T-2 T-1

NAME UNIT 2014 2015

Maithan Alloys Anjaney Alloys Maithan Alloys

Solvency Ratios

Debt to Equity Times 0.13 3.38 0.07

Interest Coverage Times 5.82 -0.13 11.43

Liquidity Ratios
Current Ratio Times 1.7 0.82 1.94

Acitivity Ratios
Total Asset Turnover Times 1.7 0.85 1.77

Profitability Ratios
EBIT Margin % 4.12 -0.72 7.51
PAT Margin % 2.67 -4.05 5.5
ROE % 8.2 -0.73 16.49
ROCE % 11.4 -16.07 20.45

1
Solvency ratios also known as leverage ratios determine an entity’s ability to service its debt. So these ratios cal
1.1 Over the years, Maithan Alloys' debt has been reducing. Simultaneously, The net worth has been increasing. M
high debt obligations, which were t
1.2 he interest coverage ratio measures how many times a company can cover its current interest payment with
2014 and 2015 had been 4.565. As can be observed from the table, the interest coverage
2 Current Ratio is used to determine the current debt repaying ability of a borrower. Any current ratio lower t
current ratio before the merger. However the curr
3 Activity Ratios indicates how efficiently a company is leveraging the assets on its balance sheet, to generate rev
The Average of both the companies before merger for the years 2014 and 2015 was 1.3975 and the average of
 T-1 T0 T+1 T+2
2015 Pre Period Averages 2016 2017 2018
Anjaney Alloys Maithan Alloys Anjaney Alloys Overall Average Maithan Alloys

2.87 0.1 3.125 1.6125 0.35 0.14 0.05

1.14 8.625 0.505 4.565 6.79 21.24 48.06

0.76 1.82 0.79 1.305 1.68 2.2 2.94

1.27 1.735 1.06 1.3975 1.79 1.62 1.75

3.4 5.815 1.34 3.5775 9.29 18.68 20.29

0.23 4.085 -1.91 1.0875 6.54 13.23 15.43
6.51 12.345 2.89 7.6175 21.67 37.62 39.76
1.63 15.925 -7.22 4.3525 25.13 43.44 48.17

y to service its debt. So these ratios calculate if the company can meet its long-term debt. It is important since the investors would like
, The net worth has been increasing. Maithan steel always had a strong debt to equity position before and after the merger. Anjaney A
high debt obligations, which were taken care of after the merger.
ver its current interest payment with its available earnings. The pre merger Interest Coverage ratio average for both the companies in
from the table, the interest coverage ratio has increased to as much as 48.6 in 2018, which is a good sign for the company.
f a borrower. Any current ratio lower than 1 implies a negative financial performance for that business or individual. Anjaney Alloys ha
o before the merger. However the current ratio has improved a lot after the merger.
s on its balance sheet, to generate revenues and cash. The asset turnover ratio can be used as an indicator of the efficiency with which
d 2015 was 1.3975 and the average of the company for the next three years after merger has increased to 1.72; which again, is a very
 Post
Merger
Average

0.18
25.36333

2.273333

1.72

ant since the investors would like to know about the solvency of the firm to meet their interest payments and to ensure that their  inv
e and after the merger. Anjaney Alloys had

verage for both the companies in the years

sign for the company.
ss or individual. Anjaney Alloys had poor

icator of the efficiency with which a company is using its assets to generate revenue.
ed to 1.72; which again, is a very good sign.