Mahesh Total Project 1

RATIO ANALYSIS
CHAPTER-I
INTRODUCTION
Financial statements are prepared primarily for decision making. They play a
dominant role in setting the frame work of managerial decisions. Financial analysis is “the
process of identifying the financial strengths and weakness of the firm by properly
establishing relationship between the items of the balance sheet and the profit and loss
account”. There are various methods or techniques used in analyzing financial statements,
such as comparative statements, schedule of changes in working capital, common-size
percentage, funds analysis, trend analysis and ratio analysis. The ratio analysis is the most
powerful tool of financial analysis.
Meaning of ratio:
According to accountant’s hand book by WIXON, KELL AND BEDFORD, “a ratio
is an expression of the quantitative relationship between two numbers”.
A ratio is simple arithmetical expression of the relationship of one number to another.

It may be defined as the indicated quotient of two mathematical expressions.
Ratio analysis is techniques of analysis and interpretation of financial statements. It is

the process of establishing and interpreting various ratios for help in making certain
decisions.
Importance of ratio analysis:

The inter relationship that exists among the different items appeared in the financial
statements, are revealed by accounting ratios. Ratio analysis of a firm’s financial statements
is of interest to a number of parties, mainly, shareholders, creditors, financial executives etc.
Shareholders are interested with earning capacity of the firm; creditors are interested in
knowing the ability of firm to meet its financial obligations; and financial executives are
concerned with evolving analytical tools that will measure and compare costs, efficiency,
liquidity and profitability with a view to making intelligent Decisions.
Dravidian university Page 1

RATIO ANALYSIS
The importance of Ratio Analysis are briefly discussed below.

(1) Aid to measure general efficiency: Ratios enable the mass of accounting data to be
summarized and simplified. They act as an index of the efficiency of the enterprise. As such
they serve as an instrument of management control.
(2) Aid in forecasting and planning: Ratio analysis is an invaluable aid to management in
the discharge of its basic function such as planning, forecasting, control etc. The ratios that
are derived after analyzing and scrutinizing the past result help the management to prepare
budgets to formulate policies and to prepare the future plan of action etc.
(3) Facilitate decision-making: It throws light on the degree of efficiency of the

management and utilization of the assets and that is why it is called surveyor of efficiency.
They help management in decision-making.
(4) Evaluation of efficiency: Ratio analysis is an effective instrument which, when

pro0perly used, is useful to assess important characteristics of business liquidity, solvency,
profitability etc. A study of these aspects may enable conclusions to be drawn relating to
capabilities of business.
(5) Effective tool: Ratio analysis helps in making effective control of the business measuring
performance, control of cost etc. Effective control is the keynote of better management.
Ratio ensures secrecy.
Uses:
 Financial statements are prepared primarily for decision making. Ratio analysis helps
in making decision from the information provided in financial statements.
 Ratio analysis is of much help in forecasting and planning. Meaningful conclusions
can be drawn for future from these ratios.
 Financial strength and weakness of a firm are communicated in an easier manner by
using ratios. Ratios help in communication and enhance the values of the financial
statements.

RATIO ANALYSIS
Inter-firm comparison:
Ratios of one firm can also be compared with the ratios of some other selected firms
in the same industry at the same point of time. This kind of companies helps in evaluating
relative financial position and performance of the firm.
Intra – firm comparison:

Ratios of various departments in the same firm or organization were compared in intra
firm comparison
Limitations of ratio analysis:

The ratio analysis is one of the most powerful tools of financial management.
Through ratios are simple to calculated and easy to understand, they from some serious
limitations.
(1) Limited use of Single Ratio: A single ratio usually, does not convey much of a sense.
To make a better interpretation a number of ratios have to be calculated which is likely to
confuse the analyst than help him in making any meaningful conclusion.
(2) Lack of adequate standards: There are no well accepted standard or rules of thumb for
all ratios which can be accepted as norms. It renders interpretation of the ratios difficult.
(3) Inherent limitations of accounting: Like financial statements, ratios also suffer from the
inherent weakness of accounting records such as their historical nature. Ratios of the past are
not necessarily true indicators of the future.
(4) Change of accounting procedure : Change in accounting procedure by a firm often

makes ratio analysis misleading, e.g., a change in the valuation of methods of inventories
from FIFO to LIFO increase the cost of sales and reduces considerably the value of closing
stocks which makes stock turnover ratio to be lucrative and an unfavorable gross profit ratio.
(5) Personal Bias: ratios are only means of financial analysis and not an end in itself. Ratios
have to be interpreted and different people may interpret the same ratio in different ways.

RATIO ANALYSIS
(6) Incomparable : not only industries differ in their nature but also the firm of the similar
business widely differ in their size and accounting procedures, etc., It makes comparison of
ratios difficult and misleading. Moreover, comparisons are made difficult due to differences
in definitions of various financial terms used in the ration analysis.
(7) Price level changes: While making ratio analysis, no consideration is made to the
changes in price levels and this makes the interpretation of ratios invalid.
(8) Ratios no substitutes: Ratio analysis is merely a tool of financial statements. Hence,
ratios become useless if separated from the statement from which they were computed.
Classification of ratios:
The use of ratio analysis is not confined to financial manager only. There are different
parties interested in the ratio analysis for knowing the financial position of a firm for different
purposes. Various accounting ratios can be classified as follows
Ratios
(A) (B) (C)

Traditional classification Functional classifications Significance
Ratios
(OR) (OR) (OR)
Statement Ratios Classification according Ratios according
To tests to Prim Ratios
1. Balance Sheet Ratios 1. Liquidity Ratios 1. Primary
Or 2. Leverage Ratios 2. Secondary
Position Statement Ratios 3. Activity Ratios
2. Statement Ratios 4. Profitability Ratios
Or
Revenue / Income
Statement Ratios
3. Composite / Mixed

RATIO ANALYSIS
Types of ratios:
Several ratios calculating from the accounting data can be grouped into the various
classes according to the financial activities or function to be evaluated. The various parties
that are generally under taken financial analysis to measure solvency and profitability of the
firm. Management is interested in evaluating every aspect of all parties and see that the firm
grows profitability. In view of the requirements of the various users of ratios, we may classify
them into the following four important categories.
 Liquidity Ratios
 Leverage Ratios
 Activity Ratios
 Profitability Ratios
Liquidity Ratios:
Liquidity ratio measures the ability of the firm to meet its current obligations.
Analysis of liquidity needs the preparation of cash, budgets and cash funds flow statements.
But liquidity ratios by establishing relation cash and other current assets to current
obligations provide a quick measure of liquidity. A firm should ensure that it does not suffer
from lack of liquidity, and also that it is not too much highly liquid. The failure of a company
to meets it obligations due to lack of sufficient liquidity will result in bad credit image. A
very high degree of liquidity is also bad. Ideal assets earn nothing. The firm’s funds will be
un necessary tied up in current assets.
The most common ratios, which indicate the extent of liquidity or lack of it, are:
 Current Ratio
 Quick Ratio
 Absolute Ratio
Current Ratio:
The current ratio is calculated by dividing current assets by current liabilities.
Current ratio = Current assets

Current liabilities

RATIO ANALYSIS
Current assets include cash and those assets, which can be converted into cash with in
a year, such a marketable securities, debtors and inventories, prepaid expenses. All
obligations maturing with in a year are included in current liabilities. Thus current liabilities
include creditors, bills payable, accused expenses, short-term bank loans, income tax and
long-term debt maturing in the current year. The current ratio is the measure of the firm’s
short-term solvency.
Quick Ratio / Acid test Ratio:

Quick ratio is used as a measure of the company’s ability to meet its current
obligations. This ratio is calculated as a supplement to the current ratio in analyzing the
liquidity of the firm. This can be calculated as.
Quick Ratio = Quick assets

Quick liabilities
Quick assets-----: Current assets – Stock and prepaid expenses

Quick liabilities: Current liabilities – Bank OD
A normal standard of 1:1 acceptable quick ratio. A very high or very low ratio is not
desirable. It is used to measure the ability of the company to meet its current liabilities at
short notice.
Absolute Liquid Ratio:

Absolute liquid ratio is also be calculated together with current ratio and acid test ratio
as to exclude even receivables from the current assets and find out the absolute liquid assets.
Absolute Liquid Ratio = Absolute liquid assets
Current liabilities
Capital structure / Leverage Ratios/ Long-term solvency Ratios:

The long-term financial stability of a firm is considered as dependent upon its ability
to meet all its liabilities. The ratios, which are measuring the long-term solvency, are:
 Debt – Equity ratio
 Share holders equity / propriety ratio

RATIO ANALYSIS
 Fixed assets to long term funds ratio

 Debt to net worth ratio
 Dividend coverage ratio
 Interest coverage ratio
Debt Equity Ratio: Debt equity ratio indicates the relationship between long-term debts and
shareholders’ funds. It helps in knowing the soundness of the long-term financial policies of a
company. It is calculated as:
Debt-Equity Ratio = Long term debt

Shareholders funds
Interest Coverage Ratio: Interest coverage ratio shows how many times interest charges is
covered by funds that are available for payment of interest. The ratio is calculated as:
Interest Coverage Ratio = EB IT

INTERST
Proprietary Ratio
It express the relationship between net worth and total assets
Net worth
Proprietary Ratio =
Total assets
Net worth = Equity Share Capital + Preference Share Capital +

Reserves – less Fictitious Assets
Activity Ratios:
Activity ratios measure how efficiency the firm employees its resources. These ratios
involve comparison between the level of sates and Investment in various accounts such as
inventories, debtors, creditors; fixed assets etc., Activity ratios are used to measure the speed
with which various accounts are converted into sales are cash.
Cost goods sold (GCS): Sales – Gross profit
The major turnover rations are:

RATIO ANALYSIS
 Inventory turnover ratio

 Debtor’s turnover ratio
 Creditor’s turnover ratio
 Capital turnover ratio
 Working capital turnover ratio
 Fixed assets turnover ratio
 Total assets turnover ratio
Inventory Turnover Ratio:

Inventory turnover ratio indicates the number of times the stock has been turnover
during the paid and evaluates the efficiency with which a firm is able to manager its
inventory.
Inventory turnover Ratio = Cost of Goods Sold

Average Inventory
Average Inventory = Opening Stock + Closing Stock

2
Debtor’s Turnover Ratio:
Debtor’s turnover ratio indicates the velocity of debt collection of a firm. It indicates
the number of times the number of debtors turns over a year.
Debtors turnover Ratio = Net Credit Sales

Average Debtors
Capital Turnover Ratio:

It used to show how the capital employed is efficiency used in the business. It is
indicates the firm’s ability to generate Sales per rupee capital employed.
Capital turnover Ratio = Net sales

Capital employed

RATIO ANALYSIS
Working capital turnover Ratio:

Working capital of a concern is directly related to sales. The current assets like
debtors, bills receivables, cash stock etc., changing with the increase or decrease in sales.
Working capital turnover Ratio = Sales

Working capital
Working capital = Current assets – Currents liabilities.
Fixed Assets Turnover Ratio:

Fixed assets turnover ratio shows a relation between sales to fixed assets.
Fixed Assets Turnover Ratio = Sales

Fixed assets
Total Assets Turnover Ratio:

Total assets turnover ratio shows a relation between sales and total assets.
Total Assets Turnover Ratio = Net sales

Total assets
Profitability Ratios:
Profitability ratio helps in assessing the adequacy of profits earned by the company
and also discovers whether profitability is increasing or decreeing. Profitability ratios are
measured with respect to sales, capital employed total assets employed shareholders
 Return on capital employed
 Return on shareholders’ funds
 Return on total assets
 Gross profit ratio
 Net profit ratio
 Operating profit ratio

RATIO ANALYSIS
Gross Profit Ratio:

Gross profit ratio measure the gross margin on total net sales of company. This ratio
measures the efficiency of company’s operations and can be used to compare with previous
year’s results. Higher the gross profit ratio, better is for the company.
Gross Profit Ratio = Gross profit X 100

Net sales
Gross Profit = Sales – less Cost of Goods Sold

Net Sales = Sale – less Sales Returns
Net Profit Ratio:

This ratio is designed to focus attention on the net profit margin arising from business
operations after interest and tax.
Net sales X 100
Net Profit Ratio =
Sales
Net profit = Earnings after tax and interest
Operating profit ratio:

This ratio is calculated by dividing earnings before tax and interest by sales. This ratio
is calculated as:
Operating Profit Ratio = Operating profit X 100

Sales
Return On Capital Employed:

The strategic aim of business enterprises is to earn a return on capital. If any case, the
return in long – term is not satisfactory then the deficiency should be corrected as:
Return on Capital Employed = Net profit after interest and tax X 100
Capital employed

RATIO ANALYSIS
Return on Total Assets:

It established relationship between net profit before interest and tax.
Return on Total Assets = NPAT X 100

Total assets
Return on Share Holder Funds:

It establishes the relationship between the net profit after tax and to shareholders
equity.
Returns on Shareholders Funds = NAPT X 100

Share Holders Equity

RATIO ANALYSIS
CHAPTER-II
PROFILE OF THE ORGANIZATION
2.1 Industry Overview:
The soap and detergent industry includes companies that are primarily engaged in
manufacturing soap, synthetic organic detergents, inorganic alkaline detergents, and crude
and refined glycerin from vegetable oils and animal fats. It is an international industry, and
during the early years of 1990, world demand for its products has increased 1 to 3 percent
every year.
Many of the participants in the industry competed on a global basis. According to
analysts, there is a firm correlation the standard of living of a nation and its usage of soap and
detergent products. The analysts are expecting the industry to continue to grow in both the
industrialized as well as developing nations.
Security Tenders:
According to recent trends, liquid cleansing products are outpacing the traditional bar
soap and powder cleaning products. In addition to environmental and health considerations,
societal transformation has propelled the changes in the soap and
Size:
The industry includes about 700 companies with combined annual revenue of about
$17 billion. Major companies in the consumer sector include divisions of P&G, Unilever, and
Dial. Major companies in the commercial sector include US Chemical and divisions of
Ecolab. The industry is highly concentrated with the top 50 companies holding almost 90
percent of the market.
Indian detergent industry profile

Detergents:
The Indian fabric wash market consists of synthetic detergents, Comprising bars, powder, and
liquids and oil-based laundry soaps.

RATIO ANALYSIS
Although the per capita consumption of detergents in India (2.7 kg pa) is

comparable to some countries like Indonesia, China and Thailand (around 2 kg pas), it is
lower than in others such as Malaysia, Philippines (3.7 kg) and the USA (10 kg). The Indian
detergent market is expected to grow at 7-9% pa in volume terms.
The synthetic detergent market can be classified into premium (Surf, Ariel), mid-price
(Rin, Wheel), and popular segments (Nirma), which account for 15%, 40% and 45% of the
total market, respectively. The product category is fairly mature and is dominated by two
players, HLL and Nirma. Nirma created a revolution in the market by pioneering the concept
of low-cost detergents. Currently, the market is highly segmented with the differential
between the premium and popular segments at almost 7X.
Growth:
High consumer awareness and penetration levels will enable the market to grow at an
average 8-10% per annum with slightly higher growth in the rural areas. Higher penetration
stems from popularity of low-cost detergents. Hence, besides increase in per capita
consumption, there is tremendous scope for movement up the value chain.
HLL, Nirma, and P&G are the major players in the market with 40%, 30%, and 12%
share, respectively. While HLL dominates the premium segment, Nirma is the leader in the
popular segment.
Personal Cleaning Products

Personal cleaning products are cleaning agents that are used to wash and clean our
hands, face, body, and hair. These products may include toilet soaps, liquid cleansers, face
wash, shampoos, and conditioners. Personal cleaning products help us remain clean and
healthy by removing dirt, oil, and environmental pollutants from our body. Personal cleaning
products can be categorized into two main types -
 Skin Cleaning Products
 Hair Cleaning Products\
Laundry Cleaning Products:

Laundry cleaning products are detergents and surface active agents that are
manufactured to wash and clean our laundry items. These products come in various forms,
such as detergent cakes, powders, and liquids and are formulated to meet different

RATIO ANALYSIS
requirements of laundry cleaning, such as stain and soil removal, bleaching, fabric softening
and conditioning and disinfectant requirements under the varying temperature, water, and
usage conditions. Laundry Cleaning Products can be categorized into five main types –
 Detergent Powder
 Detergent Cake
 Fabric Softener
 Laundry Liquid
 Stain & Odor Eliminator
Household Cleaning Products:

Household Cleaning Products are cleaners that we use in our homes to wash and clean
different household products, such as furniture, glass, plastic items, and different types of
surfaces. These products help us keep fit and healthy are killing and removing harmful
bacteria and germs from our homes and workplaces. Household Cleaning Products can be
categorized into four main classes -
 Floor Cleaners
 Glass Cleaners
 Toilet Bowl Cleaners
 Wood Cleaners
Dish washing Products:

Dishwashing products are cleaning agents that are formulated to wash and clean
dishes and other kitchen utensils. These products are available for hand wash as well as
machine wash and are made for different water, temperature, and usage conditions.
Dishwashing products can be categorized into four main types -
 Dishwasher Liquid
 Dishwasher Powder
 Dishwasher Gel
 Dishwasher Tablets
Detergent Cake:
A detergent cake is generally an all-purpose laundry cleaning detergent that comes in
the form of a cake. Easy and convenient to use, detergent cakes are generally meant for hand

RATIO ANALYSIS
washing of all washable clothes and fabrics. Detergent cakes are one of the most popular and
widely used detergent products for laundry cleaning. Detergent cakes are generally
formulated using one or more surfactants to improve their cleaning performance and make
them good even for use in hard water conditions.
Formulation:
Detergent cakes are formulated using batch or continuous process of soap making.
These cleansing products contain different ingredients that are used to improve their cleaning
performance. The surfactant play an important role in improving the cleansing action of
detergent by reducing the surface tension of wash liquid thereby improving the wet ability of
washable fabric.
Ingredients:
Some of the important ingredients of detergent cakes include - surfactants, detergent
builders, boosters, brightening agents, synthetic fragrances, colors,
Detergent Powder:
Detergent powders are laundry-cleaning products that are made using a synthetic
surfactant in place of the metal fatty acid salts, which are used in soaps. Made in powder
form, these detergents are also sold as laundry powders, hard surface cleansers, etc. Majority
of the powder detergents has soap in their mixture of ingredients; however they basically
function more as a foam depressant than as surfactant.
The main advantage of detergent powders is that they are easy to use and remove the
dust, dirt, grease, oil and other environmental pollutants with ease and effectiveness.
Detergent powders can be used for hand wash as well as machine wash applications.
Ingredients:
The most common ingredients that are used in making powder detergents are -
Surfactants, optical brighteners, fabric softeners, enzymes, detergent builders, bleaches and
compounds, synthetic perfumes and fragrances, and more.

RATIO ANALYSIS
Soaps & Detergents – Ingredients:

Along with surface active agents, which are prime ingredient in a soap / detergent,
soaps and detergents are made using a variety of ingredients that are added in these products
to give them specific properties and characteristics. Soaps & detergents are cleansing
products essential to public and personal health, soaps and detergents contribute to a good
personal hygiene; reduce the presence of germs, which cause infectious diseases; extend the
useful life of tableware, clothes, linens, surfaces and furnishings; and make our homes and
surrounding more pleasant.
Properties & Functions:

These different ingredients impart different properties and functions in soaps and
detergents and their addition or usage depends on the action or characteristics desired in the
end product. For example, toilet soaps may contain antimicrobial agents to kill or inhibit
bacteria, which can cause odor or disease. Some personal cleaning products may be made
using abrasives for removing stubborn greasy dirt.
Important ingredients that are used in making soaps and detergents are –
 Alkalis
 Glycerin
 Surfactants or Surface Active Agents
 Detergent Builders
 Detergent Boosters
 Detergent Fillers
 Rinse Agents
 Film Removers
 Lime & Rust Removers
 Emulsifiers
 Dry Cleaning Fluid
 Conditioning Agent
 Bleaches & Compounds
 Ammonia

RATIO ANALYSIS
Detergents and health:

Detergents are household chemical cleaning compounds used for laundering and
dishwashing. They contain wetting agents and emulsifiers, based on non-soap synthetic
surfactants. Synthetic detergent powders consist of surface-active agents, builders, and fillers.
A study done to understand the Indian consumer’s knowledge of harmful effects of
detergents on health and environment showed that 77.6 percent of respondents had
experienced some kinds of skin irritation due to detergents.
Of these, the majority comprised of dhobis and rural women. Conventional laundry
detergents leave chemical residues on the clothes. These residues enter our bodies either
through the skin or through the lungs. They cause many common health problems including
allergies, skin infections and in rare cases, cancer.
Detergents and water pollution:

Most laundry detergents in India are phosphate based. Phosphates are a major source
of water pollution that has become the direct cause of 42 per cent of human and animal
diseases. In India, per capita consumption of detergents in 1994 was 2.8 kg per annum. This
is projected to rise to over 4 kg/capita by 2005. In rural areas the use of detergent bars is
expected to grow 7-8 per cent annually.
The figures are of concern because high quality detergents have as much as 35 per
cent STPP in them. According to Prof Narinder K. Kauschik, Professor emeritus for
environmental biology at the Canadian University of Guelph, "the main problem is that of
phosphate-based detergents promoting eutrophication of aquatic environments."
Seasonal impacts:
Run-off of phosphates into water streams is not only due to detergents, but also due to
fertilizers and manures. Findings show that during the dry seasons when the run-off from
agriculture is virtually zero, and manure run-off is down to one fifth of the total annual rate,
detergents are responsible for additional loadings of rivers by about 7.3 per cent which poses
significant eutrophication impact risks. In India, it is not uncommon to see ponds, lakes, and
part of rivers choking with algae or other aquatic plants. In the Indian context, this is a grim
situation since these water bodies are the primary sources of water for a large section of the
population

RATIO ANALYSIS
Regulations:
India has addressed the eutrophication problem only at the level of sewage treatment
plants (STPs). The ever-increasing demand of phosphate-laden detergents in rural areas will
increase eutrophication of the local water bodies that serve as the primary water resource.
Even metropolitan cities like Delhi, Calcutta, Mumbai, and Chennai are partially skewered.
More specifically, only 43 per cent of class I cities and 12 per cent of class II cities are
skewered. Of this only 37 per cent of sewage is partially treated in class I cities and 5 per cent
in class II cities.
Prof. Kaushik reveals that in Canada, and in many states of USA, public pressure has
led to the regulation of phosphates in detergents since early 1970s. According to him these
countries have spent $8.5 billion in 1970s to upgrade sewage treatment plants to remove
excessive phosphates. Canada successfully implemented the appropriate regulation to control
phosphates emission into water systems by limiting the amount of phosphates in laundry
detergents to 0.5%.
Progressive labeling requirements – BIS:

The Bureau of Indian Standards (BIS) has separately laid down the standards for eco-
labeling of detergents in India. Based on the quality, safety and performance of these
detergents, a set of general and specific requirements for an Ecomark have been established.
The specific and general requirements laid down by BIS for ecomarking of detergents states
that they should not contain any phosphate. They also stress that the surfactants issued in the
manufacture of household laundry detergent powders should be readily biodegradable and the
products be packed in packages made of recyclable or biodegradable materials.
Eco-friendly household cleaning powders:

An environmentally superior detergent is the one that makes use of lesser chemical
ingredients. The toxicity of detergents decreases by non-addition of additives like perfumes,
color, and brightening agents. Minimal packaging can also reduce environmental harm
substantially. Synthetic surfactants may be replaced by non-petrochemical surfactants or
vegetable oil soaps; builders like phosphates can be replaced by sodium citrate and sodium
bicarbonate; dyes and fragrances can be eliminated or minimized.

RATIO ANALYSIS
Future Outlook:
Factors such as demographics, environment, globalization, and economy continue to
shape the soaps and detergent industry. The effect of demographic factors can be seen in
different sectors of industry. As the population of a nation grows old, the demand for
cosmetic products with softer colors, milder formulations, and the treatments for aging skin
increases. As the consumers become better educated and informed, there is a fast growing
market for scientifically based soap and detergent products, which at the same time medicate
and beautify.
Mergers & Acquisitions / Globalization:

Due to the saturation of traditional markets and in order to tackle the slow growth in
domestic markets, organizations now days, are creating sophisticated infrastructures and
rationalizing their production so as to make the production process centralized in fewer but
larger plants. This has contributed to standardization of the soap and detergent ingredients
across the globe. Manufacturers are striving to adopt basic formulations for all consumers all
across the world, which can be varied by the addition of some ingredients to satisfy the trends
in local markets.
Another major consequence of M&A trend is the rationalization of brands
in order to realize cost cuts in marketing and branding. Another trend, which is a result of M
&A’s, is the standardization of production process.
Competitive Land scope:

Population growth, especially households with children, drives demand in the
consumer sector, while growth in economy drives demand in the commercial sector. The
profitability of individual companies depends on several factors, such as efficient operations
and effective sales and marketing.
Large companies have scale advantages in domains like buying, manufacturing,
distribution, and marketing. Small companies can effectively compete with large companies
by formulating specialized products, offering superior customer service, or catering a local
market. The industry is capital-intensive with average annual revenue per worker more than $
7, 00,000.

RATIO ANALYSIS
Research & Technology:

The need to meet environmental regulations across the globe various research efforts
was undertaken by the soap and detergent industry during the early 1990s. Sodium
carbonate, Elite, sodium citrate, and sodium nitrate acetate were under investigation as
possible builders to replace phosphates. Other questions that were being addressed, include -
water quality, product safety, chemical disposal, the ability to wash and clean in unheated
water, and indoor air quality.
Although several technological developments and an increasing expanding
understanding of the chemical processes had improved the ability of industry to restore soiled
garments and other objects to their pre soiled condition, available soaps and detergents still
failed to achieve the desired results. Chemical scientists, therefore, continued to work on
developing and formulating innovative cleaning and laundry additives like new enzymes and
oxygen bleaches.
2.2. Company Profile

M/s BHARATHI CONSUMER CARE PRODUCTS PVT LTD; was a newly
started Private Limited Company in 2012, incorporated under the Company’s Act 1956
consisting of with Board of Directors and Managing Director, having registered Office &
Factory situated at Sy.No. 280, 281, PEDDAPARIMI Village, Amaravathi Road,
Nidumukkala (Po), GUNTUR, Andhra Pradesh in which Smt. PARIMALA
MANICKAVEL is the Managing Director of the Company. With her visionable &
dynamic leadership, the company has carved a niche for itself in the market under the
guidance of Sri A.Manickavel. The present running products of its mother Company
BHARATHI CONSUMER CARE PRODUCTS PVT LTD, a Proprietorship company
were transferred to this new Private Limited company BHARATHI CONSUMER CARE
PRODUCTS PVT LTD; from 01.01.2015 onwards under an Assignment deed in between
the two Companies and continuing with all the products of the same brands of Detergent
cakes & Detergent Powders, Dish wash and other running products of BHARATHI
CONSUMER CARE PRODUCTS PVT LTD are producing under the name & style of
BHARATHI CONSUMER CARE PRODUCTS PVT LTD; represented by its Managing
Director Smt. PARIMALA MANICKAVEL and Sri.A.MANICKAVEL as Chairman &
Executive Director of the new Company.

RATIO ANALYSIS
All the data figures and other tables, and graphics given in this profile are relating to
the Proprietorship mother Company BHARATHI CONSUMER CARE PRODUCTS PVT
LTD only, as this new Private Limited Company BHARATHI CONSUMER CARE
PRODUCTS PVT LTD; is started just about three years back only, whereas the mother
Company BHARATHI CONSUMER CARE PRODUCTS PVT LTD is since more than
three decades (-30-years) in the detergent Industry as a significant one. The Chairman &
Executive Director of this new Company Sri A.MANICKAVEL expressed his practical
experience and difficulties faced in establishing the brands by his continuous sincere and hard
work in the field under tough marketing conditions since 1980 to 2012 when he was the
proprietor of BHARATHI CONSUMER CARE PRODUCTS PVT LTD in his words as
given below.
Sri.A.Manickavel, proprietor of BHARATHI CONSUMER CARE PRODUCTS
PVT LTD, came to Guntur in 1980 with Rs.2000/- cash and brought some Detergent cakes
cases of his brother’s soap factory from Chennai by train for livelihood and he sold the soaps
by rickshaw canvassing door to door initially. He slept on folding cots in the Lodge and his
daily sales operations were started from Lodge only by keeping his soaps in a room in the
Lodge and worked sincerely by showing the quality of the soaps by washing before the
public at some centers in Guntur, as the shop keepers rejected even to give placement to his
detergent soaps “Blue Diamond & Bharathi “. Even then he has not disappointed. He
believed in GOD and luck struck him unexpectedly
He got very good response in Guntur, as people started to purchase his Soaps on
seeing the quality and shop keepers also started to purchase his soaps due to consumer
demand unexpectedly. Then he planned to start a small factory at Guntur with an initial
capital investment of Rs.65000/- and started business on 8-7-1981 at Pothurivarithota, Maya
bazaar, Guntur under the name and style of M/s BHARATHI CONSUMER CARE
PRODUCTS PVT LTD. The company was registered under SSI (Small Scale Industry) unit
with District Industries Centre, Guntur.
In the initial stage, his factory was started with 12 workers with manual labour. Later
with his hard work, he earned and shifted to D.No.67/B-1 Gorantla village, Guntur Mandal
in 1985 in his own factory premises with power motors & manual in Guntur for the first time.
The then brand names were Blue Diamond, Bharathi. The main objective is to sell good
quality detergent cakes to middle class and lower class people with low price.

RATIO ANALYSIS
Initially the products were sold at Guntur and Prakasam Districts only. But now his
hard work and maintanace or quality, he has got very good market reputation all over Andhra
Pradesh by appointing sales agents / Distributors at District Head quarters & surrounding
villages. Through its good management and organization, it acquired a good position in the
detergent industry.
He is the most popularized social worker and philanthropist in Guntur. He directly
and indirectly helped the needy like mission and charitable institution, home for the aged and
men tall challenged persons. He was also the President of TAMIL CULUTRAL
ASSOCIATION in Andhra Pradesh.
Growth and Expansion of Bharathi Soap Works

M/s. BHARATHI CONSUMER CARE PRODUCTS PVT LTD was expanded
with their day to day production capacity and supply of goods from time to time. Initially,
M/s. Bharathi Consumer Care Products Pvt Ltd capital investment is Rs.65, 000/- but shortly
the investment was reached to Rs.64, 98,817/-, hundred times.
With M/s. Bharathi Consumer Care Products Pvt Ltd good marketing and
promotional activities, its turnover was reached to Rs.8.71 cores during the year 2022-2023
when compared to Rs.24 lakhs at the initial stage.
M/s. BHARATHI CONSUMER CARE PRODUCTS PVT LTD was initially
manufactured only medium quality products and gradually started to manufacture Premium
and Economy quality products within a short period. With the increasing market share and to
face the competition, it started to introduce new brands by maintaining different styles of
packing to suit the desires of the consumers.
He was also president for the Nadargal Munnetra sangam. This Sangam is running a
school under the name of Kamaraj Public School at Tadepalli mandal of Guntur district,
Andhra Pradesh. This school is providing good education to poor students who are
financially poor.

RATIO ANALYSIS
Social activities
He was also enjoyed one more honorable post as president of WALC Foundation
(welfare artificial limb centre) at Guntur. Under this foundation he was providing monetary
support to this association for providing freely artificial legs to the handicapped poor people.
He is also interested to participate in the spiritual, cultural and sports activities in the city and
entire AP and donating the funds to the conductors & participants.
BHARATHI CONSUMER CARE PRODUCTS PVT LTD PRODUCTS’ - SALES

TURNOVER
YEAR PRODUCTS SALES TURNOVER ( Crores)
2015-2016 Detergent Cake & powder 5218496.20

M/s BHARATHI CONSUMER CARE PRODUCTS PVT LTD initially

manufactured only medium products now they are manufacturing Premium, Economy quality
products. To face competition by improving market share they introduced different type’s
new brands and packing styles to suit the desires of the consumers.
The main aim of the company M/s BHARATHI CONSUMER CARE PRODUCTS
PVT LTD was to supply quality products to consumers. Quality is more important than
profit. It is the key factor for the success of the company. The company stress upon the
quality of the products rather than its profit margins.
This motivational policy was to earn huge market share at all places of southern India.

RATIO ANALYSIS
AWARDS & CERTIFICATES WON BY THE COMPANY

BHARATHI CONSUMER CARE PRODUCTS PVT LTD
1) “ The best Entrepreneur of the State ” Award for the year -2005 received on
26.01.2005,
2) The prestigious award “Indira Gandhi Sadbhavana” Award for the year – 2005,
3) Bharathi Consumer Care Products Pvt Ltd is an “ISO 9001:2000 Certified
Organization,
4) Certification from “MOODY International Certificate”,
5) Ukas Quality Management Certification,
6) Guntur District “Best Industrialist” Award received,
7) The prestigious “Seva Ratna” Award for the Year – 2012, received on 02-10-2012.
8) M/s. Bharathi Consumer Care Products Pvt Ltd was also recognized under the Nielsen top
10 list of Regional Brands recently, after conducting National survey by M/s. Nielsen
India and also published on the popularity of its (BHARATHI CONSUMER CARE
PRODUCTS PVT LTD) quality detergent soaps and Washing Powder viz Triple-X
(XXX), Blue Diamond, Green Diamond, Magic like 10 brands of washing soap in the
National daily news paper “The Economic Times” on 26-10-2012.
9) M/s. Bharathi Consumer Care Products Pvt Ltd Company was awarded “BEST
MANAGEMENT AWARD” for the year 2015 as declared by the Government of Andhra
Pradesh and the same was received by the proprietor Sri Arunachalam Manickavel
through the hands of Hon’ble Chief Minister Sri Nara Chandra Babu Naidu garu on the
eve of May Day function held at Rajahmundry on 01-05-2015.
The secret behind the success of any famous or growing industry is nothing but the sincere
and hard working of both the Management and workers by mutual understanding and respecting
each other under the coordination and moving towards aimed goal with dedication cooperatively
for the growth of the Industry unto last. In other words, the Management and workers are the
two wheels of a cart in an Industry and if any one of the wheels is damaged, the cart cannot
move to reach the destination. Or otherwise, the Industry will be collapsed if Management and
workers differ each other and move in different way. Both categories should move like one
family to reach their goals and to run the Industry successfully for mutual benefit. Management
must recognize the worker /employee, by encouraging him on his achievements in his work from

RATIO ANALYSIS
time to time, so that he will sacrifice his whole time in his work sincerely to get better
appreciation and recognize from the Management side. Many multinational Companies are
adopting the system of “Kaizen” as universally accepted to get more productivity from the
worker/employee, i.e.extraction of maximum productivity in minimum time.
“KRUSHITO NAASTHI DURBHIKSHAM “
BHARATHI CONSUMER CARE PRODUCTS PVT LTD

The recently started new company BCCPPL (BHARATHI CONSUMER CARE
PRODUCTS PVT.LTD.), are installed with fully automatic machinery to increase their
production capacity into 4 times, so has to supply their products in time to meet the ongoing
market competition in full swing.
The company is also giving preference in marketing services by appointing field force
to cover all over nationwide markets by collecting day to day information and regarding
quality complaints and product supply as feedback on day to day basis and resolving the
problems on immediate attention by rectifying the same from time to time to create consumer
satisfaction at all levels by maintaining their regular market share. They are also planning to
launch their products on nationwide markets in other states also shortly.
They are also planning to enter into food division of daily needs with R&D facilities.
They are feeling as Customer satisfaction is their own satisfaction. They are also entering into
new ventures in the fields of DETERGENT LIQUID, FLOOR CLEANER, TOILET
CLEANERS, MULTIPURPOSE CLEANER, and SHAMPOOS & WASHING
MACHINE DETERGENT POWDER, suitable to both Top load and front load Washing
machines shortly. Although the company is started Three decades back, the company was
grown with Jet speed, by facing the tough competitors, keeping in view of middle class and
lower class people by producing various types of consumer goods by selling on reasonable
rates suitable to the pockets of all kinds of consumers with their dedicated servicing mode.
Workers of bharathi consumer care products pvt ltd

At present 75 workers are at production department and 5 employees at office, 2
employees at canteen and 18 employees as motor transport workers. The company provides
complete facilities to its workers and employees.

RATIO ANALYSIS
As it provides complete assistance and facilities to the employees, workers

dedicatedly contribute to increase its market share.
The working environment brings about a pleasant atmosphere and enables the
employees work dedicatedly, and also he is providing employment for more than 1000
families indirectly for marketing his products all over Andhra Pradesh.
Quality policy of the company

“Satisfying the costumers by providing quality products and services and striving
towards continual improvements” at all levels under strict vigilance
Quality objectives
 To improve sales compared to last year.
 To improve the customer satisfaction level.
 To reduce the wastage in production process.
 To update the knowledge of the employees.
 To continuously improve the process in all sections from time to time.
Quality maintenance of Bharathi consumer care products pvt ltd

 The main aim of M/s BHARATHI CONSUMER CARE PRODUCTS PVT LTD is
to supply quality products to its consumers, since quality is more important than
profit. It is the key for the success of the company
 The company stress upon the quality of the products rather than its profit margins.
This motive earned huge market at all places in Andhra Pradesh.
 The company is strictly adopting quality preference only in purchases of raw
materials, as well as delivery of finished goods and they assure customer that they
never compromise with quality at all stages.
 Quality assurance demands a degree of detail in order to be fully implemented at
every step.
 Planning, for example, could include investigation into the quality of the raw
materials used in manufacturing, the actual assembly, or the inspection processes
used.

RATIO ANALYSIS
 The Checking step could include customer feedback, surveys, or other marketing
vehicles to determine if customer needs are being attended or not. If not, what are the
seasons?
 Acting could mean a total revision in the manufacturing process in order to correct a
technical or cosmetic flaw.
 Competition to provide specialized products and services results in breakthroughs as
well as long-term growth and change.
 Quality assurance verifies that any customer offering, regardless if it is new or evolved
is produced and offered with the best possible materials, in the most comprehensive
way, with the highest standards.
Production capacity of bharathi consumer care products pvt ltd.

Company has an excellent production capacity of 150 Tons of Detergent cakes per
day as per infrastructure. The present installed production capacity is 60 To 70 Tons of
Detergent cakes per day and 20 Tons of washing powder per day. The machines are operated
according to the demand in the market.
Products leave factory only after thorough quality check in the laboratory with
qualified technicians under proper supervision at all levels, and it is all done before reaching
to market, so as to satisfy the customers and they feel proud of customer satisfaction.
The main aim of M/S.Bharathi Consumer Care Products Pvt. Ltd. is to supply
quality products to its consumers. Quality is more important than profit. It is the key for the
success of the company.
The Company is also launched a SOLAR POWER PLANT near the Factory under
the name and style of BSP (BHARATHI SOLAR POWER) on 09-07-2014 at
Nidumukkala(v), AmaravthiRoad, GUNTUR(Dist), AP., and supplying the generated power
to Govt. Grid so as to help to society during this Power shortage period by providing
employment to new employees.
The company BHARATHI CONSUMER CARE PRODUCTS PVT. LTD recently
launched their new product “COCORACO” tooth paste (siddha Ayurveda) as consumer
care product under the name and style of BCCPPL which is accepted by the consumer and
moving in the market.
The company is planning to launch XXX CHANDANA bath soap based on turmeric
and sandal wood oil after some modifications to the consumers shortly which is under R&D

RATIO ANALYSIS
final testing. The recently started company BCCPPL (BHARATHI CONSUMER CARE
PRODUCTS PVT. LTD.) Is installed with fully automatic machinery to increase their
production capacity into 4 times, so has to supply their products in time to meet the ongoing
market competition in full swing.
The company is also giving preference in marketing services by appointing field force
to cover all over the in land and out land markets by collecting day to day information and
regarding quality complaints and product supply as feedback on day to day basis and
resolving the problems on immediate attention by rectifying the same from time to time to by
spot replacement of the complaint products received if any to create consumer satisfaction at
all levels by maintaining their regular market share. They are also planning to launch their
products on abroad markets shortly.
Future plans of bharathi consumer care products pvt ltd

The company is also planning to enter into food division of daily needs with R&D
facilities. They feel as Customer satisfaction is their own satisfaction. They are also entering
into new ventures in the fields of DETERGENT LIQUID, FLOOR CLEANER, TOILET
CLEANERS, MULTIPURPOSE CLEANER, SHAMPOOS & WASHING MACHINE
DETERGENT POWDER (XXX MATIC) suitable to both to Top and front load Washing
machines. Although the company is started -3- years back, the company is growing like Jet
speed facing the tough competitors, keeping in view of middle class and low class people by
producing various types of consumer goods by selling on reasonable rates suitable to the
pockets of all kinds of consumers with their dedicated servicing mode.
BHARATHI CONSUMER CARE PRODUCTS PVT. LTD. - PRODUCTS
S.N PRODUCTS BRAND NAME

O
 BLUE DIAMOND
1. DETERGENT SOAPS / CAKES  TRIPLE-X ( XXX )
 MAGIC

RATIO ANALYSIS
 GREEN DIAMOND
 THREE DIAMOND’S
 SAREGAMA
2. DETERGENT POWDER / WASHING
POWDER  XXX SILVER FOAM
 XXX SILVER LINE
 XXX HI-POWER
 XXX LAVENDER
 MAGIC
3. DISH WASH CAKES (ROUND & BAR ) . XXX RUF & TUF
4. BATH SOAP ( AYURVEDIC ) . XXX LAHARI
5. TOOTH PASTE (AYURVEDIC ) XXX COCORACO
At present BHARATHI CONSUMER CARE PRODUCTS PVT. LTD. is producing - 40 –

varieties of detergent cakes and detergent powders, dish wash cakes etc under different brand
names as given below. Among them, XXX (Triple-X) brand is the premium brand of the
company.
XXX brand detergent cakes (varieties):- for the year 2022-2023
PRODUCT NAME : Triple X (XXX) MORE WASH
1
TYPE : Detergent Cake
WEIGHT : 300 gms.
M.R.P. : Rs.25-00
FREE OFFER : Rs.5/-worth XXX Det. Powder pouch free
--------------------------------------------------------------------------------------------
PRODUCT NAME : Triple X (XXX) BAR

2

RATIO ANALYSIS
WEIGHT : 300 gms.

M.R.P. : Rs.25-00
FREE OFFER : -----
PRODUCT NAME : Triple X (XXX) EASY WASH

3
WEIGHT : 250 gms.
M.R.P. : Rs.23-00
PRODUCT NAME : Triple X (XXX) ACTION SOAP

4
WEIGHT : 250 gms.
M.R.P. : Rs.17-00
FREE OFFER : -----
--------------------------------------------------------------------------------------------
PRODUCT NAME : Triple X (XXX) WHITE
5
WEIGHT : 250 gms.
M.R.P. : Rs.18-00
FREE OFFER : -----
PRODUCT NAME : Triple X (XXX) MOR WASHES (Medium)

6
WEIGHT : 150 gms.
M.R.P. : Rs.10-00
FREE OFFER : -----

RATIO ANALYSIS
--------------------------------------------------------------------------------------------
PRODUCT NAME : Triple X (XXX) QUICK WASH
7
WEIGHT : 250 gms.
M.R.P. : Rs.25-00
FREE OFFER : Bucket FREE offer for 12 Soaps purchase of WHITE / BLUE
--------------------------------------------------------------------------------------------
RODUCT NAME : Triple X (XXX) MORE WASHES (Medium)
8
WEIGHT : 165 gms.
M.R.P. : Rs.10-00
FREE OFFER : -----
--------------------------------------------------------------------------------------------
PRODUCT NAME : Triple X (XXX) Lavender (WHITE / ROSE)
9
WEIGHT : 150 gms.
M.R.P. : Rs.10-00
FREE OFFER : -----
--------------------------------------------------------------------------------------------
PRODUCT NAME : Triple X (XXX) SMALL
10
WEIGHT : 125 gms.
M.R.P. : Rs.10-0
PRODUCT NAME : SUPER Triple X (XXX)

11

RATIO ANALYSIS

WEIGHT : 125 gms.
M.R.P. : Rs.8-00
FREE OFFER : -----
--------------------------------------------------------------------------------------------
PRODUCT NAME : Triple X (XXX) MORE WASHES (Mini)

12
WEIGHT : 80 gms.
M.R.P. : Rs.5-00
FREE OFFER : ------
DIAMOND BRAND DETERGENT CAKES (VARIETIES):-
PRODUCT NAME : BLUE DIAMOND (BIG)

13
WEIGHT : 200 gms.
M.R.P. : Rs.12-00
FREE OFFER : -----
--------------------------------------------------------------------------------------------
PRODUCT NAME : BLUE DIAMOND
14
WEIGHT : 125 gms.
M.R.P. : Rs.7-00
FREE OFFER : -----
--------------------------------------------------------------------------------------------
PRODUCT NAME : THREE DIAMOND’s (3 Diamonds)

15
RATIO ANALYSIS

WEIGHT : 300 gms.
M.R.P. : Rs.16-00
FREE OFFER : -----
--------------------------------------------------------------------------------------------
PRODUCT NAME : GREEN DIAMOND
16
WEIGHT : 125 gms.
M.R.P. : Rs.7-00
FREE OFFER : -----
--------------------------------------------------------------------------------------------
PRODUCT NAME : MAGIC

17
WEIGHT : 200 gems.
M.R.P. : Rs.10-00
FREE OFFER : -----
--------------------------------------------------------------------------------------------

18
WEIGHT : 100 gms.
M.R.P. : Rs.5-00
FREE OFFER : -----
--------------------------------------------------------------------------------------------

RATIO ANALYSIS
PRODUCT NAME : NEW SAREGAMA

19
WEIGHT : 300 gms.
M.R.P. : Rs.16-00
FREE OFFER : -----
--------------------------------------------------------------------------------------------
PRODUCT NAME : CHAMP SAREGAMA

20
WEIGHT : 100 gms.
M.R.P. : Rs.5-00
FREE OFFER : -----
------------------------------------------------------------------------------------------------
Triple X (XXX) BRAND DETERGENT POWDER (VARIETIES):-
PRODUCT NAME : Triple X (XXX) SILVER FOAM

21
TYPE : Detergent Powder
WEIGHT : 1 Kg.
M.R.P. : Rs.60-00
FREE OFFER : 250 gms. XXX Action Soap free worth Rs.17/-
--------------------------------------------------------------------------------------------
PRODUCT NAME : Triple X (XXX) HI-POWER
22
WEIGHT : 1 Kg.

RATIO ANALYSIS
M.R.P. : Rs.65-00
FREE OFFER : 200 gms. XXX RUF & TUF Big Dish washes cake
--------------------------------------------------------------------------------------------
PRODUCT NAME : Triple X (XXX) LAVENDER
23
WEIGHT : 1 Kg.
M.R.P. : Rs.55-00
FREE OFFER : ----
--------------------------------------------------------------------------------------------
PRODUCT NAME : Triple X (XXX) SILVER LINE

24
WEIGHT : 3 Kg.
M.R.P. : Rs.300-00
FREE OFFER : Plastic Bucket + XXX Cocaraco Tooth Paste free
--------------------------------------------------------------------------------------------
25
WEIGHT : 5 Kg.
M.R.P. : Rs.275-00
FREE OFFER : ------
--------------------------------------------------------------------------------------------
26
WEIGHT : 500 gms.
M.R.P. : Rs.31-00

RATIO ANALYSIS
FREE OFFER : 65 g. Mini XXX Soap
--------------------------------------------------------------------------------------------

27
WEIGHT : 500 gms.
M.R.P. : Rs.28-00
FREE OFFER : -----
--------------------------------------------------------------------------------------------
PRODUCT NAME : Triple X (XXX) HI-POWER
28
WEIGHT : 500 gms.
M.R.P. : Rs.28-00
FREE OFFER : 100 gms. XXX RUF & TUF Small – Dish wash cake
--------------------------------------------------------------------------------------------

29
WEIGHT : 300 gms.
M.R.P. : Rs.20-00
FREE OFFER : -----
--------------------------------------------------------------------------------------------

30
WEIGHT : 170 gms.
M.R.P. : Rs.10-00

RATIO ANALYSIS
FREE OFFER : -----

--------------------------------------------------------------------------------------------

31
WEIGHT : 75 gms.
M.R.P. : Rs.5-00
FREE OFFER : -----
--------------------------------------------------------------------------------------------
PRODUCT NAME : Triple X (XXX) POWDER POUCH (High Power)

32
WEIGHT : 75 gms.
M.R.P. : Rs.5-00
FREE OFFER : -----
--------------------------------------------------------------------------------------------
PRODUCT NAME : Triple X (XXX) POWDER POUCH
33
WEIGHT : 30 gems.
M.R.P. : Rs.2-00 (Two rupees)
FREE OFFER : -----
PRODUCT NAME : Triple X (XXX) POWDER POUCH

34
WEIGHT : 12 gms.
M.R.P. : Rs.1-00 (One Rupee)

RATIO ANALYSIS
FREE OFFER : -----

--------------------------------------------------------------------------------------------

35
WEIGHT : 1 Kg.
M.R.P. : Rs.45-00
FREE OFFER : -----
--------------------------------------------------------------------------------------------

36
WEIGHT : 3 Kg.
M.R.P. : Rs.250-00
FREE OFFER : Plastic Bucket
--------------------------------------------------------------------------------------------
DISH WASH CAKES (VARIETIES):-
PRODUCT NAME : Triple X (XXX) RUF & TUF

37
TYPE : Round Dish wash
WEIGHT : 500 gms.
M.R.P. : Rs.40-00
FREE OFFER : Scrubber
--------------------------------------------------------------------------------------------
38
TYPE : Round Dish wash
WEIGHT : 250 gms.

RATIO ANALYSIS
M.R.P. : Rs.23-00
FREE OFFER : Scrubber
--------------------------------------------------------------------------------------------
39
TYPE : Dish wash cake (Big)
WEIGHT : 200 gms.
M.R.P. : Rs.10-00
FREE OFFER : -----

40
TYPE : Dish wash cake (Small)
WEIGHT : 100 gms.
M.R.P. : Rs.5-00
FREE OFFER : -----
PRODUCT NAME : XXX COCORACO

41
TYPE : HERBAL TOOTH PASTE (SIDDHA AYURVEDIC)
WEIGHT : 40 gms.
M.R.P. : Rs.20-00
FREE OFFER : -----
Worker’s Welfare of Bharathi Consumer Care Products Pvt. Ltd.

At present there are 76 workers at production department and 5 employees at office, 2
employees in the canteen and 17 employees as transport workers. The company provides
complete assistance and facilities to the employees, workers dedicatedly contributed to
increase its market share.

RATIO ANALYSIS
The working environment brings about a pleasant atmosphere and enables the
employees work dedicatedly. And also he is providing employment for mare than 1000
families in directly for marketing his products all over southern India.
ORGANIZATION STRUCTURE OF BHARATHI CONSUMER CARE PRODUCTS
PVT. LTD.
MANAGING
DIRECTOR
(M.D.)
CHAIRMAN & DIRECTORS

EXECUTIVE DIRECTOR
General FINANCE PRODUCTIO ELECTICAL

Transport
Manager MANAGE N MANAGER SECTION
(Gm) R
Section Legal
Manager
Super Machinery
Accounts Sec. Drivers
Visors
Asst Dept
General
Manager
(Agm)
Workers
Chemist & Wrappers &
Rd Packing
Section
Marketing Sales Field

Manager Staff
(REPS.)

RATIO ANALYSIS
CHAPTER-III
DESIGN OF THE STUDY
Finance is the study of how investors allocate their assets over time under
conditions of certainty and uncertainty. A key point in finance, which affects decisions, is the
time value of money, which states that a dollar today is worth more than a dollar tomorrow.
Finance measures the risks vs. profits and gives an indication of whether the investment is
good or not.
A project is an activity sufficiently self-contained to permit financial and
commercial analysis. In most cases projects represent expenditure of capital funds by pre-
existing which want to expand or improve their operation.
In general a project is an activity in which, we will spend money in expansion of
returns in which logically seems to lead itself planning. Financing and implementations as a
unit, is a specific activity with a specific point and a specific ending point intended to a
accomplish a specific objective of the study.
Capital budgeting has its going in the natural recourse and infrastructures sectors.
The current demand for infrastructures and capital investments is being fueled by
deregulation in the “FMCG” (Fast Moving Consumer Goods), Telecommunication, &
Transportation sectors, by the globalization of product markets and the needs from
manufacturing scale and by the privatization of government owned entities in developed
countries & developing.
Understanding the organization’s financial health is a fundamental aspect of
responding to today’s increasingly stringent financial reporting requirements. To avoid risks,
organizations must quickly
 Identify ascertain financial ratios and trends across in liabilities and assets
 Analyze and adjust planned and forecasted amounts
 Act to provide regulatory statements as needed
Financial management is a process of identification, accumulation, analysis,
preparation, interpretation communication of financial information and communication of
financial information to plan, evaluate, and control business firms.
Financial management is the specialized function of general management, which, is relates to
the procurement of finance, and its effective utilization for the achievement of the goal of the
organization.

RATIO ANALYSIS
3.1 Nature and scope of financial management:

 Financial management is a branch of business management, which is associated with
future planning, Organization, co-ordination and control.
 Financial management provides a sound base to all managerial decisions.
 Production, research and development decisions based on financial management.
 Financial management is a scientific and analytical analysis.
 In the process of decision making and financial analysis modern mathematical
techniques are used. Managing a firm is both science and an art.
 An analysis of the various definitions mentioned above make it clear that financial
management is concerned with the proper management of funds keeping in view the
enterprise objectives.
 The financial manager should look after that the funds are procured in a manner that
the risk and cost consideration are properly balanced and there is optimum utilization
of funds.
The present chapter deals with the objectives of the study & methodology adopted.
Methodology includes sources of data collection, analysis of data and limitation of the study.
3.2. Need for the study:

After the liberalization, many MNC’S entered in to the market. Financial analysis
must require for a company in this cut through competition. Because of that reason ratio
analysis is used in analyzing the firm’s position. Known that fact the success of an
organization depends up on the financial management. This situation has created an interest
to study and analysis some of the financial aspects of this corporation. Hence a study may be
undertaken on financial analysis through ratio in Bharathi Consumer Care Products Pvt Ltd.
Dividend Decision:
Dividend decision is the third 1 major financial decision. The financial manager must
decide whether the firm should distribute all profits, or retain them, or distribute a portion and
retain the balance. Like the debt policy, the dividend policy should be determined in terms of
its impact on the shareholder’s value.

RATIO ANALYSIS
Liquidity Decision:
Current assets manager that affects a firm’s liquidity is yet another important finances
function, in addition to the management of long-term assets. Current assets should be
managed efficiently for safeguarding the firm against the dangers of liquidity and insolvency.
Investment in current assets affects the firm’s profitability, liquidity and
3.3 Objectives of the study

Keeping in view of above – mentioned facts, the following are the objectives of the study.
Objectives:
 To analyze the financial performance of the firm through calculation of various
ratios.
 To study the financial strengths and weakness of the firm.
 To evaluate the capital structure of the firm through leverage rations.
 To find out the reasons of the problem and to evaluation possible way of the
resolving the problem.
3.4 Methodology of the study

The data related to the financial statements of the Bharathi Consumer Care Products
Pvt Ltd, Guntur and information relating to the “Ratio Analysis” has been collected using
primary and secondary data.
Primary Data:
Primary data for the study was collected from accountants, account officers and
financial department head, personal interaction and observation.
Secondary Data:
Secondary data means the data that already available that is they refer to the data which
have been already collected by someone else and which have been processed. The data is
collected from 5 years i.e. 2017 to 2022.
 Annual reports.
 Audit reports.
 Text books & journals.
 Company’s website

RATIO ANALYSIS
3.5 Limitations of the study

The entire study is based on financial data this is provided by the company’s financial
statements. Therefore the following are the limitations of the study.
 The study is limited to a period of 8 weeks.
 Calculated ratio may not be future indicators.
 Ratio analysis is the only tool used for evaluating the financial performance of the
firm.
 The study is based on the information provided by the company

RATIO ANALYSIS
CHAPTER- IV
DATA ANALYSIS AND INTERPRETATION
Present chapter deals with analysis and interpretation of data. The data was analyzed
with the help simple statistical tools such as averages. The data is depicted in the form of bar
charts and tables.
Liquidity ratios:
Current ratio:
Current ratio always known as working capital ratio. Current ratio indicates the
liquidity of current assets or the ability of a business to meet its current obligations. The ideal
form of the ratio is two to one (2:1) that means two times of current assets to one time of
current liabilities.
Current ratio = Current Assets / Current Liabilities
Table and Graph No 4.1: Current Ratio for the year ended 2021-2022
Year Current Assets Current Liabilities Ratio
2017-18 15550535.74 20417516.75 0.767
2018-19 24913042.09 32487368.28 0.766
2019-20 35241872.90 29090342.69 1.211
2020-21 67160506.78 37294274.05 1.800
2021-22 81984258.99 23215999.72 3.531
Interpretation:
The company current ratio slightly changed from year to year since 2019-2020.
The company current ratio has been increasing from year to year from 2020-2021.
Company current assets had fluctuation occurred during the study period from the year 2022.

RATIO ANALYSIS
Quick ratio:
The quick ratio or the acid ratio test ratio as it is some times called, is concerned with
the relationship between liquid assets and liquid liabilities to supplement the information
given by the current ratio. The ideal norm of this ration 1 : 1 that means equal proportion of
liquid or current assets to current liabilities. Inventories are not included in current assets for
the purpose of this ratio.
Quick ratio = Quick assets / Current liabilities
Table and Graph No 4.2: Quick Ratio for the year ended 2021-2022
Year CURRENT ASSETS Current Liabilities Ratio
2017-18 5148952.02 20417516.75 0.252
2018-19 3422915.78 32487368.28 0.105

2019-20 17640901.21 29090342.69 0.606
2020-21 31852751.33 37294274.05 0.854
2021-22 31216652.09 23215999.72 1.344
Interpretation:
The company quick ratio slightly changed from year to year since 2017-2017.
The company quick ratio has been decreasing in the year 2018-2019.
The company quick ratio has been increasing in the year 2019-2020.

RATIO ANALYSIS
The company quick ratio has been increasing in the year 2021-2022.
Absolute liquidity ratio:
The absolute liquidity ratio is also known as super quick ratio. Through receivables
are generally more liquid in nature than inventories. There may be doubts regarding the real
stability of debts. Therefore, absolute liquidity ratio related the sum of cash and marketable
securities to the total current liabilities.
Absolute liquidity ratio = Cash / Current Liabilities
Table and Graph No 4.3: Absolute Liquidity Ratio for the year ended 2021-2022
Year Cash Current Liabilities Ratio
2017-18 2875200.13 20417516.75 0.140
2018-19 1140501.80 32487368.28 0.035
2019-20 2348732.97 29090342.69 0.080
2020-21 11207397.81 37294274.05 0.300
2021-22 396810.09 23215999.72 0.170
Interpretation:
Company cash ratio had been decreasing from 2017-2018 i.e. 0.140 – 0.035.
Company cash ratio has maintained cash lowest is 285.179 in the year 2018-2019.
Company cash ratio had been decreasing from 2021-2022.

RATIO ANALYSIS
Leverage ratios:
Debt equity ratio:
The debt equity ratio is the measure of relative claims of creditors and owners against
the firm’s assets. There are various interpretations of debt and equality and therefore debt-
equity may be calculated in number of ways.
The term debt considered here is exclusive of current liabilities and equity refers to
own funds. A high ratio shows that the claims of creditors are grated than those of owners. A
low ratio implies a greater claim of owners that that of creditors. An ideal norm of the ratio is
1:1.
Debt equity ratio = Long term debt / Capital
Table and Graph No 4.4: Debt equity ratio for the year ended 2021-2022
Year Debt Capital Ratio
2017-18 17051980.83 19623142.25 0.868
2018-19 18136397.03 18008338.85 1.007
2019-20 27184487.39 31178034.86 0.871
2020-21 27556646.17 58605672.05 0.470
2021-22 75896572.53 66515128.03 1.141
Interpretation:
The ratio was decreased in the year 2020-2021
The ratio was increased in the year 2021-2022. A firm with a high debt equity ratio exposes
its creditors to greater risk.

RATIO ANALYSIS
Activity ratios:
Debtors turnover ratio:
Debtors constitute an important constituent of current assets quality of debtors
determines to a great extent a firms liquidity debtors turnover ratios is very important as it
depicts the efficiency of the staff entrusted with the task of collection from debtors.
Debtor turnover ratio = Sales / Average debtors
Average debtors = Opening Debtors + Closing Debtors / 2
Table and Graph No 4.5: Debtor turnover ratio for the year ended 2021-2022
Year Sales Avg. Debtors Ratio
2017-18 87119174.47 2682606.63 32.475
2018-19 101199557.00 1780867.71 56.826
2019-20 190969819.09 4638186.50 41.173
2020-21 344323299.36 11322551.14 30.410
2021-22 422842627.78 17483608.26 24.185
Interpretation:
The ratio has been decreased in the year 2019-2020.
The ratio has been decreased in the year 2021-2022 compared to the previous years. It
indicated that the chances of bad debts are less.

RATIO ANALYSIS
Debtor collection period ratio:

This ratio indicates the extent to which the debts have been collected in time the debt
collection period indicates the average debt collection period this ratio is a good indicator to
the lenders of the firm, because it explains to the whether their barrower from its debt in time.
Debtor collection period ratio = 365 / Debtors turnover ratio
Receivables = Debtors + Bills receivables.
Table and Graph No 4.6: Debtor Collection Period Ratio for the year ended 2021-2022
Year Days Debtors Turnover ratio Ratio
2017-18 365 32.475 11.239
2018-19 365 56.826 6.423
2019-20 365 41.173 8.865
2020-21 365 30.410 12.002
2021-22 365 24.185 15.091
Interpretation:
Debtor’s collection period ratio increased in the year 2019-2020.
Debtor’s collection period ratio has been increased, because debtor turnover ratio fluctuated
year to year.

RATIO ANALYSIS
Total assets turnover ratio:

The relation ship between sales with total assets is called “total assets turnover ratio”.
The total assets turnover ratio is calculated by dividing the value of the total assets into that
on net sales. A high ratio indicates over trading of fixed assets while a low ratio shows
excessive investments – a symptom of idle capacity. The traditional standards for the ratio are
two times.
Total assets turnover ratio = Net sales / Net total assets.
Table and Graph No 4.7: Total assets turnover ratio for the year ended 2021-2022
Year Net Sales Total Assets Ratio
2017-18 87119174.47 56569237.53 1.54
2018-19 101199819.00 68328702.16 1.48
2019-20 190969819.09 86829462.94 2.19
2020-21 344323299.36 122833190.27 2.80
2021-22 422842627.78 165004298.28 2.56
Interpretation:
The ratio has been increased in the year 2019-2020.
The ratio has been increased in the year 2020-2021.
The total assets turnover ratio decreased in the year 2021-2022. It indicates that the trading of
total assets is less compared with previous year.

RATIO ANALYSIS
Working capital turnover ratio:

Working capital turnover ratio indicates the velocity of the utilization of net working
capital. This ratio indicates the number of times the working capital is turnover in the course
of year. This ratio measures the efficiency with which the working capital is being used by
the firm. A higher the ratio indicates the efficient utilization of working capital and the low
ration indicates otherwise.
Working capital turnover ratio = Net sales / Net working capital
Net working capital = Current assets – Current liabilities.
Table and Graph N0 4.8: Working capital turnover ratio for the year ended 2021-2022
Year Sales Working Capital Ratio
2017-18 87119174.47 -4866981.01 -17.90
2018-19 101199557.00 -7574326.19 -13.36
2019-20 190969819.09 6151530.21 31.04
2020-21 344323299.36 29866232.73 11.53
2021-22 422842627.78 58768259.27 7.19
Interpretation:
The ratio has been increased from -13.36 to 31.4 since the year 2018-2019.
In the year 2019-2020 the ratio decreased from 31.04 to 29.24.
In the year 2020-21 the ratio decreased from 11.53 to 7.19. It indicates the inefficiency
utilization of the firm’s funds. However, it should not result in overtrading.

RATIO ANALYSIS
Fixed assets turnover ratio:

This ratio measures the efficiency of the assets use. The efficient use of assets will
generate greater sales per rupee invested in all the assets of a concern. The inefficient use of
the asset will result in low sales volume coupled with higher overhead charges and under
utilization of the available capacity. This ratio expresses the number of times fixed assets are
being turned-over in a stated period.
Fixed assets turnover ratio = Net sales / Net fixed assets
Table and Graph No 4.9: Fixed assets turnover ratio for the year ended 2021-2022
Year Sales Fixed assets Ratio
2017-18 87119174.47 41018701.79 2.123
2018-19 101199557.00 43415660.07 2.330
2019-20 190969819.09 51587590.04 3.701
2020-21 344323299.36 55672683.49 6.184
2021-22 422842627.78 83020039.29 5.093
Interpretation:
Fixed assets turnover ratio has been increased in the year 2021.
Fixed assets turnover ratio has been decreased in the year 2022. It indicates the firm is not
utilize the fixed assets in a better manner.

RATIO ANALYSIS
Inventory turnover ratio:

It denotes the speed at which the inventory will be converted into sales, thereby
contributing for the profits of the concern. This ratio establishes relationship between cost of
goods sold during a given period and the average amount of inventory held during that
period. Higher the ratio, the better it is because it shows that finished stock is rapidly turned-
over.
Inventory turnover ratio = Cost of goods sold /Average stock
Cost of goods sold = Sales – Gross profit
Average stock = Opening stock + Closing stock/2
Table and Graph No 4.10: Inventory turnover ratio for the year ended 2021-2022
Year Cost of goods sold Average stock Ratio

2017-18 61218669.03 10122406.57 6.04
2018-19 68920340.27 14971195.51 4.60
2019-20 128867284.52 17803656.50 7.23
2020-21 206000409.91 24541202.99 8.39
2021-22 287400779.87 41162650.10 6.98
Interpretation:
Inventory turnover ratio has been increased in the year 2021.
Inventory turnover ratio has been decreased in the year 2022. It shows that finished stock is
not rapidly turned-over.
Profitability ratios:

RATIO ANALYSIS
Gross profit ratio:

The gross profit ratio indicates the extent to which selling prices of goods per unit
may decline with out resulting the losses on operations of a firm. This reflects the efficiently
with which the firm produces its products. There is no standard norm of the gross profit ratio.
Gross profit ratio = Gross profit / Net sales X 100
Table and Graph No 4.11: Gross profit ratio for the year ended 2021-2022
Year G.P. Net Sales Ratio
2017-18 25900505.44 87119174.47 29.729
2018-19 32279216.73 101199557.00 31.896
2019-20 62102534.57 190969819.09 32.519
2020-21 138322889.45 344323299.36 40.172
2021-22 135441847.91 422842627.78 31.321
Interpretation:
In the year 2019-2020 gross profit ratio has increased.
In the year 2020-2021 gross profit ratio has increased.
In the year 2021-2022 gross profit ratio has decreased. It indicates unfavorable trend in the
form of reduction in selling prices not accompanied by proportionate decrease in cost of
goods or increase in cost of production.
Net profit ratio:

RATIO ANALYSIS
New profit ratio establishes a relationship between the net profit and sales and
indicates the efficiency of the management in manufacturing, selling administrative and other
activities of the firm. This ratio is overall measure of firm’s profitability. The ratio is very
useful as if the profit is not sufficient; the firm shall not be also to achieve a satisfactory
return on its investments.
Net profit ratio = Net profit / sales X 100
Table and Graph No 4.12: Net profit ratio for the year ended 2021-2022
Year N.P. after Tax Net Sales Ratio
2017-18 5705880.37 87119174.47 6.549
2018-19 4392926.31 101199557.00 4.340
2019-20 11929774.91 190969819.09 6.246
2020-21 42545114.11 344323299.36 12.356
2021-22 45643075.82 422842627.78 10.794
Interpretation:
In the year 2018-2019 the ratio has been increased from 4.340 to 6.246
In the year 2020-2021 the ratio has been increased.
In the year 2021-2022 the ratio has been decreased. The firm’s profitability is decreased.
Return on total assets:

RATIO ANALYSIS
This ratio is calculated to measure the profit after tax against the amount invested in total
assets to ascertain whether assets are being utilized properly or not.
Return on total assets = Net profit after tax / Total assets X 10
Table and Graph No 4.13: Return on total assets for the year ended 2021-2022
Year N.P. after Tax Assets Ratio
2017-2018 5705880.37 56569237.53 10.08
2018-2019 4392926.31 68328702.16 6.43
2019-2020 11929774.91 86829462.94 13.74
2020-2021 42545114.11 122833190.27 34.64
2021-2022 45643075.82 165004298.28 27.66
Interpretation:
The return on total assets ratio has been increased in the year 2021.
The return on total assets ratio had been decreased in the year 2022. It indicates the assets are
not utilized properly.

RATIO ANALYSIS
CHAPTER-V
FINDINGS AND SUGGESTIONS
5.1. Findings
 The company current ratio has been increased from year to year. In 2022 the company
current ratio is 3.5. The current ratio of more than 3 indicates that the firm is having
idleunds and has not invested them properly.
 The company quick ratio is 1.33. It indicates that adequate liquidity of the business.
 The absolute liquidity ratio has been decreased.
 The debt equity ratio was increased in the year of 2021-22. It indicates that its
creditors to greater risk.
 The debtor’s turnover ratio has been decreased in the year of 2021-22 compared to the
previous years. It indicates that the chances of bad debts are less.
 The debtor’s collection period ratio has been increased because debtor turnover ratio
fluctuated from year to year.
 The total assets turnover ratio decreased in the year of 2021-22. It indicates that the
trading of total assets is less compared with previous year.
 In the year of 2021-22 the working capital turnover ratio decreased from 11.53 to
7.19. It indicates the inefficiency utilization of firm’s funds. However, it should not
result in overtrading.
 Fixed assets turnover ratio has been decreased in the year 2022. It indicates that the
firm is not utilized the fixed assets in better manner.
 Inventory turnover ratio has been decreased in the year 2019. It shows that finished
stock is not rapidly turned-over.
 In the year 2021-22 gross profit ratio has been decreased. It indicates unfavorable
trend in the form of reduction in selling prices not accomplished by proportionate
decrease in cost of goods.
 In the 2021-22 the net profit ratio has been decreased. The firm’s profitability was
decreased.
 The return on total assets ratio had been decreased in the year 2018. It indicates the
assets are not utilized properly.

RATIO ANALYSIS
5.2. Suggestions
 It is suggested to BSW need to decrease in the volume of current assets and increase
the proportion of current liabilities for the purpose of to meet the working capital
requirements.
 It is suggested to BSW to decrease debt equity volume because it is going to greater
risk.
 It is suggested to BSW to increase the cash volume at least half of the current
liabilities for the purpose to meet day to day financial requirements.
 It is suggested to maintain the minimum debtor’s collection period is better to BSW.
Because of present received rupee value is more than will be received rupee in future.
 It is suggested to BSW maintain the same level of debtors.
 It is suggested to BSW should be increase the net profit is better. It is possible with
minimizing operating expenses. Then BSW can increase net profit volume.

RATIO ANALYSIS
BIBLIOGRAPHY
REFFERED BOOKS
 FINANCIAL MANAGEMENT - I. M. PANDEY
 MANAGEMENT ACCOUNTANCY - PILLAI & BAGAVATI
 MANAGEMENT ACCOUNTING – SHARMA & GUPTA
INTERNET SITE
 www.ercap.org
 www.wikipedia.com
 www.nwda.gov.in

RATIO ANALYSIS
ANNEXURE
M/s Bharathi Consumer Care Proeducts Pvt Ltd: Guntur

Profit and loss account for the year ended 31st March 2018
Particulars As on 31-03-2018 As on 31-03-2017
A. Income
Sales 843299865.00 284662125.80
Other expenses 22352287.00 11293111.00
Closing Stock 266860982.68 219588087.40
1132513134.68 515543324.20
B. Expenditure
Opening stock 21958808740 73137555.00
Purchases-seeds 284397184.50 183910782.00
Purchases-chemicals 9012953.00 14457484.00
Production expenses 31523352.00 14801327.91
Administration exp 63200363.01 33464326.48
Salaries & wages 29826575.60 19239403.10
Selling & dist. Exp 234649141.04 96209376.75
Trait fee 147886950.00 37138350.00
R & D expenses 11065252.00 9396045.00
Preliminary exp. Written off 55333.00 22200.00
Amortization of technical know 833333.00 833333.00
Financial charges 14572218.90 11581557.00
Depreciation 10209628.25 6321968.07
1056820371.70 500513708.33
C. Profit Before Tax 75698762.98 15029615.89
D. Provision for income tax 27993251.00 5044756.00
E. Provision for Deffered tax 0.00 0.00
F. Provision for F.B.T. 2612025.67 2577893.00
G. Profit after I.T, D.T.L, & F.B.T. 45087486.31 7406966.89
H. Profit & Loss A/c B/F (Profit) 14428284.54 7021317.65

RATIO ANALYSIS
I. Balance taken to Balance sheets 59515770.85 14428284.54
M/S BHARATHI CONSUMER CARE PROEDUCTS PVT LTD: GUNTUR

BALANCE SHEETS AS ON 31ST MARCH 2018
Particulars Sch. As on 31-03-18 Amount As on 31-03-17 Amount
No
A. Source of funds
I. SHARE CAPITAL
a. Capital 1 10000000.00 10000000.00
b. Share application money 1 6900000.00 0.00
c. Profit and loss A/c 2 59515770.85 76415770.85 14428284.54 24428284.54
2. Loan Funds
a. Secured loans 3 131430609.93 98099516.00
b. Unsecured loans 4 572698.92 132003308.85 73334.92 98832651.44
208419079.70 123260935.98
B. Application of funds
1. FIXED ASSETS
In tangible assets technical 5 5000000.00 5000000.00
know-how
LESS: Amortisation of tech 4166665.00 833335.00 3333332.00 1666668.00
tangible assets
a. Gross block 6 140736047.90 83473020.40
b. LESS: Depreciation 36733056.63 104002991.27 27616587.38 56126433.02
2.a. Inventories 7 266860982.68 219588087.40
b. Sundry Debtors 8 433715019.73 220570852.64
c. Cash & Bank Balances 9 12756084.79 2850972.06
d. Deposits & Advances 10 24128575.00 2446006.00
e. Prepaid expenses 11 4563419.50 3590934.00
742024081.70 449046852.10
LESS: Current liabilities 12 637834413.27 382861773.14
and provisions
Deferred tax liability 739444.00 103450224.43 739444.00 6544563.96

RATIO ANALYSIS
Total 208419079.70 123260935.98

A. Income
Sales 1420098789.00 843299865.00
Other expenses 39289543.00 22352287.00
Closing Stock 430787633.20 266860982.68
1890175965.20 1132513134.68
B. Expenditure
Opening stock 266860982.68 21958808740
Purchases-seeds 563584826.50 284397184.50
Purchases-chemicals 16588730.00 9012953.00
Production expenses 49094639.45 31523352.00
Administration exp 63573239.24 63200363.01
Salaries & wages 42475881.00 29826575.60
Selling & dist. Exp 389622079.75 234649141.04
Trait fee 33695907.00 147886950.00
R & D expenses 205595918.00 11065252.00
Preliminary exp. Written off 33133.00 55333.00
Amortization of technical know 833335.00 833333.00
Financial charges 32558081.73 14572218.90
Depreciation 13401282.29 10209628.25
1798918005.64 1056820371.70
C. Profit Before Tax 91257959.56 75698762.98
D. Provision for income tax 33429825.00 27993251.00
E. Income tax earlier year 2289547.00 0.00
F. Provision for dividend tax 2447280.00 0.00
G. Provision for F.B.T. 2997527.00 2612025.67
H. Profit after I.T, D.T.L. & F.B.T. 50093780.56 45087486.31
I. Profit & Loss A/c B/f (Profit) 59515770.85 14428284.54
J.Issue of bonus share 45000000.00 0.00

RATIO ANALYSIS
K. Proposed dividend 14400000.00 0.00

I. Balance taken to Balance sheet 50209551.41 59515770.85

No
A. Source of funds
I. SHARE CAPITAL
a. Capital 1 90000000.00 10000000.00
b. Share application money 1 113500000.00 6900000.00
c. Profit and loss A/c 2 50209551.41 153709551.41 59515770.85 76415770.85
2. Loan Funds
a. Secured loans 3 216059754.16 131430609.93
460785862.57 208419079.70
1. FIXED ASSETS
know-how
tangible assets
a. Gross block 6 177210982.92 140736047.90
b. LESS: Depreciation 48920054.92 128290927.98 36733056.63 104002991.27
2.a. Inventories 7 430787633.20 266860982.68
b. Sundry Debtors 8 896310138.16 433715019.73
1333872253.34 742024081.70
and provisions

RATIO ANALYSIS
Total 460785862.57 208419079.70


A. Income
Sales 196,00,88,407.00 1420098789.00
Other expenses 8,29,24,836.00 39289543.00
Closing Stock 26,86,42,921.50 430787633.20
231,16,56,164.50 1890175965.20
B. Expenditure
Opening stock 34,78,70,307.00 266860982.68
Purchases-seeds 51,21,67,527.00 563584826.50
Purchases-chemicals 2,10,79,606.00 16588730.00
Production expenses 4,82,48,288,.36 49094639.45
Administration exp 9,43,85,674.37 63573239.24
Salaries & wages 5,81,62,453.00 42475881.00
Selling & dist. Exp 55,46,07,091.58 389622079.75
Trait fee 44,58,11,448.00 33695907.00
R & D expenses 1,51,40,393.00 205595918.00
Preliminary exp. Written off 33,133.00 33133.00
Financial charges 4,62,48,855.00 32558081.73
Depreciation 1,77,90,317.36 13401282.29
216,15,45,033.67 1798918005.64
C. Profit Before Tax 15,01,11,130.83 91257959.56
D. Provision for income tax 5,15,32,001.00 33429825.00
E. Income tax earlier year 0.00 2289547.00
F. Profit after Tax 9,85,79,129.83 50093780.56
G. Profit & Loss A/c B/f (Profit) 13,5371,267.59 59515770.85
H. Proposed Dividend 18,63,00,000.00 14400000.00
I. Provision for dividend tax 3,09,42,101.25 2447280.00
J. Balance taken to Balance sheet 1,67,08,296.17 50209551.41

RATIO ANALYSIS


No
A. Source of funds
I. SHARE CAPITAL
a. Capital 1 90000000.00 10,35,00,000.00
b. Share application money 1 113500000.00 10,00,00,000.00
c. Profit and loss A/c 2 50209551.41 153709551.41 1,67,08,296.17 220208296.17
2. Loan Funds
a. Secured loans 3 216059754.16 292491063.75
460785862.57 603485831.92
1. FIXED ASSETS
know-how
tangible assets
a. Gross block 6 177210982.92 46600000.00
2.a. Inventories 7 430787633.20 1323615071.38
b. Sundry Debtors 8 896310138.16 19215800.65
1333872253.34 1710818592.03
and provisions
Total 460785862.57 603485831.92

RATIO ANALYSIS

Sl.No Particulars As on 2021 As on 2020

1 Revenue from operations 2,08,99,25,019.00 1,96,00,88,407.00
2 Other income 11,79,35,405.00 8,29,24,836.00
3 Total revenue 2,20,78,60,624.00 2,04,30,13,243.00
4 Expenses
Cost o material consumed 76,04,02,087.40 53,32,47,133.00
Changes in inventories of finished goods -3,00,84,713.50 7,92,27,385.50
Employee benefits 7,09,23,062.00 6,28,39,165.00
Finance costs 5,82,05,942.90 4,62,48,855.00
Depreciation 1,85,96,890.00 1,77,90,317.36
Other expenses 1,06,36,15,714.05 1,15,35,49,256.31
Total expenses 194,16,58,982.85 189,29,02,112.17
5 Profit before exceptional and 26,62,01,441.15 15,01,11,130.83
extraordinary items
6 Exceptional items 0.00 0.00
7 Profit before extraordinary items and tax 26,62,01,441.15 15,01,11,130.83
8 Extraordinary items 0.00 0.00
9 Profit before tax 26,62,01,4/41.15 15,01,11,130.83
10. 1. Current tax (including prior period 8,97,49,561.00 5,15,32,001.00
income tax of Rs.35,13,888)
2. Deferred tax 4,13,850.00 0.00
11 Profit for the period from continuing 17,68,65,730.15 9,85,79,129.83
operation
12 A. Profit from discounting operations 0.00 0.00
B. Tax expense of discounting operations 0.00 0.00
13 Profit from discounting operations 0.00 0.00
14 Profit for the period 17,68,65,730.15 9,85,79,129.83

RATIO ANALYSIS

PARTICULARS NOTENO 31-3-2021 31-3-2020

A.EQUITY AND LIABILITIES
I.SHARE HOLDER’S FUNDS
a. Share Capital 1 289800000.00 103500000.00
b. Reserves and surplus 2 193574026.32 16708296.17
483374026.32 120208296.17
2.SHARE APPLICATION 0.00 100000000.00
MONEY3
3.NON-CURRENT LIABILITIES
a. Long term borrowings 4 505820140.04 123893054.00
b. Deferred tax liability 5 325594.00 739444.00
c. Other long term liabilities 6 340219113.00 10334113.00
d. Short term provisions 7 38701.00 38701.00
846403548.04135005312.00
4.CURRENT LIABILITIES
a. Short term borrowings 8 260058208.61 259384481.75
b. Trade payable 9 157662426.31 81763744.78
c. Other current liabilities 10 735201010.00 1166264607.17
1215715370.25 1550160428.00
TOTAL 2545492944.61 1905374036.17
B.ASSETS
INON-CURRENT ASSETS
a. Fixed Assets-tangible assets 12 163011054.14 147922314.14
b. Non-current investments 13 0.00 46600000.00
c. Deferred tax assets (Net) 0.00 0.00
d. Long term loans & advances 14 691861166.00 874526.00
e. Other non – current assets 15 2508629.00 3680727.00
857380849.14 199077567.14
2. CURRENT ASSETS
1. Current investments 16 0.00 0.00
2. Inventories 17 298727635.00 268642921.50
3. Trade receivables 18 285699504.27 210294452.49
4. Cash & cash equivalents 19 17779444.39 20743122.65
5. Short term loans and advances 20 1058835115.02 197127029.89
6. Other current assets 27070396.79 9488942.50
1688112095.471708296469.03
TOTAL 2545492944.61 1905374036.17

RATIO ANALYSIS
Sl.No Particulars As on 2021 As on 2022

1 Revenue from operations 2,08,99,25,019.00 228,67,64,217.00
2 Other income 11,79,35,405.00 12,38,63,581.00
3 Total revenue 2,20,78,60,624.00 241,06,27,798.00
4 Expenses
Cost o material consumed 76,04,02,087.40 119,67,13,006.29
Changes in inventories of finished goods -3,00,84,713.50 -501.130.006.00
Employee benefits 7,09,23,062.00 8,16,34,201.00
Finance costs 5,82,05,942.90 7,53,56,407.27
Depreciation 1,85,96,890.00 1,96,84,470.00
Other expenses 1,06,36,15,714.05 128,00,56,191.22
Total expenses 194,16,58,982.85 215,33,14,269.78
5 Profit before exceptional and 26,62,01,441.15 25,83,13,528.22
extraordinary items
6 Exceptional items 0.00 0.00
7 Profit before extraordinary items and tax 26,62,01,441.15 25,83,13,528.00
8 Extraordinary items 0.00 0.00
9 Profit before tax 26,62,01,4/41.15 25,83,13,528.22
10. 1. Current tax (including prior period 8,97,49,561.00 6,88,04,852.00
income tax of Rs.35,13,888)
2. Deferred tax 4,13,850.00 -767.327.00
11 Profit for the period from continuing 17,68,65,730.15 19,02,76,003.22
operation
12 A. Profit from discounting operations 0.00 0.00
B. Tax expense of discounting operations 0.00 0.00
13 Profit from discounting operations 0.00 0.00
14 Profit for the period 17,68,65,730.15 19,02,76,003.22

RATIO ANALYSIS
PARTICULARS NOTENO 31-3-2021 31-3-2022

A.EQUITY AND
LIABILITIES
I.SHARE HOLDER’S FUNDS
a. Share Capital 1 289800000.00 380000000.00
b. Reserves and surplus 2 193574026.32 383550029.54
483374026.32 769850029.54
2.SHARE APPLICATION 0.00 0.00
MONEY3
3. NON-CURRENT
LIABILITIES
a. Long term borrowings 4 505820140.04 79881742.34
b. Deferred tax liability 5 325594.00 0.00
c. Other long term liabilities 6 340219113.00 266374113.00
846403548.04135005312.00 346339351.34
4.CURRENT LIABILITIES
a. Short term borrowings 8 260058208.61 441283413.11
b. Trade payable 9 157662426.31 314346970.79
c. Other current liabilities 10 735201010.00 789057263.39
1215715370.25 1557936711.76
TOTAL 2545492944.61 2668126092.64
B.ASSETS
INON-CURRENT ASSETS
a. Fixed Assets-tangible assets 12 163011054.14 194751288.00
b. Non-current investments 13 0.00 0.00
c. Deferred tax assets (Net) 0.00 441733.00
d. Long term loans & advances 14 691861166.00 322053096.00
e. Other non – current assets 15 2508629.00 2601427.00
857380849.14 519817544.00
2. CURRENT ASSETS
1. Current investments 16 0.00 0.00
2. Inventories 17 298727635.00 799857641.00
s3. Trade receivables 18 285699504.27 320333187.21
4. Cash & cash equivalents 19 17779444.39 14575735.48
5. Short term loans and advances 20 1058835115.02 977526467.21
6. Other current assets 27070396.79 36015517.74
1688112095.47 2148308548.64
TOTAL 2545492944.61 2661826092.64

Mahesh Total Project 1

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RATIO ANALYSIS

A ratio is simple arithmetical expression of the relationship of one number to another.

Ratio analysis is techniques of analysis and interpretation of financial statements. It is

Importance of ratio analysis:

Dravidian university Page 1

The importance of Ratio Analysis are briefly discussed below.

(3) Facilitate decision-making: It throws light on the degree of efficiency of the

(4) Evaluation of efficiency: Ratio analysis is an effective instrument which, when

Dravidian university Page 2

Intra – firm comparison:

Limitations of ratio analysis:

(4) Change of accounting procedure : Change in accounting procedure by a firm often

Dravidian university Page 3

(A) (B) (C)

Dravidian university Page 4

Current ratio = Current assets

Dravidian university Page 5

Quick Ratio / Acid test Ratio:

Quick Ratio = Quick assets

Quick assets-----: Current assets – Stock and prepaid expenses

Absolute Liquid Ratio:

Capital structure / Leverage Ratios/ Long-term solvency Ratios:

Dravidian university Page 6

 Fixed assets to long term funds ratio

Debt-Equity Ratio = Long term debt

Interest Coverage Ratio = EB IT

Net worth = Equity Share Capital + Preference Share Capital +

Dravidian university Page 7

 Inventory turnover ratio

Inventory Turnover Ratio:

Inventory turnover Ratio = Cost of Goods Sold

Average Inventory = Opening Stock + Closing Stock

Debtors turnover Ratio = Net Credit Sales

Capital Turnover Ratio:

Capital turnover Ratio = Net sales

Dravidian university Page 8

Working capital turnover Ratio:

Working capital turnover Ratio = Sales

Fixed Assets Turnover Ratio:

Fixed Assets Turnover Ratio = Sales

Total Assets Turnover Ratio:

Total Assets Turnover Ratio = Net sales

Dravidian university Page 9

Gross Profit Ratio:

Gross Profit Ratio = Gross profit X 100

Gross Profit = Sales – less Cost of Goods Sold

Net Profit Ratio:

Net profit = Earnings after tax and interest

Operating profit ratio:

Operating Profit Ratio = Operating profit X 100

Return On Capital Employed:

Dravidian university Page 10

Return on Total Assets:

Return on Total Assets = NPAT X 100

Return on Share Holder Funds:

Returns on Shareholders Funds = NAPT X 100

Dravidian university Page 11

2.1 Industry Overview:

Indian detergent industry profile

Dravidian university Page 12

Although the per capita consumption of detergents in India (2.7 kg pa) is

Personal Cleaning Products

Laundry Cleaning Products: