Institute of Management Studies

Financial Management
Assignment
Ratio Analysis
Of
TATA MOTORS

Submitted To:- Submitted By:-

Dr. Kapil Sharma Anmol Bharti
Kanupriya Kakodia
Aman Manore
Rohit Choubey
Akshay Chouhan
Kartik Goyal
RATIO ANALYSIS
of
Liquidity Ratios
Current Ratio
Current ratio = current assets/current liabilities

The current ratio is a liquidity ratio that measures whether or not a firm has enough resources to meet its short-term obligations
The current ratio is an indication of a firm's liquidity. Acceptable current ratios vary from industry to industry.

FY 18 - 0.62
FY 17 - 0.59
FY 16 - 0.63

Management point of view

They have current ratio of 0.62 in fy 2018 which is much less than idle current ratio i.e 2.so the management have to improve there assets and should
decrease liabilities.

Investors point of view

Investors want to be invest in such a companies who have idle comparative ratios of approx the idle one, but in case of tata motors current ratio there
assets are less than liabilities which is not for good business.

Lenders point of view

Money lenders want there money to be safe at the time of insolvency of company and as we see the current ratio of tata motors money lenders
believe less in giving them loans.
Quick Ratio
Quick ratio = quick assets /current liabilities

FY18 = 0.44
FY17 = 0.42

Quick assets = cash +cash equivalent +short term investment+current receivables

The quick ratio is a financial liquidity ratio that compares quick assets to current liabilities. Quick assets generally include cash, cash equivalents, and ac

The acid test ratio should be 1:1 or higher; however, this varies widely by industry

Management point of view

They have quick ratio of 0.44 in fy 2018 which is much less that the idle ratio i.e.1 , so the management have to improve their quick assets and should d

Investors point of view

Investors want to invest in such a companies who have idle comparative ratios of approx the idle one, but in case of tata motors , quick ratio there quick

Lenders point of view

Creditors want their money to be safe and the quick ratio assures the creditors that their money are safe but in the case of tata motors creditors believe