Prestige Institute of Management and Research, Indore

(An Autonomous Institution Established in 1994, Accredited with Grade ‘A++’ NAAC(UGC) ISO 9001:
2008Certified Institute, AICTE / UGC Approved Programs affiliated to DAVV, Indore)

(Batch 2020 – 2022)

ASSIGNMENT
On
“Fundamental Analysis of Bajaj Finance”

Submitted To: Submitted By:

Dr. Deepesh Mahajan Arushi Nandecha
Kunika Jaiswal
Mantasha Khan
Saloni Soni
Varsha Chelani
MBA FA-B III Semester

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 CONTENT

Sr. TITLE Page No.

No.

1. About The Industry 4

2. About The Company 5

3. Directors Report 6

4. Financial Ratios, P&L, Cash Flow Statement, B/S 7-14

5. Conclusion 15

6. Industry Economic Factors Affecting, PEST analysis 16-22

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 ABOUT THE INDUSTRY

The electronics industry encompasses a wide range of different manufacturing processes and
products. The most visible products of the electronics industry are consumer goods such as
television sets, music reproduction systems and computers. These visible products represent a
tip of the iceberg situation as a large part of the electronics industry is concerned with the
manufacture of the component parts of products. The manufacture of switches, printed circuit
boards, semiconductor devices and the assembly of complex computer systems are all aspects of
the electronics industry. The fact that each of these activities would typically be performed by
different organizations shows that there are few common factors across the electronics
industry’s component companies.

The electronics industry consists of various sectors. The central driving force behind the entire
electronics industry is the semiconductor industry sector,[1] which has annual sales of over
$481 billion as of 2018.[2] The largest industry sector is e-commerce, which generated over $29
trillion in 2017.[3] The most widely manufactured electronic device is the metal-oxide-
semiconductor field-effect transistor (MOSFET), invented in 1959, which is the "workhorse" of
the electronics industry

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 ABOUT THE COMPANY

About Bajaj Finance Limited

We believe good is the enemy of great. And this belief fuels the desire to create a better reality
every day. Today, we’re the most diversified non-bank in the country financing the widest set of
outcomes.

You may think that all banks and non-banks do it, so what’s the big deal? There is.

While you go about acquiring means(finance), we let you do it in the least time and with the
least effort. And we ensure your pursuits are not hindered by limited access to finance by
extending the biggest ticket sizes across most of our portfolios.

This culture of performance and delivery is central to us. It runs through our products, customer
experience and orientation of all employees. Through deep investments in technology, processes
and people, we have constantly strived to deliver what we promise.

The net result - you get what you need in lesser time, lesser effort, so that all your life pursuits
are hassle-free.

Bajaj Finance Limited has been assigned a long term rating of ‘BB+/stable‘ and short term
rating of ‘B’ by S&P Global Ratings

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 Directors Report
• Revenue from Consumer Product Segment increased by 12.55% to ₹3,084.62 crore.

• Export increased by 24.17% to ₹113.86 crore.

• Revenue from EPC Segment decreased by 51.89% to ₹1,891.76 crore.

• The Company’s cash and cash equivalent as at March 31, 2020 was ₹101.61 crore.

• During the year under review, the Company raised ₹349.92 crore through Rights Issue
with an objective to utilise the proceeds for prepayment or repayment of all or a portion
of certain borrowings availed by the Company and general corporate purposes.

• The Company’s shares are compulsorily tradable in electronic form. As on March 31,
2020, 98.52% of the Company’s total paid up capital representing 112,084,851 equity
shares are in dematerialised form.

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 FINANCIAL RATIOS,
PROFIT AND LOSS STATEMENT, CASH FLOW

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STATEMENT, BALANCE SHEET STATEMENT

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 CALCULATION OF RATIOS

LIQUIDITY RATIOS:

1. CURRENT RATIO :

MARCH 2020 MARCH 2021

1.11 1.10

Generally, your current ratio shows the ability of your business to generate cash to meet its
short-term obligations. Regardless of the reasons, a decline in this ratio means a reduced ability
to generate cash.

2. QUICK RATIO:

M MARCH 2020 M MARCH 2021

0. 0.81 0. 0.78

As the company is having quick ratio less than 1 which implies that company may not be able
to fully pay off its current liabilities in the short term.

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PROFITABILITY RATIOS:

1. GROSS PROFIT RATIO:

M MARCH 2020 M MARCH 2021

8 82.86 9 93.82

This ratio indicates the relationship between gross profit and net sales. Higher the ratio, lower
the cost of goods cold.

2. OPERATING RATIO:

M MARCH 2020 M MARCH 2021

9 95.29 9 96.69

This ratio is calculated to assess the operational efficiency of the business. A decline in the
operating ratio is better because it means higher margin and thus higher profit.

3. NET PROFIT RATIO:

M MARCH 2020 M MARCH 2021

2 20.6 4 41.2

It indicates overall efficiency of the business. Higher the net profit ratio, better the business.

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TURNOVER RATIO:

1. WORKING CAPITAL TURNOVER RATIO:

M MARCH 2020 M MARCH 2021

4. 4.93 3. 3.98

This ratio shows the number of times working capital has been employed in the process of
carrying on business.

SOLVENCY RATIOS:

1. DEBT TO EQUITY RATIO:

M MARCH 2020 M MARCH 2021

2 29.11 1 10.48

This ratio assesses the long term financial position and soundness of enterprises. In general
lower the DER higher the degree of protection enjoyed by the lenders.

2. TOTAL ASSETS TO DEBT RATIO:

M MARCH 2020 M MARCH 2021

6. 6.89 17.77

This ratio measures the safety margin available to lenders of long term debts.
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 CONCLUSION

As there is very tough competition in the market it is becoming more important to have satisfied

trade partners and customers to stay in market and to retain and gain new customer and for the

growth of the company. Bajaj is competing with many established Indian and global brands and

has mostly achieved in satisfying its customers as well as dealers. This can also be depicted by

seeing the profit and loss statement as the company in 2020 was in loss but now it is in profit

which shows that the company has performed better than last year. During the year, the

Company generated positive cash flow from operations at 627.41 crore, compared to a negative

cash flow of 601.92 crore in the previous year. The company also raised equity capital through

a successful rights issue. Consumer Products segment continued to deliver healthy double-digit

growth, ahead of industry growth, implying an increase in overall market shares.

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