1

Financial Analysis
(Financial Analysis of FMCG Sector)

Under the guidance of Prof. Ashish Kumar

Submitted by: Group 7

NAME ROLL No. COMPANY

Balamukundan VR MBA20097 Jubliant Foodworks

Utsav Mevada MBA20370 Nirma Limited

Satyam Sharma MBA20129 Hatsun Agro Products

Nitesh Kumar MBA20259 Bajaj Consumer Care

Akash Masaram MBA20081 Nestle India

Ashish Kapoor MBA20095 HUL

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Table of Contents

FMCG Overview 3

Company Overview 4

Inventory Turnover Ratio 6

ROTA (After Tax) 6

Du Pont Analysis 7

Debt to Equity Ratio 11

Net Profit Margin 12

Equity Turnover Ratio 13

EBITDA Margin 13

Current Ratio 14

Quick Ratio 15

Dividend Payout Ratio 15

Earnings Per Share 16

Price to Earnings Ratio 17

Price to Book Value Ratio 18

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FMCG Overview

▪ FMCG is the 4th largest sector in the Indian Economy.

▪ It is expected to grow at around 9-10% in 2020 with a CAGR of around 14%.

▪ Within the FMCG sector, Food and beverages account for 19%, Healthcare for 31% and
Households and Personal Care for 50%.

▪ Revenue of FMCG in 2020 is expected to be around US$ 103.7 Billion.

▪ Government of India has allowed 100 FDI in food processing under the FMCG sector.

▪ FMCG sector witnessed FDI inflow of US$ 16.28 Billion during the FY 2019-2020.

▪ FMCG Urban segment witnessed growth rate of 8% and the rural segment of 5%.
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Founded in 1970, Hatsun Agro Products is a dairy company in India. Receiving the award for the ‘Fastest
Growing Asian Dairy Company’, Hatsun Agro proudly became a one billion dollar company by 2016.
Hatsun Agro Products had shown tremendous growth potential from the previous years and its total
turnovers had tripled over the past three years. The company has also proudly got the status of the fastest
growing company in the world, registering a record growth of 116%. The company’s revenues have been
increasing at a phenomenal pace, for the year 2020 being ₹ 531698.34 Lakhs. The company’s excellent
performance can be gauged through its Market value per share value which has seen a constant rise over
the years. Leveraging its growth potential, the company has also expanded to the Middle East and the
North American Regions.

HUL is India's largest Fast-Moving Consumer Goods Company with a heritage of over 80 years in
India. On any given day, nine out of ten Indian households use our products to feel good, look good
and get more out of life – giving us a unique opportunity to build a brighter future. With over 35
brands spanning 20 distinct categories such as soaps, detergents, shampoos, skin care, toothpastes,
deodorants, cosmetics, tea, coffee, packaged foods, ice cream, and water purifiers, the Company is
a part of the everyday life of millions of consumers across India. Its portfolio includes leading
household brands such as Lux, Lifebuoy, Surf Excel, Rin, Wheel, Fair & Lovely, Pond’s, Vaseline,
Lakmé, Dove, Clinic Plus, Sunsilk, Pepsodent, Closeup, Axe, Brooke Bond, Bru, Knorr, Kissan,
Kwality Wall’s and Pureit.

is an Indian Consumer goods company with major brands in Hair care. It is

started in 1953 by Mr. Kamalnayan Bajaj as Bajaj Sevasharam to sell and market hair oils and other
beauty products. Bajaj consumer care ltd. is second largest player in the overall hair oils segment.
Bajaj’s marque product Bajaj almond drops hair oil has 52% market share in light hair oil category.
Bajaj hair care category include Bajaj Almond Drops Hair Oil, Bajaj Kailash Parbat Thanda Tel,
Bajaj Brahmi Amla Hair Oil, Bajaj Amla Shikakai Hair Oil, Bajaj Jasmine Hair Oil and in dental
care it holds brand Bajaj Red Tooth Powder. Bajaj Consumer Care Ltd also entered into Face
Creams, Face Wash, Soaps, Face Packs, Face Scrubs Market by acquiring Nomarks.
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Jubilant food works is an Indian food delivery company. It is the parent franchise for Domino’s Pizza
in Nepal, India, and Dunkins in India. The company is a part of the Jubilant Bhartia group. The
company has reported sales In the last quarter of 2020 which are down by -57.26% from the previous
quarter of 2020. The company has a pan India presence with 1350+ restaurants across India. The
company is rebounding after a sharp hit by COVID-19 and continues to have a better cash position
and debt-free balance sheet.

Nestle India is an Indian Subsidiary of Nestle. It is a Swiss Multinational company founded 150
years ago by Henri Nestle. It is one of fastest growing FMCG company in India. Its products are
mostly consumables like chocolates, pasta, noodles, sauces, etc. The company has recorded profit of
about 40% in the month of February, 2020.

Nirma, an FMCG company, once a successful brand and a strong rival of Hindustan Unilever
(HUL)), still maintains a strong brand image in the minds of Indian consumers. “Washing powder
Nirma” the jingle became widely popular and is still associated with when someone says Nirma. The
company is currently focusing on Nirma cement since the FMCG products aren’t generating the
desired profits. The sales have been decreasing because of lack of innovation and a consumer
perception of Nirma not being a premium product. Nirma has a challenge of entering the premium
segment of the market and still maintain a position in the low-price segment.
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INVENTORY TURNOVER RATIO

Inventory turnover is a ratio showing how many times a company has sold and
replaced inventory during a given period. A company can then divide the days in the period
by the inventory turnover formula to calculate the days it takes to sell the inventory on hand

Inventory Turnover Ratio

60

50

40

30

20

10

0
2016 2017 2018 2019 2020

HUL Jubiliant Foods Nirma nestle India Hutsun Bajaj

From the data following conclusion can be made:

• Inventory Turnover Ratio of Hindustan Unilever LTD is constant over the year (2016-
2020)
• Inventory Turnover Ratio of Jubiliant Foods is constant over the year (2016-2020)
• Inventory Turnover Ratio of Nirma decreases over the year (2016-2020)
• Inventory Turnover Ratio of Nestle India is constant over the year (2016-2020)
• Inventory Turnover Ratio of Hutsun increases over the year (2016-2020)
• Inventory Turnover Ratio of Bajaj is constant over the year (2016-2020) but it
increases during 2017-2018
Among the all 6 companies in the above given period in 2020 Inventory Turnover Ratio is
maximum for Jubiliant Foods, means Jubiliant Foods has more inventory turnover as
compared to other five companies it means that how liquid a company’s inventory is.

ROTA (AFTER TAX)

Return on total assets (ROTA) is a ratio that measures a company's earnings before interest
and taxes (EBIT) relative to its total net assets. It is defined as the ratio between net income
and total average assets, or the amount of financial and operational income a company
receives in a financial year as compared to the average of that company's total assets.
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ROTA(AT)
50.00%

40.00%

30.00%

20.00%

10.00%

0.00%
2016 2017 2018 2019 2020
-10.00%

HUL Jubiliant Foods Nirma nestle India Hutsun Bajaj

From the data following conclusion can be made:

• ROTA After Tax for Hindustan Unilever LTD is constant over the year (2016-2020)
• ROTA After Tax for Jubiliant Foods increases over the year (2016-2020)
• ROTA After Tax for Nirma is negative over the year (2016-2019)
• ROTA After Tax for Nestle India is constant over the year (2016-2019)
• ROTA After Tax for Hutsun decreases over the year (2016-2020)
• ROTA After Tax for Bajaj decreases over the year (2016-2020)
Among the all 6 companies in the above given period in 2020 ROTA (After Tax) is
maximum for HUL, means HUL is able to convert maximum of its asset into net income as
compared to other five companies

Dupont Analysis
Dupont analysis is a framework that helps to analyse fundamental performance of a company.
It focuses on various components of Return on Equity (ROE) like Net Profit Margin (NPM),
Asset Turnover Ratio and Total leverage a company has. This breakdown let analyst to focus
on strengths and weaknesses of a company.

NET PROFIT MARGIN

HUL Bajal Consumer care Nestle India Jubliant Foods Hatsun Agro Nirma
29.36%

28.17%

24.60%

23.56%

20.95%
17.05%
15.61%
15.52%
14.26%

13.91%
13.10%
12.39%

11.82%
11.24%
10.52%

9.75%
9.66%

9.37%

8.24%
7.01%
6.93%
4.42%

3.21%
3.12%

2.41%
2.11%

2.11%
1.75%

2016 2017 2018 2019 2020

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• Net Profit Margin: NPM tells about how much Net Income (subtracting tax, interest &
other expenses) a company is making on total sales that it is generating.
• NPM = Net Profit/Sales

Analysis:
• NPM for HUL has shown continuous growth over past 5 years.
• NPM of Bajaj consumer care is seeing a continuous drop since last 5 years.
• NPM of Nestle India has seen growth from 2016-2019
• NPM of Jubliant food has increased from 2016 to 2017 and then dropped in 2018. After
that it has remained almost constant
• NPM of Nirma has seen a drop from 2016-2018 and had seen a jump in 2019.

Conclusion:
NPM tells us about how company is earning over sales. And as data shows HUL & Nestle India
has shown growth over last few years compared to other companies.

Asset Turnover Ratio

• Asset Turnover Ratio: This ratio tells about how efficient a company is
in converting its assets into sales. Higher the ratio suggests how good a company is preforming
• ATR = Sales/ Total Assets

ASSET TURNOVER RATIO

HUL Bajal Consumer care Nestle India Jubliant Foods Hatsun Agro Nirma
2.98

2.65
2.22

2.14

2.12
2.04
2.1
1.99

1.96
1.92

1.91

1.84
1.9

1.78

2
1.55
1.46

1.42

1.42
1.41

1.4

1.4

1.14
1.08
0.89

0.53
0.52
0.49

2016 2017 2018 2019 2020

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Analysis:

• ATR for HUL has increased in 2017 from 2016 and has remained almost constant after
dropping in 2018
• ATR for Bajaj consumer care has seen drop from 2016 to 2018. Then after jumping in
2019, again dropped in 2020
• ATR for Nestle India has remained stable for 2016-2018. Then it has seen a jump in
2019.
• ATR for Hatsun agro has seen drop from 2016 to 2018. But after growing in 2019 it
again dropped in 2020
• ATR for Nirma has seen a drop 2017 and then has remained stable till 2019

Conclusion:
As seen from graph Hatsun despite having good ATR there is continuous fall in ATR but HUL
has been able to maintain consistency in ATR. Making HUL best choice among others

Total Leverage

Total leverage: It tells about how the debts and Equities are balanced in an organization. It
gives the proportion of how the assets are divided among debts & equity.
Higher the ratio means higher the level of debts used for assets and less amount of investment
from investors. Higher ratio also means higher the risk for investors in both profit and loss.

TOTAL LEVERAGE
HUL Bajal Consumer care Nestle India Jubliant Foods Hatsun Agro Nirma
5.78
5.01

4.55

3.65

2.87
2.79
2.67
2.55

2.49

3
2.31

2.29
2.29

2.4

2.4
2.15
2.07

2.2
1.57

1.56

1.56

1.45
1.5

1.25
1.23
1.19
1.18

1.3

2016 2017 2018 2019 2020

Analysis:
• TL for HUL has dropped from 2016-2017 and then has improved in 2018. It again
dropped in 2019 and then increased in 2020
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• TL for Bajaj consumer care has seen growth from 2016 to 2019 and then it has
dropped in 2020.
• TL for Nestle India has seen continuous growth from 2016 to 2019.
• TL for Jubliant food has seen a drop from 2016 to 2019 and then it has increased in
2020.
• TL for Hatsun agro has dropped in 2017 and then increased in 2018. Again, after
dropping in 2019 it increased in 2020.
• TL for Nirma has increased from 2016 to 2017 and then it has seen continuous drop
from 2017 to 2019.
Conclusion:

Bajaj Consumer care is least levered company makes it low risk company, but shareholder
has to settle with less return also. Whereas Hatsun agro is high levered company and along
with high return risk are also higher.

Return On Equity
• Return on Equity: It gives the overall picture how a company is performing and how
much income a company is generating out of total equity it has
• Higher the ROE shows company is efficiently managing its shareholders money and
able to provide return on their investments.
• ROE: Net Income/ Equity

RETURN ON EQUITY
HUL Bajal Consumer care Nestle India Jubliant Foods Hatsun Agro Nirma
101.93%

82.03%
76.96%
71.93%
66.58%
62.80%
50.55%

47.67%

47.16%
43.74%
42.61%
38.84%
35.82%
30.84%

28.29%

27.07%
26.22%

24.99%
24.85%
19.77%
15.53%

14.27%
13.37%

12.59%

12.41%
11.77%
9.32%

9.04%

2016 2017 2018 2019 2020

Analysis:
• ROE of HUL has continuously increased over years from 2016 to 2020. Due to its
continuous growth in NPM and maintaining consistency in ATR and TL.
• ROE of Bajaj care has seen drop from 2016 to 2018 due to dropping NPM. Then it has
seen growth in 2019 due to jump in leverage and ATR and again dropped in 2020
impacted by ATR.
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• ROE for Nestle India has seen continuous growth from 2016 to 2018. And in 2019 it
has seen sudden jump in ROE due to steep increase in leverage.
• ROE of Jubliant foods has dropped in 2017 due to drop in ATR but has seen
continuous growth after that due to improving NPM and increased leverage in 2020
where NPM and ATR has fallen.
• ROE of Hatsun agro increased in 2017 and then dropped from 2017-2020 due to
fluctuation in NPM, ATR & Leverage
• ROE of Nirma has dropped till 2018 due to NPM & ATR and then has increased in
2019 due to increased NPM.

Conclusion:
Overall HUL is performing good in maintain improvement in ROE over years along with
maintain low leverage which make it more suitable company for investors to invest their
money without taking much risk.

Debt to Equity Ratio

Chart Title
1.6

1.4

1.2

0.8

0.6

0.4

0.2

0
2016 2017 2018 2019 2020

Hindustan Unilever Hatsun Agro Bajaj Consumer care Nestle In Jubiliant Foods Nirma

• Debt to equity ratio is a financial ratio indicating the relative proportion of entity’s
equity and debt to finance an entity’s assets. The factors considered here tells about
how company is being levered.
• If the ratio is much high, say Nirma Limited in 2017, the above graph indicates the
company is highly levered and in the next case, say Jubiliant Foodworks from 2016-
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2020, the debt to equity ratio is approximately 0. This means the company is not highly
levered.
• Debt equity ratio comes under insolvency ratio. Whenever a company is need of any
loan, the lender will majorly ask about its debt-equity ratio and depending upon the
ratio a lender will be able to grasp a brief know about any company’s financial health.
It tells about for Rs.1 how much more a company has to pay from their pocket.
• In the graph above, Jubiliant Foods is working very good as its debt-equity ratio is
approximately zero from 2016- 2020. Second company which is performing well is
Hatsun Agro Product as well as Nestle India Pvt. Ltd. Lastly Hindustan Unilever
followed by Nirma Limited are the companies which are lower in order.
• These varies mostly because either the company is so much debt or the total equity of
the company is less in number. The total debt of the company can consist of any factor
like long term and short term borrowings, long term and short term provisions and other
financial liabilities.
• These all factors adds up to give a high debt to equity ratio which can affect the leverage
of the company
Net Profit Margin

NET PROFIT MARGIN

35%
29.36%

28.17%

30%
24.60%

23.56%

20.95%
25%

17.05%
15.61%
15.52%

20%
14.26%

13.91%
13.10%

11.82%
11.24%
10.52%
12%

15%
9.75%
9.66%

9.24%

8.10%
7.01%
6.87%

10%
4.40%

3.21%
3.10%

2.41%
2.11%

2.11%
1.75%

5%

0%
2016 2017 2018 2019 2020

HUL Bajaj Consumer Care Nestle Jubilant Foodworks Hatsun Agro Nirma

• Net Profit Margin can be termed as one of the most important indicators of checking a
company’s financial health. If a company’s Net Profit Margin is high, it means either
the sales are increasing, or the costs are decreasing.
• Over the years, HUL and Nestle have seen a constant growth whereas Bajaj
Consumer Care has seen a constant decline in Net Profit Margin. Nirma signed a deal
with Lafarge in 2016 which increased the profit but it gradually started losing its
customers in the FMCG sector, however it has been able to get back in 2019.
• Jubiliant Foodworks saw a major growth in 2018 owing to introduction of Everyday
Value offers on Regular Pizza which saw a massive response due to IPL T20 Cricket
season.
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Equity Turnover Ratio

EQUITY TURNOVER RATIO

14.95
16

12.08

11.76
14
12
10

6.53

5.92

5.88
8 5.08
5.07

5.04

4.96

4.81
6

3.34
3.14
3.04

3.03
2.93

2.88

2.7
1.73
1.72

1.69

4 3
1.38

1.35
1.29

1.21
1.3

2
2
0
2016 2017 2018 2019 2020

HUL Bajaj Consumer Care Nestle Jubilant Foodworks Hatsun Agro Nirma

• Equity Turnover Ratio is basically a measure of how well a company uses its
stockholder’s equity to generate revenue. The efficiency of a company in using the
capital is determined by how high the ratios are.
• The Equity Turnover Ratio for HUL, Bajaj Consumer Care, Jubilant Foods and Nirma
have been pretty much constant over the years showing their efficiency in using the
stockholder’s equity. Nestle on the other hand showed a huge growth in 2019 possibly
owing to the new innovations like KitKat Dessert Delight, Maggi Fusian and the
encouraging response it received.
• Hatsun Agro has been seeing a constant decline in the ETR over the years unlike the
other companies which have seen constant behavior over the years, however it is still
seeing an ETR which is almost on par with HUL.

EBITDA Margin

EBITDA MARGIN
36.47%

36.11%

32.49%

40.00%
31.02%

35.00%
26.65%
25.18%

24.90%

24.66%
24.57%

24.29%
23.27%
23.04%

22.56%
22.21%

22.18%
21.93%

30.00%
21.38%
20.79%
20.69%

16.99%

25.00%
14.86%

20.00%
11.22%

10.31%
9.63%

9.39%
9.14%
8.97%

8.84%

15.00%
10.00%
5.00%
0.00%
2016 2017 2018 2019 2020

HUL Bajaj Consumer Care Nestle Jubilant Foodworks Hatsun Agro Nirma
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• EBITDA Margin is Earnings Before Interest, Tax, Depreciation and Amortization

divided by the Total Revenue. EBITDA margin is the company’s operating
profitability.
• EBITDA margin is irrelevant if the company has a lot of debt that needs to be paid.
• Nirma has been seeing a slight decline in EBITDA margin although it has a healthy
EBITDA margin and since company has repaid debt of Rs 1050 crore as scheduled by
September 2018 and had no major obligations, the EBITDA margin holds importance.
• Bajaj Consumer Care has been seeing a constant decline in EBITDA Margin over the
years. Jubilant foods, HUL and Nestle have been seeing gradual increase in the
EBITDA Margin over the years indicating that the business earnings are stable.
• Hatsun Agro has been seeing fluctuating EBITDA margin over the years but it has
been showing growth over the past 2 years.

Current ratio
The current ratio of Jubilant foods has shown gradual improvement over the five years although
there has been a minor slump in the last financial year. The ratio implies that the company has
managed to boost its current assets, which is signifies that the company is capable of meeting
its near term commitments since the liquidity has increased. The reasoning behind the steady
ascent is the rise in current assets year on year.

Current Ratio
6

0
2016 2017 2018 2019 2020

HUL Bajal Nestle Jubilant Hatsun Nirma

The current ratio of Jubilant foods has shown gradual improvement over the five years although
there has been a minor slump in the last financial year. The ratio implies that the company has
managed to boost its current assets, which is signifies that the company is capable of meeting
its near term commitments since the liquidity has increased. The reasoning behind the steady
ascent is the rise in current assets year on year. On the other hand, Nirma has shown a consistent
decline in its current ratio. On making comparative analysis with other organizations belonging
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to the same industry, Bajal consumer care is performing the best among the six companies,
though the ratio has steadily declined over the given period.

Quick ratio

The quick ratio a.k.a acid test ratio helps determine the ability of an organization to settle its
current liabilities by evaluating the monetary value excluding the investment of the current
assets. In that regard, Jubilant food’s quick ratio for 2016 and 2018 has been lesser than one.
Over the years, there has been a dramatic rise and the ratio has doubled. On making a
comparative analysis, it can be seen that bajal consumer care has maintained a high quick ratio,
which signals the company’s strong liquidity and its ability to pay off the near term current
liabilities.

Quick ratio
5

4.5

3.5

2.5

1.5

0.5

0
2016 2017 2018 2019 2020

HUL Bajal Nestle Jubilant Hatsun Nirma

Meanwhile, the quick ratio of Nirma has seen a gradual decline in the ratio from 2016-2020,
and the Hatsun’s ratio is always in the lower range. The liquid asset of these two companies
are much lower than the other four organizations and may find difficulties in running the
operations.

Dividend Payout Ratio

The dividend payout ratio is a tool used by investors to decide their next investments. It portrays
the proportion of profit, the company is distributing to its investors and the amount invested in
operations over a year. Investors often look for a consistent trend in the ratio to decide their
investments. It also acts as an indicator of a company’s performance. Jubilant foods have
maintained largely a steady ratio which makes it desirable for investments.
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Dividend payout ratio

100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2016 2017 2018 2019 2020

HUL Bajal Nestle Jubilant Hatsun Nirma

The other organizations in this sector have also largely performed well. HUL has a more stable
ratio over the years than other companies but has shown a marginal decrease in the ratio, which
is not a right sign for investors. Though Bajal’s ratio has seen a steep rise until 2019, there’s
been a steep decline in 2020. Investors look for the long term performance of the companies to
make decisions. None of the companies have consistently had an upward trend in the five years.

Earnings Per Share

Net Income or the Profit After Tax when divided by the total number of outstanding shares of common
stock gives the earnings per share ratio. Understanding this ratio in a layman’s language, higher the EPS
means that more financially profitable the company is.
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Though Earnings Per Share is one of the major ratios while valuing the stocks of a company, it cannot be
seen in isolation. By studying the above graph, following inferences can be drawn:

• The first impression from the graph is that the Jubliant foods has the highest EPS over the years from
2016-2018, crossing 30 mark in 2018. But subsequently after that, it has fallen.
• HUL has shown a constant increasing trend over the years and it has been increasing constantly. Similar
is the case with Nestle, whereas for Hatsun Agro and Bajaj, it has fallen.
• By the above observed trend, it could very well be inferred that Hatsun Agro and Bajaj, though they
have been stable over the years, but growth chances are very slight in their case.
• On the other hand, HUL has shown and is expected to show in future also, tremendous growth.

Price to Earnings Ratio (P/E)

Calculating the Earnings per share can give only the half part of the image. The total profit a
company makes divided by its outstanding shares gives us the earnings per share value. Now how
the investors and the market is valuing that company is given by the Price to Earnings Ratio. Here
by price, we mean the market price of a share of the company.

P/E ratio = Market Price of a share/ Earnings per share

Price to Earning Ratio (P/E)

140

120

100

80

60

40

20

0
2016 2017 2018 2019 2020

Bajaj Consumer Care Hatsun Agro Products HUL Jubliant Foods Nirma Nestle India

Of all the ratios, P/E ratio is the most important ratio to evaluate a company because it gives insight
to both the performance of the company as well as on the aspect about how the investors are viewing
the future growth potentials of the company. From the above graph, the conclusions drawn are as
follows:
 18

• Bajaj Consumer Care’s P/E ratio has not been very impressive as compared to other competitors
and also after 2018, it has started declining. This means that its market price has fallen maybe
because of investors growing sceptical about the company. As we have seen that its EPS has been
more or less constant, hence a fall in P/E means its MPS has fallen.
• HUL and Nestle India are showing a very slight increase in P/E ratio. But as above we have seen
that for both of these companies, the EPS have risen sharply, hence not a very sharp increase in
P/E can be attributed to the fact that their Market Price may not have risen with the same pace.
• Analysing the P/E ratios, the company which catches our attention is Hatsun Agro Products.
Although its EPS is not very impressive, but still this phenomenal increase and high in the P/E
indicates that the company has a growth potential and the investors are valuing the company,
seeing that it might be a profitable company, hence increasing its market price of shares.
• Jubliant foods has shown a constant trend in P/E over the years.

Price to Book Value Ratio

This ratio is used by the companies and investors to gauge the company’s current market
capitalization to its book value. This ratio can be calculated by dividing the Market Price of a share
by the book value of a share of the company. This ratio is used by investors to identify potentials
investments.

P/B ratio = Stock price per share/ Book value per share

Price to Book Value (P/B)

80

70

60

50

40

30

20

10

0
2016 2017 2018 2019 2020

Bajaj Consumer Care Hatsun Agro Products HUL Jubliant Foods Nirma Nestle India
 19

• Nestle India is showing a phenomenal growth in the P/B valuation aspect. From 2018 to 2019, it
has shown a sudden increase in value of P/B, which clearly states that the investors were very
positive about the company and its market price has suddenly increased.
• HUL has also exhibited a constant growth rate over the years, and its growth is stable, meaning that
the company is not overvalued and in a strong financial position.
• Jubliant foods and Bajaj have maintained a more or less stable P/B value from 2016 to 2018, but
after 2018, where on one hand, Bajaj started to fall down, Jubliant Foods’s P/B started to increase.
• Evaluating Hatsun Agro product’s P/B, we see that from 2016 to 2018, it has increased. This shows
that the investors were positive till 2018 about the company. But when in 2019, the P/B came down
instead of rising MPS, it indicates that previously, the company was overvalued and now the
valuation is being done judiciously. This fact is also proven by the fall of P/B again in 2020.