Ratio Analysis of Bajaj Auto Ltd

BALANCE SHEET:

PARTICULARS MARCH 2018 (in crs) MARCH 2019(in crs)

SHARE CAPITAL 289 289

RESERVES 20136 22944

BORROWINGS 121 125

OTHER LIABILITIES 4798 5570

TOTAL LIABILITIES 25344 28929

FIXED ASSETS 1878 1764

INVESTMENTS 18895 20603

OTHER ASSETS 4514 6514

TOTAL ASSETS 25344 28929

 1. CURRENT RATIO
Current ratio=Current assets/Current liabilities

YEAR RATIOS
Mar 2019 1.45
Mar 2018 2.25
Interpretation:
The standard Current Ratio is 2:1. From the above table it is clear that company’s liquidity is
high. The reason is company’s current asset have increased. It is very clear that the company
has a good liquidity position in selected 2 years

2. QUICK RATIO
Quick ratio=Quick Assets/Quick liabilities

YEAR RATIOS
Mar 2019 1.25
Mar 2018 2.07
Interpretation:
A quick ratio is greater than 1 means the company has enough quick assets to pay for
its current liabilities and it can be converted into cash very easily.

3. RETURN ON TOTAL ASSETS

Return on Total Assets=Net Profit/Total Assets*100

YEAR RATIOS
Mar 2019 17.03
Mar 2018 16.64
Interpretation: ROA over 5% are considered good, it indicates that has a solid performance
and it is able to make maximum use of its assets for getting more profit
 4. RETURN ON EQUITY
Return on equity = Net income/shareholders equity*100

YEAR RATIOS
Mar 2019 21.25
Mar 2018 20.71

Interpretation:
ROEs of 15-20% is are generally considered good. It indicates that the company
is increasing its ability to generate profit and effective use of funds by the management for
the growth of the company.

5. RETURN ON CAPITAL EMPLOYED:

Return on capital employed = EBIT/Capital Employed

YEAR RATIOS
Mar 2019 30%
Mar 2018 31%

Interpretation:
It indicates that the company is efficiently generating its profits from its capital
employed

6. ASSET TURNOVER RATIO:

Asset turnover ratio = net sales/avg total asset

YEAR RATIOS
Mar 2019 1.049
Mar 2018 1.003
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