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  • Aurobindo Pharma Ratio Analysis Anuja Vagal Sample

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    Aryan Raj
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    The ratios analyzed for Aurobindo Pharma in 2018-19 and 2019-20 show: 1) The current ratio is lower than ideal but higher than what is accepted by financial institutions due to increases in inventories, investments, receivables and other assets as well as decreases in other liabilities and borrowings. 2) The debt-equity and interest coverage ratios improved from 2018-19 to 2019-20 indicating lower leverage and greater ability to service debt. 3) Profitability ratios like net profit ratio and return on equity increased from 2018-19 to 2019-20 showing higher profitability.

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    The ratios analyzed for Aurobindo Pharma in 2018-19 and 2019-20 show: 1) The current ratio is lower than ideal but higher than what is accepted by financial institutions due to increases in inventories, investments, receivables and other assets as well as decreases in other liabilities and borrowings. 2) The debt-equity and interest coverage ratios improved from 2018-19 to 2019-20 indicating lower leverage and greater ability to service debt. 3) Profitability ratios like net profit ratio and return on equity increased from 2018-19 to 2019-20 showing higher profitability.

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    63 views13 pages

    Aurobindo Pharma Ratio Analysis Anuja Vagal Sample

    Uploaded by

    Aryan Raj
    The ratios analyzed for Aurobindo Pharma in 2018-19 and 2019-20 show: 1) The current ratio is lower than ideal but higher than what is accepted by financial institutions due to increases in inventories, investments, receivables and other assets as well as decreases in other liabilities and borrowings. 2) The debt-equity and interest coverage ratios improved from 2018-19 to 2019-20 indicating lower leverage and greater ability to service debt. 3) Profitability ratios like net profit ratio and return on equity increased from 2018-19 to 2019-20 showing higher profitability.

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    © All Rights Reserved
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    of 13

    Sr No Ratio Formula

    Short Term Liquidity Ratios

    1 Current ratio Current Assets / Current Liabilities


    Current Assets
    Current Liabilities

    2 Quick Ratio Quick Assets / Quick Liabilities

    Quick Assets
    Current Assets
    Less Inventory

    Quick Liabilities
    Current Liabilities

    3 Super Quick Ratio (Cash+ Bank Balance+Marketable Securities) / Curerent Liab

    Cash
    Bank Balance
    Marketable Securities
    Total

    Current Liabilities

    Leverage Ratios

    4 Debt Equity Ratio Debt / Equity


    Debt=Long Term +Short Term
    Equity=Share Capital +Reserves and Surplus
    Share capital
    Reserve and Surplus

    5 Interest Coverage Ratio NPBIT/Interest


    NPBT
    Interest
    NPBIT

    Debt Service Coverage NPAT+Interest+Depreciation & Other Non Cash


    6 Ratio Exp/Interest +Principal Repayment Of Debt
    NPAT
    Interest
    Depreciation
    Principal Repayment Of Debt

    Turnover Ratios
    7 Stock Turnover Ratio Cost of Goods Sold/Average Stock
    Property, plant and equipment
    Capital work-in-progress
    Goodwill
    Other intangible asset
    Less Depreciation

    Average stock

    8 Stock Holding Period 365/Stock Turnover Ratio

    9 Debtors Turnover Ratio Credit Sales/Average Receivables

    10 Average Collection Period 365/ Debtors Turnover Ratio

    Profitability Ratio

    11 Gross Profit Ratio Gross Profit/Sales*100


    Sales
    COGS
    Profit

    12 Net Profit Ratio NPBT/Sales*100


    NPAT/Sales*100
    NPBT
    NPAT
    Sales

    13 Return On Investment Dividends+Interest+Capital Gains/Inv*100

    14 Return On Total Assets NPAT/Total Assets*100


    Total assets
    NPAT

    15 ROCE NPAT/CE*100
    CE = Fixed Assets + Working Capital
    NPAT
    16 Return On Equity NPAT/Equity*100
    NPAT
    Equity

    17 Earning Per Share NPAT/Total Shares


    Ratio Analysis : Aurobindo Pharma 2018-19 / 2019-20

    Ideal Ratio 2018-19 2019-20

    2:1 (Accepted by financ 1.55 1.77


    104,083.40 112,480.90
    67,364.60 63,599.00

    (1:1) 0.96 1.09

    104,083.40 112,480.90
    39,712.60 43,145.60
    64,370.80 69,335.30

    67,364.60 63,599.00

    0.5:1 0.011247747 0.012303653

    734 757.2
    23.7 25.3
    0 0
    757.7 782.5

    67,364.60 63,599.00

    0.4 0.29

    113506.2 130255.6
    585.9 585.9
    112,920.30 129,669.70

    16.42935679 27.88793396
    19,646.20 23,777.00
    1,273.30 884.3
    20,919.50 24,661.30

    3.15 3.25
    15,297.30 18,727.40
    1,273.30 884.3
    4,130.30 4,704.80
    7845.014 7253.807

    3.09 3.07
    56,936.50 64,948.10
    13,419.40 16,218.20
    8,325.10 9,159.40
    19,486.90 19,857.20
    4,130.30 4,704.80
    94,037.60 105,478.10
    30,432.88 34,357.68

    118.1229773 118.8925081

    2.27875965 2.231193336

    160.17 163.59

    21.12679837 18.34575174
    119,226.30 129,176.50
    94037.6 105478.1
    25,188.70 23,698.40

    16.47807573 18.40659872
    12.83047448 14.49752858
    19,646.20 23,777.00
    15,297.30 18,727.40
    119,226.30 129,176.50

    0.018199614

    7.830886475 10.32340502
    195,345.70 181,407.20
    15,297.30 18,727.40

    19.25 19.87
    794.66 942.496
    15,297.30 18,727.40
    13.47706116 14.37742408
    15,297.30 18,727.40
    113506.2 130255.6

    31.96 26.11
    Aurobindo Pharma 2018-19 / 2019-20

    Analysis

    The current ratio for both the years is lower than the ideal
    ratio of 2:1 but higher than the one accepted by financial
    institutions i.e 1.33:1. This is due to the increase in
    inventories, investments, trade receivables and a great
    increase in other financial assets. There is also a great
    decrease in other financial liabilities and borrowings.
    Statement of Ratios

    2018-19 2019-20
    SHORT TERM LIQUIDITY RATIOS
    1 Current Ratio 1.55 1.77
    2 Quick ratio 0.96 1.09
    3 Super Quick Ratio 0.01 0.01

    LEVERAGE RATIOS
    4 Debt-Equity Ratio 0.4 0.29
    5 Interest Coverage Ratio 16.4293568 27.887934
    6 Debt Service Coverage Ratio 2.25 times 1.61 times

    TURNOVER RATIOS
    7 Stock Turnover Ratio 3.09 3.07
    8 Stock Holding Period 118.122977 118.892508
    9 Debtors Turnover Ratio 2.27875965 2.23119334
    10 Average Collection Period 160.174857 163.589589

    PROFITABILITY RATIOS
    11 Gross Profit Ratio 21.1267984 18.3457517
    12 Net Profit Ratio 16.4780757 18.4065987

    13 Return On Investment 1.82%


    14 Return On Total Assets 7.83088647 10.323405
    15 ROCE 19.25 19.87
    16 Return On Equity 13.4770612 14.3774241
    17 Earning Per Share 31.96 26.11

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