RATIO ANALYSIS

CURRENT RATIO = CURRENT ASSETS/ CURRENT LIABILITIES

PARTICULARS 2018 2019 2020 2021
CURRENT 3639.05 2390.65 3847.31 4141.87
ASSETS
CURRENT 2987.55 3087.82 3415.63 2585.8
LIABILITIES
CURRENT 1.22 0.7 1.12 1.6
RATIO

QUICK RATIO = (CURRENT ASSETS – INVENTORIES)/CURRENT LIABILITIES

PARTICULARS 2018 2019 2020 2021

CURRENT 3639.05 2390.65 3847.31 4141.88
ASSETS
INVENTORIES 1299.40 1358.3 1507.76 1911.74
CURRENT 2987.55 3087.82 3415.53 2585.8
LIABILITIES
QUICK RATIO 0.78 0.33 0.68 0.86

DEBT TO EQUITY RATIO = TOTAL LIABILITIES / SHAREHOLDERS’ FUND

PARTICULARS 2018 2019 2020 2021

TOTAL 7263.58 7012 6791.55 5730.94
LIABILITIES
TOTAL 4556.49 5015.27 5120.97 6030.1
SHAREHOLDERS
FUNDS
DEBT TO 1.59 1.39 1.32 0.95
EQUITY RATIO
RETURN ON EQUITY RATIO = (NET PROFIT /SHAREHOLDERS’ FUND) *100
PARTICULRARS 2018 2019 2020 2021
NET PROFIT 562.13 935.12 1116.77 1366.11
SHAREHOLDERS 4556.49 5015.97 5120.97 6030.1
’ FUND
RETURN ON 12.34 18.64 21.80 22.65
EQUITY RATIO

NET PROFIT MARGIN = (NET PROFIT / NET SALES) * 100

PARTICULARS 2018 2019 2020 2021

NET PROFIT 562.13 935.12 1116.77 1366.11
NET SALES 4580.55 6144.44 6405.37 6568.91
NET PROFIT 12.27% 15.22% 17.43% 20.79%
MARGIN

CONCLUSION FROM RATIO ANALYSIS

1. Current ratio is also called as Liquidity Ratio. In Torrent pharma in the year 2019 current ratio was
lowest that is 0.77and Year 2021 Current ratio highest that is 1.6.

2. Quick Ratio of Torrent pharma shows that company does have liquid assets to cover current
liabilities. In Year 2021 company can pay 86% of current debt.

3. Debt To Equity Ratio of Torrent pharma indicates in Year 2018 borrowed more funds from
shareholders that is 1.59. But as seen from year 2019 to 2021 there is downward trend in borrowed
funds from shareholder that is from 1.39 to 0.95.

4. Return on equity is seen to showing a continuous rise in these 4 years from 12.34% to 22.65%

5. Net profit margin of torrent pharma has been seeing a constant rise in the past years with highest
going up to 20.79% in 2021, indicating that COVID -19 did not hamper the company and instead gave
a boom from 17.43% to 20.79%.