fund 100 FOR RETURN ON SHAREHOLDER'S FUND 2009 2008 2007 2006 2005 Particulars 1072.07 860.18721 756 41 . It is due to recession during that period where an overall sale was affected. In the year 2008. the return on shareholders¶ equity measures exclusively the return on the owners¶ funds. this ratio is ascertained.29 1197. it is better for the company. This ratio shows what amount of dividend is likely to be received on shares. as it enables the profitability of a company to be compared with that of other.71 1535.82 3591.6 4378.down in company¶s sale.09 there is decrease of 43.642 Return on Investment 395 46 393 136 3678 2004 621.4 6853. Implementation: It expresses the profitability of a firm in relation to the funds supplied by the creditors and owners taken to gather.63 1669.9 5452. This show slow.8 capital + Reserves and surplus) (In x10M Rs) 11. Return on shareholder¶s fund: Meaning: It is carries the relationship of return to the sources of funds yet another step further.4782 19.4002 21.Higher the ratio.

5 2004 621. For the year 2004 05 it is 21. During the year 2008-09 there is 72.72 0 144. Implementation: This is probably the single most important ratio to judge whether the firm has earned a satisfactory return for its equity ± holders or not.1 0 144.97% decrease in the ROI. (2) comparisons with the overall industry average.07 0 144. Its adequacy can be judge by: (1) comparing it with the past record of the same form. Formula: Net profit after tax  Preference dividend X 100 Equity capital Particulars Net Profit (In x10M Rs) Preference Dividend (In Rs) Share Capital (In FOR RETURN ON EQUITY SHARE CAPITAL 2009 2008 2007 2006 2005 1072.29 0 144. This ratio shows upward trend for that financial year for the company.5 2003 129.5 42 .5 1669. This ratio shows downward trend in the ratio in return on shareholders fund for this company.82 0 144.INTERPRETATION: The ratio indicates relationship between Net profits to share holders fund therefore higher the returns to shareholders.90 % that increase in the year 2005 ± 06 up to 23. Return on Equity share capital: Meaning: It is obtained by dividing net profit after tax deduction of performance dividing by his amount of ordinary share capital plus free reserve.5 860.71 0 144.5 1535.70.63 0 144.5 1197.

For the year 2004 ± 05 it is 19. Formula: Net profit after tax  Preference dividend X 100 Equity share holders¶ funds 43 .13 22. year 2008-09 shows marked improvement that is why it is taken into consideration. Implementation: This is probably the single most important ratio to judge whether the firm has earned a satisfactory return for its equity ± holders or not.46 INTERPRETATION: The ratio indicates relationship between Net profits to share holders fund therefore higher the returns to shareholders.73 79.12 11. Here.14 27.49 % that increase in the year 2005 ± 06 up to 21. For the financial year 2008-09 there is 85% increase in the ratio in return on shareholders fund.73 8.03 28.x10M Rs) Return on Equity Share Capital (In Rs) 55. This ratio shows downward trend in the ratio in return on shareholders fund for this company.81 %. (2) comparisons with the overall industry average. Return on Equity share holders fund: Meaning: It is obtained by dividing net profit after tax deduction of performance dividing by his amount of ordinary share capital plus free reserve. Its adequacy can be judge by: (1) comparing it with the past record of the same form.

63 1669.1 Capital Employed ( Share capital + Reserves and 9344.9541 136 0 19. Here in the year 2008-09 there is decrease of 69% compared to previous year in the ROI which shows upward trend in the company.9 8415.64 % that increase in the year 2005 ± 06 up to 21. These ratios shows downward trend in the ratio in return on shareholders fund for this company.9 5452.315 1036 2003 129.6 4378.8 surplus) (In x10M Rs) Preference Dividend (In Rs) Return on Investment (In Rs) 0 11.2 0 17.29 1197. the amount that they can get on every share head.4 6853.4002 393 0 21.95%. that is. It is essential that EPS of the company should be compared with the other companies and also average of the company before giving final opinion. The limitation of EPS is that it does not show how much dividend is actually paid to shareholders and how much profit is retained in business.71 1535.07 860.72 3098 0 4. Earning per share: Meaning: EPS measures the profit available to the equity shareholders on a per share basis.18721 756 INTERPRETATION: For the year 2004 ± 05 it is 19.4782 395 0 19.FOR RETURN ON EQUITY SHARE HOLDERS FUND Particulars 2009 2008 2007 2006 2005 Net Profit (In x10M Rs) 1072. This ratio shows the profitability of the firm from the owner¶s point of view.6423 678 2004 621. Implementation: Earning per share is a widely used ratio. EPS s a measure of profitability 44 .8411 246 0 22. By comparing EPS of the current year with past years the path of the trend of profitability can be ascertained.82 3591.

Like the EPS.63 1669.43 % and its increase on 2006-07 is 53. In the year 2004 ± 05 ratio is 29.29 1197.7934 53. Dividend per share: Meaning: DPS is the dividend paid to shareholders on a per share basis.522 9612 2003 129. the DPS is also should not be taken at its face value as the increase DPS may not be a reliable measure of profitability as the equality base may have 45 . of Equity Shares 60 60 60 60 60 Preference Dividend (In Rs) 0 0 0 0 0 Return on Investment ( In 37.71 1535.Formula: Profit after tax ± preference dividend X 100 No.4340 29.8997 865 INTERPRETATION: This ratio indicates the earning per share for shareholders of company.07 860.therefore it is good for company as well as shareholders. DPS is the Net distributed profit belonging to the shareholders divided by the No.7705 Rs) 792 185 594 02 106 2004 621.72 2889100 60 0 44. In the other words. of equity shareholders fund FOR RETURN ON EARNING PER SHARE Particulars 2009 2008 2007 2006 2005 Net Profit (In x10M Rs) 1072.82 288910 060 0 21.1407 41. Implementation: The DPS would be a better indicator than EPS as the former shows what exactly is received by the owners.1267 57.1 2889100 2889100 2889100 2889100 2889100 No. of ordinary shares outstanding.14 %.77 % and 2005 ± 06 it is 41.

8 2. Thus ratio is computed by dividing the market price of the shares by the EPS.increase due to increase relation without any change in the number of outstanding shares.00062 262 2004 288910 060 43.49967 024 101. of shares. Thus for the current year it is decreased.49935 894 57. Price earning ratio: Meaning: It is closely related to the earning yield leanings price ratio.50 % in the year 2006 ± 07. For the year 2004 ± 05 it is 2 % and 2005 ± 06 is3.1 3.1 3. It is actually the reciprocal of the latter. Implementation: 46 .49935 894 144.50 % and increase on 4.84%.3 1. of equity shares Particulars No. of Equity Shares Total Dividend (In x10M Rs) Dividend per Share ( In Rs) FOR DIVIDEND PER SHARE 2009 2008 2007 2006 2005 2889100 2889100 2889100 2889100 2889100 60 60 60 60 60 101.4987 3632 2003 2889100 60 42. It indicates slow-down in the financial position of the company.7 1. Formula: Total dividend declared No.47796 861 INTERPRETATION: This ratio indicates the total dividend declared to no. For the year 2007-08 is 96% increased compared to previous year while for the year 2008-09 it is decreased to 26.5 5.00155 654 130 4.

56 24.1106 557 INTERPRETATION: This ratio indicates the earning per share for shareholders of company. Dividend yield ratio: Meaning: Dividend yield ratio is closely related to the EPS and DPS. the PIE ratio measures investors¶ expectations and the market appraisal of the earnings. In the year 2004 ± 05 ratio is 17. Formula: Market value per share Earning per share FOR PRICE EARNING RATIO 2009 2008 2007 2006 1559. In other words. Therefore it is good for company as well as shareholders.65 41.58% and 2005 ± 06 it is 21.57 37.7606 838 2004 461. 47 .03 8.95% and its increase on 29. the yield is expressed in terms of the market value per share.65 22.3 4.5186 433 520.8130 381 Particulars Market Value of Share (In Rs) Earning Per Share (In Rs) Price Earning Ration 2005 636.35 40. Therefore.1 59.851 8319 2003 376.25 21. The earnings yield may be defined as the ratio of earnings per share to the market value per ordinary share.05 53. only normally sustainable earning associated with the assets are taken into account.81077 418 990.25 18.88 77.5785 326 927.The price earning ratio reflects the price currently being paid by the market for each Rupee of currently reported EPS.5 29. While the EPS and DPS are based on the book value per share.29 18.55%.

003773 5 Particulars Market Value of Share (In Rs) Dividend Per Share (In Rs) Dividend Yield Ratio 2005 636. It is determined by dividing the operating profit or earning before interest and taxes (EBIT) by the fixed interest changes on loans.Implementation: The dividend yield ratio is calculated by dividing the cash dividends per share by the market value per share.3 1.4993589 4 0. Interest coverage ratio: Meaning: It is also known as µtime interest ± earned ratio¶.95%.00314 316 2004 461.001555 65 0.00062 262 0.9% and for 2008-09 it is increased by 76. In the year 2004 ± 05 ratio is 17. So for current situation is good for company as well as shareholders. This ratio measures the debt servicing capacity of a firm insofar as fixed interest on long term loan is concerned.49967 024 0.51%.25 1.009616 53 990. Formula: Dividend per share Market value share FOR DIVIDEND YIELD RATIO 2009 2008 2007 2006 1559.05 4.5 2.0032 4929 2003 376.58% and 2005 ± 06 it is 21. 48 .4987 3632 0.65 3.4779 6861 0.499358 94 0.0022436 8 520. For the year 2007-08 the ratio is decreased by 109.35 3.1 5.00454 489 927.0039 2763 INTERPRETATION: This ratio indicates the earning per share for shareholders of company.

It is decreasing for the last 2 financial years due to the fluctuation in for-ex.9361 111 2004 1308.8 and its decrease on 68.53. Formula: EBITD Interest FOR INTEREST COVERING RATIO 2009 2008 2007 2006 2433.Implementation: This ratio uses the concept of net profits before taxes because tax is calculated after paying interest on long term loan.1 43.774 1764 13 38 51 7 PARTICULARS OPERATING PROFIT (EBDIT) (IN X10M RS) INTEREST (IN X10M RS) INTEREST COVERING RATIO 2005 1797. This ratio as the name suggests. show how many times the interest changes are covered by EBIT out of which they will be paid.7 12.1405 53 2003 656.4 47.93 and 2005 ± 06 it is 100.9 52.85106 100.71 52.464 8956 INTERPRETATION: This ratio indicates the EBDIT to interest. Activity / Turn over Ratio: Overall turnover ratio: 49 . For the year 2008-09 the interest covering ratio is 47.therefore it is good for company as well as shareholders.8 2588.6 20. 3130.71 while for the year 200708 it is 52.7 36 49.85.8 2055. In the year 2004 ± 05 ratio is 49.8 3 51 59.4 30.53020 68.6 37.

14 in the year 2006 ± 07.31765 6553 INTERPRETATION: This ratio indicates net sales to capital employed.19 while in the year 2007-08 the ratio is decreased to 2.5351 97149 3098 2.49470 174 3591.Meaning: The amount invested in business is invested in all capital employed and sales are affected through them to earn profits so in order to find relation between net sales to capital employed.19693 0946 8415. fixed assets turn over ratio: 50 .1 9344.6 2.126054 614 6853.20 and its decrease on 2.8 2. Formula: Net sales Capital employed Particulars Net Sales (In x10M Rs) Capital Employed ( Share capital + Reserves and surplus) (In x10M Rs) OVERALL TURNOVER RATIO FOR OVERALL TURNOVER RATIO 2009 2008 2007 2006 20530.203700 987 4378.9 2.6 14696. In the year 2004 ± 05 ratio is 2. In the year 2008-09 the ratio is 2.2 2.8 2004 9104.3 12015. Therefore it is bad for company.49 and 2005 ± 06 it is 2.1 17891.9 2.12 which shows slow down in the company. Implementation: The usefulness of the Du Pont analysis lies in the fact that it presents the overall picture of the performance of a firm as also enables the management to identify the factors which have a bearing on profitability.4 2.9 2005 10923.1442244 56 5452.4 2003 7180.

166 4740.3 12015. Formula: Sales Fixed assets FOR FIXED ASSETS TURNOVER RATIO 2009 2008 2007 2006 2005 20530.02 INTERPRETATION: Fixed turn over ratio indicates the turnover of the company in one year.4299 99998 2003 7180.61 4828 134 35 441 011 2.1 3554.77 Particulars Net Sales (In x10M Rs) Total Fixed Asset (In x10M Rs) Fixed Asset Turnover Ratio 2004 9104.1 in the year 2006 .8 7079.50 495 2.77 and 2005 ± 06 it is 2.1 2. In the year 2004 ± 05 ratio is 2.34 5716. Therefore.9 10923.07.13 3. In the year 2008-09 there is decrease of 7% in the fixed turnover ratio compare to last year while during year 2007-08 there is very minor change in the ratio.1 17891.95 2.186 3943. The higher the turnover ratio.6 14696.7419 4073. it is good for company.95 and it increase on 3.4 3746. Implementation: To ascertain efficiency and profitability of the business. A reference to this was made while working out the overall profitability of a form as reflected in its earning power.6 6667 2. the more efficiency is the management and utilization of the assets while low turnover ratios are indicative of underutilization of available resources. Year 2007-08 and 2006-07 shows almost similar financial position of the company while year 2008-09 shows slight slow down in the financial position of the company 51 .9 3.Meaning: It is based on the relationship between the sales and assets of the firm.

In the year 2004 ± 05 ratio is 20.24 2003 7180.Debtor turn over ratio: Meaning: It is allied and closely related to this is the average collection period.61 57635 16. In the year 2008-09 there is 1% decrease in the Debtor¶s turnover ratio compare to previous year and 2007-08 there is 17.8 527.117 1477 29.89 INTERPRETATION: Debtor turnover ratio indicates credit sales to avg. It is the test of the liquidity of the debtors of a firm.3 595.69 2005 10923.2140 144 23. 52 .23288 78 24.97 14696.69 and its increase on 24.69 in the year 2006 ± 07.974 867 20. debtors.91% increase in the debtor¶s turn over ratio. Formula: Credit sales Avg. Debtors Particulars Net Sales (In x10M Rs) Sundry Debtors (In x10M Rs) Debtor Turnover Ratio FOR DEBTOR TURN OVER RATIO 2009 2008 2007 2006 20530.4 560.69 2004 9104. it is good position for company.6 596. Therefore.1 603.877 2077 11.45 17891.9836 503 29.69 12015. as in the case of average inventory. Implementation: This figure should be measured. on the basis of the monthly average. It suggests that number of times the amount of credit sale is collected during the year.69 and 2005 ± 06 it is 23.1 697.9 507.

3 19. of day¶s collection period increase which indicate inefficiency of collection department. Creditor ratio: Meaning: It is the no.8 22.1 0 9392.3863245 0 10836. Formula: Creditor + B / P Credit Purchases X 365 Particulars Creditor (In x10M Rs) Bills Payable (In x10M Rs) Credit Purchase (In x10M Rs) Creditor Ratio FOR CREDITOR RATIO 2008 2007 854.8 21. As compare to previous year the no.57093731 2005 463.6 0 13938.How efficiently the amount is collected from the customers from the credit sales.9 909.4 30. Lower the collection period and higher debtor turnover ratio is advisable. of days within which we make payment to our creditors for credit purchases it obtained from creditor ratio.6316681 INTERPRETATION: Creditor ratio indicates creditor to credit purchase. 53 .7 0 8621. Implementation: The generally the longer credit period achieved means the operation of the payment being financial interest feels by supper funds.63785021 2006 555.

92091515 18. Formula: No. decrease of 36.36% in the creditor ratio compare to previous year. Thus it indicates slight slow down in the financial condition of the company. creditor turns over ratio: Meaning: It is the no.30459703 11.63785021 365 21.57 and its increase on 30. of days within which we make payment to our creditors for credit purchases it obtained from creditor ratio.63 in the year 2006 ± 07.6316681 16. Of Days in Year Creditor's Ratio Creditors Turnover Ratio FOR CREDITOR TURN OVER RATIO 2008 2007 2006 365 22.57093731 2005 365 19.In the year 2004 ± 05 ratio is 19.91336851 16. Implementation: The generally the longer credit period achieved means the operation of the payment being financial interest feels by supper funds. In the year 2007-08 there is decrease on 22.63 and 2005 ± 06 it is 21.38 times i.5924089 54 .3863245 365 30.e. of days in a year Creditor¶s ratio Particulars NO.

It measures the relationship between COGS and inventory level.92 and its increase on 11. To judge whether the ratio of a firm is satisfactory or not. obsolete and low quality goods. Formula: Cost of good sold Average stock 55 . Lower stock turn over ratio indicates accumulation of slow moving. Therefore.30. During the year 2007-08 ratio is 16. It is measures how quickly inventory is sold. It is a test of efficient inventory management.INTERPRETATION: Creditor ratio indicates creditor to credit purchase.59 and 2005 ± 06 it is 16. Stock Turnover Ratio: Meaning: It is the no. the more profitable business would be. it is good position for company. Such firms will be able to trade on a smaller margin of a gross profit.91 in the year 2006 ± 07. Higher the turnover ratio. It increases in compare to previous financial year thus it indicates good position of the company. of times the average stock is turned over during the year is known as stock turnover ratio. Implementation: This approach has the advantage of being free from bias as it smoothens out the fluctuations in the inventory level at different period. which is a danger signal for management. In the year 2004 ± 05 ratio is 18.

better position of the company as well as efficiency. Implementation: The current ratio of a firm measures its short term solvency. It is also known as a working capital ratio.05 times and 17. as it is measure of working capital available at a particular time.2 17954 1038 17.7 11574 666.7 881.L.80 times in the year 2006 ± 07.3 23.Particulars Sales Turnover (In x10M Rs) Gross Profit (EBDT) (In x10M Rs) Cost Of Good Sold (COGS) (In x10M Rs) Inventories (In x10M Rs) Stock Turn over Ratio 2009 23182.362736 3 2004 11047. For the year 2008-09 and 2007-08 the ratio are 23.A.9 902. In the year 2004 ± 05 ratio is 17. It indicates better position of the company.1 2035.3 times respectively. it is good for company. as and when they mature. Liquidity Ratio: Current Ratio: Meaning: The current ratio is the ratio of total current assets to total current liability.052089 11 FOR STOCK TURN OVER RATIO 2008 2007 2006 21025. Therefore.7 1761.7 9782.7 439. 56 .3 20799.4 1264.2 INTERPRETATION: Stock turnover ratio indicates cost of goods sold to average stock.6 17.9 2551.4322514 8 2005 13335.2 3071. It is calculated by dividing current assets by current liability.36 times and 2005 ± 06 it is 14. It is more in 2008-09 compare to 2007-08. How efficiently stock rate in the year Higher the ratio.4 12717.7 701.4 20. The fact that a firm can rarely count on such an even flow requires that the size of the C. It is a measure of short term financial strength of the business and shows whether the business will be able to meet its current liabilities. That is a measure of margin of safety to the creditors.893498 72 14753.2 14654.29672 447 17205.43 times and it¶s increase on 20.2 14.2 2382. should be sufficiently larger than C.8 22.243519 78 2 89 6 83 17.

43: 1 in the year 2006 ± 07. In the year 2004 ± 05 ratio is 1. If the liquid assets are equal to or more than liquid liabilities. For the year 2008-09 the ratio is 1. it is good for company. It indicates.8 3097.1 2008 2005 2972 2004 2018.892114 1608 1.9 3397. Therefore. Formula: Current Assets Current liability FOR CURRENT RATIO 2007 2006 4405 3740. The standard current ratio must be 2:1.4 1.6 1.61:1 and for the year 2007-08 it is 1. It liquid ratio is designed to show the amount of cash available to meet immediate payments.096330 3072. 57 . the condition may be considered as satisfactory.882050 INTERPRETATION: Current ratio indicates current assets to current liability.31799 1478.9 2003 2782. Mainly 2: 1 is good.84: 1 and 2005 ± 06 it is 1.9 Particulars Total Current Assets (In x10M Rs) Total Current Liabilities (In x10M Rs) Current Ratio 2009 5491.1 1.89: 1 and its decrease on 1. So for the year 2008-09 it is good as ideal is 2:1 and 1.433732 1977. Liquid Ratio: Meaning: It is obtained by dividing the liquid assets by liquid liabilities.848258 1531.so that the firm would be assured of being able to pay its current maturing debts as and when it becomes due. repaying condition of the company to the current liabilities.61:1 closer to ideal one.61:1.6162 2825.7 1.6 1.8 1.

Formula: Liquid assets Liquid liability FOR LIQUIDITY RATIO 2008 2007 2006 3097. It measures ability of a firm to meet its short term obligations and reflect the short term finance strength of a firm.0308787 1.1 Particulars Total Current Assets (In x10M Rs) Inventories (In x10M Rs) Prepaid Expenses (In x10M Rs) Quick Asset (In x10M Rs) Total Current Liabilities (In x10M Rs) Bank Over Draff (In x10M Rs) Liquidity Ratio 2009 5491.9 439.4 1608 2004 2018.55268497 INTERPRETATION: 58 .1 902.9 2825.6 0 0 0 0 0 0 0 1.8 3397.6 3072. In fact liquidity is a prerequisite for the very survival of a firm.72898751 1.6 0 2305.4 0 3703.Implementation: The importance of adequate liquidity in the sense of the ability of a firm to meet short term obligations when they become due for payment can hardly be overstressed.8 0 1579.1 1531.7 1977.2 0 2859.35060042 0.8 2003 2782.44641141 1.9 881.205442 1.7 4405 701.4 3740.6 2005 2972 666.8 1478.43370647 1.9 1038 0 2059.3 0 4588.8 487 0 2295.

Implementation: This ratio is the most rigorous and conservative test of a firm¶s liquidity position.44: 1 and its decrease on 1. Quick / acid test ratio: Meaning: The measure of absolute liquidity may be obtain by comparing only cash and bank balance as well as readily marketable securities with liquid liabilities. Quick assets here do not include both stock and debtors.Liquid ratio indicates liquid assets to liquid liability.6 2005 2972 1608 2004 2018. it is suggested that it would be useful for the management.8 2003 2782.35:1 which shows slight better condition compare to FY 2004-05. Therefore.43: 1 and 2005 ± 06 it is 1.4 3740. it is good for company. For the year 2008-09 the ratio is 1.43373259 1.1 Particulars Quick Assets (In x10M Rs) Current Liability (In x10M Rs) Quick Acid Test Ratio 2009 5491. This is exacting standard of liquidity and it is satisfactory if the ratio is 0. The standard liquidation must be 1:1.9 1531. because payment from debtors would not generally be received immediately when liquid liabilities are to be paid.9 1977.8 1478.7 4405 3072.1 3397.6 1. Formula: Quick assets Liquid liability FOR QUICK ACID TEST RATIO 2008 2007 2006 3097.89211471 1. In the year 2004 ± 05 ratio is 1.61617024 1.5:1.84825871 1.21: 1 in the year 2006 ± 07. How effectively the liability paid off. Further.88205059 59 .9 2825.3179919 1.09633011 1.

Leverage Ratio: Proprietary ratio: Meaning: The ratio shows the proportion of proprietors¶ funds to the total assets employed in known in the proprietary ratio. Therefore. Generally it is said that proprietor¶s fund should be enough to cover fixed assets.6 6853.INTERPRETATION: Quick acid test ratio is indicates quick assets and liquid liability. as it signifies that the proprietors have provided larger funds to purchase assets. Purchases are made for cash only and firm carries business entirely from own funs only.4 2004 3591. In the year 2004 ± 05 ratio is 1.9 7484.9 10043. so the benefit of trading on equity is obtained. Implementation: Proprietary ratio helps to known how many proprietary funds to total assets. it is good for company. And also reasonable proportion must be maintained between owned funds and borrowed funds. This ratio can not exceed 100%.7 5452.4: 1 in the year 2006 ± 07. Which inture increase the rate of equity dividend.8 FOR PROPEIETARY RATIO 2008 2007 2006 8415.3 2005 4378.4 9315.89: 1 and its decrease on 1. A very high ratio therefore is not desired as it shows insufficient use of out side fund is made. it means that the business does not use any outside funds.1 2003 3098 3554 60 .8 4686. the stronger the financial position of the enterprise.6 5524. There are no outside liabilities.2 3903. Formula: Proprietary _____________ __ Particulars Total Proprietary Funds (In x10M Rs) Total Assets (In 2009 9344.84: 1 and 2005 ± 06 it is 1. The higher the ratio. 9.

62 61 .54 411.57214 05 98.169 38661 INTERPRETATION: This ratio indicates the proprietary funds to total assets. The pressure from creditors would increase and their interference will also increase.3366 3962 91.0089 1599 87. Alternatively this ratio indicates the relative proportions of debts and equity in financing the assets of a firm.57 % and 2007± 08 is 90.041 FOR DEBT EQUITY RATIO 2008 2007 2006 841. It has important implication from view point of the creditors.702098 93. A higher ratio means that outside creditors have a larger claim than the owners of business. Particulars Long term 2009 841. This is a good for company.304 2004 395.104 2005 350. as benefit of trading on equity is not availed of and the rate of equity dividend will be comparatively lower. owners and the firm itself. The company with high debt position will have to accept strict conditions from the lenders. Debt equity ratio: Meaning: The relationship between borrowed funds and owner¶s capital is a popular measure of the long term financial solvency of a firm. The D/E ratio is an important tool of financial analysis to appraise the financial structure of a firm.041478 32 90. Implementation: This ratio reflects the relative claims of creditors and shareholders against the assets of the firm.04 %.33 % and increase in 2008 ± 09 it is 93. This relationship is shown by the debt ± equity ratio.43632 639 92.032 2003 588. while borrowing money. A lower ratio is not profitable from the view point of equity share holders.234 218. For the year 2006 ± 07 it is 91.x10M Rs) Proprietary Ratio 93.

4 6853.6 4378. Conclusion Maruti was listed in 2003.6% over the financial year 2007-2008. The downfall of net profit during the financial year 2008-09 is 29. But. still it again varies for company to company.9 8415.Liabilities (In x10M Rs) Total Shareholders Funds (In x10M Rs) Debt-Equity Ratio 9344. For the year 2004 ± 05 it is 8 %and 2005± 06 is 4 % and increase in 2006 ± 07 it is 6%. and has been a consistent and strong performer on the stock exchange. This is a bad for company as compare to 2005-06 year is more debt ratio which indicate the more realize on debt fund rather owned fund.9 5452. The good impact is interest burden will be more indirectly.2 3098 9% 10% 6% 4% 8% 11% 19% INTERPRETATION: This ratio indicates the debt to equity ratio.During the financial year 2008-09 the there is downfall in the growth of the company. They are practically debt free and have a healthy cash balance.8 3591. company has a trend of growth from 2003 to 2007. Maruti Suzuki India LTD. As the higher debt equity ratio it shows the weaker financial condition of the company. They have financed all growth from internal resources. even in good times. Their continuous efforts at cost cutting and improving productivity. For the year 2008-09 and 2007-08 the debt equity ratio is 9% and 10% respectively. The main reason behind this downfall is because of the global recession and the price of commodities of Maruti was quite high in the commodity market. have helped them in making reasonable profits despite the impact of higher commodity prices and weaker rupee. giving handsome returns to investors.The 62 .

5 681.9 4405 3740.5 87.5 132.9 517.6 622.3 1038 701.7 6146.9 900.3 4686.9 1533.1 63.6 4566.9 550.8 984.2 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 9344.3 72.7 0 250.8 4384.4 881.8 1218.8 0 3296.total sales numbers in 2009-10 mark a growth of 29% over last financial year.6 698.9 655.9 8415.5 635.8 0 861.1 561.6 1619.1 2247.6 8720.7 3866.4 6853.9 5452.3 9200.1 599.9 2258.4 1730.3 389.3 5491.1 839. From above facts and figures we reach to the conclusion that the future is exciting and full of promise.3 2642.7 .7 263.1 1516.3 3173.2 58.8 1401.4 671.8 3487.2 3098 2707.6 1763.2 989.2 320.5 239.8 1364 487.4 5308.4 1135.6 1029.3 7285.575 units in the year2009-10 are the highest ever annual export by the company.5 698.7 5524.4 812 676.1 567.7 2735.8 9315.3 5180.8 2255.5 144.1 3097.6 3259.1 1608 1531.3 132.8 1211.5 144.5 144.5 144.2 2011 1505.9 1073.7 1026.5 1422.1 10043.1 1954.8 3016.5 272.8 1478.8 95.1 0 2659.7 3072.6 2825.6 311.4 342.6 4378.3 3754.7 0 42.1 3554 3363.9 9.7 307.4 0 1695.9 2456.5 71.5 1061.1 2093.3 71.4 8270.5 2575 2510.7 4513.7 2953.6 311.2 0 92 2051. Appendix 1 Balance Sheet of Maruti Suzuki Balance Sheet(2009-2000) of Maruti Suzuki *All numbers are in INR and in x10M 200903 200803 200703 200603 200503 200403 200303 200203 200103 SOURCES OF FUNDS : Share Capital Reserves Total Equity Share Warrants Equity Application Money Total Shareholders Funds Secured Loans Unsecured Loans Total Debt Total Liabilities APPLICATION OF FUNDS : Gross Block Less : Accumulated Depreciation Less:Impairment of Assets Net Block Lease Adjustment Capital Work in Progress Investments Current Assets.2 644.5 0 736. Maruti has crossed sale of 1million cars and by achieving this now it has become landmark for Maruti where other companies will take time to reach and of course they have raise their bar for themselves also.8 0 4070.1 0.5 689.8 71.9 456 656 1112.9 6709.4 63 3397. Loans & Advances Inventories Sundry Debtors Cash and Bank Loans and Advances Total Current Assets Less : Current Liabilities and Provisions Current Liabilities Provisions Total Current Liabilities Net Current Assets Miscellaneous Expenses not written off 144.2 4954.2 96.2 630.8 487 918.4 240.9 1201.6 439.2 666.4 646.1 0 0 0 0 74.4 0 1873.3 88.5 649.7 307.4 1677.2 5053.5 144.6 0 0 0 0 1830.4 1977.4 368.1 1304.1 3179.7 2430.4 2251 902.7 119.6 1465.8 3591.9 2972 2018.5 144.7 380.4 3903.3 0 0 0 156 260.9 0 0 0 0 0 16.7 2110 865.9 300 395.2 1266.1 1939 330.7 369.3 3446.9 2782.3 103.5 675.8 900.5 0.3 3988.2 1332. The export sales of 147.5 747.6 4649.6 7484.1 4234.7 3409.4 471.

5 -94.71 1535.5 0 -23.53 0 9671 1797.4 6.8 2588.6 -6.8 1304.4 2335.6 2551.6 17891.1 0 70 41.99 2046.4 377.56 124.2 211.8 251.57 41.7 0 8177.8 459.8 0 40 29.4 1264.9 42.2 8981.6 837.9 324.7 2411.72 621.5 147.3 598.3 4393.6 463.9 3442.7 1562 26.35 13791.5 860.4 1750 587.2 5839.16 9335.6 21172 21025.7 456.3 2055.6 318 141.71 0 5637.1 0 70 40.4 1943 9104.8 1218.6 14753.2 141.6 57.1 217.5 941.9 769.5 -0.9 52.07 1072.25 60.9 2509.7 2433.1 998.4 16.57 41.3 668.3 7021.1 336.9 118.29 153.8 61.03 59.1 1189.09 1669.8 37.76 71.5 -356.8 2269.8 0 0 104.5 254.4 78.1 191.2 129 75.4 2035.56 18.1 -7.57 323.71 105.33 5889.2 2233.7 144.8 20.2 101.69 0 2502.25 29.5 8928.9 0 309.9 39.9 524.8 293.2 0.2 8004.6 0 -73.3 706.6 146.2 0 67.67 264.4 -243.5 1675.94 0 12462.3 5.7 11047.4 7180.1 43.2 2652.2 9485.45 141.19 0 10625.4 227.9 10923.1 322.6 -20.25 151.1 276.3 19065 17205.1 13335.29 53.9 101.26 5563.2 3133.3 346.7 2211.9 7534.97 1197.4 0 168.2 635.29 53.4 0 15934.65 40.2 0 0 -269.03 291.7 9087.9 0 120.7 -11.2 2503 759.7 11468.3 51 2382.8 621.35 64 .1 57.19 10739 97.3 538.7 146.4 266.7 494.46 92.4 18.2 12015.6 14696.2 3130.29 237.29 166.6 3.3 621.2 568.5 1801.1 15051.2 322.2 271.2 77 461.9 53.4 2279.8 1110.89 0 6704.84 0 18738.7 0 30 78.03 59.8 542.9 7361.4 340.01 185.7 604.56 211.1 0 100.8 117.29 -287.7 580.1 -79.6 2757.8 0 0.7 36 1761.2 58.6 1730.2 236 12681.8 656.8 403.1 35.7 0 240.1 282.52 6973.7 -32.8 9.56 18.1 536.4 199.7 0 30 4.4 7025.1 0 237.2 0 0 0 0 1997.9 0 80.7 89.29 -8.02 184.8 51.3 853.9 429.1 2737.8 2013.65 40.3 95.1 1308.65 188.8 2.82 57.1 20530.5 0 100 59.44 206.3 0 342.88 0 6892.2 7074. below Net Profit P & L Balance brought forward Statutory Appropriations Appropriations P & L Balance carried down Dividend Preference Dividend Equity Dividend % Earnings Per Share(Adj)-Unit Curr Earnings Per Share-Unit Curr Earnings Per Share(Adj)-Unit Curr Book Value-Unit Curr 23182.2 15763.68 129.3 13.8 5637.72 0 2269.4 285.88 107.3 -269.3 130 0 90 53.96 576.8 59.67 8563.21 0 2233.1 0 2757.6 3071.82 0 2335.8 197.25 29.63 0 7025.7 1486.3 0 30 18.2 342.8 6716.07 0 3442.2 9.22 82.1 551.Appendix 2 Income Statement Income Statement (2009-2003) of Maruti Suzuki *All numbers are in INR and in x10M 200903 (12) 200803 (12) 200703 (12) 200603 (12) 200503 (12) 200403 (12) 200303 (12) 200203 (12) 200103 (12) INCOME : Sales Turnover Excise Duty Net Sales Other Income Stock Adjustments Total Income EXPENDITURE : Raw Materials Power & Fuel Cost Employee Cost Other Manufacturing Expenses Selling and Administration Expenses Miscellaneous Expenses Less: Pre-operative Expenses Capitalised Total Expenditure Operating Profit Interest Gross Profit Depreciation Profit Before Tax Tax Fringe Benefit tax Deferred Tax Reported Net Profit Extraordinary Items Adjusted Net Profit Adjst.83 0 6996.6 49.1 193.4 43.8 4393.

9 -10 -1.6 2694.6 -226. Profit before Working Capital Changes Adjustment For Trade & 0th receivables Inventories Trade Payables Loans & Advances Investments Net Stock on Hire Leased Assets Net of Sale Trade Bill(s) Purchased Change in Borrowing Change in Deposits Others Total (OP before Working Capital Changes) Cash Generated from/(used in) Operations Interest Paid(Net) Direct Taxes Paid Advance Tax Paid Others Total-others Cash Flow before Extraordinary Items Extraordinary Items Excess Depreciation W/b £¢ ¡¡  ¡¡  1) .7 -124.2 566.8 1750 1304.4 -89.5 1627.4 22 11.2 -38.6 1029.1 194.1 0 0 0 0 0 0 0 -7.2 -580.2 -166.4 -35 43.9 0 0 0 -45.9 0 0 65 .7 -8.8 1822.5 0 -864.3 271.5 322.3 172.1 322.9 -73.3 0 200803 1422.4 456.9 2279.3 279 397.5 1193.7 1035. Lease & Rental Chrgs Others Total Adjustments (PBT & Extraordinary Items) Op.3 89.7 0 -452.5 0 0 0 0 0 0 0 0 -635.2 -580.9 -20.7 -4.6 -119.8 -72 -79.4 2028 1222.2 -81.1 0 0 0 0 0 0 0 -99.6 -265 135.9 0 0 0 0 167.1 -48.4 -233.3 0.3 517 318.8 1745.7 1035.2 989.7 0 0 -864.5 2028 1222.9 -61 0 0 69.4 -499.8 0 -42.9 -3 5.1 116.5 -29.2 -81.1 175 -20.4 240.8 -85.8 71.8 0 200703 200603 200503 200403 200303 200203 1401.6 -3.4 -36.2 1152.3 -12.8 706.9 769.3 -86.6 1074.1 0 0 0 0 0 0 0 0 -8.5 269.7 2663.4 -30.8 494.3 -130.5 -213.5 -616.4 -233.5 653.7 645.6 356.2 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 429.4 285.1 -3.2 782.9 2.9 2234 1884.5 105.8 666.3 0 0 191.3 382.7 1822.6 0 0 0 0 0 0 0 0 0 0 0 0 0 0 216.6 92 -336.1 2687.3 87.5 0 0 -12.7 -37.8 2503 568.4 -499.8 134.4 168 -214.3 -12.6 770.7 47.3 -0.8 2.3 342.4 0 0 0 0 -635.9 1645.4 1193.9 0.4 0 0 -452.9 770.4 -152.4 -43.3 0 0 0 -0.1 1269.3 -184.9 118.Appendix 3 Cash Flow Statement Cash Flow Statement ( ¥¤ *All numbers are in I and in x10M Cash Flow Summary Cash and Cash Equivalents at Beginning of the year Net Cash from Operating Activities Cash Flow From Operating Activities Net Profit before Tax & Extraordinary Items Adjustment For Depreciation Interest (Net) Dividend Received P/L on Sales of Assets P/L on Sales of Invest Prov.1 -21.6 653.5 44.6 0 0 0 284.3 1675.5 -23.2 113 -152.5 -192.7 -103.6 -144 12.2 0 0. & W/O (Net) P/L in Forex Fin.5 282.3 -12.Maruti Suzuki 200903 330.6 105.2 -72.2 1803 1574.6 1074.5 -53.9 -18.5 -55.

)"14 -0 -10"4 0"1  -47") 2 ")7) 2 0"41) 11   -03  -3)"4  6")        3"31    ))3 2 2 2 2         0"1     2 0"1 2         )"3 7"57   -1"3 11 2                          3 3"54 5")4 0"7) 5"07 0" 0 2    1")135 0"0 73 4"0430 2 0" 3"61 3" 2 2    6"7 4"1 -)1"7 -0 -53 -55)   4"3 0"57 3  2                 54 7"501 7" 1 4"511    5"5577 3"05) 1  )"6 " 2 2 22 -)3 -31)"4   3"51 -13)0"0                 7"661 1 22 ) 1 )"5 5 2    3"51 41 5"435)1  1")1    )"6 -1670"7   ") 2 -555")    3"5 1" 2 2   0"13 3"  4"        1"4 4"                           "4 2 2      "10) 2      r m um n nd ym§n T© rd VS r r Y§r ' T n n n F©r§ ch" Trn O h§r h d n In n c h F© r©m In n c In m§n n urch d F¨ d S§ F¨ d cp¨ I¦ p Sub dy cd F¨nnc¨/$p¨ In m§n urch In m§n S§ In m§n In m§n Inc©m§ In r c d d nd c d In In Sub d r n Sub d r In m§n n r©up I u§ Sh" n cqu" nc" In n cq" cqu¨ n mpn¨§ In r rp©r p O h§r h d n F¨nnc¨n c h F© Fr©m F¨nnc¨n c r c d r c d r©m I u§ hr§ (¨nc hr§ pr§m¨um) r c d r©m I u§ b n ur§ r c d r©m h§r n T§rm rr© n r c d r©m n rr© n r c d r©m Sh©r T§m rr© n r c d r©m p Shr§ pp¨c n n y h/$p¨ In m§n Sub dy n r©m rp©r dy ym§n Shr§ pp¨c n n y und On d mp n b n ur§ O h§ n T§m rr© n O h§ h©r rm rr© n O n nc¨ b d nd d Sh§ r nc§ r In r d O h§r h d n F¨nnc¨n c Inc/(@§c) n h nd h qu¨ n h nd h qu¨ n nd h§ y§r  2 -3 -5 -03 -1)3"4 -1001"1 43 7"63 -14 -165 -036"5 -176)6"6 -155 -51 -055 - -1 -13"3 2  4"5   2        6"4            4"1            3"35  0"460    2        )"11         )"))3     3"531 -477"4 -63" -31"4 -534"6 -11") -1 -5 -1 -0    1"      " 2 22         7" 0 2 2     -1 -15)") -1 -04"7 - -  4"5  3" 22  5"3   1"1  -04") -4 -57 -56 - - 2  5"4 ")5 1 6"1 1 7"55 1 2  2 2 5")74 5"543 5"15 3  2  -31)"4 -)1"7   3" -036"5 -53 -4 5" 5 2 5") 2 0" 33  3"5)  3"531 )3)1 0"7 61   66 -1 -0 -157"1 © !  §  & ! $  $    §  §# & ! $  $ ¨   ¨ § % $ §# § ¨ ¨ &¨  ( '    ¨¦ § §   §  ¨ § & § §   (  ¨¦ § ¨ &¨@  ¨ § ¨ ¨  ¨  ¨  ' ¨  ©A §      ' ¨  ©A ' ©   § §@ © © ¨ § §    § § ©C © ¨  (  8 ¦  ©A § ©$  ©   ¨ §  $    & § ©C © ¨  ( §§ © ¦ ¨ © §@  §§ © ¦ ' ¨  ©A   §§ © ¦ ' ¨  ©A B A  §§ © ¦ ' ¨  ©A ' ©   §§ © ¦   § §@ ©   §§ © ¦    ©   8  §§ © ¦  $ § ¨ ¨ &¨  ( ' ¨ § § ¨ ¨ &¨  ( ' % $ §#   ©$ § ¨ © §@ §   ©$ © © ¨ ¨   (  ©$ ¨ " § & © $  (  © ©  ©$ © (  ¨ § ©$   & © © § ¨ ¨ ¨   " § & § ¨ ¨ ¨   § &¨§ § § ¨ &¨@ § &¨§ § § §  §   & § ©   &  § ©§ ¦   &   8 §    &  § ¨  ¨ $    9  § ( §  © ¦ § ( §  © §  8 § § ( ¨   & § ¨ ¨ &¨  ( ' ¨ § & $  § ¨ ¨ &¨  ( ' ¨ § & ¨ § % $ §#   © ¨ !  ©¨    ©¨ ¦  ¦      © § § © ¨ §¦  .

28 21.41 7.47 2.02 15.19 14.9 23.52 3.98 3.9 29.19 8% 8% 1.83 10.74 24.91 8.63 6.15 5.22 2.38 4% 4% 1.23 30.43 12.21 9.54 5.75 12 2.44 9.69 37.24 21.47 14.05 13.67 6% 6% 1.77 24.07 4.83 6.69 86.06 34.92 1.79 6.4 5.97 43 14.42 2.37 2.25 13.63 25.63 15.1 21.66 9.84 16.99 8.13 3.59 0.18 29.51 22.76 12.59 -3.68 24.55 1.4 31.62 15.03 1.02 -5.Appendix 4 Ratio Key Ratios for Maruti Suzuki Key Ratios Debt-Equity Ratio Long Term Debt-Equity Ratio Current Ratio Turnover Ratios Fixed Assets Inventory Debtors Interest Cover Ratio Profitability Ratio PBIDTM (%) PBITM (%) PBDTM (%) CPM (%) APATM (%) Return on Capital Ratio ROCE (%) RONW (%) 200903 200803 200703 200603 200503 200403 200303 200203 200103 2 9% 6% 1.08 10% 7% 1.16 0.42 11% 11% 1.63 3.58 9.78 13.13 24.43 23.22 2.08 35.91 30% 15% 1.34 18.59 19% 18% 1.2 11.64 -2.38 11.47 12.11 20.1 4.45 29.91 9.47 33% 24% 1.69 61.67 4.42 9.8 9.06 23.7 67 .95 19.35 2.52 10.44 -2.73 2.89 12.44 -9.93 8.93 12 13.15 5.48 10.4 6.89 5.63 15.92 2.05 13.11 5.61 10.63 25.

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