Term Paper

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Term paper on “FundamenTal

performance analysis of
TEXTILEIndus Try”
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title : Financial
Course
Management
SOUTHEAST
UNIVERSITY
Course code: FIN 514
Meeting the Challenge of Time
Prep ared tO :ed By:

Prepar
Mr.Khairul Alam Concord group
Senior Lectural,
SchoolNadim (Id.2020210004045)
Southeast BusinessMinhaz
Amir
Southeast Univers Submission Date: 3rd February 2021
y.Hamza
Subject: Razonmanagement
Financial (Id: 2020210004047 )
Subrina Islam (Id : 2020210004092)
Faculty of Finance.
Tusher Ahmed (Id : 2020210004093)
Sohag Rayhan(Id: 2020210004046) Term paper on
Semester: Fundamental
Fall 2020 Performance analysis of Textile Industry
Md. Abdul Alin (2020210004086) )

(2020210004086
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Letter of transmittal
2nd February 2021
Khairul Alom
Sr. Lecturer
Course Instructor
School of Business
Southeast University
Subject: Request to accept our Term paper on “Fundamental Performance analysis of Textile
Industry (2009-2019).”
Dear Sir,
With great pleasure we submit this Term paper that we have been assigned as an important requirement of
MBA program at Southeast University. We found the study to be quite interesting, beneficial and
knowledge. We have tried our level best to prepare an effective & creditable term paper. This term paper
is about fundamental Performance analysis of Textile Industry (2009-2019).” WE also want to thank you
for your support and patience with me and we appreciate the opportunity provided by Southeast
University to work on this wonderful term paper report.
Sincerely Yours
………………………………
Md. Subrina Islam (On behalf of the Concord Group)
ID:2020210004092
Program: MBA
Subject: Financial Management
Department of Business Administration
Southest University.
Acknowledgement
At first, we offer millions of sincere thanks to almighty Allah for his kindness on us in
completing this report. We are also thankful to my Course teacher Mr. Khairul Alom. The
success and final consequence of this project required a lot of guidance and assistance from him.
We are extremely privileged to have this up and completion of our term paper. All that we have
done is only due to such supervision and we would not forget to express gratitude toward him.
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We would like to special thanks to Khairul Alom who is our project advisor, helped us a lot to
prepare this project, time to time He advised us how to work on it. There are many people who
helped us; it is not possible to mention all the names though we remember your help.
Finally this paper is subject to defects drawbacks that are inherent in very human endeavor. We
therefore request every reader of this paper to furnish me any mistake so that further action for
improvement can be taken.
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Executive Summary
This project report is based on our analysis of financial statements of
2010,2011,2012,2013,2014,2015,2016,2017,2018 and 2019 of, prime,Saiham,shasha,desh textile
Limited. We have done our analysis mainly focusing on the comparative analysis between these
five Textile industries. In this period, we have chosen five Textile prime, Saiham, shasha, desh
Textile Limited to done this performance Comparison. It was a great opportunity to know and
gather knowledge different types of Textile industries limited. Our faculty supervisor helped me
to choose the topic- Fundamental Performance Analysis of Textile Industry”. In the new
competitive business area, Textile sector is getting more competitive in Bangladesh.
This paper focuses on the comprehensive comparison about the Textile industries limited. For
this analysis we have used some most commonly used measures such as general business
measures, profitability ratios, liquidity ratios Asset management, Debt management and marker
value. In this sector the most used financial statements are the balance sheet and profit and loss
account where the balance sheet shows the financial position and profit and loss account shows
the net profit or net loss of the Textile industries. Ratio Analysis deals with these statements.
Ratio analysis is the most popular trend to evaluate performance over years or with other and
within companies in an industry. In our report we had to study these Textile limited financial
statements for the last ten years then had to analyze and give significant comments regarding the
changes in the financial position. Analysis and interpretation of these financial statements
through ratio analysis has now become an important technique for performance appraisal
because the investors, financial experts, management executives and the manager and owners are
always rely on these ratios to make important decisions.
We have analyzed the financial statements of these Textile to find out its ratios by using its past
records. After preparing this report we came to know that analysis of financial statements
through ratios helps to overcome the past flaws and make the future decisions and strategies.
Therefore, it is very necessary for every organization whether the company’s size is to make
financial statement and to analyze it by ratios
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Table of contents
Topic Page no.

Letter of Transmittal 04
Acknowledgement 05
Executive summary 06
Chapter 01
1.1 Introduction
Background of the study 10
Objective of the study 10
Scope of the project 11
Methodology 11
Project design 11
Data sourses 11
Data collection 12
Data analysis 12
Limitation of the study 12
Competitor 12
Chapter 02:Company profile:
ShashaTextile Industry Limited 13
Desh Textile Industry Limited’ 14-15
Prime Textile Industries Limited 16-17
Saiham Textile Limited’ 18-20
RAHIM Textile Mill Limited’ 21-22
Chapter 03 : Ratio analysis:
3.1 ratio analysis 23
Liquidity Ratio: 23
Current ratio(CR) 23-26
Quick ratio 26-28
Asset management: 28
Inventory turnover ratio: 28-30
Fixed asset turnover ratio: 31-33
Total asset turnover ratio: 33-36
Debt management ratio 36
Debt to total assets ratio 36-38
Time interest earned ratio: 39-41
Profitability ratio: 42
Net profit margin ratio: 42-44
Return on Assets ratio 44-47
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Return on Equity ratio 47-49
Earnings per share (EPS) 50-51
Chapter 04: Comments

Comments on finding from ratio analysis: 52-54
55
Chapter 05: Strength and weakness of Textile industries
limited
55-58
Chapter 06: Major challenges of Covid & Govt. Support.
59
Chapter 07: Recommendations:
60
CHAPTER08: Conclusions:
61
Bibliography
List of tables
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Table Table name Page no.
no.
01 Current 24
02 Quick ratio: 26
03 Inventory turnover ratio 29
04 Fixed asset turnover ratio 31
05 Total asset turnover ratio 34
06 Debt to total assets ratio 36
07 time interest earned (TIE) ratio 39
08 Net profit margin ratio 42
09 Return on assets (ROA) 45
10 Return on equity (ROE) 47
11 Earnings per share 50
List of Figure
Chart no. Chart name Page no.

01 Current ratio 24
02 Quick ratio: 27
03 Inventory turnover ratio 29
04 Fixed asset turnover ratio 32
05 Total asset turnover ratio 34
06 Debt to total assets ratio 37
07 Time interest earned (TIE) ratio 39
08 Net profit margin ratio 43
09 Return on Assets ratio 45
10 Return on equity (ROE) 48
11 Earnings per share 50
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Chapter: 1 Introduction:
The Textile industry or apparel industry is primarily concerned with the production of yarn ,and
cloths and the subsequent design or manufacture of clothing and their distribution .The raw
material may be natural ,or synthetic using products of the chemical industry.
we have decided to select Textile industry of Bangladesh for our project. We have compared and
analyzed the financial performance of the five major Textile companies are,
prime,Saiham,shasha,desh Textile Ltd. We decided to select this industry because of its huge
contribution to improve the economic condition of our country.
Textile has a high demand in the world. Bangladesh apparently has the perfect geographical
position, supply of raw materials and labor available to meet this demand. Textile industry of
Bangladesh produces fabrics are cotton, chiffon, crepe, damask, georgette, chenille, wool, and
the products are T-shirt, jines pants, swatter, bead sheet, carpet etc. Textile industry of
Bangladesh is a booming sector and the great potential of both domestic and foreign market.
Background of the Study:

Under MBA program a student must have to do a project by which students experience
practically. In a project students have to go for huge research and apply their theoretical
knowledge into the project work. This project enables a student for developing their analytical
skills. At the end of the day it reflects what they learned throughout the program change in the
life style of the people. We have prepared the project paper under the supervision of Mr. Khairul
Alom, Sr. Lecturer, Facultry of Business Administration, Southeast University. In this regard, the
project was selected to prepare report on the title fundamental performance analysis of Textile
Industry.” Textile product is now-a-days a Common item for everybody, belongs to high
income group only, it is even commonly used in the people. The demand of the Textile product is
increasing day by day due to change in the life style of the people.
Objectives of the Study:

BROAD:
The main objective of this study was to identify and assess the present financial position of
Textile Industries Limited considering its market shares. The study was also attempted to
evaluate the prospects of financial growth market growth of the organization. The study broadly
aimed at analyzing the feasibility of the expansion project of Comparative Performance Analysis
between Textile Industries Limited
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SPECIFIC:
(a) To analyze the overall financial position of Textile industries Limited.

(b) To comparing the Textile industries limited.
(c) To assess the quality of the brand from the viewpoint of users.
(d) To evaluate the current financial position of Textile industries limited.
(e) To find out the current financial position of Textile Limited.
Scope of the project:

The project covers the topic Comparative Performance Analysis between Textile Industries
Limited.” To conduct a study on this topic I have gathered valuable information from EWU
library, & Dhaka stock exchange library. I have also got some information from web sites that
are related to my topics. I have also collected much information from Security Exchange
Commission library.
➢ These are the leading Textile industries in Bangladesh and

➢ Information is available
Methodology:
Project design:
The nature of the study is evaluative one and it described different ratios of Textile Limited in
terms of financial position. This project report typically focused on ratio analysis but there is
some descriptive information too. It focused five Textile industries limited financial position,
performance, current position etc.
Data sources:
This report is prepared mainly on the extensive use of secondary data available in annual reports.
Based on the data from the annual reports the overall project report is prepared. The overall
conceptual and theoretical framework has been explained as well as the how the data are
analyzed is explained below: o The primary sources” are absent in this case.
o The secondary Sources “of data and the information are used to prepare this project work.
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Data collection:
o Annual Report of Prime, Saiham, Shasha, Desh Textile Limited.
o Website
o Various books, articles and compilations o Journals
Data analysis:
Financial Analysis based on the performance comparison has been done with ratio formulas, and
used to compare the performances of Textile industries. Ratio analysis is presented in a standard
manner so that the calculations and interpretations might clear to all. The decision criterion is
based on the comparison of each Textile performance with the Industry Average. The industry
average is calculated on the basis of the average of average of the banks that are collected as
sample for the comparison of performance between five Textile limited.
Limitation of the study:

Shortage of time period:
Time constraint would be the major limiting factor for the study. We had to complete this report
writing within a shorter period of time. So the time constraint of the study hindering the course
of vast area and time for preparing a report within the mentioned period is really difficult.
Lack of sufficient well informed websites:
There are some lacks of information in financial statement (balance sheet and income statement).
We have to face many difficulties to collect this information.
• Organization has not provided all information needed to conduct study.

• Lack of experience partially.
• In many cases, updated information were not be available.
• In some cases, respondents did not provide needed information.
Competitors:
Some of the major competitors of these two companies are Peoples Textile Industry Ltd, Saiham
Textile, Shasha Textile Works Ltd.
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Chapter: 2 Company profile:
ShashaTextile Industry Limited”
ShashaTextile is a product of ShashaGroup which is one of the largest industries in Bangladesh.
From the very beginning ShashaGroup has been trying to maintain the quality of the products.
This group produces a comprehensive range of Cloth, Fabric & Textile Products with high
quality & standard.
SHASHATextile Industry Ltd. incorporated in Bangladesh is located in Dhaka ,Dhaka

Bangladesh is part of the Textile Manufacturing industry. Around 1,069 employees are working
in this industry. It has started its generates $63.28 million in sales (USD) .ShashaTextile gained
the users trust because of the high quality & standard and as a result it achieved. There are two
companies in the SHASHA DENIMS LTD. It has been producing/manufacturing various
type fabric and
Products (like-swatter, jines). Here are some snapshots of various ShashaTextile products:
ShashaExclusive jines that is the denim fabric manufacturer ShashaTextile Industry Limited is
capable of meeting the increasing demand of customers countrywide. This industry is using high
quality raw materials, Italian/Chinese machinery and highly experienced foreign and local
engineers in order to introduce the best Textile to the country people. All types of fabric such as
Special jeans and T-shirt , decoration to bed sheets are produced by utilising the latest printing
and laser cut technology.
SHASHATextile Industry Ltd. meets European standards in production and planning to export
these products to foreign countries. This company is already exporting its products to the North
Eastern region of India.
ShashaTextile enlisted in Dhaka Stock Exchange on 1998. This company is rated as A” category
share under the Textile sector as on 08-07-2012
Contact Information of ShashaTextile Industry Limited
Corporate Head Quarter: Head Office –Gulshan1, Dhaka-1212
Plot:184/193/277DEPZ(EXT Tel: +880 2 9883274-5, 8825573, 8825361

Fax: +02-7789304
Website: www.shashadenim.com
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‘Desh Textile Industry Limited’
Desh Garments limited was the first export oriented ready-made garments industry in
Bangladesh.it was set up in joint venture with Daewoo of south korea.At its time of
inception,Desh was the single largest and most modern garment-manufacturing unit in the sub-
continent.
Desh Textile Industry also knows as Desh” started its journey in Bangladesh in 1985. It is
producing amaging product for the Bangladesh home market since 1985. Its cloths is very
popular in Bangladesh.
Textile material made by man-made raw materials, generally including cotton, jute, silk, wool.
Desh Textile Industry began producing jute silk for the first time in Bangladesh in 1985. In each
product of Desh Textile there is a seal made in Bangladesh” which proves that this industry is
proud to contribute to the growth of the Bangladesh economy. We all should know that, Desh” is
original exporter of malayshia, china and other enlistment country.
Each and every individual of Bangladesh know the name of Desh Textileæ, Desh” takes a place
in people’s heart by providing extra ordinary Textile materials. There are some talented artists
and designers in Desh Textile Industry who are very adroit in Textile industry. Designers work
with the experienced print unit to achieve striking results.
Desh Textile Industry is very much concern to produce world class Textile materials with quality
and quantity and that’s why it invested huge capital in modern machinery so that it can obtain the
best output, color press machine ,drying machine,draw frame, Spray drying system feature is
available in this industry. Desh Textile is having the capacity to produce 2 Million pieces per
month.
There are approximately 5000 skilled and non skilled (fresher) artisans, designers, crafts men and
women are employed in Desh Textile Industry who are being encouraged to develop their full
creative potential for the industry. As Desh Textile Industry always introduce highly structured
machinery so obviously training is required and some very skilled technicians provides the
training facility to the skilled and non skilled workers. Training is highly regarded in this
industry.
Desh Textile Industry is very concerned about social environment issue. It uses natural non toxic
materials in its porcelain and only recycled pulp in its packaging. By obeying Federal and
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European standards this industry discharges the factory waste to a specific location. Desh Textile
provides equal work policy environment .
Desh Textile enlisted in Dhaka Stock Exchange in 1983 and it’s been rated as A” category share
under the Textile sector as on 08-07-2012.
Contact Information of Desh Textile Industry
Factory & Head Office: Desh Textile Industries Ltd.

Awal Center(6th Floor)Kemal
Ataturk Avenue C\A 1213,Dhaka 1213

Tel: +88-02-779 1347-50
Fax: +88-02-770 8800
Email: mail@DeshTextile.net
Website: www.Deshgroup.com
Show Room-5\48,6th floor,Eastern Mallika Shoping complex
,5 new elephant road,Dhaka 1205
Prime Textile Industries Limited’

Prime Textile spinning mills limited is located in Dhaka,Dhaka,Bangladesh and is part of the
textile manufacturing industry .prime Textile spinning mills limited has 1,500 total employees
across all of its locations and generates $20.28 million in saies(USD).
Prime Industries Limited also known as (ptI) in its short form started its commercial production
as a public limited company in Bangladesh from1989.
Prime Textile’s factory is situated in Dhaka,Dhaka,Bangladesh and is part of the Textile

manufacturing industry .which is around 30km far from the Dhaka City. Around six hundred
dedicated employees are working in this industry. They are very honest in their working fields
that’s why this industry has gained capacity to produce . So, annually standard Textile industry is
producing around four thousand seven hundred eighty two products.
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Prime Textile Industry Limited has many eye catching products T-Shirt and Bed sheet set
available with unique designs and shapes. This industry is very committed to bring the affordable
luxury in our daily life. So, they introduced superb quality products in our local market. If you
closely look the following pictures, then you will agree with our statement.
Prime Textile Industry Limited Products Shape:

Prime Textile industry limited uses highly expensive machines to produce these kinds of
amazing products. These machines are mainly brought from Japan. Skilled operators provide
instructions to these big bots for producing, shaping & glazing, cutting and packing.
Prime Textile Industry Limited Products Design:

Other gorgeous looking products shape can be found into prime Textile’s official website:
(Primegroup.com.bd).prime is exporting its products in foreign countries. At this stage, its
products are available in four continents including the United States and European markets.
Customers can order with their desired shapes to this industry, but there is a minimum
requirement. If any customer is interested to order desired shape,
Factory Details
Location:Sena kalian Bhaban Floor-8,195 motijheel Commercial Area
Dhaka,1000 bangladesh +880-29564851

www.prime group.com.bd
Operation Space 12,500 Sqm.
Annual Capacity 4765 Tons, 17 million assorted pieces.
Delivery Details
Lead time: 2 months for 1st 20' container & there after 1x20' container 7-10 days for continuous
order. Minimum order size: 1x20' container from current shapes. Facilities Available
can develop customers’ desired shape (minimum order 5x20' container). Can have own back
stamps, decals (i.e. patterns). Microwave safe Gold Trim. Container loading in the City Railway
Station under personal supervision.
Countries Importing
Standard Textile export in different countries Sweden, Finland, Spain, Italy, U.K, France,
Germany (GSP available for EU, U.S.A., Canada, Australia, New Zealand).
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Major Customers
Premier Housewares, Wetherby Fashions, Argos, GUS, (U.K.), COFAC, Guerra San Martin, La
Esmeralda Regalos, Regalo Kasa (Spain), KF (Sweden), OY Hobby Hall (Finland), Scafati &
Co. Inc., Shadle Enterprises Inc, Boscovs, (U.S.A.)
Requirement for firm order:

Irrevocable Letter of Credit at sight covering full amount.
Insurance:
From buyers end
Prime Textile enlisted in Dhaka Stock Exchange on 1996. It’s been rated as B” category share
under the Textile sector.
Contact information of prime Textile Industries Limited:
Office Address: Prime Textile Industries Limited,sena kalayan bhobon
Floor 8 -195.motijheel commercial area
Dhaka,1000,bangladesh
Telephone:+880-29564851
Fax: +(880-2) 9561950
Website: www.primegroup.com.bd
‘SAIHAM Textile Limited’

Saiham Textile mills located in Dhaka Bangladesh and it is part of the Textile Manufacturing
Industry.Saiham Textile limited has 600 total employee across all of its location and generates
$30.88 million in sales (USD).
D&B Hoovers provides sales leads and sales intelligence data on over 120 million companies
like SAIHAM textile Mills limited around the world,including contacts ,financials, and
competitors information.TO Witness the full depth and breadth of our data and industry leading
sales intelligence tools ,take D&B Hoovers for the test drive..
Saiham Textile has been registered as a private company in Bangladesh in 1997.”Saiham has
started its product plant in April 1999 and Bone China plant in November 1999, one year earlier
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that means in 1998 these plants were commissioned. Saiham Textile Limited which is around
40km far from Dhaka city. In Saiham – captive power generation, water supply, effluent water
treatment and all other infrastructural facilities are available.
Saiham uses highest quality raw-materials and ingredients in order to produce world class as
well as good products . Saihiam Textile Limited always proceed with some critical examines
like color print and quality, . That’s why we see eye caching designs in all saiham products. Of
course these tests are run by adroit specialists who works all day long in saiham in-house lab.
Some China fabric , japanise silk and lilen ” product pictures.
Saiham Textile Limited has quality control department. Each employee is picked from every
corner of Bangladesh based on their merit on Textile industry. Textile has gained the people’s
trust and achieved ISO 9001:2008 certificate. Saiham Textile Limited uses expensive machines
in testing, packaging and producing unit. These machines are brought from TAKASAGO, and
SKK of Japan. SP Textile provides effective training facilities to all employees who are involved
in operating these bots.
Saiham Textile Limited introduces various china fabrics and products such as baby dress, bed
sheet, jeans, etc. 245 shapes of products available in our local market. Besides shapes, Saiham
has over sixteen hundred designs available for its customers. Among these designs, China fabric
All designs and shapes are done from Saiham’s own Design studio and Plant. At this stage,
Saiham Textile Limited is exporting its product in foreign countries like Australia, Argentina,
Canada, Denmark, Egypt, France, Germany, India, Ireland, Italy, Japan, Mexico, Norway, New
Zealand, Poland, Pakistan, USA, UK, UAE etc.
Main mission of saiham Textile Each of our activities must benefit and add value to the common
wealth of our society. We firmly believe that, in the final analysis we are accountable to each of
the constituents with whom we interact; namely our employees, our customers, our business
associates, our fellow citizens and our shareholders.”
Foreign Sales:
Textile manufacturing is yarn-based, labor intensive and skill-oriented project. As such
Bangladesh enjoys the comparative advantages in manufacturing Textile product particularly for
export market due to competitive cost. Traditionally, Japan, UK, Germany and European
countries were exporting Textile product for world markets. But due to tremendous wage
increase, currency appreciation as well as non availability of willing worker to work in Textile
factories, many Textile manufacturing project of these countries ware turned out unfeasible.
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Bangladesh enjoys Generalized System of preferences (GSP) which allow duty quota restriction
for export to any country.
After consider the present international Textile’s market saiham has found good opportunity to
export it’s products into number of overseas and non-overseas countries. Now, in the
international market Saiham exporting it’s products to, Singapore, UK, India and Turkey.New
segments of customer in the international markets in USA, Scandinavia and Australia etc.
Internationally targeted sales are about $12 million per month but the actual figure is low, only
$3 to $5 lacks sales are made per month. To promote export Saiham took part in a number of
International Fairs
.
Saiham Textile Limited Achievement:
As Saiham Textile Limited has expanded its business in almost every part of the global world so
we can surely say that it is indeed one of the largest Textile products exporter from Bangladesh.
Corporate Office Address: STML Block#SE ©-1

House -34, Road-136,Gulshan-1
Dhaka-1212 Bangladesh
Phone: +88029862284
Fax: 9661678, 8613470
Email: saihamgmail.com
Website: www.saiham.com
RAHIM TEXTILE MILL LTD

TEXTILE MILLS RAHIM LTD a public limited company, started commercial operation in
1987 with dyeing, printing and finishing unit. The Company has pioneered for the printing
of woven & knit fabric and other textile products. She has Monforts Thermosole dyeing range
with E-Control, Kluster continious dyeing machine for woven fabric processing & MHMS ERA
12 rotary screen printing machine, which is truly the class of state of the art. The products of the
processing mill conform to the International standard. We treat all our affluent before discharge.
We are also equipped with the caustic recovery plant. We are an Oeko-Tex 100 product class 1,
certified company also certified for Organic Content Standard (OCS) and have BCI membership.
Products Category:
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@ Woven fabric as cotton twill, poplin, canvas, rip-stop, TC twill, TC, stretch poplin, stretch
twill, cotton voile etc.
@ Knit fabric as regular basis for printing production only.
@ Printing on denim category fabric only.
Capacity:
@ Dyeing capacity 60,000 mtr/day & printing capacity 95000 mtr/day (approx.)
@ For knit fabric printing capacity 18 ton/day (approx.)
Quality Control:
Quality is controlled at every stage starting with monitoring of raw materials quality. The
quality control plant includes state-of-art laboratory and inspection facilities to ensure quality
control in every phase.
Buyer:
H&M, C&A, Zara, Matalan, Lindex, Tesco, Kmart, Avon, CHARLES VOEGELE , KIK,
Decathlon, American Eagle, Justice, NKD, Li &Fung, ASMARA, Wilson, Urban Ice etc.
Objectives of the Study:

 To give an overview of Rahim textile Mill Ltd
 To analyze the financial performance of Rahim Textile Mills Ltd
 To suggest ways and means to improve the financial performance of the copany
Methodology of the Study:

Research Design: .
The study, financial performance of Rahim textile Mill Ltd is descriptive in nature which is mainl
based on secondary data from the year 2012 to 2020. The study focuses on Financial Performance
of Rahim textile Mill Ltd.
Data source:
The entire study is based on the secondary sources of information. The details of which are
reviewed below
The Secondary Sources:

The availability of the study such as ratio analysis, Liquidity Ratio Activity Ratio, Debt Ratio,
Profitability Ratio, Comparative Analysis of Rahim textile Mill Ltd , Findings, Recommendations
& Conclusion. The entire study is concluded from:
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SN/no Source Nature of
data
1 Annual reports of Rahim Textile Mill Ltd Secondary
2 Periodical report on Financial performance of Rahim Textile Mill Ltd Secondary
3 Websites:
Rahim Textile Mill Ltd - www.Rahimtextile.com
Secondary
Analyzing & processes of data:
 The ratio analysis is used to analyze the financial performance of Rahim Textile Mill Ltd.
Different types of computer software such as- Microsoft Word, Microsoft Excel etc. are used for
analyzing and reporting purpose of the study. The ratio analysis such as Liquidity Ratio, Activity
Ratio, Debt Ratio, and Profitability Ratio are conducted in form of time series analysis and cross
section analysis.
 Time series analysis: Time series analysis is the analysis of firm’s performance over time
using ratios. It is really important to analyze trends in ratios as well as their absolute
levels. This analysis informs us whether a company’s financial condition improving or
deteriorating.
CHAPTER: 3 Ratio analyses
Liquidity Ratio:
Liquidity ratios are used to determine a company’s ability to meet its short-term debt obligations.
Investors often take a close look at liquidity ratios when performing fundamental analysis on a
firm. Since a company that is consistently having trouble meeting its short-term debt is at a
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higher risk of bankruptcy, liquidity ratios are a good measure of whether a company will be able
to comfortably continue as a going concern.
A class of financial metrics that is used to determine the company's ability to pay off its
shortterms debts obligations. Generally, the higher the value of the ratio, the larger the margin of
safety that the company possesses to cover short-term debts.
Liquidity ratio, expresses a company's ability to repay short-term creditors out of its total cash.
The liquidity ratio is the result of dividing the total cash by short-term borrowings. It shows the
number of times short-term liabilities are covered by cash. If the value is greater than 1.00, it
means fully covered. The liquidity ratios are:
Current ratio:
The current ratio is the first of financial ratios that we will examine. As stated earlier, liquidity
CURRENT RATIO
SHASHA DESH PRIME SAIHAM Rahim textile
2010 0.755 0.96 0.889 1.20 2.07
2011 2.685 0.95 0.904 1.16 2.29
2012 1.664 1.11 0.924 1.11 2.00
2013 1.834 1.08 0.877 0.98 1.97
2014 0.688 1.03 0.193 0.58 2.01
2015 2.13 1.03 0.949 0.64 1.60
2016 3.21 1.25 0.903 0.56 1.63
2017 2.17 1.12 0.085 0.56 1.59
2018 2.37 1.19 0.894 0.62 1.66
2019 1.84 1.33 0.921 0.70 1.71
Ratios measure a company’s ability to pay off its short-term debt using assets that can be easily
liquidated. In this case, the current ratio measures a company’s current assets against its current
liabilities. Generally, higher numbers are better, implying that the firm has a higher amount of
current assets when compared to current liabilities and should easily be able to pay off its
shortterm debt.
If current liabilities are rising more rapidly than current asset, the current ratio will fall which
could spell trouble. Because the current ratio provides the best single indicator of the extent to
which the claims of short term creators are covered by assets that are expected to be converted to
cash fairly quickly. The lower ratio shows the liquidity position weak and the higher ratio
indicates the liquidity is strong.
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TABLE: CURRENT RATIO OF SHASHA ,DESH, PRIME, SAIHAM Textile Industry
FORMULA: CURRENT RATIO = CURRENT ASSET / CURRENT LIABILITIES
FIGURE: CURRNT RATIO SHASHA, DESH, PRIME, SAIHAM
ShashaTextile:
For 1 taka worth of current liabilities of ShashaTextile has 2010 to 2019 accordingly 0.755,
2.685, 1.664, 1.834, 0.688, 2.13, 3.21, 2.17,2.37 and 1.84 taka worth of current assets. This ratio
has increased from 2015 to 2017 then fall in 2018 and again fall down to 2019 and the highest
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level in2016. The lower ratio value indicates the liquidity position weak and the higher ratio
indicates the liquidity is strong. So, Fu –Wang Textile reached higher liquidity position in 2016.
Desh Textile:
For 1 taka worth of current liabilities of Desh Textile has 2010 to 2019 accordingly 0.96, 0.95,
1.11,1.08, 1.03, 1.03 1.25,1.12,1.9 and 1.33 taka worth of current assets. The ratio value 2014 to
2016 is almost same over the year. But in 2011 the ratio value 0.95 is lowest and 2019 the ratio
value 1.33 is highest.
The graph shows from 2016 to 2019 variability high and from 2010 to 2011 variability low.
Prime Textile:
For 1 taka worth of current liabilities Prime Textile has 2010 to 2019 accordingly 0.889, 0.904,
0.924, 0.877, 0.193, 0.949, 0.903, 0.085, 0.894 and 0.921 taka worth of current assets. The ratio
value 2011, 2012 and 2016 is almost same over the year. In 2017 the ratio is 0.085 is lowest and
2012 the ratio value 0.924 highest.
The graph shows from 2017 and 2014 variability low and the ratio value is always less than one
that’s means Prime Textile not fully covered by cash.
Saiham Textile:
For 1 taka worth of current liabilities of Saiham Textile has 2010 to 2019 accordingly 1.20, 1.16,
1.11, 0.98, .0.64, 0.56, 0.56, 0.62 and 0.70 taka worth of current assets. The ratio value indicates
from 2010 to 2011 variability is high. In 2016 is the ratio value is lowest that is 0.56 and in 2010
the ratio value is highest that is 1.20.
The graph show from 2010 to 2011 variability is high and not always fully covered by cash.
Textile:
For 1 taka worth of current liabilities of RAK Textile has 2010 to 2019 accordingly 2.07, 2.29,
2.00 1.97, 2.01, 1.60, 1.63, 1.59, 1.66 and 1.71 taka worth of current assets. The ratio value from
26 | P a g e
2010 to 2012 variability is high. In 2017 the ratio value is lowest that is 1.59 and in 2011 the
ratio value is highest that is 2.29.
Comparative Analysis:
The graph and the table shows Shasha, Desh, Prime, Saiham Textile current ratio values
variability is high but the Prime Textile current ratio value is almost same over the year that’s
why variability is low but the ratio value always less than 1. The prime Textile is not fully
covered by cash. On the other hand though Rahim Textile ratio values variability is high the ratio
value always more than 1 that’s why is fully covered by cash.
Quick ratio:
The quick ratio, also known as the acid-test ratio, is a liquidity ratio that is more refined and
more stringent than the current ratio. Instead of using current assets in the numerator, the quick
ratio uses a figure that focuses on the most liquid assets. The main asset left out is inventory,
which can be hard to liquidate at market value in a timely fashion. The quick ratio is more
conservative than the current ratio and focuses on cash, short-term investments and accounts
receivable. Inventory typically is the least liquid of a firm’s current asset, so they are the asset on
which losses are most likely to occur in the event of a quick liquidation. Therefore a measure of
the firm’s ability to pay off short term obligations without relying on the sale of inventories is
important.
TABLE: QUICK RATIO OF SHASHA, DESH, PRIME, SAIHAM

QUICK RATIO
SHASHA DESH PRIME SAIHAM Rahim
Textile
2010 0.282 0.37 0.227 1.20 1.29
2011 1.669 0.42 0.302 0.393 1.49
2012 0.893 0.70 0.379 1.117 1.28
2013 0.930 0.66 0.470 0.45 1.31
2014 0.251 0.58 0.613 0.207 1.49
2015 0.691 0.59 0.553 0.217 1.07
2016 1.033 0.76 0.431 0.175 1.04
2017 0.665 0.66 0.437 0.175 1.06
2018 0.932 0.71 0.296 0.18 1.04
2019 0.443 0.87 0.310 0.23 1.09
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FORMULA: QUICK RATIO = (CURRENT ASSETS – INVENTORIES)/ CURRENT
LIABILITIES
FIGURE: QUICK RATIO OF SHASHA, DESH, Prime, SAIHaM
ShashaTextile:
The ratio value from 2010 to 2019 is accordingly 0.282, 1.669, 0.893,930, 0.251, 0.691, 1.033,
0.665, 0.932 and 0.443. The ratio value indicates there is a high variability. In 2014 the ratio
value is lowest that is 0.251 and in 2011 the ratio value is highest that is 1.669
The graph shows from 2014 and 2019 variability is low and from 2011 to 2016 variability is
high.
Desh Textile:
The ratio value from 2010 to 2019 is accordingly 0.37, 0.42, 0.70, 0.66,0.58, 0.59, 0.76, 0.66,
0.71, and 0.87. The ratio value from 2010 to 2011 indicates there is a low variability and the
graph shows from 2016 to 2019 variability high. In 2010 the ratio value is lowest that is 0.37 and
in 2019 the ratio value is highest that is 0.87.
Prime Textile:
The ratio value from 2010 to 20119 is accordingly 0.227, 0.302, 0.379, 0.470, 6.13, 0.553, 0.431,
0.437, 0.296 and 0.310. The ratio value 2009 to 2019 is almost same over the year. In 2010 the
ratio 0.227 is lowest and 2014 the ratio value 0.613 highest.
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SAIHAM Textile:
The ratio value from 2010 to 2019 is accordingly 1.20, 0.393, 1.117,0.45, 0207, 0.217, 0.175,
0.175 0.175, 0.18 and 0.23. The ratio value indicates there is a high variability from 2009 and
2011. In 2018 the ratio value 0.18 is lowest and in 2009 the ratio value 1.20 is highest.
Rahim Textile:
The ratio value from 2010 to 2019 is accordingly 1.29, 1.49, 1.28 1.31. 1.49 , 1.07, 1.04, 1.06
1.04 and 1.09. The ratio value indicates there is a high variability. In 2018 the ratio value 1.04 is
lowest and in 2010 the ratio value 1.49 is highest.
The graph and the table shows shasha, prime and RAK Textile Quick ratio values variability is
high but the Standard and Desh Textile Quick ratio value is almost same over the year that’s why
variability is low but the ratio value is always less than 1 that’s why standard and Desh Textile
does not fully covered by cash on the other hand RAK Textile only in 2009 its value less than 1
otherwise greater than 1 that’s why it’s may said to be fully covered by cash.
ASSET MANAGEMENT:
Asset management ratio measures how efficiency the firm is managing its asset. These ratios are
design to answer the flowing question: does the total amount of each types of asset as reported on
the balance sheet seem reasonable, too high, or too low in view of current and projected sales
level? Firms invest in asset to generate revenue both in current period and in future period. Asset
management ratios are:
Inventory turnover ratio:

The inventory turnover ratio is one of the most important financial ratios. Of all the asset
management ratios, it gives the business owner some of the most important financial
information.
The inventory turnover ratio measures the efficiency of the business in managing and selling its
inventory. This ratio gauges the liquidity of the firm's inventory. It also helps the business owner
determine how they can increase their sales through inventory control.
Generally, a high inventory ratio means that the company is efficiently managing and selling its
inventory. The faster the inventory sells the fewer funds the company has tied up. Companies
have to be careful if they have a high inventory turnover as they are subject to stock outs.
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If a company has a low inventory turnover ratio, then there is a risk they are holding obsolete
inventory which is difficult to sell. This may eat in to a company's profit. However, the company
may be holding a lot of inventory for legitimate reasons. They may be preparing for a holiday
season in the case of the retail industry or preparing for a strike, among other reasons
TABLE: INVENTORY TURNOVER RATIO OF SHASHA, DESH, PRIME, SAIHaM

INVENTORY TURNOVER RATIO
SHASHA DESH PRIME SAIHAM Rahim Textile
2010 1.656 1.96 1.505 1.499 1.68
2011 2.132 1.89 2.225 1.399 1.62
2012 2.765 2.20 2.722 1.500 1.68
2013 2.090 2.05 3.941 2.34 1.45
2014 1.342 1.57 5.92 1.86 1.67
2015 1.20 1.85 5.29 2.19 1.29
2016 1.219 1.92 4.82 1.01 1.27
2017 0.943 1.98 5.4 1.75 1.6
2018 0.492 2.13 3.44 1.58 1.43
2019 0.419 3.01 3.21 1.37 1.47
FORMULA: INVENTORY TURNOVER RATIO = COGS / INVENTORIES
30 | P a g e
FIGURE: INVENTORY TURNOVER RATIO OF SHASHA, DESH, PRIME, SAIHAM
ShashaTextile:
The ratio value from 2010 to 2019 is accordingly 1.656, 2.132, 2.765, 2.090, 1.342,1.20, 1.219,
0.943, 0.492 and .419. The ratio value indicates there is a high variability. In 2019 the ratio value
is lowest that is .419 and in 2012 the ratio value is highest that is 2.765.
Desh Textile:
The ratio value from 2010 to 2019 is accordingly 1.96, 1.89, 2.20, 2.05, 1.57, 1.85, 1.92, 1.98,
2.13 and 3.01. The ratio value from 2009 to 2013 indicates there is a high variability. In 2019
the ratio value is height that is 3.01 and in 2014 the ratio value is lowest that is1.57.
PRIME Textile:
5.4, 3.44, and 3.21. The ratio value from 2009 to 2019 indicates there is a high variability. In
20140 the ratio is 1.96 is lowest and 2014 the ratio value 5.925 is highest.
SAIHAM Textile:
1.58, and 1.537. The ratio value indicates from. In 2019 the ratio value 1.37 is lowest and in
2015 the ratio value 2.19 is highest.
Rahim Textile:
1.43, and 1.47. The ratio value indicates there is a low variability. In 2010 the ratio value 21.68 is
highest and in 2016 the ratio value 1.27 is lowest.
The graph shows from 2009 to 2019 variability is low over the year.
The graph and the table shows Fu-Wang, Desh and Standard Textile inventory turnover ratio
values variability is high but the Shinepukur and RAK Textile inventory turnover ratio value is
almost same over the year that’s why variability is low.
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Fixed asset turnover ratio:
The fixed asset turnover ratio measures the company's effectiveness in generating sales from its
investments in plant, property, and equipment. It is especially important for a manufacturing firm
that uses a lot of plant and equipment in its operations to calculate this ratio. The denominator in
the equation should be net of accumulated depreciation.
If the fixed asset turnover ratio is low as compared to the industry or past years of data for the
firm, it means that sales are low or the investment in plant and equipment is too high. This may
not be a serious problem if the company has just made an investment in fixed asset to modernize,
for example.
If the fixed asset turnover ratio is too high, then the business firm is likely operating over
capacity and needs to either increase its asset base (plant, property, equipment) to support its
sales or reduce its capacity.
TABLE: FIXED ASSET TURNOVER RATIO OF SHASHA, DESH, PRIME, SAIHAM
FIXED ASSET TURNOVER RATIO

Mill
2010 0.559 2.093 1.51 0.552 1.30
2011 0.745 2.058 1.80 0.343 1.54
2012 0.679 0.342 1.80 0.364 1.47
2013 1.959 0.334 1.83 0.35 1.56
2014 0.516 0.304 2.04 0.297 2.14
2015 0.750 0.334 2.42 0.247 1.26
2016 0.978 0.351 2.48 0.114 1.38
2017 0.485 0.364 2.35 0.259 1.69
2018 0.521 0.393 2.45 0.28 1.69
2019 0.441 0.462 2.52 0.28 1.65
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FORMULA: FIXED ASSET TURNOVER RATIO = SALES / NET FIXED ASSETS
FIGURE: FIXED ASSET TURNOVER RATIO OF SHASHA, DESH, PRIME, SAIHAM
ShashaTextile:
0.485, 0.521 and 0.441 The ratio value from 2010 to 2019 indicates there is a low variability. In
2019 the ratio value is lowest that is 0.44 and in 2013 the ratio value is highest that is 1.95.
Desh Textile:
The ratio value from 2010 to 2019 is accordingly 2.09, 2.05, 0.342, 0.33 0.30, 0.33, 0.35, 1.36,
0.39, and 0.46. The ratio value from 2010 to 2019 indicates there is a high variability. In 2009
the ratio value is height that is 2.09 and in 2014 the ratio value is lowest that is 0.30 The graph
shows from 2010 to 2019 variability is high over the year.
PRIME Textile:
1.45, and 2.52. The ratio value from 2009 to 2019indicates there is a high variability. In 2016 the
ratio is 2.48 is highest and 2013 the ratio value 1.83 is lowest.
The graph shows from 2010 to 2019 variability is high over the year.
33 | P a g e
SAIHAM Textile:
0.28 and 0.28. The ratio value from 2009 to 2019 indicates there is a low variability over the
year. In 2016 the ratio value 0.11 is lowest and in 2010 the ratio value 0.55 is highest.
The graph shows from 2010to 2019 there is a low variability over the year.
Rahim Textile:
The ratio value from 2010 to 2019 is accordingly 1.30, 1.54, 1.47, 1.56, 2.14, 1.26, 1.38, 1.69
and 1.65. The ratio value from 2009 to 2019 indicates ther
e is a high variability over the year. In 2014 the ratio value 2.14 is highest and in 2015 the ratio
value 1.26.
Rahim Textile Mill Ltd

LIQUIDITY RATIOS
1) Current Ratio:
One of the most general and frequently used of these liquidity ratios is the current ratio.
Organizations use current ratio to measure the firm’s ability to meet short-term obligations. It
shows the bank’s ability to cover its current liabilities with its current assets.
1. Current ratio: Current Asset / Current Liability
Year 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011
Current 2.8 3.8 3.67 3.56 3.89 3.48 3.19 3.45 3.38 3.30
Ratio
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Graphical Presentation:
4.5
3.5
2.5
1.5
0.5
0
2020 2019 2018 2017 2016 2015 2014 2013 2012 2011
Series 2 Column2
Interpretation:
The graph shows that current ratio of Rahim Textile Mill Ltd was varried over the years. The
current ratio was increased from 3.018% in 2013 to 3.3% in 2014 to 3.26% in 2015. This
indicates that liquidity position of the bank has increased in 2014 from 3.018% to 3.3% but
decreased from 3.3% to3.26% in 2015 respect of short term obligations of the bank.
ACTIVITY RATIOS
Total Assets Turnover
The total asset turnover indicates the efficiency with which the firm is able to use all its assets to
generate sales. It is calculated as follows-
Total Asset Turnover = Operating Income / Total Assets
Total Assets Turnover: (Amount in TK in
thousand)
Year 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011
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Total 3.10 6.70 5.87 6.43 5.1 5.90 5.70 5.56 5.27 5.1
asset % % % % % % % % % %
Turnove
r
Graphical Representation:
Chart Title
8.00%
7.00%
6.00%
5.00%
4.00%
3.00%
2.00%
1.00%
0.00%
2020 2019 2018 2017 2016 2015 2014 2013 2012 2011
Series 3
Interpretation:
The graph shows that the total asset turnover of Rahim Textile Mill LTD was increased over the
years from 5.10% in 2011 to 6.70% in 2019 , but decreased in the year of 2016, 2018 and 3.10%
in 2020
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DEBT RATIOS
1) Debt Ratio:
The debt ratio measures the preparation of total assets provided by the firm’s creditors.
Debt ratio: Total Liabilities / Total Assets
Debt Ratio
(Amount in thousand)
Year 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011
Debt 48.5 63.4 54.4 59.6 68.54 66.2 62.4 58.78 62.5 58.4
Rati % % % % % % % % % %
o
Series 1
80.00%
70.00%
60.00%
50.00%
40.00%
30.00%
20.00%
10.00%
0.00%
2020 2019 2018 2017 2016 2015 2014 2013 2012 2011
Series 1
37 | P a g e
Interpretation:
The graph shows, debt ratio of Rahim Textile Mill Ltd was varied over the years. The highest debt
ratio was 68.54% in 2016 and lowest in 2020 about 58.5% which indicates that the proportion of
total assets financed by the firm's creditors was decreased over the years.
Return on Asset (ROA)
Return on assets ratio of a bank gives an idea of how efficiently a bank is using its assets to
generate profit. Return on Assets (ROA) is calculated by dividing the annual earning of a bank by
the total assets. So it can be said that the formula of ROA is:
ROA= Net income / Total asset
Year 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011
RO 0.21 0.83 0.74 0.67 0.69 0.45 0.62 0.57 0.54 0.45%
A % % % % % % % % %
38 | P a g e
Series 1
0.90%
0.80%
0.70%
0.60%
0.50%
0.40%
0.30%
0.20%
0.10%
0.00%
2020 2019 2018 2017 2016 2015 2014 2013 2012
Series 1
Interpretation:
The graph shows that return on assets ratio was increased over the years except 20215 and 2020.
The Return on assets ratio was increased from 0.45% in 2011 to 0.86% in 2019 which indicates
that efficiency of bank management in using its assets to generate profit was increased every year
but decreased in 2020
Comparative Analysis/ CROSS SECTION ANALYSIS

The graph and the table shows, Desh Standard and RahimTextile fixed asset turnover ratio values
variability is high but the SAIHAM and Shasha Textile fixed asset turnover ratio value is almost
same over the year that’s why variability is low.
Total asset turnover ratio:
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The total asset turnover ratio measures the ability of a company to use its assets to efficiently
generate sales. This ratio considers all assets, current and fixed. Those assets include fixed assets,
like plant and equipment, as well as inventory, accounts receivable, as well as any other current
assets. The lower the total asset turnover ratio (the lower the Times), as compared to historical
data for the firm and industry data, the more sluggish the firm's sales. This may indicate a
problem with one or more of the asset categories composing total assets - inventory, receivables,
or fixed assets. The small business owner should analyze the various asset classes to determine in
which current or fixed asset the problem lies. The problem could be in more than one area of
current or fixed assets
TABLE: TOTAL ASSET TURNOVER RATIO OF SHASHA, DESH, PRIME, SAIHAM

TOTAL ASSET TURNOVER RATIO
SHASHA DESH PRIME SAIHAM 555555
2010 0.360 2.093 0.72 0.375 0.56
2011 0.386 2.058 0.91 0.265 0.59
2012 0.463 0.342 0.95 0.272 0.59
2013 0.808 0.247 1.01 0.16 0.53
2014 0.344 0.225 2.11 0.250 0.53
2015 0.441 0.247 1.31 0.211 0.47
2016 0.531 0.208 1.39 0.098 0.50
2017 0.248 0.268 1.34 0.222 0.58
2018 0.267 0.292 1.34 0.23 0.56
2019 0.237 0.341 1.30 0.23 0.44
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FORMULA: TOTAL ASSET TURNOVER RATIO = SALES / TOTAL ASSETS
FIGURE: TOTAL ASSET TURNOVER RATIO OF SHASHA, DESH, PRIME, SAIHAM
ShashaTextile:
0.26 and 0.23. The ratio value from 2010 to 2019 indicates there is a low variability. In 2017 the
ratio value is lowest that is 0.24 and in 2013 the ratio value is highest that is 0.80..
Desh Textile:
The ratio value from 2010 to 2019 is accordingly 2.09, 2.05, 0.34, 0.22, 0.24,0.20, 0.26, 0.29 and
0.34. The ratio value from 2010 to 2019 indicates there is a high variability. In 20010 the ratio
value is height that is 2.09 and in 2014 the ratio value is lowest that is 0.22.
PRIME Textile:
1.34 and 1.30. The ratio value from 2010 to 2019 indicates there is a high variability. In 2009 the
ratio is 0.72 is lowest and 2014 the ratio value 2.11 is highest.
41 | P a g e
SAIHAM Textile:
0.23, and 0.23. The ratio value from 2010 to 2019 indicates there is a low variability over the
The graph shows from 2010 to 2019 there is a low variability over the year.
555 Textile:
The ratio value from 2010 to 2019 is accordingly 0.56, 0.59, 0.59, 0.53, 0.47, 0.50, 0.58, 0.56
and 0.44. The ratio value from 2010 to 2019 indicates there is a high variability over the year. In
2010 and 2011 the ratio value 0.759 is highest and in 2019 the ratio value 0.44 is lowest.
The graph and the table shows, Desh and prime Textile total asset turnover ratio values
variability is high but the Saiham , Shasha and Rahim Textile total asset turnover ratio value is
almost same over the year that’s why variability is low.
Debt Management Ratio:

A ratio of a company's debt to its total financing. The debt management ratio measures how much
of a company's operations personal savings come from debt instead of other forms of financing,
such as stock o. The debt management ratio is one measure among many of a company's risk and
likelihood of default. The debt management ratio measures the firm's ability to repay long-term
debt by indicating the percentage of a company's asset that is provided via debt.
A measure of the extent to which a firm uses borrowed funds to finance its operations. Owners
and creditors are interested in debt management ratios because the ratios indicate the riskiness of
the firm's position. Debt management ratios are:
Debt to total asset ratio:

The debt to total assets ratio is an indicator of financial leverage. It tells you the percentage of
total assets that were financed by creditors, liabilities, debt. Debt ratios measure the firm's ability
to repay long-term debt. It is a financial ratio that indicates the percentage of a company's assets
that are provided via debt. It is the ratio of total debt (the sum of current liabilities and long-term
liabilities) and total assets (the sum of current assets, fixed assets, and other assets such as
'goodwill').
The higher the ratio, the greater risk will be associated with the firm's operation. In addition, high
debt to assets ratio may indicate low borrowing capacity of a firm, which in turn will lower the
42 | P a g e
firm's financial flexibility. Like all financial ratios, a company's debt ratio should be compared
with their industry average or other competing firms.
If the ratio is less than 0.5, most of the company's assets are financed through equity. If the ratio
is greater than 0.5, most of the company's assets are financed through debt. Companies with high
debt/asset ratios are said to be "highly leveraged," not highly liquid as stated above. A company
with a high debt ratio (highly leveraged) could be in danger if creditors start to demand
repayment of debt.
TABLE: DEBT TO TOTAL ASSET RATIO OF SHASHA, DESH, PRIME, SAIHAM

DEBT TO TOTAL ASSET RATIO
SHASHA DESH PRIME SAIHAM

Rahim Textile
Mill
2010 0.471 0.694 0.585 0.467 0.48
2011 0.179 0.691 0.547 0.371 0.29
2012 0.223 0.241 0.512 0.361 0.31
2013 0.375 0.241 0.508 0.035 0.35
2014 0.483 0.257 0.499 0.362 0.38
2015 0.249 0.253 0.554 0.363 0.44
2016 0.185 0.295 0.541 0.363 0.45
2017 0.288 0.296 0.555 0.355 0.45
2018 0.328 0.053 0.558 0.028 0.42
2019 0.393 0.313 0.573 0.029 0.42
FORMULA: DEBT TO TOTAL ASSET RATIO = TOTAL LIABILITIES / TOTAL
ASSETS
43 | P a g e
FIGURE: DEBT TO TOTAL ASSET RATIO OF FU-WANG, DESH, STANDARD, SHINEPUKUR, RAK
ShashaTextile:
0.32, and 0.39. The ratio value from 2010 to 2019 indicates there is a low variability and the
value always within 0.5 that indicates most of the company's assets is financed through equity. In
2011 the ratio value is lowest that is 0.17 and in 2014 the ratio value is highest that is 0.48.
The graph shows from 2010 to 2019 variability is low over the year and Debt to total asset ratio
ranges from 0.00 to.0.50 that indicates most of the company's assets is financed through equity.
Desh Textile:
The ratio value from 2010 to 2019 is accordingly 0.69, 0.69, 0.24, 0.24, 0.25,0.25, 0.29, 0.29,
0.05, and 0.31. The ratio value from 2009 to 2019 indicates there is a high variability then from
2018 to 2019 indicates there is a low variability. In 2010 and 2011 the ratio value is height that is
0.69 and in 2018 the ratio value is lowest that is 0.05.
The graph shows from 2010 to 2019 variability is high over the year. The ratio value almost
every year greater than 0.5 that indicates the most of the company's assets are financed through
debt. In which year the ratio value less than 0.5 that indicates most of the company's assets is
financed through equity.
PRIME Textile:
0.55,0.56 and 0.57. The ratio value from 2009 to 2009 indicates there is a low variability. In
2013 the ratio value is 0.50 is lowest and 2015 and 2017 the ratio value 0.55 is highest.
The graph shows from 2010 to 2019 variability is low over the year. The ratio value almost every
year greater than or equal to 0.5 that indicates the most of the company's assets are financed
through debt. In which year the ratio value less than 0.5 that indicates most of the company's
assets is financed through equity
SAIHAM Textile:
0.2, and 0.29 The ratio value from 2009 to 2019 indicates there is a high variability over the year.
In 2019 the ratio value 0.03 is lowest and in 2009 the ratio value 0.46 is highest.
The graph shows from 2010 to 2019 there is a high variability over the year. The ratio value
almost every year greater than 0.5 that indicates the most of the company's assets are financed
through debt. In which year the ratio value less than 0.5 that indicates most of the company's
44 | P a g e
assets is financed through equity. In 2010 to 2019 the ratio value less than 0.5 that indicates most
of the company's assets is financed through equity.
Rahim Textile:
0.45, 0.42 and 0.42. The ratio value from 2010 to 2019 indicates there is a high variability over
the year. In 2010, 2011 and 2012 the ratio value is greater than 0.5 indicates the most of the
company's assets are financed through debt otherwise the ratio value is less than 0.5 that
indicates most of the company's assets are financed through equity. In 2010 the ratio value 0.48
is highest and in 2011 the ratio value 0.29 is lowest.
The graph and the table shows, Desh Prime and Saiham Textile debt to total asset ratio values
variability is high the ratio value is almost every year more than 0.5 that indicates the most of the
company's assets are financed through debt. But the Shasha and 5555 Textile debt to total
asset ratio value is almost same over the year that’s why variability is low. The ratio value is
almost every year less than 0.5 that indicates most of the company's assets are financed through
equity. Debt to total asset ratio value 0.5 means that half of the company's assets are financed
through debts. Debt ratio ranges from 0.00 to 1.00. Lower value of debt ratio is favorable and a
higher value indicates that higher portion of company's assets are claimed by its creditors which
means higher risk in operation since the business would find it difficult to obtain loans for new
projects.
Time interest earned ratio:

The time interest earned (TIE) ratio measures the extent to which a firms earnings before interest
and ax (EBIT) also called net operating income, can decline before these earning are unable to
cover annual interest cost. Failure to meet this obligation can bring legal action by the firm’s
creditor
TABLE: TIME INTEREST EARNED RATIO OF SHASHA, DESH, PRIME, SAIHAM
TIME INTEREST EARNED RATIO
Mill
2010 3.63 0.053 1.09 1.221 0.077
2011 3.64 0.500 1.89 0.701 0.863
2012 4.52 0.280 2.78 0.480 0.084
2013 8.07 0.160 3.91 1.68 0.071
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2014 3.63 0.053 4.40 0.084 0.06
2015 1.94 0.092 3.75 0.561 0.08
2016 8.18 0.053 4.43 0.165 0.09
2017 4.19 0.050 -0.72 0.112 0.087
2018 4.14 0.891 3.23 0.132 0.085
2019 2.02 0.241 0.38 0.480 0.078
FORMULA:TIME INTEREST EARNED RATIO = EBIT OR NET OPERATING

INCOME / INTEREST CHARGES OR FINANCE COST
FIGURE: TIME INTEREST EARNED RATIO OF FU-WANG, DESH, STANDARD, SHINEPUKUR, RAK
ShashaTextile:
The ratio value from 2010 to 2019 is accordingly 3.63, 3.64, 4.52, 8.07, 3.63, 1.94, 8.18, 4.19.
4.14 and 2.02. The ratio value from 2010 to 2019 indicates there is a high variability over the
year. In 2019 the ratio value is 2.02 which is the lowest and in 2016 the ratio value is highest that
is 8.18.
The graph shows from 2010 to 2019 variability is high over the year.. Desh
Textile:
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The ratio value from 2010 to 2019 is accordingly 0.05, 0.50, 0.28, 0.16, 0.05,0.09, 0.05, 0.05,
year. In 2010 the ratio value is height that is 0.50 and in 2009 the ratio value is lowest and
negative that is -0.05.
The graph shows from 2010 to 2019 variability is low over the year except 2011.
PRIME Textile:
The ratio value from 2010 to 2019 is accordingly 1.0, 1.89, 2.78, 3.91, 4.40 3.75, 4.43, -0.72,
3.23, 0.38. The ratio value from 2010to 2019 indicates there is a high variability over the year. In
2017 the ratio is lowest and negative that is -0.72 and in 2016 the ratio value 4.43 is highest.
The graph shows from 2010to 2019 variability is high over the year.
SAIHAM Textile:
The ratio value from 2010 to 2019 is accordingly 1.22, 0.70, 0.48, 1.68, 0.08, 0.56, 0.16, 0.11.,
5555 Textile:
and 0.07. The ratio value from 2010 to 2019 indicates there is a low variability over the year. In
2009 the ratio value 0.07 is lowest and in 2010 the ratio value 1.86 is highest.
The graph and the table shows Shasha, Prime and Rahim Textile time interest earned ratio values
variability is high but theSaiham and Desh Textile time interest earned ratio value is almost
same over the year that’s why variability is low. Overall highest ratio value is RAHIM Textile
that is 33.12 and lowest standard Textile that is -1.61.
Profitability ratio:
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Profitability ratios are the most popular metrics used in financial analysis. A class of financial
metrics that are used to assess a business's ability to generate earnings as compared to its
expenses and other relevant costs incurred during a specific period of time. For most of these
ratios, having a higher value relative to a competitor's ratio or the same ratio from a previous
period is indicative that the company is doing well
Some examples of profitability ratios are profit margin, return on assets and return on equity. It is
important to note that a little bit of background knowledge is necessary in order to make relevant
comparisons when analyzing these ratios.Profitability ratios are:
Net profit margin ratio:

The profit margin is one of the most used profitability ratios. The profit margin refers to the
amount of profit that a company earns through sales. The profit margin ratio is broadly the ratio
of profit to total sales times one hundred percent. The higher the profit margin, the more profit a
company earns on each sale. The profit margin is mostly used for internal comparison. It is
difficult to accurately compare the net profit ratio for different entities. A low profit margin
indicates a low margin of safety and a higher risk that a decline in sales will erase profits and
result in a net loss or a negative margin.
TABLE: NET PROFIT MARGIN RATIO OF SHASHA, DESH, PRIME, SAIHAM
NET PROFIT MARGIN RATIO
mill
2010 0.077 0.004 0.018 0.131 0.1513
2011 0.157 0.036 0.019 0.088 0.2097
2012 0.180 0.021 0.032 0.046 0.1009
2013 0.073 0.011 0.032 0.069 0.16
2014 0.008 0.003 0.017 0.009 0.1305
2015 0.050 0.004 0.024 0.077 0.22
2016 0.158 0.133 0.023 0.29 0.1667
2017 0.153 0.003 -0.009 0.057 0.2033
2018 0.146 0.058 0.034 0.0532 0.1794
2019 0.135 0.067 0.031 0.06 0.1533
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FORMULA: NET PROFIT ARGIN RATIO = NET PROFIT / SALES
FIGURE: NET PROFIT MARGIN RATIO OF SHASHA, DESH, PRIME, SAIHAM
ShashaTextile:
The ratio value from 2010 to 2019 is accordingly 7.7%, 15.7%, 18%,7.3 %, 0.8%,5%, 15.8%,
15.3%, 14.6%, and 13.5%. From 2010 to 2019 the ratio value indicates the percentages of profit
that ShashaTextile earns through sales. It measure lower risk and high margin of safety. In 2014
profit margin ratio 0.8% indicates a low margin of safety and a higher risk that a decline in sales
will erase profits and result in a net loss or a negative margin.
The graph shows from 2010 to 2019 they earn profit and in 2014 earn less profit margin.
Desh Textile:
The ratio value from 2010 to 2019 is accordingly 0.4%, 3.6%, 2.1%, 1.1%, 0.3%, 0.4% 13.3%,
0.3%, 5.8%, and 6.7%. The ratio value from 2010 to 2019 indicates there is a low variability
over the year except in 2007. From 2003 to 2013 except 2016 the ratio value indicates the
percentages of profit that Desh Textile earns through sales. The ratio value is low that’s why it
measure a low margin of safety and a higher risk.
Standard Textile:
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The ratio value from 2010 to 2019 is accordingly 1.8 %,1.9 %, 3.2 % , 3.2%, 1.7% 2.4%2.3 %,
0.9%, 3.4% and 3.1% . From 2010 to 2019 except 2017 the ratio value indicates the percentages
of profit that Prime Textile earns through sales. It measure lower risk and high margin of safety.
In 2017 profit margin ratio -0.9% indicates a low margin of safety and a higher risk that a decline
in sales will erase profits and result in a net loss or a negative margin.
The graph shows from 2010 to 2019 except 2017 they earn profit and in 2017 7 net loss or a
negative margin.
SAIHAM Textile:
The ratio value from 2010 to 2012 is accordingly 13.1%, 8.8%, 4.6%, 6.9%, 0.9%, 7.7%, 29%,
5.7%, 5.3% and 6%. The ratio value from 2010 to 2019 indicates there is a low variability over
the year. From 2009 to 2019 the ratio value indicates the percentages of profit that Saiham
Textile earns through sales. It measure lower risk and high margin of safety. They earn
maximum in 2016 an amount of 29% and minimum earn in 2014 an amount of 1.1%.
The graph shows from 2010 to 2019 Saiham Textile earn profit over the year.
Rahim Textile:
The ratio value from 2010 to 2019 is accordingly 15.13%, 20.97%, 10.09%, 16%, 13.5%, 22 %,
16.67%, 20.33, 17.94% and 15.33%. The ratio value from 2009 to 2019 indicates there is a low
variability over the year. From 2010 to 2019 the ratio value indicates the percentages of profit
that RAK Textile earns through sales. It measure lower risk and high margin of safety. They earn
maximum in 2015 an amount of 22% and minimum earn in 2012 an amount of 10.09%.
The graph shows from 2010 to 2019 RAK Textile earn profit over the year.
The graph and the table shows, Desh and Prime and Textile profit margin ratio values variability
is high but the SHASHA , SAIHAM and 555 Textile profit margin ratio value is almost same
over the year that’s why variability is low. SAIHAM and 555 Textile profit margin ratio value
indicates the percentages of profit earns through sales measuring lower risk and high margin of
safety.
Return of total asset (ROA) ratio:

The Return on Assets ratio is an important profitability ratio because it measures the efficiency
with which the company is managing its investment in assets and using them to generate profit. It
measures the amount of profit earned relative to the firm's level of investment in total assets. It is
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also a measure of how much the company relies on assets to generate profit. The return on assets
ratio is related to the asset management category of financial ratios.
The higher the percentage is better, because that means the company is doing a good job using its
assets to generate sales.
TABLE: RETURN ON TOTAL ASSET (ROA) OF SHASHA, DESH, PRIME, SAIHAM

RETURN ON TOTAL ASSET(ROA)
SHASHA DESH PRIME SAIHAM
Rahim Textile
Mill
2010 0.027 0.004 0.013 0.049 0.11
2011 0.060 0.029 0.0174 0.023 0.1241
2012 0.083 0.005 0.031 0.012 0.6
2013 0.059 0.002 0.032 0.017 0.9
2014 0.002 0.0008 0.019 0.002 0.7
2015 0.224 0.001 0.031 0.007 0.10
2016 0.084 0.0007 0.032 0.009 0.0856
2017 0.038 0.0008 -0.012 0.0012 0.12
2018 0.039 0.017 0.046 0.0125 0.1006
2019 0.032 0.023 0.040 0.014 0.082
FORMULA: RETURN ON TOTAL ASSET (ROA) = NET PROFIT AFTER TAX OR NET
INCOME / TOTAL ASSETS
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FIGURE: RETURN ON TOTAL ASSET (ROA) OF SHASHA, DESH, PRIME, SAIHAM
ShashaTextile:
The ratio value from 2010 to 2019 is accordingly 2.7%, 6%, 8.3%, 5.9%,0.2%, 22.4%, 8.4%,
3.8%, 3.9% and 3.2%. From 2009 to 2019 the ratio value indicates the percentage of taka is
earned on every 100 taka assets The highest ratio value is 22.4% in 2015 that indicate highest
return on asset.
The graph shows from 2010 to 2019 ShashaTextile earn % of taka is earned on every 100 taka
assets. It also measure high safety and lower risk.
Desh Textile:
The ratio value from 2010 to 2019 is accordingly 0.4%, 2.9%, 0.5%, 0.2%, 0.08%, 0.1%, 0.07%,
0.08%, 1.7% and 2.3%. From 2010 to 2019 the ratio value indicates the percentage of taka is
earned on every 100 taka assets. The highest ratio value is 2.9% in 2011 that indicate highest
return on asset.
The graph shows from 2010 to 2019 Desh Textile earn % of taka is earned on every 100 taka
assets which is very poor. It measure low safety and lower risk.
PRIME Textile:
1.2,%, 4.6%, and 4%. From 2010 to 2019 except 2017 the ratio that indicate highest return on
asset.
The graph shows from 20110 to 2019 except 2017 Prime Textile earn % of taka is earned on
every 100 taka assets which is very poor. It measure low safety and lower risk. In 2017 indicates
1.2% of taka is loss on every 100 taka asset and it measure low safety and higher risk
SAIHAM Textile:
The ratio value from 2010 to 2019 is accordingly 4.9%, 2.3%, 1.2%, 1.7%, .2%, 7.%, .9%,
0.1%,1.25% and 1.4%. From 2010 to 2019 the ratio value indicates the percentage of taka is
earned on every 100 taka assets. In 2017 the ratio value is 0.1% is the lowest value. The highest
ratio value is 4.9% in 2010 that indicate highest return on asset.
The graph shows from 2010 to 2019 Saiham Textile earn % of taka is earned on every 100 taka
assets. It also measure high safety and lower risk. The variability is low over the year.
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Rahim Textile:
The ratio value from 2010to 2019 is accordingly 11%, 12.4%, 6.%, 9%, 7%, 10%, 8.5%, 12% ,
10 % and 8.2%. From 2010 to 2019 the ratio value indicates the percentage of taka is earned on
every 100 taka assets. There is a low variability over the year. The highest ratio value is 12.1% in
2010 that indicate highest return on asset.
The graph shows from 2010 to 2019 RAK Textile earn % of taka is earned on every 100 taka
assets. It also measure high safety and lower risk. The variability is low over the year
The graph and the table shows, Desh and Prime and Textile return on total asset ratio (ROA)
values variability is high but the SHASHA, SAIHAM and 555 Textile return on total asset ratio
(ROA) values is almost same over the year that’s why variability is low. SAIHAM and 5555
Textile return on total asset ratio (ROA) indicates the percentages values measuring lower risk
and high safety because they earn comparatively high other than Textile industry.
Return on equity (ROE) ratio:

The Return on Equity ratio is perhaps the most important of all the financial ratios to investors in
the company. It measures the return on the money the investors have put into the company. This
is the ratio potential investors look at when deciding whether or not to invest in the company.
The return on equity (ROE) measures profitability related to ownership. It measures a firm's
efficiency at generating profits from every unit of the shareholders' equity.. The higher the
percentage is better, with some exceptions, as it shows that the company is doing a good job
using the investors' money. ROEs between 15 percent and 20 percent are generally considered
good. The ROE is equal to the net income divided by the shareholders’ equity.
TABLE: RETURN ON EQUITY (ROE) OF SHASHA, DESH, PRIME, SAIHAM,

RTURN ON EQUITY (ROE)
YEAR SHASHA DESH PRIME SAIHAM Rahim Textile
Mill
2010 0.0528 0.013 0.031 0.092 0.1142
2011 0.074 0.096 0.038 0.037 0.14
2012 0.107 0.007 0.064 0.019 .09
2013 0.051 0.005 0.066 0.26 0.13
2014 0.005 0.001 0.038 0.003 0.11
2015 0.029 0.001 0.071 0.011 0.18
2016 0.103 0.029 -0.071 0.144 0.15
2017 0.053 0.005 -0.029 0.0019 0.09
2018 0.058 0.023 0.105 0.142 0.10
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2019 0.053 0.033 0.094 0.017 0.11
FORMULA: RTURN ON EQUITY (ROE) = NET INCOME / TOTAL SHAREHOLDERS

EQUITY.
FIGURE: RETURN ON EQUITY (ROE) OF FU-WANG, DESH, STANDARD, SHINEPUKUR, RAK
ShashaTextile:
10.3%, 5.3%,5.8% and 5.3%. From 2010 to 2019 the ratio value indicates the percentage of taka
is earned on every100 taka equity. The highest ratio value is 10.7% in 2012 that indicate highest
return on equity.
The graph shows from 2010 to 2019 ShashaTextile earn % of taka is earned on every 100 taka
invested by the owners. . It also measure high safety and lower risk.
Desh Textile:
The ratio value from 2010 to 2019 is accordingly 1.3%, 9.6%, 0.7%,0.5%, 0.1%, 0.1%, 2.9%,0.5%, 2.3%
and 3.3 . From 2010 to 2019 the ratio of taka is earned on every 100 taka invested by the owners. The
highest ratio value is 9.6% in 2011 that indicate highest return on equity.
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The graph shows from 2010 to 2019 Desh Textile earn % of taka is earned on every 100 taka
equity which is very poor. It measure low safety and lower risk.
PRIME Textile:
The ratio value from 2010 to 2019 is accordingly 3.1%, 3.8%, 6.4%, 3.8%, 4.0, 7.1%, -7.1%,
2.9%, 10.5%, and 9.4%. From 2010 to 2019 except 2016 and 2017 the ratio value indicates the
percentage of taka is earned on every 100 taka invested by the owners. In 2017 and 2018 the
ratio value indicates –7.1% and -2.9% of taka is loss on every 100 taka invested by the owners.
The highest ratio value is 7.1% in 2015 that indicate highest return on asset.
SAIHAN Textile:
The ratio value from 2010 to 2019 is accordingly 9.2%, 3.7%, 1.9%, 26%, 0.3%, 1.1%, 14.4%,
0.1% ,14.2 and 1.7%. From 2010 to 2019 the ratio value indicates the percentage of taka is
earned on every 100 taka invested by the owners. In 2017 the ratio value is 0.1% is the lowest
value. The highest ratio value is 14.4% in 2016 that indicate highest return on equity.
The graph shows from 2010 to 2019 Saiham Textile earn % of taka is earned on every 100 taka
invested by the owners. It also measure high safety and lower risk. The variability is low over the
year. The Textile industry is in good position.
Rahim Textile:
The ratio value from 2010 to 2019 is accordingly 11.42%, 14%, 9%, 13% 11%, 18%, 15%, 9% ,
10% and 11%. From 2010 to 2019 the ratio value indicates the percentage of taka is earned on
every 100 taka invested by the owners. There is a low variability over the year and the ratio value
measure high safety and low risk. The highest ratio value is 18% in 20154 that indicate highest
return on equity.
The graph shows from 2010 to 2019 RAK Textile earn % of taka is earned on every 100 taka
invested by the owners. It also measure high safety and lower risk. The variability is low over the
year. The Textile industry is in good position.
The graph and the table showsSHASHA, Desh and PRIME Textile return on equity ratio (ROE)
values variability is high and ratio value is low but the SAIHAM and 555 Textile return on
equity ratio (ROE) values is almost same over the year that’s why variability is low and the ratio
value is high. SHASHA, DESH, and PRIME Textile measure low safety and high risk in its
position on the other hand SAIHAM and 555 Textile return on equity ratio (ROE) indicates the
percentages values measuring lower risk and high safety because they earn comparatively high
other than Textile industry.
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Earnings per share (EPS):
Earnings per share (EPS) are the dollar / Tk value of earnings per each outstanding share of a
company's common stock.
Earnings per share are generally considered to be the single most important variable in
determining a share's price. It is also a major component used to calculate the price-to-earnings
valuation ratio.
TABLE: EARNING PER SHARE (EPS) OF SHASHA, DESH, PRIME, SAIHAM

Earnings per share(EPS)
SHASHA Desh PRIME SAIHAM Rahim
Textile
2010 0.85 2.84 5.12 2.62 2.54
2011 7.71 1.86 0.62 1.32 2.72
2012 0.97 0.71 1.07 0.71 1.99
2013 1.57 0.35 1.12 0.8 2.03
2014 2.48 0.11 0.62 0.02 1.67
2015 12.23 0.13 1.50 0.22 3.25
2016 12.53 0.09 1.06 0.26 2.72
2017 12.03 0.11 0.39 0.06 2.62
2018 11.61 1.63 0.15 0.42 2.29
2019 11.15 2.22 0.15 0.43 1.76
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FIGURE: EARNING PER SHARE (EPS) OF SHASHA, DESH, PRIME, SAIHAM
ShashaTextile:
ShashaTextile earned 2010 to 2019 accordingly 0.85, 7.71, 0.97, 7.1.57, 2.48, 12.23, 12.53,
12.03, 11.61, and 11.15 taka per share.
Desh Textile:
Desh Textile earned 2010 to 2019 accordingly 2.84, 1.86, 0.71, 0.35, 0.11, 0.13, 0.09, 0.11, 1.63
and 2.22 taka per share.
PRIME Textile:
Prime Textile earned 2010 to 2019 accordingly 5.12, 0.62, 1.07, 1.12, .62, 1.50, 1.06, 0.39, 0.15,
SAIHAM Textile:
Saiham Textile earned 2010 to 2019 accordingly 2.62, 1.32, 0.71, 0.8, 0.02, 0.22, 0.26, 0.06, 0.42
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Rahim Textile Mills Ltd :
RAK Textile earned 2004 to 2012 accordingly 2.54, 2.72, 1.99, 2.03,1.67, 3.25,2.72,2.62,2.29
Comparative analysis:
The graph and the table shows, Shasha, Desh and Prime Textile earning per share (EPS)
variability is high. Sometimes they earned more and sometimes loss. But the Saiham and 555
Textile earning per share (EPS) variability is low. SAIHAM and 555 Textile earn less but not
losses over the year.
Chapter 4: Comments
Comments on finding from ratio analysis:
Current Ratio:
The current ratio shows 555 Textile is in good position other than fu-wang, Desh and standard,
shinepukur Textile. Because RAK Textile ratio value always more than 1 that’s why it’s fully
covered by cash.
Quick ratio:
The firm’s ability to pay off short term obligations without relying on the sale of inventories is
important. The ratio vaue indicates standard and Desh Textile does not fully covered by cash
over the year on the other hand RAK Textile only in 2009 its value less than 1 otherwise greater
than 1 that’s why it’s may said to be fully covered by cash.
Inventory turnover ratio:

The inventory turnover ratio measures the efficiency of the business in managing and selling its
inventory. A high inventory ratio means that the company is efficiently managing and selling its
inventory. In case of my analysis Fu-Wang, Desh, RAK and Standard Textile inventory turnover
ratio values are high and but Shinepukur Textile ratio value is low. So the ratio value measures
Fu-Wang, Desh, RAK and Standard Textile is efficiently managing and selling its inventory but
shinepukur is efficient but less than others Textile companies limited.
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Fixed asset turnover ratio:
The fixed asset turnover ratio of Shinepukur and ShashaTextile is low as compared to the Desh,
Standard and RAK Textile, it means that sales are low or the investment in plant and equipment
is too high.
Total asset turnover ratio:

Standard and RAK Textile total asset turnover ratio indicates use its assets to efficiently generate
sales than Fu-Wang, Desh and shinepukur Textile limited.
Debt to total asset ratio:

Desh, Standard and Shinepuku Textile debt to total asset ratio values variability is high the ratio
values are almost every year more than 0.5 that indicates the most of the company's assets are
financed through debt. But the Shashaand RAK Textile debt to total asset ratio value is almost
same over the year that’s why variability is low. The ratio value is almost every year less than
0.5 that indicates most of the company's assets are financed through equity.
Time interest earned ratio:

Fu-Wang, Standard and RAK Textile time interest earned ratio values are high but the
Shinepukur and Desh Textile time interest earned ratio values are low over the year.
Net profit margin ratio:

Desh and Standard and Textile profit margin ratio values are low over the year that indicates the
percentages of profit earns through sales measuring higher risk and loewer margin of safety
FuWang, Shinepukur and RAK Textile profit margin ratio values are high over the year that
indicates the percentages of profit earns through sales measuring lower risk and high margin of
safety.
Return of total asset (ROA) ratio:

Desh and Standard Textile return on total asset (ROA) ratio measures lower percentages and it
indicates higher risk and lower safety because they earn comparatively low other than Textile
industry.
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ShashaShinepukur and RAK Textile return on total asset ratio (ROA) indicates the percentages
values measuring lower risk and high safety because they earn comparatively high other than
Textile industry.
Return on equity (ROE) ratio:

Fu-Wang, Desh and Standard Textile return on equity (ROE) values measure low safety and high
risk other than Textile limited. On the other hand Shinepukur and RAK Textile return on equity
ratio (ROE) indicates the percentages of values measuring lower risk and high safety because
they earn comparatively high other than Textile industry.
Earnings per share (EPS):

The EPS vales shows Fu-Wang, Desh and Standard sometimes get loss but overall they earn
more other than Textile limited. On the other hand Shinepukur and RAK Textile earn less but not
losses over the year.
Chapter: 5
SWOT Analysis:
Strength and Weakness Analysis:
The strength and weakness are related to internal environmental analysis. Each business needs to
evaluate its internal strengths and weaknesses periodically. The company can use the checklist
for measuring strengths and weaknesses. Management or an outside consultant reviews the
business’ marketing, financial, manufacturing and organizational competencies.
The main strengths of the Textile sector are:

1. Textile as a sector is labor intensive.
2. Availability of highly skilled and low-cost labor.
3. Cheaper, clean and abundant source of energy.
4. Bangladesh is already recognized as a reliable source for high quality Textile products.
5.Bangladesh enjoys GSP (Generalized System of Preferences) facilities in most of the

countries around the world, which facilitates global market access.
6.Huge potential of market access to neighboring India whose Textile technology is lagging
behind Bangladesh.
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7.Existence of sizeable domestic market.
The major weaknesses of this sector in Bangladesh are:

1. Raw material quality is generally poor and unsuitable for producing top-end products.
2. Modern Textile industries are generally capital intensive.
3. Technology barrier in Textile industry is significant.
Chapter: 6
Major challenges faced by the Covid-19
Textile industry is one of the fastest-growing sectors in Bangladesh which is now facing a serious
setback amid corona virus pandemic. Demand for Textile has collapsed in the local and international
market due to lockdown measures taken by governments across the world.
Due to order cancellation and a slump in local sales and production, Textile manufacturers are unable
to generate any revenue at the moment. As a result, these companies are facing extreme shortages of
working capital to pay wages to their employees.
Our Textile manufactures produce a range of tableware, jeans ,T-shirt items – meeting 85% of the
local demand while creating 500,000 jobs. But these jobs are under threat as manufacturers were
asked to shut down factory operation since March 26, the lockdown still continues.
Currently, 62 Textile companies are understood to be operating in Bangladesh and 75% of them
exports products and equipment to more than 50 countries around the globe. Rapid growth in the
domestic market and export orders – before the corona outbreak started –encouraged companies to
increase production capacity.
Investment in this section sector has increased manifold in recent years, estimated to be around TK
10,000 crore. As a result, local companies are now capable of producing around 90% of the country’s
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required silk base and 70% of the cotton while more than 80% of the sanitary ware is also produced
by them.
The total market size of the Textile industry is estimated to be around Tk 7,200 crore. Around 75% of
the total market is contributed only for the product with a 30-35 per cent annual growth and this trend
was expected to continue before the corona virus outbreak started.
The fate of the Textile industry now largely depends on how long this lockdown stays as construction
works in both public and privates sectors are put on hold. However, a boost in demand is likely once
lockdown measures are lifted.
Even before the corona virus pandemic started, Bangladeshi Textile manufacturers were facing
challenges to remain competitive in the domestic and international market. But now they have to face
uncertainty amid the COVID-19 crisis.
Jute,wool japanise silk, china febric one of the key materials for the Textile industry – is usually
sourced from countries such as China, India, New Zealand, and Germany. All these countries are
currently under lockdown and it will be difficult for the Textile manufacturers to source raw
materials for the time being.
Without raw materials , some companies would be forced to remain closed even if the lockdown is
eased. Only a small portion of raw materials is collected but that won’t be enough for the 60+
Textile producers.
Another major challenge for this promising industry is the high import duty on raw materials which
ultimately increases production cost and could make locally produced Textile less competitive both
in the local and international market as well.
Export scenario before COVID-19

Our Textile goods have been exported to foreign destinations such as in the USA, Canada, UK,
Germany, France, Italy and Middle-East. According to Export Promotion Bureau (EPB), during
201819, the Textile sector had reported $68 million earnings from exports, an increase of $18 million
(23.59%) than previous fiscal year.
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However, due to disruption in global trade and supply chains, this industry has already received order
cancellations from foreign buyers and a fall in export earnings from this sector is increasingly likely.
The UK, USA and Italy, some of the worst-hit countries by COVID-19, have been the major buyers
for the Bangladeshi Textile products as more than half of the exports went to these three countries
during 2018-19 fiscal year.
However, a significant reduction in orders from these countries is highly likely as the USA has
announced more than 50,000 deaths while Italy has the highest casualties in Europe. The UK is also
facing an exponential rise in the number of confirmed cases and deaths – the number of deaths have
already crossed 20,000 so far.
In the global export market, our Textile industry usually faces strong challenges from the likes of Sri
Lanka, China, and Thailand. To overcome such competition, Desh, Shinepukur, Standard, FARR,
DBL and Bengal Textile have recently expanded their plants with the state of art machinery
supplemented by the latest technology to further improve their share in the global Textile exports.
Prospect in the post-corona era

Textile industry has a great prospect and the government should embrace it by helping the
manufacturers through this difficult time with the financial assistance as this sector earns Tk 4 billion
per annum from export.
Industry insiders expect government intervention to facilitate continuous growth of this flourishing
industry which will not only increase export earning but also reduce our dependence on the RMG
sector.
Due to recent trade war between the USA and China in conjunction with increasing Chinese labour
cost, international buyers have been placing more orders to low-cost countries for quality Textile
wares before the pandemic started.
Bangladesh is in an ideal position to offer international standard Textile products and capture a
discernable share of the global market if proper guideline and support are provided.
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Govt. policy support enjoyed by the Industry in the
covid-19
Bangladesh's growing Textile sector is seeking government support as the already-struggling
industry is facing a deeper crisis amid the corona virus pandemic. Before corona virus Textile
industries progress was totally good in Bangladesh. Restrictions imposed on movement to stop the
virus spreading have crippled manufacturing and export-oriented factories. The Textile sector is no
exception and facing a deeper crisis as the so-called lockdown in global trade has shut the doors for
the Bangladeshi Textile exporters.
According to Bangladesh Textile Manufacturers and Exporters Association (BCMEA), this sector
needs extensive government support and requested the Ministry of Finance to release Tk 1,000 crore
immediately to save the sector from collapsing.
On Wednesday 25th of March, Prime Minister Sheikh Hasina announced a Tk 5,000 crore incentive
package to help export-oriented factories – to pay wages only – but this fund doesn’t particularly
support those of around 45 manufacturers who only sell in the local market.
In a bid to overcome the ongoing crisis, BCMEA has sought collateral-free and interest-free working
capital for at least six months to run the factories. The association also requested an exemption from
paying interest on bank loans for the six months and deferral of the loan repayment schedule for one
year.
Additionally, Textile makers have urged the government to provide policy support such as delay in
repayment of VAT, tax and AIT instalments for six months. An extension of the utility bills for
water, gas and electricity for one year is also sought by the BCMEA. Unusual gas price hikes over
the year, and uneven competition both at home and abroad – mainly with China which is the key
source of raw materials for BCMEA members.
64 | P a g e
Chapter: 7 Recommendations:
After studying the total scenario of Textile industries Limited, the following recommendations
may be offered for improving present condition of the market as well as its prospects:
• The Textile industries limited should maintain the liquidity, profitability, asset
management and debt management ratio.
• The Textile industries limited should follow the ratio analysis and try to improve their
loss and maintain their profit.
• The Textile industries should inform its consumers and customers about the new
improvement of its products.
• The Textile industries limited can encourage its customers (retailers) by providing
different types of trade offers, complementary samples, gift offerings etc.
• The Textile industries limited should confirm the availability of its products for more
convenience of the end users;
• The Textile industries limited should cover as much outlet it can ensuring the availability
of the brands.
• The Textile industries limited should make aware all about its brand to the consumers as
well as customers for creating image of brand assistance;
• The Textile industries limited should improve its merchandising activities to get an
improved market shares as it has enough scope to increase the same;
• The Textile industries limited increase its advertising efforts. Billboard may be the best
way in advertising of its products;
• The Textile industries limited can arrange cultural programs like–verities shows, folk
concerts etc under its brand to improve brand image in the mind of people;
• The Textile industries limited should increase the annual budget for merchandising
expenses.
65 | P a g e
Chapter: 8
Conclusions:
The desirable qualities of the cloths , excellence in making and affordable price – are rooted with
the Textile industries mission and commitment. The cloth is made to the most exact standards to
please the most apprehensive customers. The quality control supervisors at every stage of
production ensure that all items meet the most critical standards in the world. Giving dignity and
distinction to the users, the Textile industries cloths becomes centerpiece in any stylish home. It
blends together the outstanding technology.
The existing firms should plan in the long-run to enjoy the benefit of market opportunity by
realizing the nearest competitors china whose R&D of the textile industry is 5.4% average.In our
country product Textile industry is developing day by day. Already many companies are in the
market and are serving consumers delivering quality products. To compete smartly in the
domestic and international markets companies need to set appropriate financial and marketing
strategies.
BIBLIOGRPHY
1. http://theexecutivetimes.com/Coverstory/Bangladesh-Textile-Industry-Outlook.html
2. http://www.encyclopedia.com/doc/1O999-Textile.html
3. http://smetimes.com/Textile-sector-in-bangladesh.html
4. http://bangladeshinfo.com/business/Textile-industry-in-bangladesh.html
5. http://boi.gov.bd/competitive-sectors-for-investment/Textile.html
6. http://www.Textile- directory.com/TEXTILE-INDUSTRY/2-0.html
7. www.shashaTextile.com
8. www.desh.com
66 | P a g e
9. www.primeTextile.net
10. www.saiham.com
11. www.rakcerambd.com
12. www.wikipedia.com
13. Annual report of ShashaTextile

14. Annual report of Desh Textile
15. Annual report of Prime Textile
16. Annual report of Saiham Textile
17. Annual report of rak Textile
18. www.dsebd.com
19. www.edupediaeducarnival.com
20. www.assignmentpoint.com
21. www.projectpoint.com
22. http://www.amclpran.com/investor.php
23. Essentials of managerial finance, 14e, Lawrence J. Gitman • Chad J. Zutter
24. www.lankabanglabd.com
67 | P a g e

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1|Page

Term paper on “FundamenTal

Prep ared tO :ed By:

Md. Abdul Alin (2020210004086) )

Topic Page no.

Chapter 04: Comments

Chart no. Chart name Page no.

Background of the Study:

Objectives of the Study:

(a) To analyze the overall financial position of Textile industries Limited.

Scope of the project:

➢ These are the leading Textile industries in Bangladesh and

o Various books, articles and compilations o Journals

Limitation of the study:

• Organization has not provided all information needed to conduct study.

SHASHATextile Industry Ltd. incorporated in Bangladesh is located in Dhaka ,Dhaka

Contact Information of ShashaTextile Industry Limited

Corporate Head Quarter: Head Office –Gulshan1, Dhaka-1212

Plot:184/193/277DEPZ(EXT Tel: +880 2 9883274-5, 8825573, 8825361

Contact Information of Desh Textile Industry

Factory & Head Office: Desh Textile Industries Ltd.

Ataturk Avenue C\A 1213,Dhaka 1213

Show Room-5\48,6th floor,Eastern Mallika Shoping complex

,5 new elephant road,Dhaka 1205

Prime Textile Industries Limited’

Prime Textile’s factory is situated in Dhaka,Dhaka,Bangladesh and is part of the Textile

Prime Textile Industry Limited Products Shape:

Prime Textile Industry Limited Products Design:

Dhaka,1000 bangladesh +880-29564851

Requirement for firm order:

Contact information of prime Textile Industries Limited:

Office Address: Prime Textile Industries Limited,sena kalayan bhobon

Floor 8 -195.motijheel commercial area

‘SAIHAM Textile Limited’

Saiham Textile Limited Achievement:

Corporate Office Address: STML Block#SE ©-1

RAHIM TEXTILE MILL LTD

Objectives of the Study:

Methodology of the Study:

The Secondary Sources:

Analyzing & processes of data:

CHAPTER: 3 Ratio analyses

FORMULA: CURRENT RATIO = CURRENT ASSET / CURRENT LIABILITIES

FIGURE: CURRNT RATIO SHASHA, DESH, PRIME, SAIHAM

TABLE: QUICK RATIO OF SHASHA, DESH, PRIME, SAIHAM

FIGURE: QUICK RATIO OF SHASHA, DESH, Prime, SAIHaM

Inventory turnover ratio:

TABLE: INVENTORY TURNOVER RATIO OF SHASHA, DESH, PRIME, SAIHaM

FORMULA: INVENTORY TURNOVER RATIO = COGS / INVENTORIES

TABLE: FIXED ASSET TURNOVER RATIO OF SHASHA, DESH, PRIME, SAIHAM

FIXED ASSET TURNOVER RATIO

FIGURE: FIXED ASSET TURNOVER RATIO OF SHASHA, DESH, PRIME, SAIHAM

Rahim Textile Mill Ltd

Return on Asset (ROA)

Comparative Analysis/ CROSS SECTION ANALYSIS

Total asset turnover ratio:

TABLE: TOTAL ASSET TURNOVER RATIO OF SHASHA, DESH, PRIME, SAIHAM

FIGURE: TOTAL ASSET TURNOVER RATIO OF SHASHA, DESH, PRIME, SAIHAM

Debt Management Ratio:

Debt to total asset ratio:

TABLE: DEBT TO TOTAL ASSET RATIO OF SHASHA, DESH, PRIME, SAIHAM

SHASHA DESH PRIME SAIHAM

Time interest earned ratio:

FORMULA:TIME INTEREST EARNED RATIO = EBIT OR NET OPERATING