PREFACE

Marketing should not be looked upon in a vacuum or in isolation. It is an

essence taking a view of the whole business organization and its ultimate objective
concern for marketing must penetrate all areas of the enterprise. Market survey in
today’s competitive world is a must for every organization.

This project is a study of Ratio Analysis of Mahindra Finance . The rational

behind this particular study is to find out the present market scenario of various
brands & to find out the corporate need and perception. It was a pleasurable
experience to conduct a research on behalf of Mahendra pertaining to the study of
the Automobile Sector.

Conclusion and there by recommendation has been arrived at by proper and

justified interpretation of the result derived from the above said analytical tools and
techniques.

ACKNOWLEDGEMENT
 Preparing a project of this nature is an arduous task and I was fortunate enough to
get support from a large number o persons. I wish to express my deep sense of gratitude to all
those who generously helped in successful completion of this report by sharing their
invaluable time and knowledge.

It is my proud and previledge to express my deep regards to Respected , Head of

Department Dr. Neeraj topkhane, Department of Business Management , Swami Vivekanand
University Sagar for allowing me to undertake this project.

I feel extremely exhilarated to have completed this project under the able and
inspiring guidance of Mr. Vikash Dev He rendered me all possible help me guidance while
reviewing the manuscript in finalising the report.

I also extend my deep regards to my teachers , family members , friends and all those
whose encouragement has infused courage in me to complete to work successfully.

(KARISHMA VISHWAKARMA )
BBA –Vth Semester
 DELCLARATION BY THE CANDIDATE
Date :

I declare that the project report titled " RATION ANALYSIS OF MAHENDRA

FINANCE " on Market Segmentation is nay own work conducted under the supervision of Mr.

Vikash Dev Department of Business Management , Swami Vivekanand University Sagar , To

the best of my knowledge the report does not contain any work , which has been submitted for

the award of any degree , anywhere.

(KARISHMA VISHWAKARMA )
BBA –Vth Semester
 CERTIFICATE
The project report titled " RATION ANALYSIS OF MAHENDRA FINANCE "

been prepared by Miss Karishma Vishwakarma BBA Vth Semester , under the guidance and

supervision of Mr. Vikash Dev for the partial fulfillment of the Degree of B.B.A.

Signature of the Signature of the Signature of the

Supervisor Head of the Department Examiner

CONTENTS
PAGE
TOPIC NO.
TITLE

1.
Preface

2. Acknowledgement

3. Declaration of the Candidate

4. Certificate

5. Introduction of Mahindra Finance

 6. History of Mahindra Finance
7. Scope of the Study

8. Limitation of the Study

9. Research Methodology

10 Ration Analysis

12 Data analysis & Interpretation

13 Findings
15 Suggestions & Recommendation
15 Conclusion
16 Bibliography
17 Questionnaires

INTRODUCTION OF MAHINDRA FINANCE

Empowering potential. Transforming lives.

Two decades ago, Mahindra and Mahindra Financial Services Limited (MMFSL) commenced
its journey in the rural non-banking finance industry. And with that was born a vision to
transform rural and semi-urban India into a self-reliant, flourishing landscape. Since then, we
have come a long way, empowering millions of ambitious individuals with personalised
finance for a wide range of vehicles, home development requirements and many other diverse
endeavours – all to help them live their dreams and Rise in life.

At Mahindra Finance, we are guided by a firm belief in people, their dreams, and their
potential to achieve those dreams. Hence, our socially inclusive business model facilitates
loans to customers based not on their current financial status, but their future earning
capacity. This philosophy has instilled a sense of confidence in the minds of rural and semi-
urban India – a confidence that allows them to believe that no dream is too big. Today, as one
of the leading non-banking finance companies, we are proud to have touched over 2.5 million
such lives.

During the course of our journey, apart from emerging as the top tractor financer in India, we
have constantly strived towards developing skill sets of the local population. Which is why,
we provide employment to over 13,000 people in over 650 branches across India. This not
only ensures equal growth opportunity for all, but also enables us to serve our customers
better through local understanding and expertise.

So be it a humble farmer or a budding entrepreneur – we are committed to empower every

individual with resources to help their dreams see the light of day.

The Mahindra Group focuses on enabling people to rise through solutions that power
mobility, drive rural prosperity, enhance urban lifestyles and increase business efficiency.

A USD 16.2 billion multinational group based in Mumbai, India, Mahindra employs more
than 180,000 people in over 100 countries. Mahindra operates in the key industries that drive
economic growth, enjoying a leadership position in tractors, utility vehicles, after-
market, information technology and vacation ownership. In addition, Mahindra enjoys a
strong presence in the agribusiness, aerospace, components, consulting services, defence,
energy, financial services, industrial equipment, logistics, real estate, retail, steel,commercial
vehicles and two wheeler industries.

In 2012, Mahindra featured on the Forbes Global 2000 list, a listing of the biggest and most
powerful listed companies in the world. In 2013, the Mahindra Group received the Financial
Times 'Boldness in Business' Award in the 'Emerging Markets' category.
 VISION AND MISSION

Our Vision
“To be a leading financial services provider in
semi-urban and rural India.”
Our Mission
“To transform rural lives and drive positive change in the communities.”
Our Vision:

"To be India's no.1 Insurance Broker in revenue by 2015."

 Strategic Partnership

During the year under review, Mahindra Insurance Brokers Limited (MIBL) has entered into
Definitive Agreements with Inclusion Resources Private Limited (IRPL), a subsidiary of
LeapFrog Inclusion Fund (LFIF), incorporated in Singapore and Mahindra & Mahindra
Financial Services Limited (MMFSL), its parent company to expand the Company's services
to consumers in rural and semi-urban areas of India, by bringing in IRPL's international
knowledge and experience, especially in using low cost technology solutions to provide
insurance in mass markets. In addition, given IRPL's expertise and association in reinsurance
globally, IRPL would help the Company to connect with various global reinsurers to assist in
the Company's reinsurance broking business.

HISTORY
The history of Mahindra Finance has been one of continuous ascent where our effort to
empower our customers has been a constant element. A strong set of values, an evolved
lineage and a group of highly motivated individuals is what we started with.
What followed was a series of events that helped us grow from strength to strength. And two
decades that witnessed many dreams across the nation see the light of day. Come, walk with
us through the journey of time and take a glimpse of how Mahindra Finance grew with all
those who believed in it.
We were incorporated on January 1, 1991 as Maxi Motors Financial Services Limited and
received certificate of commencement of business on February 19, 1991. The name was
changed to Mahindra & Mahindra Financial Services Limited on November 3, 1992. We are
registered with the RBI as an NBFC with effect from September 4, 1998 under Section 45IA
of the Reserve Bank of India Act 1934.

Key Events in our business history

Calendar Year Event
1993 Commenced financing of M&M UVs 1995 First branch opened outside Mumbai, at
Jaipur 1996 Commenced financing M&M dealers for purchase of tractors 1998 Launched
pilot project for retail tractor financing 1999 Commenced tractor retail financing in rural and
semi-urban areas 2001 Total Assets crossed Rs. 10 billion 2002 Commenced financing of
non-M&M vehicles Received Tier II debt from International Finance Corporation Our first
securitisation transaction of Rs. 434.8 million 2004 Long term credit rating of AA+/Stable
Branch opened in Port Blair Listing of non convertible debentures on BSE on the wholesale
debt market segment Securitisation of tractor assets of Rs. 256.6 million 2005 Tie-up with
HPCL MIBL became our wholly owned subsidiary Commenced distribution of third party
mutual funds

2006
Following a successful IPO, subscribed nearly 27 times more, Mahindra & Mahindra
Financial Services Ltd (MMFSL) priced its shares at Rs 200 each. The original price band for
the issue of two crore shares of Rs 10 each, for cash at a premium decided through the book-
built process, had been fixed at Rs 170-200 a share.

-Mahindra & Mahindra Financial Services Limited has informed that Mr. Narayan Shankar
has ceased to be the Company Secretary of the company with effect from October 26,2006.
Ms. Angarika Baviskar would continue to hold the post of Deputy Company Secretary and
Compliance Officer of the company.

-Tied up with Maruti Udyog Limited. -Reached a new benchmark with 400 branches.

2007 -Commenced Home Loans Business through our subsidiary Mahindra Rural Housing
 Finance Limited.

2008 -Received 12.5% equity participation from NHB for our Subsidiary Mahindra Rural
Housing Finance Ltd. -Preferential allotement of shares to Standard Chartered Private Equity
Ltd. & TPG Axon Private Equity Ltd.
2009 Commenced Fixed Deposits Program.
2010
More than 2 lakh new customer contracts in a financial year for the first time.
Branch network crosses 550 branches.
2011
Maiden QIP Issue. Joint Venture with Rabobank subsidiary for tractor financing in USA.
2012
Mahindra Finance wins the inaugural Porter Prize in the category of Creating Distinctive
Value.
Mahindra Finance are first runners up at CNBC TV18 Best Bank & Financial Institution
awards.
Ranked 9th in the prestigious Dun & Bradstreet's India's Top 500 Companies 2011(released
on 1st June, 2012), based on the total income in the FIs/ NBFCs/ Financial Services Sector.

2013 Company has splits its Face value of Shares from Rs 10 to Rs 2

BOARD OF DIRECTORS
Mahindra Finance is led by an ensemble of highly motivated visionaries who bring years of
experience and expertise to the table. They guide, inspire and propel us to push the
boundaries and move towards our collective vision of empowering every life with resources
to put their ambitions on the map.
The board consists of eight noted directors vested with the charge of general supervision,
direction and management of the operations of our company. The primary responsibilities of
the Board of Directors include:

 Overseeing high standards of corporate governance and compliance with various laws
 Overseeing our financial management and approving various lines of business
 Shaping our policies and procedures
 Monitoring our performance and evolving the growth strategy
 Setting up counter-party and other prudential risk management limits
Mr. Bharat N. Doshi Mr.UdayY.Phadke
Director Chairman

Dr. Pawan Kumar Goenka Mr.RameshIyer

Managing Director Director

At Mahindra Finance, our vision has always been to make a positive difference to as many
lives as possible. It is what inspires us to expand our family and deliver more value to our
customers through superior services and expertise. Here's a bit about two such successful
ventures – Mahindra Insurance Brokers Ltd. and Mahindra Rural Housing Finance Ltd.,
whom we are proud to have as a part of our ever-growing family.

We live in a day and age where staying protected against the uncertainties of tomorrow is of
paramount importance. Understanding this very requirement, Mahindra Insurance Brokers
Ltd. (MIBL), our subsidiary, provides 360o insurance solutions, tailor-made for the diverse
needs and risk profiles of our varied consumer base. While providing direct insurance broking
for the retail customer base of around 1.3 million and catering to a large number of corporate
customers, the company also offers a range of plans for the Life as well as Non-life insurance
segments.

MIBL is committed to provide value to its customers by understanding their insurance needs
and risk profile in a highly detailed and systematic manner. This helps in chalking out more
innovative, cost-effective and customised insurance solutions. And its uncompromising
adherence to the highest standards of quality is evident from the fact that it is one of the few
insurance broking companies in India to have been awarded the prestigious ISO 9001:2008
Certification for Quality Management Systems.
MIBL was granted a Direct Broker's Licence by the Insurance Regulatory and Development
Authority (IRDA) in May 2004, enabling it to undertake direct insurance broking in Life and
Non-life businesses. In addition, MIBL has empanelled itself with various public and private
insurance companies to fulfil its promise of delivering customised solutions to customers. In
September 2011, MIBL was granted a Composite Broker licence by the IRDA, thus foraying
into the Reinsurance Broking business along with Direct Broking. As a Total Insurance Risk
Solutions provider, MIBL also plays an integral role in the Risk Management portfolio of
customers.

OBJECTIVE
PRIMARY OBJECTIVES
 To know about Promotional policies of Mahindra Finance.

SECONDARY OBJECTIVES
 The main objectives of this project is to find, what steps Mahindra Finance is
adapting to be market leader and to differentiate itself from its competitors.

 The basic objective of this project is as mentioned above to find ways so that
Mahindra Finance remain market leader by considering all the needs &wants
and fulfilling their demand.

 To find out the Strategy of Mahindra Finance to remain market leader in

future.

 It should do something to give after sales service and collect feedback from
the customers.
 SERVICES OF MAHINDRA FINANCE
1. VEHICLE LOANS

a. Tractor Loans

“I have availed of four new tractor loans and my experience has always been positive.”
I have been a Mahindra Finance customer for the last six years and I am very happy with their
service. I first went to them in 2004 when I wanted to buy a Mahindra tractor...
- Mr. S. Subhash, Nagercoil
*Images are for reference only. Actual customer images may vary.
 Features & Benefits

 Eligibility & Documentation

 Repayment based on cash flows i.e. monthly/quarterly and half yearly (asset becomes
loan free in five years)

 Quick disbursal within two days after loan approval

 Available for a wide range of tractors

 Stress-free loan sanction without mortgaging of land

 Easy and flexible documentation

.b. UTILITY VEHICLES LOANS

“My life has changed completely.”

I have a small business dealing in cattle feed. Before I approached Mahindra Finance, I used
to purchase cattle feed from farmers and transport it via a three wheeler to a cattle camp,
where I would sell the entire stock. It would earn me around Rs 7,000 – Rs 8,000/- at that
time...
- Mr. Salemamad Ibrahim Node, Bhuj
*Images are for reference only. Actual customer images may vary.

“I thank Mahindra Finance for helping me achieve success and stability in life.”
My job is to pick up and drop kids to school in my vehicle. Earlier, I owned an auto, but it
proved insufficient in handling the increasing number of students.At that point of time, I
began hunting for used cars and luckily...
- Mr. Hitendra Bhagwati Lal Shah, Vadodara
*Images are for reference only. Actual customer images may vary.
 Features & Benefits

 Eligibility & Documentation

 Flexible repayment options ranging from 12 to 60 months

 Fast loan disbursement within 48 hours

 Competitive rates of interest

 Hassle-free documentation

 Pay online and through direct debit

 Enjoy a repayment period of up to 5 years

c. CAR LOAN
“Mahindra Finance fueled my dream of driving my own car.”
I live in the slum area of Surat and have my own scrap business. I have been associated with
Mahindra Finance since the last nine years. In 2004, when I needed a loan I approached many
banks and financiers but no one was ready to provide me a loan due to lack of documents....   
-

“Now I take my family out in my own car, thanks to Mahindra Finance.”

My wife and kids always used to complain to me that other relatives have a car, and we don’t.
However, being an ordinary petrol attendant with a modest income, I had to admit that buying
a car was next to impossible
- Mr. Ram Prajapat, Sangane
*Images are for reference only. Actual customer images may vary.
 Features & Benefits

 Eligibility & Documentation

 Minimum documentation to ensure a hassle-free process

 Quick car loan approval

  Up to 100% ex-showroom funding

 Multiple repayment options

d. THREE WHEELER LOAN

“Today, I've regained my confidence and happy about doing well in my motherland.”
I used to be a taxi driver in Mumbai for six years. But a dire need of money forced me to
leave my motherland and migrate to Saudi Arabia to earn a living...
- Mr. S.K. Rabbani, Hyderabad
*Images are for reference only. Actual customer images may vary.

“From repairing vehicles to owning one!”

I started working at the age of 10 at a garage and grew up working there as a mechanic. Then
one day, a Bajaj 3-Wheeler came in for repair. I decided to buy it. So I arranged for the
money from my relatives and the savings I already had. I used the vehicle for around six to
seven years...
- Mr. Mohammad Basheer, Hyderabad
*Images are for reference only. Actual customer images may vary.
  Features & Benefits

 Eligibility & Documentation

 We cover the widest range of three-wheelers in India

 Flexible repayment options, ranging from 12 to 36 months

 Loan sanctioned within 48 hours

 Enjoy hassle-free documentation

 Multiple plans customised to match your needs

 Competitive rates of interest

E. COMMERCIAL VEHICLE LOAN

“From an employee to an entrepreneur - it has been a magical journey!”

I was with a construction company for eight years. In 2004, I left my job and started
subcontracting with a few friends. Three years later, I decided to expand. So I took up a
commercial vehicle loan from...
- Mr. Surya Narayan, Hyderabad
*Images are for reference only. Actual customer images may vary.

“After I got a loan, my business just took off and grew by five times! Needless to say,
Mahindra Finance will always be my first choice.”
I’ve been into the dairy business for the last 15 years. I earn around Rs. 30,000 every month
and at present, have a loan for two Mahindra...
- Mr. Ratnabhai Bharvad, Vododara
*Images are for reference only. Actual customer images may vary.
 Features & Benefits

 Eligibility & Documentation

The rate of interest for the loan depends on various factors like customer profiles and
location.
A commercial vehicle loan can be taken for a variety of commercial vehicles, which may be
used at different locations. The loan is applicable to customers with diverse profiles.
For new CVs
 Fast processing

 Greater flexibility

 Maximum tenure of 60 months

 Competitive rates

 Customised financing

For old CVs

 Finance against vehicles that are up to 15 years old
  Maximum tenure of up to 3 years

 Maximum finance flexibility

F. TWO WHEELER LOAN

“Mahindra Finance offers exactly what you need.”

I choose Mahindra Finance because I was attracted by the interest rates they were providing. I
have compared Mahindra Finance to other finance companies, and found the staff completely
professional...
Read More
- Ms. Rekha Arjun Wagh, Nashik
*Images are for reference only. Actual customer images may vary.
 Features & Benefits

 Eligibility & Documentation

 Quick and efficient loan approval

 Special 0.5% rebate for women customers

 Maximum funding of up to 80% on LTV

 Flexible repayment option, ranging from 12 to 36 months

 Loan insurance available

F. USED VEHICLE LOAN

“Mahindra Finance has been a source of great support.”
Mahindra Finance is not just a financer, but has emerged as a support system for me. I have
refinanced three vehicles with the help of Mahindra Finance and expanded my business as
well. Today, I am considered as an opinion leader amongst my friends...
Read More
- Mr. Jaswant Singh, Lucknow
*Images are for reference only. Actual customer images may vary.
 Features & Benefits

 Eligibility & Documentation

 Used vehicle loans available for vehicles up to 10 years old

 Lower rates of interest as compared to other unsecured loans

 Maximum flexibility

 Speedy loan disbursements

2. PERSONNEL LOANS

a. Personnel loan
 “New look to my old house - without any difficulty!”
I took a personal loan from Mahindra Finance as I wanted to renovate my house. The
rate of interest being offered to me was very low. So I took it, and I found the loan
process to be smooth and quick. The entire house renovation process...
Read More
- Mr. Sharad Patel, Nashik
*Images are for reference only. Actual customer images may vary.
 Features & Benefits

 Eligibility & Documentation

 FAQs

 Instant personal loan approval and disbursement in 2 days

 Loans of up to Rs. 3 lakh

 Hassle-free documentation with maximum flexibility

 Maximum loan tenure of up to 3 years*

 Easy EMI payment option through cheque, ECS, mobile transfer or cash at the branch

*Conditions Apply

b. GOLD LOAN
 “Mahindra Finance has made my life much easier.”
I needed funds for my construction business. So I approached Mahindra Finance as
they had attractive interest rates on gold loans. I found them highly professional and
more co-operative than most other financial service providers. They customised the
loan as per my needs with...
Read More
- Mr. Jiji K. P., Kerala
*Images are for reference only. Actual customer images may vary.
 Features & Benefits

 Eligibility & Documentation

 Get a gold loan of up to Rs. 10,00,000/-

 Repay only by servicing regular interest on the loan/EMI repayment option available
on request

 Enjoy assured security of your gold jewellery

 Loan tenure is of 1 week to 3 years

METHODOLOGY:
 The study conducted was based upon the financial statement in annual report
and accounts of the firm that were published annually in the internet by the company.

The comparative size analysis has been made earlier to identify the variations at
different levels and interpretations of ratios etc and taken into account for the period
2004-2008 to clear out the picture of the company earlier form.

To assess accurate profit & losses and estimate the expenses incurred for
financial statement in annual reports and accounts of the firm which were collected
were of secondary nature.

Limitations
 It is difficult to decide in the proper basis of comparison.

 The comparison is rendered difficult because of differences in situations of two companies

are of one company over ears.

 The price level changes make the interpretation of ratio invalid.

 The difference in the definition of items in the balance sheet and the profit and loss
statement make the interpretation of ratio difficult.

 The calculated ratios at the point of time are less informative and defective as they suffer
from short term changes.

 The ratios generally calculated from the past financial statement and thus there are known
indicators of future.
 FINANCIAL RATIO ANALYSIS:

Ratio analysis is a powerful tool of financial analysis. A ratio is

defined as “the indicated quotient of two mathematical expressions” and as “the relationship
between two or more things”. In financial analysis a ratio is used as a benchmark for
evaluating the financial position and performance of a firm. The absolute accounting figures
reported in the financial statement do not provide a meaningful understand of the
performance and financial position of a firm. An accounting figure conveys meaning when it
is related to some other relevant information.

The relation between two accounting figures, expressed

mathematically is known as a financial ratio (or simply as a ratio) ratio help to
summarize large quantities of financial data and to make qualitative judgment about
the firm’s financial performance. The point to note is that a ratio reflecting a
quantitative relationship helps to form a qualitative judgment.
 NATURE OF RATIO ANALYSIS

Standards of comparison

A single ratio in itself does not indicate favorable or

unfavorable condition. It should be compared with some standards. Standard of
comparison may consist of.
 Past ratio i.e. ratio calculated from the financial statement of the some firm.
 Competitor’s ratios, i.e. ratios of same selected firms, especially the most
progressive and successful competitor, at the same point in time.
 Industry ratios i.e. ratios or the industry to which the firm belongs and
 Projected ratios, i.e. ratios developed using the projected or Performa, financial
statements of the same firm.

There are four types of ratios to be calculated to know the status of the
firm.

They are,

1. Liquidity ratio

2. Leverage ratio

3. Activity ratio

4. Profitability ratio

I. Liquidity ratio
 Liquidity ratios measure the ability of the form to meet its current obligation. In fact,
analysis of liquidity needs the preparation of cash budgets and cash and fund flow statement,
but liquidity ratios by establishing a relationship between cash and other current assets to
currents obligations, provide a quick measure of liquidity. A firm ensures that it does not
suffer from lack of liquidity, and also that it does not have excess liquidity, therefore it is
necessary to strike a proper balance between high liquidity and lack of liquidity.

The most common ratios indicate the extent of liquidity or lack of it is:

 Current ratio
 Quick ratio

 Absolute liquidity ratio

II.LEVERAGE RATIOS

Leverage ratios are calculated t analyze the long-term financial position of the firm.
These indicate mix of funds provided by owners and lenders. As a general rule, there should
be an appropriate mix be debt and owners equity in financing the firm’s assets. The process
of magnifying the shareholders return through the use of debt is called “financial gearing” or
“trading on equity”. Leverage ratios calculated to measure the financial risk and firm’s
ability of using debt to share holder’s advantages.

 Interest coverage ratio

 Capital equity ratio

III.ACTIVITY (OR) TURNOVER RATIOS

 The turnover ratios indicate the efficiency with which the capital employed is rotated
in the business. The ratios are employed to evaluate the efficiency with which the firm
manages and utilizes its assets to indicate the speed with which assets are being converted on
turned over into sales. A proper balance sales and generally reflects that assets are managed
well.

 Debtor’s turnover ratio.

 Total assets turnover ratio.
 Fixed assets turnover ratio.
 Current assets turnover ratio.

IV.PROFITABILITY RATIO

Profitability is an indication of the efficiency with which the operations of the

business are carried on. Bankers, financial institutions and other creditors look at the
profitability ratios as an indicator whether or not the firm earns substantially more than it pays
interest for the use of borrowed finds and whether the ultimate repayment of their debt
appears reasonably certain. Owners are interested to know the profitability as it indicates the
return, which they can get their investments.

 Gross profit ratio

 Net profit ratio
 Operating profit ratio
 Operating ratio
 Return on investment ratio
 Return on equity
 EPS
 DPS
 Pay out

1. Current ratio:
 This ratio relates current assets to current liabilities. The current ratio indicates the
ability of the organization to meet its current obligations. It measures short-term solvency of
the concern.

The current ratio is calculated by dividing current assets by current liabilities.

Current assets
Current ratio=
Current liabilities

years Current assets Current liabilities Current ratio

2004 335.21 126.20 2.66:1

2005 363.31 172.53 2.11:1

2006 525.04 398.06 1.32:1

2007 984 638.12 1.54:1

2008 1488 892.6 1.66:1

Analysis:

The current ratio of the company is decreased from 2004 to 2006 as 2.66:1, 2.11:1,
1.32:1, later it is increased from 2006 to 2008 as 1.32:1, 1.54:1, and 1.66:1.

The graph between Years and Current ratio shows as below

 Interpretation:
In the year of 2004, 2005 the current ratio of Techmahindra maintains the standards of
2:1. After the situation is less than 2:1 it shows the margin of safety for creditors is low and
company may be struggling to meet their obligations to pay.

2.Capital equity ratio:-

 This is the ratio which expressing the basic relationship between debt and equity.
Calculating the ratio of Net assets to Net worth can find this ratio.

Capital employed
Capital equity ratio =
Net worth

Capital employed = Total debt + Net worth

years Capital employed Net worth Capital equity ratio

(in.Rs.Cr) (in.Rs.Cr)
2004 435.34 435.34 1.00
2005 482.82 482.83 0.99
2006 597.86 597.86 1.00
2007 930.78 878.12 1.06
2008 1323.40 1228.40 1.08

Analysis:-
Capital equity ratio of the firm for 2004 to 2008 are 1, 0.99, 1, 1.03, 1.08.it is
decreased from 2004 to 2005 after the years it raised to 1.08.
The graph between Years and Capital equity ratios ratio shows as below

Iterpretation:-

The funds being contributed by the lenders and owners for each rupee is almost i.e.
Rs.1/-.It indicates that the firm maintained the constant capital and equity in the equal
proportion change.

1. Debtors turnover ratio:-

 Debtors turnover ratio can be calculated by dividing total sales by dividing debtors.

Sales
Debtors turn over =
Debtors

years Sales Debtors Debtors turnover

ratio

2004 711.50 276.21 2.58times

2005 922.34 217.42 4.24times

2006 1197.14 412.72 2.90times

2007 2753.22 792.02 3.48times

2008 3604.7 1057.40 3.41times

Analysis:-
Debtor’s turnover ratio for the years 2004, 2005, 2006, 2007 and 2008 are 2.58, 4.24,
2.90, 3.48 and 3.41 respectively. It is raised to 4.24 for the year 2005 after it decreased to 3.41
in the year 2008.
The graph between Years and Debtors turnover ratios shows as below

Interpretation:-
The ratios are more than 2, this indicates the firm is good at the management of credit.
It is high in the year 2005 and least in the year 2004. The firm maintained conversion of the
debtor’s funds to sales is sufficiently.
3. Operating profit ratio:-

This ratio measures the relationship between operating profit and net sales. It
determines the operational efficiency of the management.

Operating profit
Operating ratio= ×100
Net sales

Years Operating profit Net Sales Operating profit ratio

(in.Rs.Cr) (in.Rs.Cr) (%)

2004 129.88 711.50 18.25

2005 174.53 922.34 18.92

2006 257.53 1197.14 21.51

2007 720.88 2753.22 26.18

2008 839.40 3604.7 23.29

Analysis:-

The operating profit for the years from 2004 to 2008 are 18.25%, 18.92%, 21.51%,
26.18% and 23.29%.it increased up to 2007 then decreased to 2008 with 23.29%.

The graph between Years and Operating profit ratio shows as below
Interpretation:

It indicates an average operating margin earned on a sale of Rs.100, remaining can

used for non-operating expenses, to pay dividend and to create reserves is shown by the firm
is very effectively.

4.Operating ratio:-
 This ratio measures the relationship between operating cost and net sales.

Operating expenses
Operating ratio= ×100
Net sales

Operating expenses= power&fuel+empoyee cost+othermanufacturing

expenses+selling & administration expenses+miscellaneous
expenses.

Years Operating expenses Net Sales Operating ratio

2004 581.62 711.50 81.75%

2005 747.81 922.34 81.08%

2006 939.61 1197.14 78.49%

2007 2032.34 2753.22 73.81%

2008 2765.30 3604.7 76.71%

Analysis
The operating ratio of the firm for the years from 2004 to 2008 is 81.75%, 81.08%,
78.49%, 73.81 & 76.71%.

The graph between Years and Net profit ratio shows as below
Interpretation

The ratios are in decreasing from 2004 to 2007 and next year i.e. in 2008 increases to
76.71% more over the operating expenses when compare to net sales is decreased.

5. Return on investment:
 ROI is one of the very important parameters affecting business plans. It can be
calculated by net profit after tax dividing with net assets.

Profit after tax

ROI = ×100
Net assets

Years Profit after tax Net assets ROI

2004 94.13 435.34 21.62%

2005 71.09 482.82 14.72%

2006 220.12 597.86 36.81%

2007 65.23 930.78 7.01%

2008 325.70 1322.40 24.61%

Analysis:

ROI of the firm for the years from 2004 to 2008 are 21.62%, 14.72%, 36.81%, 7.01%
& 24.61%.it is highest in the year 2006 i.e. 36.81%, least in the year 2007 i.e. 7.01%.

The graph between Years and ROI shows as below

INTERPRETATION:

This ratio indicates the firm ability of generating profit per rupee of capital employed.
Return to the share holder and lenders is in high in the year 2006, least in the year 2007 and
satisfactory return is in 2008

6. Return On Equity (ROE):

 The return on equity is net profit after taxes divided by share holders equity, is given
by net worth.

Profit after taxes

ROE=
Net worth

years Profit after taxes Net worth ROE

2004 94.13 435.34 21.62%

2005 71.09 482.83 14.72%

2006 220.12 597.86 36.82%

2007 65.23 878.12 7.43%

2008 325.70 1228.40 26.51%

Analysis:

ROE of the firm for the year from 2004 to 2008 are 21.62%, 14.72%, 36.82%, 7.43%
& 26.51%.

The graph between Years and ROE shows as below

Interpretation:

This ratio of company should be compared with the ratio for similar companies and
this will reveal the relative performance and strength of the company in attracting future
investment. Returns of the firm are highest in 2006 least in 2007, 2008 it is in satisfaction
level.

DATA ANALAYSIS AND INTERPRETATION

Q1. Are you aware about Mahindra Finance?
YES NO
85% 15%

According to survey we find that 85% of customers are aware about Mahindra Finance while
15% are not.

Q2. Have you owned any Services of Mahindra Finance?

 YES NO
40% 60%

According to survey we find that 40% of customers are owned a services of Mahindra
Finance while 60% are not.

Q3. Which type of Service do you owned?

 Two wheeler loan 28%
Car Loan 35%
Commercial Loan 5%
Personnel loan 15%
Home Loan 17%

According to survey we find that 28% of customers are owned Two wheeler loan, 35%
customers have Car Loan, 5% customers have Commercial loan, 15% customers owned
Personnel loan while 17% customers are have Home Loans from Mahindra Finance.

Q4. Are you satisfy with the interest rates and services provided by Mahindra Finance?
YES NO
 65% 35%

According to survey we find that 65% of customers are satisfy with Mahindra Finance while
35% are not.
Q5. Rate the product about your satisfaction?
GOOD 52%
VERY GOOD 20%
EXCELLENT 18%
POOR 10%

According to survey we find that 52% of customers are likely to says that its Good, 20%
customers says its Very Good, 18% customers says its excellent while 10% says its Poor.
Q6. By which source you come to know about Mahindra Finance?
T.V 58%
NEWSPAPER 15%
HOARDINGS 10%
MOUTH OF TONGUE 17%

According to survey we find that 58% of customers are come to know by T.V, 20%
customers says by Newspaper, 10% customers says by Hoardings while 17% says by Mouth
of tongue.
Q7. Did you aware about Promotional policies of Mahindra Finance?
YES NO
65% 35%

According to survey we find that 65% of customers are aware about promotional policies
while 35% are not.
Q8. Are the employees of Mahindra Finance cooperative with you when you visit?
YES 55%
NO 45%

According to survey we find that 55% customers are satisfied with the workers of Mahindra
Finance while 45% customers are not satisfied.

FINDINGS:
 Firm maintained liquidity ratio indicates that it is in standards in the years 2004 &
2005. In the next years it is below the standards.

 Debt of the firm is almost equal to its net worth.

 Turnover ratios indicate that the firm is in good at conversion assets to sales.

 Current assets turnover is very high when compare to the fixed assets turnover.

 Gross profit is high in the years 2004 after the years firm gets fluctuations finally it is
in good position.

 In the 2004 & 2005 years it is having more operating expenses than to sales it is well
for next years.

 Returns is not in preferable way it is below 25% on average.

 Earnings on each share are good condition for the firm.

 But the payment to the share holders is below 50%.

 SUGGESTIONS:

 Although firm maintains sufficient liquidity, it is needed to increase, in order to attain

future demand.

 Because of being a soft solutions Mahindra ltd need to raise their turnovers to get good
impression on the maintenance.

 Firm needed to decrease the operating expenses, in order to sustain in this rescission
period.

 Returns are of below 25% there is necessary to increase it. By getting more projects it
will happens.

 Although the earnings on each share is good payment to the share holders is below
50%.it is better to maintain 50% to 75%, it will helps attracting share holders towards

invest on Techmahindra .
 BIBLIOGRAPHY:

1. Financial management
By I .m. Pandey

2. Advanced accountancy
By R.L.Gupta
By M.Radhasway

3. Financial management
By S.N.Maheswari

Web sites:

www.techmahindra.com
www.reddiffmoneybuzz.com
www.moneycontrol.com
 QUESTIONNAIRE
NAME................................. OCCUPATION.................................

SEX................................... CONTACT NO. ................................

Q1. Are you aware about Mahindra Finance?

YES NO

Q2. Have you owned any Services of Mahindra Finance?

YES NO

Q3. Which type of Service do you owned?

Two wheeler loan Commercial Loan

Car Loan Personnel loan

Home Loan

Q4. Are you satisfy with the interest rates and services provided by Mahindra Finance?

YES NO

Q5. Rate the product about your satisfaction?

GOOD EXCELLENT

VERY GOOD POOR

Q6. By which source you come to know about Mahindra Finance?

T.V HOARDINGS

NEWSPAPER MOUTH OF TONGUE

Q7. Did you aware about Promotional policies of Mahindra Finance?

YES NO

Q8. Are the employees of Mahindra Finance cooperative with you when you visit?

YES NO
SIGNATURE