CHAPTER I

INTRODUCTION

1.1

INTRODUCTON

Financial statements are the basis for managerial decision making. It is a collection of data organized according to logical and consistent, accounting procedures. They convey an understanding of some financial aspects of a business firm, to the parties interested in its operations. Ratio analysis is the major tool used for analyzing the financial statements. A financial ratio is the relationship between two according figures expressed mathematically.

Financial Statements: - The financial statements provide rich information about

the operational results of a business unit and much can be learned from a careful examination of these statements .A forecast of future earnings of a business can also be prepared based on the analysis and interpretation of financial statements.

Financial Statement Analysis, according to Myers, It is largely a study of relationship among the various financial factors in a business as disclosed by a single set of statements and a study of the trends of these factors as shown in a series of statements.

In the words of W.B.Meig, Financial Statements are organized summaries of detailed information and are thus a form of analysis.

MEANING OF FINANCIAL STATEMENT:The focus of financial analysis is one key figures contained in the financial statements and the significant relationship that exists between them. Analyzing Financial Statements, according to Metcalf and Titard, is a process of evaluating the relationship between component parts of a financial statement to obtain a better understanding of a firms position and performance.

These financial statements are required by the management for the purpose of evaluation and decision making.

There are three steps involved in the financial statement analysis and they are:1) Selection: - The first step involved refers to the selection of information relevant
to the purpose of evaluation from the total of information contained in the financial statements.

2) Classification: - The second step involved is the classification or grouping of

information in such a manner to focus on the significant relationship.

3) Interpretation: - The final step is the interpretation which includes drawing of

interferences and conclusions.

The analysis and interpretation are closely interlinked since interpretation is impossible without a proper analysis and any analysis which is not followed by interpretation becomes a meaningless exercise.Thus, interpretation precedes a proper analysis.

1.2 Need for the study

The study concentrates on the financial state of the company. It involves the study of ratio analysis. It helps to present a broader picture of the financial position of the company through ratios. The study has great significance and provides benefits to various parties whom directly or indirectly interacts with the company. Ratio analysis is useful in the following ways:1. Short term and long term planning. 2. Measurements and evaluation of financial performance. 3. Study of financial trends. 4. Decisions making for investments and operations. 5. Diagnosis of financial skills. 6. It is beneficial to top management of the company by providing clear picture regarding important aspects like liquidity,leverage,activity and profitability.

To be done to well understand the performance of various operations identifies the shortcoming in management and to suggest for improvement in those areas.

1.3 Objectives of the study

This study of INDUS Hospitals has been undertaken to evaluate the financial efficiency of the organization by establishing the following objectives. a) To analyze the financial performance of a company. b) To know the changes in total financial resources of the company. c) To know the liquidity of the company. d) To study the operation efficiency and performance of the company.

1.4 Methodology
The analysis of the project was based on the available information. Any information about the topic is called the data. The data was gathered from various sources. Basically we have two types of data collections

1. Primary data 2. Secondary data

PRIMARY DATA:
Any information that is collected afresh and for the first time thus happen to be original in character is called Primary Data. It can be collected either through experience or through survey or gathered from concerned employees.

SECONDARY DATA:
Any information which has already been analyzed by someone else and which have already been passed through the statistical process is called Secondary Data. The secondary data for the study have been gathered from balance sheets, P&L accounts, annual reports and other books and manuals of INDUS HOSPITALS. Secondary data may either be published data or unpublished data that are available.

Usually published data are available in company financial records, organizations technical and trade journals; books magazines, internet and news papers etc., are sources of secondary data. Research must be very careful in using secondary data.

1.5 Limitations
There may be limitations to this study because the study duration (project) is very short and its not possible to observe every aspect. The study is strictly based on mathematical interpretation of the figure and ignores the factor such as management style, motivation, leadership etc. The entire study is based upon the secondary data available at site office. Ratio used for financial performance analysis is not necessarily the true indicator of future result. Firm may adopt the changes in accounting polices, procedures,

due to changes in accounting standards from time to time. Result of a ratio analysis are not a solution for the problem. Where there is change in price, quantitative and qualitative data in absolute figures are for managerial decision. Financial analysis depends up on certain individual assumption, definitions. This gives several results leading to difficult in comparison.

CHAPTER II
INDUSTRY PROFILE COMPANY PROFILE

2.1 INTRODUCTION TO INDUSTRY

It is a health care industry. Health care is one of the largest sectors, in term of revenue and employment, and this sector is expanding rapidly according to technopak advisors in their reports India health trends 2008 healthcare, which is a US$ 35 billion industry in India, is expected to reach over US$ 75 billion by 2012 and US$ 150 billion by 2017. The industry has today become a growth engine for the Indian economy, contributing substantially to the increase in the GDP, urban employment, to achieve the vision of the powerful and resilient India. the increase in the number of affordable middle class, rise in insured population , widening demand supply gap, growing number of life style diseases especially cancer, cardiovascular diseases, diabetes and chronic

health care industry. Other like wellness programmes, fitness programmes, health management, and preventive medicine- synonyms of healthcare are growing more and more familiar with each passing heart beat. A growing elderly population and rise in income levels are also pushing for better facilities in the country. To meet this growing demand, the country needs US$50 billion annually for the next 20 years, says a confederation of Indian industry (CII) study. India needs to add 3.1 million beds by 2018 to the existing 1.1 million, and requires immediate investment of US$82 billion, as per the technopak advisors report. It clearly indicates the continuing potentiality in the health sector.

Brief Overview:
India is one of the worlds most lucrative healthcare markets, and is expanding rapidly, according to latest findings by a report published in February 2012, by market research firm RNCOS. India is the most competitive destination with advantages of

lower cost and sophisticated treatments, according to RNCOS report titled Indian Healthcare New Avenues for Growth. The report further highlighted that several key

trends are backing the growth of Indias healthcare sector.

Of these, medical city is

relatively a new concept that offers immense growth opportunities. Likewise, there is a huge potential for day care surgeries. Almost 60 percent of all surgeries can be done in a day care mode as the current infrastructure supports.

India will witness the largest number of mergers and acquisitions (M & A) in the pharmaceutical and healthcare sector, according to consulting firm Grant Thornton. A survey conducted across 100 companies has revealed that a fourth of the respondents were optimistic about acquisitions in the pharmaceutical sector.

Market Size:
The hospital and diagnostic centre in India has attracted foreign direct investment (FDI) worth US$ 1,183.04 million, while drugs & pharmaceutical and medical & surgical appliances industry registered FDI worth US$ 9,170.24 million and US$ 514.08 million respectively, during April 2000 to January 2012, according to the data provided by Department of Industrial Policy and Promotion (DIPP).

Trends and Investments:

Sovereign fund Government of Singapore Investment Corporation (GIC) has picked up a minority stake in Vasan Healthcare Enterprise, an eye care chain, for US$ 100 million. Vasan will use the funds to expand rapidly in new geographies, besides look at acquisitions, as per AM Arun, Chairman, Vasan. Ranbaxy has announced the opening of its new manufacturing facility at Casablanca, Morocco. Morocco is one of the important markets and this manufacturing facility further reinforces our commitment to the people of

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Morocco and the African continent, according to Mahendra Bhardwaj, Head, Randbaxy (Africa). Ranbaxy Laboratories Ltd announced that it has launched the generic versions of cholesterol reducing drug Atorvastatin, in Italy, Sweden and the Netherlands. With sales worth US$ 377 million, it is the largest selling pharmaceutical produt in Italy. The market size for Atorvastatin in the Netherlands is US$ 164.4 million and in Sweden US$ 55 million. Dubai-based DM Healthcare has opened a multi- speciality hospital in Kolhapur in Maharashtra. The Aster-Aadhar hospital, a joint venture (JV) between DM

Healthcare and Aadhar hospital, is a 175 bed facility and is equipped with complete spectrum of healthcar amenities and infrastructure. A Medicity in Kochi, estimated to cost Rs 1,500 crore (US$ 2.98 million) , is part of the expansion plans. Halcyon Finance and Capital Advisors Pvt Ltd has bought management and development and rights of an under construction super specialty hospital in Delhi, India, for Rs 375 crore (US$ 74.4 million). Halcyon plans to develop a 700 bed facility and will also provide allied healthcare activities such as research and medical education at the hospital. The urology and laparoscopy chain, RG Stone Hospital, would invest Rs 120 croe (US$ 23.81 million) in Uttar Pradesh (UP) over the next two years to set up a chain of hospitals across the country. We would provide reliable and affordable treatment available in the state, according to Bhaldev Raj, Country Head, RG Stone Urology and Paparoscopy Hospital. With an intention to increase their foothold in the US healthcare market, Wipro Technologies has launched its NextGen care management solution. The solution enables physicians drive patient participation in devisiong a personalised care plan with defined care goals, treatment plan and health improvement activites. Apollo Hospitals plans to set up a second haopital in Bangladesh, at the prt city of Chittagong, through a local partner. The 300 bed project is expected to be on

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steam in two years.

Apollo hospital sha participated in a similar tele-medicine

initiative in 24 countries in Africa and runs 120 video conferencing hubs, mostly in India and a Few in Mauritius, Maldive, parts of West Asia, Sri Lanka and others, to take healthcare to the patients doorstep, according to Sangita Reddy, Executive Director, Operations, Apollo Group of Hospitals. Bio-pharmaceutical and health science sector representatives from the UK are willing to expand partnerships with India companies, as per lan Felton, British Deputy High Commissioner, Bangalore. Pharmaceutical majors such as Novartis, GlaxoSmithKline, Pfizer, Ranbaxy and Aventis are keen to emulate the consumer industrys success in the hinterland. Novartis educates 6 million villagers in a year on health under the banner of Arogra Parivar.

Medical Tourism:
The boom in medical tourism is encouraging hospitals and hoteliers to strike alliances with each other. According to industry estimates, the market size of medical tourism in India is growing at over 25 per cent annually at more than US$ 2.5 billion. The segments growing business potential prompted the ITC gro up to set up the 58 room Fortune Park Lake City business hotel at the Jupiter Lifeline Hospitals complex in Thane, near Mumbai, to serve medical tourists. Apollo Hospitals is also exploring similar tie-ups with neighbourhood hotels. Most international patients are from Africa, SAARC and West Asia. Patients requiring higher-end tertiary care are now coming to India for cardiology, orthopaedics, neurology, oncology and organ transplants. Affordability of treatment is a big pull

factortreatment in India costs ust 10-20 percent of what it costs abroad, added Saumyajit Roy, Associate Director Strategic Consulting (Education, Healthcare and Senior Living), Jones Lang LaSalla India.

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Healthcare Government Initiatives:

The Government has decided to increase health expenditure to 2.5 percent of the gross domestic product (GDP) by the end of the 12 th Five Year Plan, from the current 1.4 percent. In addition a number of initiatives that have been proposed and taken up by the Government of India (GOI) for enhancement of the healthcare sector. 100percent foreign direct investment (FDI) is permitted for health and medical services under the automatic route. Allocation for national Rural Health Mission (NHRM) has proposed to be increased from Rs 18,115 crore (US$ 3.59 billion) in 2011-12 to Rs 20,822 crore (US$4.13 billion) in 2012-13. National Urban Health Mission is being launched.

Health and Nutrition:

Proposal to extend concessional basic customs duty of 5 percent with full exemption from excise duty/CVD to 6 specified life saving drugs/vaccines. Basic customs duty and excise duty reduced on Soy products to address protein deficiency among women and children. Basic customs duty and excised duty reduced on lodine. Basic customs duty reduced on Probiotics.

Road Ahead:
Indias thriving economy is driving urbanisation and creating an expanding middle class, with more disposable income to spend on healthcare. The Government of India has developed an all-inclusive policy on healthcare which aims to achieve a remarkable growth for the sector which has led to a high number of compelling opportunities such as developing new infrastructure and providing novel medical equipment solutions. The

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sector holds enormous potential which is waiting to be unleashed to the maximum potential. On the back of continuously rising demand, the hospital services industry is expected to be worth US$ 81.2 billion by 2015, according to the latest RNCOS research report titled, Indian Hospital Services Market Outlook, published in March 201 2. Huge private sector investments will significantly contribute to the development of hospital industry, comprising around 80percent of the total market, highlighted the report. Exchange Rage used; INR 1 = US$ 0.01984 as on March 20, 2012.

INDUSTRY SCENARIO:Visakhapatnam is becoming a Medical City next to Hyderabad in the State People from Vizianagaram, Srikakulam, Godavari Districts, from neighbouring States Orissa, Chattisgarh, Jarkhand regularly visit Visakapatnam for their medical needs.

Visakhapatnam is equipped with Govt Hospitals like K.G.H, Victoria hospital; Regional Eye Hospital, RCD Hospital and Corporate Groups like Seven Hills, Apollo, and Care etc are very busy in serving the needs of people. The proposed hospital project located very near to KGH and other Corporate Hospitals. This is well known in for medical services. In the recent past due to increase in Traffic conditions the accident and emergency cases growing abnormally. As per the medical survey reports for every

10000 population there is a need for 10 medical beds. As at Present the population of Greater Visakhapatnam is approximately around 25.00 Lacs and the available medical facilities are insuffities are insufficient to cater the needs of the public. There exisits a big gap in between the demand and supply in this field.

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2.2 ABOUT INDUS HOSPITAL

A star was born on the healthcare horizon when Indus Hospitals was established in the beach city of Visakhpatnam. Managed by a team of stalwarts in the medical profession and ably led by Dr V Satyanaryana who is an experienced Neurologist with over 35 years of experience. Indus Hospitals serves patients from all walks of life with the best facilities

Dr V Satyanaryana is one of the foremost Neurologists in the country and has a heart of gold for patients who are poor and downtrodden. He has helped countless number of patients recover from their illness and chronic suffering through his philanthropic nature which has made him very highly respected among his peers.

Indus Hospitals has a capacity of 150 beds and is equipped with the best state of the art infrastructure which is comparable to any international hospital in the world. With well equipped Acute Medical Care units (ACMU), Cardiothoracic Intensive Care Unit (CTICU) and Intensive Coronary care units (ICCU) departments which are built to world class standards and use the services of the best technicians and surgeons in the medical field.

With varied departments ranging from Nephrology, Neurosurgery and Cardiac care, Indus Hospitals fulfils a complete spectrum of services and is a single point solution for various medical requirements for our patients who come from the diverse social spectrums.

With state of the art, centrally air conditioned facilities and world class facility management; we successfully exceed the expectations of every patient who comes to our hospital for treatment.

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We are poised to redefine the future of healthcare through our dynamic services and have established a bond of trust with our patients.

OUR PROFILE

Indus Hospitals is one of the most prominent hospitals in the city of Visakhapatnam. Indus Hospitals was established by Dr V Satyanaryana who is a veteran to the medical field. With a vision to establish a quality medical care facility which caters to all segments of the population, he started Indus Hospitals in with the latest equipment and medical acumen of several doctors who had specialized in India and abroad in some of the finest institutions

Indus Hospitals believes in the philosophy of delivering the best patient care for all segments of patient who come to our hospital. With a service oriented approach, Indus Hospitals is helping many thousands of people who are from the weaker sections of the society and making them lead happy and healthy lives. Our founder Dr V Satyanaryana is a great philanthropist who has helped many needy patients in their time of need and given monetary and medical assistance to countless families on a personal basis.

We have a rare distinction of performing various critical surgeries in our hospital with a very high rate of success. This is not only due to our world class infrastructure but also due to the dedication and commitment of our doctors and staff who deliver the best treatment and service for all patients who come to us. We have set our sights on the future which holds new promise of growth and enhanced service capabilities for our patients. We have established a state of the art Indus heart center which provides the best cardiac care compared to any other facility in India. Our Indus heart center is equipped with advanced equipment like the M.C 1000 Plus Automated Coagulation Analyzer from Germany, Cardiac readers from Roche, Germany and the Siemens Artis ZEE Cath lab which one of the worlds finest equipment for p roviding cardiac digital imaging.

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At Indus Hospitals, we believe in delivering quality patient care which is a combination of the best medical equipment and human skill which leads to better patient well being and an improvement in the healthcare standards for every ordinary person.

VISION & MISSION

Mission
To provide quality medical services to all patients and deliver international treatment standards in India.

Vision
To become a leader in the healthcare segment and add value to our patients, doctors and employees through constant innovation and service enhancement.

BOARD OF DIRECTORS
The hospital is headed by Dr V Satyanaryana (Chairman and Founder)- The hospital is headed by Dr V Satyanaryana who is one of the foremost neurologists in the country and has a soft corner for patients who are poor and downtrodden. He has helped countless number of patients recover from their illness and chronic suffering through his philanthropic nature. This has made him highly respected among his peers in the hospital.

Key Achievements include:

Achieved the rare distinction of being the first qualified neurophysician in the entire state of Andhra Pradesh. Served in the department of AP Medical &Health Services from 1965 to 1977.

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Served as a professor in Neurology in Andhra Medical College from 1977 to 1996.

Member of various eminent medical fellowships including the Indian Medical Association, Indian Academy of Neurology and Member of the World Federation of Neurology and AP Neurology Scientists Association.

Has published highly acclaimed papers on the recurrent polyneurotherapy and Wilson disease and many other critical subjects.

Dr. S. Sridhar (Managing Director) - He is the Managing director of the hospital and is actively involved in day to administration of the hospital. He has pursued his MBBS degree at Ranagaraya Medical College in Kakinada and his M.S in General Surgery at the Guntur medical college. Dr Sridhar achieved his post specialization in the field of gastro Intestinal Surgery at the GB Pant Hospital University in New Delhi.

A highly capable administrator, he has a keen vision to make Indus Hospitals the leader in the healthcare and medical segment in the city of Visakhapatnam. He is one of the few highly qualified Gastro Enterologists who is present in the entire state of Andhra Pradesh.

Dr Sridhar also has the distinction of working as a surgical registrar with Nizams Institute of Medical Sciences (NIMS). He has also served as a managing director in visaka hospital and Siddhartha medical canter. These Institutions are now running as highly profitable ventures and have established themselves as key facilities for providing medical healthcare services.

Dr Sridhar also has the rare distinction of presenting various papers and research projects in major conferences worldwide. He is a highly qualified Surgical Gastro Enterologist.

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Dr B.S Nehru (Director) is a highly eminent Nephrologist who has close to over 3 decades of experience in treating various types of Nephrological conditions. He has established a private practice since the year 1984.

His wide ranging experience includes practicing as a Physician from 1984 to 1998 in Srikakulam and then working as Senior Registrar in the department of Nephrology in Apollo Hospitals in Chennai for two years from 1998-2000. He has been practicing as a Nephrologist in Visakhapatnam since Dec 2000.

Dr B.S Nehru is a MD in General Medicine and has specialized in DNB (Nephrology).

Dr V. Sujatha(Director)- She is one of the Directors of Indus Hospitals and has specialized in the field of cardiology. After completing her MBBS in the year 1990 at Andhra Medical College Vizag, she specialized Internal Medicine in the year 1994 at Andhra Medical College and the prestigious King George Hospital in Vizag.

Dr Sujatha completed her DM in Cardiology in the year 2000 at Nizams Institutes of Medical Sciences in Hyderabad.

Her professional experience includes working a consultant cardiologist since the year 2000 and she has worked in Care hospitals, Seven Hills Hospitals and Apollo Hospitals and is familiar with the latest trends and technologies which are adopted worldwide in the field of cardiac care.

Professional Experience: : Senior resident in cardiology Nizams Institute of Dec94-Dec96 Medical Sciences Jan97-Jan00 : Residency in Cardiology Nizams Institute of Medical

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Sciences : Post-doctoral trainee Nizams Institute of Medical Feb00 Sciences : Assistant professor of cardiology Nizams Institute Mar00-July00 ofMedical Sciences Aug00-May01 : Consultant Cardiologist CARE hospitals Visakhapatnam. : Consultant Cardiologist Seven Hills hospital May01-Sep03 Visakhapatnam : Fellowship in Interventio Cardiology Institute Oct03-Oct04 Cardiovaculaire Paris Sud, Paris

Dr Sailaja(Director)-She is one of the key Directors of the hospital. After pursuing her MBBS in 1990 at the Gandhi Medical College in Hyderabad. She obtained a master degree in Internal Medicine at the Yale Primary Care Internal Medicine Residency Program which was conducted at New Haven, Connecticut. She is currently pursuing her fellowship in infectious disease at the Yale University.

Her professional experience includes

1998-2004 Medical Director, Stay well Health Center, Waterbury, CT 1999-2004-Clinician Educator, Yale Primary Care Internal Medicine Residency Program, CT

1998-2003-Emergency Staff Physician, St. Marys Hospital, CT 2003-2004-Staff Physician, DMR, State of CT, CT

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Her Teaching Experience includes

1993-1994-Supervised research Projects of NYU medical students(Honors Program)

1994-1995-Tutored first year medical students at NYU Medical Center In Molecular Biology and Biochemistry

1998- Taught Medical residents of the Yale Primary Care Internal 1999-2004-Clinician Educator, Yale Primary Care Internal Medicine Residency Program

A list of awards and merits which she has garnered include

1983-1985-National Merit Scholarship from Govt. Of India 1985-1990-National Merit Scholarship from Govt. Of India for Medical School Education

1996 Second Prize in the poster competition at the spring Scientific Session of the Connecticut State ACP Meeting

1996 "Intern of the Year" in the Yale Primary Care Residency Program 1997 "Young Investigator Award" from the Connecticut State Infectious Disease Society

1998 "John Brackett Award" for being an outstanding medical resident of the Yale Primary Care Internal Medicine Residency Program

2001 "Best Teacher Award" from Yale Primary Care Internal Medicine Residency Program

Mr. V Ravikumar(Director)- He is one of the present Directors of the hospital and has completed his B. Tech at IIT Madras and PhD at the university of Southern California. He is currently employed as senior Scientist in General Electric, USA.

Dr K Ravindra(Director)- He brings his wide range experience in general medicine to Indus Hospitals. He completed his MBBS in the year 1972 from Belgaum University and

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worked in the peoples poly clinic in Nellore from 1972 to 1975. He then opened a general practice clinic in Tenali which was operational for four years from 1975 to 1979.

He then worked in the country of Algeria in North Africa for a period of 5 years from 1979 to 1984 under the ministry of external affairs Govt of India. He has been practicing General Medicine in the City of Visakhapatnam from the year 1985 till date and has been providing a wide range of medical services to his patients. Additionally, he has also toured various countries like France, Singapore and Germany to gain medical experience.

CHAIRMAN'S MESSAGE

I extend a warm welcome to all the visitors who have visited our website. I had the vision of establishing Indus Hospitals to provide quality healthcare services for the population of visakhpatnam and adjacent areas and meet their growing medical needs. At Indus Hospitals, we continue to set new standards of patient treatment quality which could only be achieved by world class infrastructure and skilled medical expertise of highly talented doctors. We have carefully chosen our staff that has not only an excellent professional record but also a true desire to care and enhance patient well being at all times.

Indus Hospitals has been constantly expanding to meet the diverse needs of patients across various specialties. Our latest addition has been the setting up a fully fledged Indus Heart Center which provides super specialty heart care to our patients. Our Indus heart center now offers our patients various types of invasive and non invasive cardiac surgeries which are highly advanced and require specialized equipment and infrastructure which was available only in a few select hospitals in the country. Our attention to detail and a high standard of facility management ensures a very high success ratio in the surgeries which are performed at the Indus Heart Center.

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With a view towards the future, Indus Hospitals has been procuring the latest equipment and medical technology from around the world which includes the world famous Siemens Artis ZEE cath lab equipment which is the reference standard for cardiac imaging and care.

Indus Hospitals is committed to deliver patient satisfaction on all fronts through the integration of sound management, advanced infrastructure and above all a strong will to deliver the best patient experience at all times.

INFRASTRUCTURE HOME
Indus Hospitals has the highest quality infrastructure to cater to the needs of patients who need highly specialized care. With a focus on patient satisfaction, Indus Hospitals has designed its hospital environment to be totally patient friendly and offer the best utility for patients and doctors who use our facilities.

We offer the following facilities in our hospital.

Acute Medical Care Unit(AMCU) Intensive Coronary Care Unit(ICCU) Cardio Thoracic Intensive Care Unit(CTICU)

Each of these departments is equipped with the latest equipments and facilities for quality patient care and ensures very high standard of treatment and surgery for our patients.

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Ward Wise Infrastructure

AMCU ICCU CTICU GENERAL WARD SHARING(A/C& NON A/C) SINGLE(A/C&NONA/C) CATHWARD CASUALITY DIALYSIS PRE OP

16 BEDS 10 BEDS 04 BEDS 40 BEDS 53 BEDS 18 BEDS 03 BEDS 05 BEDS 03 BEDS 04 BEDS

AMCU UNITS
At Indus Hospitals, we know the true seriousness of an emergency which requires specialized medical care. Our Acute medical care units(AMCU) function round the clock and provide Critical Care for patients who are suffering from various health

complications.

Our AMCU department has the following facilities

16 bed capacity HP monitors

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Puritan Benetton and Siemens ventilators Nelcor make pulse ox meters Parameter display monitors with centralized networking Centralized gas supply system Syringe and infusion pumps Ventilator systems for various types of patients Transport Ventilator Anesthesia Ventilators Valley Lab Diathermy Apparatus

ICCU UNITS
The ICCU unit at Indus Hospitals is equipped with world class facilities which are second to none in the market. We have designed and built our ICCU unit to world standards which is an envy of every hospital around us.

Our ICCU consists of 10 beds which are effectively laid out to provide spacious environs. We have installed the latest equipment for our ICCU block which includes state of the art technology and the finest skilled technicians to handle them.

Our ICCU consists of the following:

HP Monitors Puritan Benetton and Siemens ventilators Nelcor pulse oxymeters Multiple parameter monitors with a central network Multiple parameter monitors with a central network Centralized gas supply system Syringe pumps and infusion pumps Ventilators for adult pediatric and neonatal Transport Ventilator

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Anesthesia ventilators Valley Lab Diathermy Apparatus.

CTICU UNITS

Indus Hospitals has a fully fledged Cardiothoracic Intensive Care Unit which has been designed to provide the best facilities for patients. Our CTICU unit is designed to provide the highest quality critical care for patients who are admitted in the cardiothoracic surgery unit.

We have the following specialized equipment in our CTICU unit

Central Monitoring System High Quality Ventilators State of the art patient monitoring systems

Beyond all the equipment, we have a highly skilled team of doctors and nursing staff who take complete care of the patients on all fronts. This ensures that or patients make a complete recovery after undergoing cardiac surgery and any cardiac related procedures. We have designed our CTICU based on world standards of clean room and ICU care design. This ensures that there is a minimal risk of infection and enhanced protection for patients who need quick recoveries from surgeries.

INDUS HEART CENTER

Founded as an integral part of the Indus Hospitals division, the Indus Heart Center caters to numerous patients across diverse backgrounds using the best equipment and specialists. Established with a vision to provide quality services at affordable prices, the Indus Heart center is setting new standards in the handling of cardio care through the implementation of advanced technology and expert Physicians who heal the heart.

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We offer specializations in various aspects of cardiology and cardiothoracic surgery which are of the highest standards and help our patients lead healthier lives. Indus Heart Center has some of the best medical specialists who have spent a great deal of time and effort in finding the right solutions for cardio problems which affect patients.

With wide ranging expertise in cardiology and Cardiothoracic surgery, Indus Heart Center offers Critical Care, non Invasive and invasive cardiology treatments which exceed the standards set by many hospitals around India.

The Indus Heart Center is equipped with the following specialized equipments which help us provide quality cardiac services for our patients.

M.C. 1000 plus Automated Coagulation Analyzer (Germany)

The Hemoclot MC-1000 Plus is an optomechanical coagulation analyzer which applies the turbodensitometric measuring principle. All routine coagulation clothing tests such as PT activated and partial thromboplastin, fibrinogen and single factor assays can be performed with the instrument. The unit uses a liquid crystal display with one row and 8 characters have been integrated for visual communication. Parameters memory is accessed with the mode-key. The measuring channel is integrated into the 37.4OC incubation block with 1 position reagent bottle and 4 positions for cubettis.

Cardiac Reader Instrument (Roche, Germany)

Cardiac reader instrument 5 designed for cardiac profile investigations such as Troponin.T, Myoglobin, D-Dimer and Pro-BMP tests Quantitatively. The instrument is programmed for parameters with a digital display which shows the results automatically.

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Cardiac Catheterization (CathLab) : SIEMENS ARTIS ZEE

The digital imaging capabilities and flat panel detector technology of the Siemens Artis Zee modules are unmatched and provide quality images to manage the various types of treatments which Indus offers. This enhanced quality of imaging help identify minute problems which were invisible through other means which lead to better diagnosis and accurate treatment.

FACILITIES
We strive and provide the best facilities to enable our doctors and staff to serve patients effectively. Every aspect of facility management services are carefully monitored to ensure that there is no shortfall in the quality of service towards the patient at any point of time. Indus Hospitals is equipped with the following facilities

Biomedical Engineering Department

This department caters to all the maintenance planning and repairs of every biomedical department in the hospital.

Ambulance Services
We have two large ambulances and one small ambulance which is equipped with various life saving drugs and equipment.

Medical Records Department

totally computerized medical records department handles all the storage and management of medical records in the hospital as per regulatory norms.

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Backup Power Supply

Indus Hospitals has 2 fallback generators which of 250 Kva, these are designed to act in manual and automatic modes in the event of main power supply failure.

Medical Gas Storage

Indus Hospitals stores various medical gasses which are required for emergency medical care and always maintains 100% redundancy of gas stock over and above the current usage levels.

Centralized Air Conditioning

The hospital consists of a high quality daikin VRV system. And all major rooms in the hospital are air conditioned except for a few unimportant areas.

Solar Water Heating System

Indus Hospitals has a 4500 litter solar water heater system combined with the effective use of with heating elements.

Surplus Water Supply

Indus Hospitals has a reverse osmosis facility to provide high quality water supply to the entire hospital. Indus Hospitals uses about 50,000 litters of water a day and these are also provided using various ground and piped water sources.

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Patient Lifts
Indus Hospitals has 2 bed lifts and 1 passenger lift. The passenger lift can accommodate a patient bed with oxygen cylinder and also the support nursing staff.

We additionally have the following facilities which we offer our patients:

1) 26 dedicated outpatient consultation chambers for total patient comfort.

2)Four state of the art operation theatres which are equipped with world class anaesthesia work stations and surgical equipment with facility for laminar flow (bacteria free air flow) to ensure absolute sterility and prevent risk of infection.

3) A single operation theater which is exclusively dedicated for Neuro Surgery and specific operation theaters which are present exclusively for Cardiothoracic Surgery, Surgical Gastro Enterology, General surgery and Orthopedic surgery. We also have two exclusive operating theaters for cardiothoracic sugery which meet international standards.

We offer a wide suite of rooms for our patients based on their requirements these include

1. Single A/c Rooms 2. Deluxe Rooms 3. Single Non-A/c Rooms

4. Sharing Non-A/c Rooms

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4) Indus Hospitals also has a well stocked library which consists of a vast collection of medical literature which comprises of various nations and international journals and papers.

5) We are equipped with a large air conditioned Lecture hall which has a seating capacity of 120 people. It is equipped with a slide projector and LCD projector for

showing multimedia presentations and training the hospital staff.

6) We have a 100% medical emergency standby system for the hospital which consists of a reserve vacuum generator, reserve oxygen and nitrogen supply and a dedicated UPS.

7) We have installed Epoxy poly urethane flooring around the hospital to maintain stertility in all public areas, operation theaters, Critical Care Units.

8) We have designed our rooms to be spacious and well ventilated and ensured that all wards have the required amount of light and air.

9) We are equipped with a state of the art video conferencing and Tele facility.

conferencing

10) Indus Hospitals has a very advanced ambulance facility.

11) We use very powerful software for billing and patient management along with record maintenance.

12) We have a fire proof record room for manual and digital storage of patient records.

31

MANAGEMENT
Indus hospital believes in delivering quality care to its patients at all times. Indus has been providing quality services to patients from all walks of life and of different economic strata.

Indus was started with the sole aim of providing quality healthcare to patients by a team of dedicated specialists who felt the need for a specialized healthcare facility in the city of vishakapatnam. At Indus, We believe in giving our patients the best care and facilities of international standards which they can expect within the country. The hospital is headed by Dr V Satyanaryana (Chairmen and Founder) who is one of the foremost Neurologists in the Country and has a soft corner for patients who are poor and downtrodden. He has helped countless number of patients recover from their illness and chronic suffering through his philanthropic nature. This has made him highly respected among his peers in the hospital.

Key Achievements include:

Achieved the rare distinction of being the First Qualified Neurologist in entire Pradesh. Coastal Andhra

Served in the department of AP Medical&Health Services from 1965 to 1977.

Served as a Professor in Neurology in Andhra Medical College from 1977 to 1996.

Member of various eminent Medical Fellowships including the Indian Medical Association, Indian Academy of Neurology and Member of the World Federation of Neurology and AP Neurology Scientists Association.

Has published highly acclaimed papers on the Recurrent Polyneurotherapy and Wilson Disease and many other critical subjects

DR S. Sridhar (Managing Director) is the Managing Director of the company and is actively

32

involved in day to Administration of the Hospital. He has pursued his MBBS degree at Ranagaraya Medical College in Kakinada and his M.S in General Surgery at the Guntur Medical College. Dr Sridhar achieved his post specialization in the field of Gastro Intestinal Surgery at the GB Pant Hospital University in New Delhi.

A highly capable Administrator, he has a keen Vision to make Indus the leader in the Healthcare and Medical Segment in the city of Visakhapatnam. He is one of the few highly qualified Gastro Enterologists who is present in the entire state of Andhra Pradesh.

Dr Sridhar also has the distinction of working as a surgical registrar with Nizams Instittute of Medical Sciences(NIMS). He has also served as a Managing Director in Visaka Hospital and Siddhartha Medical Center. These Institutions are now running as highly profitable ventures and have established themselves as key facilities for providing medical healthcare

services. He is a highly qualified Surgical Gastro Enterologist

Dr Sridhar also has the rare distinction of presenting various papers and research projects in major conferences worldwide. Dr B.S Nehru (Director) is a highly eminent Nephrologist who has close to over 3 decades of experience in treating various types of Nephrological conditions. He has established a private practice since the year 1984.

His wide ranging experience includes practicing as a Physician from 1984 to 1998 in Srikakulam and then working as Senior Registrar in the department of Nephrology in Apollo Hospitals in Chennai for two years from 1998-2000. He has been practicing as a Nephrologist in Visakhapatnam since Dec 2000.

Dr B.S Nehru is a MD in General Medicine and has specialized in DNB(Nephrology). Dr V. Sujatha (Director) is a Director of Indus Hospitals and has specialized in the field of Cardiology. After completing her MBBS in the year 1990 at Andhra Medical College Vizag she specialized Internal Medicine in the year 1994 at Andhra Medical College and the prestigious

33

King George Hospital in Vizag.

Dr Sujatha completed her DM in Cardiology in the year 2000 at Nizams Institutes of Medical Sciences in Hyderabad.

Her professional experience includes working a consultant Cardiologist since the year 2000 and she has worked in Care Hospitals, Seven Hills Hospitals and Apollo Hospitals and is familiar with the latest trends and technologies which are adopted worldwide in the field of Cardiac Care.

Professional Experience:

: Senior Resident in Cardiology Nizams Institute of Medical Dec94-Dec96 Sciences : Residency in Cardiology Nizams Institute of Medical Jan97-Jan00 Science Feb00 : Post-Doctoral Trainee Nizams Institute of Medical Sciences : Assistant professor of Cardiology Nizams Institute of Mar00-july00 Medical Sciences Aug00-May01 May01-Sep03 : Consultant Cardiologist Care Hospitals Visakhapatnam. : Consultant Cardiologist Seven Hills Hospital Visakhapatnam : Fellowship in Interventio Cardiology Institute Oct 03-Oct 04 Cardiovaculaire Paris Sud, Paris Dr Sailaja (Director) is one of the key directors of the hospital. After pursuing her MBBS in 1990 at the Gandhi Medical College in Hyderabad. She obtained a master degree in Internal Medicine at the Yale Primary Care Internal Medicine Residency Program which was conducted at New Haven, Connecticut. She is current pursuing her fellowship in infections disease at the Yale University.

34

Her professional experience includes

1998-2004 Medical Director, Staywell Health Center, Waterbury, CT 1999-2004-Clinician Educator, Yale Primary Care Internal Medicine Residency Program, CT 1998-2003-Emergency Staff Physician, St. Marys Hospital, CT 2003-2004-Staff Physician, DMR, State of CT, CT

Her Teaching Experience includes

1993-1994-Supervised research Projects of NYU medical students(Honors Program) 1994-1995-Tutored first year medical students at NYU Medical Center In Molecular Biology and Biochemistry

1998- Taught Medical residents of the Yale Primary Care Internal 1999-2004-Clinician Educator, Yale Primary Care Internal Medicine Residency Program

A list of awards and merits which she has garnered include

1983-1985-National Merit Scholarship from Govt. Of India 1985-1990-National Merit Scholarship from Govt. Of India for Medical School Education 1996 Second Prize in the poster competition at the spring Scientific Session of the Connecticut State ACP Meeting

1996 Intern of the Year in the Yale Primary Care Residency Program 1997 Young Investigator Award from the Connecticut State Infectious Disease Society 1998 John Brackett Award for being an outstanding medical resident of the Yale Primary Care Internal Medicine Residency Program

2001 Best Teacher Award from Yale Primary Care Internal Medicine Residency Program

35

Dr K Ravindra (Director) brings his wide range experience in general medicine to Indus Hospitals. He completed his MBBS in the year 1972 from Belgaum university and worked in the peoples poly clinic in Nellore from 1972 to 1975. He then opened a general practice in tenali which was operational for four years from 1975 to 1979.

He then worked in the country of Algeria in North Africa for a period of 5 years from 1979 to 1984 under the ministry of external affairs Govt Of India.

He has been practicing General Medicine in the City of Visakhapatnam from the year 1985 till date and has been providing a wide range of medical services to his patients. Additionally, he has also toured various countries like France, Singapore and Germany to gain medical experience.

36

CHAPTER III
THEORITICAL FRAME WORK

37

3.1 Theoretical Framework:

3.1.1 Use and significance of ratio analysis:The ratio is one of the most powerful tools of financial analysis. It is used as a device to analyze and interpret the financial health of enterprise. Ratio analysis stands for the process of determining and presenting the relationship of items and groups of items in the financial statements. It is an important technique of the financial analysis. It is the way by which financial stability and health of the concern can be judged. Thus ratios have wide applications and are of immense use today. The following are the main points of importance of ratio analysis:

A. Managerial uses of ratio analysis:1. Helps in decision making:Financial statements are prepared primarily for decision-making. Ratio analysis helps in making decision from the information provided in these financial Statements.

2. Helps in financial forecasting and planning:Ratio analysis is of much help in financial forecasting and planning. Planning is looking ahead and the ratios calculated for a number of years a work as a guide for the future. Thus, ratio analysis helps in forecasting and planning.

3. Helps in communicating:The financial strength and weakness of a firm are communicated in a more easy and understandable manner by the use of ratios. Thus, ratios help in communication and enhance the value of the financial statements.

38

4. Helps in co-ordination:Ratios even help in co-ordination, which is of at most importance in effective business management. Better communication of efficiency and weakness of an enterprise result in better co-ordination in the enterprise

5. Helps in control:Ratio analysis even helps in making effective control of business. The weaknesses are otherwise, if any, come to the knowledge of the managerial, which helps, in effective control of the business.

B. Utility to shareholders/investors:An investor in the company will like to assess the financial position of the concern where he is going to invest. His first interest will be the security of his investment and then a return in form of dividend or interest. Ratio analysis will be useful to the investor in making up his mind whether present financial position of the concern warrants further investment or not.

C. Utility to creditors: The creditors or suppliers extent short-term credit to the concern. They are invested to know whether financial position of the concern warrants their payments at a specified time or not.

D. Utility to employees:The employees are also interested in the financial position of the concern especially profitability. Their wage increases and amount of fringe benefits are related to the volume of profits earned by the concern.

39

E. Utility to government:Government is interested to know overall strength of the industry. Various financial statement published by industrial units are used to calculate ratios for determining short term, long-term and overall financial position of the concerns.

F. Tax audit requirements:Sec44AB was inserted in the income tax act by financial act; 1984.Caluse 32 of the income tax act requires that the following accounting ratios should be given: 1. Gross profit/turnover. 2. Net profit/turnover. 3. Stock in trade/turnover. 4. Material consumed/finished goods produced.

Further, it is advisable to compare the accounting ratios for the year under consideration with the accounting ratios for earlier two years so that the auditor can make necessary enquiries, if there is any major variation in the accounting ratios.

3.1.2 Limitations:
Ratio analysis is very important in revealing the financial position and soundness of the business. But, in spite of its advantages, it has some limitations which restrict its use. These limitations should be kept in mind while making use of ratio analysis for interpreting the financial the financial statements. The following are the main limitations of ratio analysis:

1. False results:Ratios are based upon the financial statement. In case financial statement are in correct or the data of on which ratios are based is in correct, ratios calculated will all so

40

false and defective. The accounting system it self suffers from many inherent weaknesses the ratios based upon it cannot be said to be always reliable.

2. Limited comparability:The ratio of the one firm cannot always be compare with the performance of other firm, if uniform accounting policies are not adopted by them. The difference in the methods of calculation of stock or the methods used to record the deprecation on assets will not provide identical data, so they cannot be compared.

3. Absence of standard universally accepted terminology:Different meanings are given to a particular term, egg. Some firms take profit before interest and tax; others may take profit after interest and tax. A bank overdraft is taken as current liability but some firms may take it as non-current liability. The ratios can be comparable only when all the firms adapt uniform terminology.

4. Price level changes affect ratios:The comparability of ratios suffers, if the prices of the commodities in two different years are not the same. Change in price effect the cost of production, sale and also the value of assets. It means that the ratio will be meaningful for comparison, if the prices do not change.

5. Ignoring qualitative factors:Ratio analysis is the quantitative measurement of the performance of the business. It ignores qualitative aspect of the firm, how so ever important it may be. It shoes that ratio is only a one sided approach to measure the efficiency of the business.

6. Personal bias:Ratios are only means of financial analysis and an end in it self. The ratio has to be interpreted and different people may interpret the same ratio in different ways.

41

7. Window dressing:Financial statements can easily be window dressed to present a better picture of its financial and profitability position to outsiders. Hence, one has to be very carefully in making a decision from ratios calculated from such financial statements.

8. Absolute figures distortive:Ratios devoid of absolute figures may prove distortive, as ratio analysis is primarily a quantitative analysis and not a qualitative analysis.

3.1.3 Classification of ratios:

Several ratios, calculated from the accounting data can be grouped into various classes according to financial activity or function to be evaluated. Management is interested in evaluating every aspect of the firms performance. They have to protect the interests of all parties and see that the firm grows profitably. In view of thee requirement of the various users of ratios, ratios are classified into following four important categories: Liquidity ratios Leverage ratios Profitability ratios Activity ratios - short-term financial strength - long-term financial strength - long term earning power - term of investment utilization

Liquidity ratios measure the firms ability to meet current obligations; Leverage ratios show the proportions of debt and equity in financing the firms assets; Activity ratios reflect the firms efficiency in utilizing its assets; and Profitability ratios measure overall performance and effectiveness of the firm

42

LIQUIDITY RATIOS:
It is extremely essential for a firm to be able to meet the obligations as they become due. Liquidity ratios measure the ability of the firm to meet its current obligations (liabilities).
The liquidity ratios reflect the short-term financial strength and solvency of a firm.

In fact, analysis of

liquidity needs the preparation of cash budgets and cash and funds flow statements; but liquidity ratios, by establishing a relationship between 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 does not have excess liquidity. The failure of a company to meet its obligations due to lack of sufficient liquidity, will result in a poor credit worthiness, loss of credit worthiness, loss of creditors confidence, or even in legal tangles resulting in the closure of the company. A very high degree of

liquidity is also bad; idle assets earn nothing. The firms funds will be unnecessarily tied up in current assets. Therefore, it is necessary to strike a proper balance between high liquidity and lack of liquidity. The most common ratios which indicate the extent of liquidity are lack of it, are: (i) Current ratio (ii) Quick ratio. (iii)Cash ratio and (iv)Networking capital ratio.

1. Current Ratio:
Current ratio is calculated by dividing current assets by current liabilities. Current ratio = Current assets Current liabilities

43

Current assets include cash and other assets that can be converted into cash within in a year, such as marketable securities, debtors and inventories. Prepaid expenses are also included in the current assets as they represent the payments that will not be made by the firm in the future. All obligations maturing within a year are included in the current liabilities. Current liabilities include creditors, bills payable, accrued expenses, short-

term bank loan, income tax, liability and long-term debt maturing in the current year. The current ratio is a measure of firms short-term solvency. It indicates the availability of current assets in rupees for every one rupee of current liability. A ratio of greater than one means that the firm has more current assets than current claims against them Current liabilities.

2. Quick Ratio:
Quick ratio also called Acid-test ratio, establishes a relationship between quick, or liquid, assets and current liabilities. An asset is a liquid if it can be converted into cash immediately or reasonably soon without a loss of value. liquid asset. Cash is the most

Other assets that are considered to be relatively liquid and included in

quick assets are debtors and bills receivables and marketable securities (temporary quoted investments). Inventories are considered to be less liquid. Inventories normally require some time for realizing into cash; their value also has a tendency to fluctuate. The quick ratio is found out by dividing quick assets by current liabilities. Quick ratio = Quick assets Current liabilities

44

3. Cash Ratio:
Since cash is the most liquid asset, it may be examined cash ratio and its equivalent to current liabilities. Trade investment or marketable securities are

equivalent of cash; therefore, they may be included in the computation of cash ratio: Cash + Marketable Securities Cash Ratio= Current Liabilities

4. Interval Measure
Yet another, ratio, which assesses a firms ability to meet its regular cash expenses, is the interval measure. Interval measure relates liquid assets to average daily operating cash outflows. The daily operating expenses will be equal to cost of goods sold plus

selling, administrative and general expenses less depreciation (and other non cash expenditures divided by number of days in a year (say 360). Current assets - inventory Interval measure = Average daily operating expenses

5. Net Working Capital Ratio

The difference between current assets and current liabilities excluding short term bank borrowings in called net working capital (NWC) or net current assets (NCA). NWC is sometimes used as a measure of firms liquidity. It is considered that between two

firms the one having larger NWC as the greater ability to meet its current obligation s. This is not necessarily so; the measure of liquidity is a relationship, rather than the

45

difference between current assets and current liabilities. NWC, however, measures the firms potential reservoir of funds. It can be related to net assets (or cap ital employed) Net working capital (NWC) NWC ratio = (Net assets (or) Capital Employed)

6. LEVERAGE RATIO:
The short-term creditors, like bankers and suppliers of raw materials, are more concerned with the firms current debt-paying ability. On other hand, ling-term creditors like debenture holders, financial institutions etc are more concerned wit h the firms longterm financial strength. In fact a firm should have a strong short as well as long-term financial strength. financial position. In fact a firm should have a strong short-as well as long-term To judge the long-term financial position of the firm, financial These ratios indicate mix of

leverage, or capital structure ratios are calculated.

funds provided by owners and lenders. As a general rule there should be an appropriate mix of debt and owners equity in financing the firms assets. Leverage ratios may be calculated from the balance sheet items to determine the proportion of debt in total financing. Many variations of these ratios exist; but all these ratios indicate the same thing the extent to which the firms has relied on debt in financing assets. Leverage ratios are also computed form the profit and loss items by determining the extent to which operating profits are sufficient to cover the fixed charges.

7. DEBT RATIO:
Several debt ratios may be used to analysis the long term solvency of the firm The firm may be interested in knowing the proportion of the interest bearing debt (also called as funded debt) in the capital structure. It may, therefore, compute debt ratio by dividing

46

total debt by capital employed or net assets. Capital employed will include total debt and net worth

Total debt (TD) Debt ratio = Total debt (TD) + Net worth (NW)

Debt-Equity Ratio:
The relationship describing the lenders contribution for each rupee of the owners contribution is called debt-equity (DE) ratio is directly computed by dividing total debt by net worth:

Total debt (TD) Debt - equity ratio = Net worth (NW)

8. Capital Employed to Net worth Ratio

It is another way of expressing the basic relationship between debt and equity. One may want to know: How much funds are being contributed together by

lenders and owners for each rupee of owners contribution? Calculating the ratio of capital employed or net assets to net worth can find this out:

47

Capital employed (CE) Capital employed to net worth Ratio = Net worth (NW)

COVERAGE RATIO: Interest Coverage Ratio:

Debt ratios described above are static in nature, and fail to indicate the firms ability to meet interest (and other fixed charges) obligations. The interest coverage ratio or the times interest-earned is used to test the firms debt-servicing capacity. the interest coverage ratio is computed by dividing earnings before interest and taxes(EBIT)by interest charges: EBIT Interest coverage ratio= Interest

ACTIVITY RATIOS:
Funds of creditors and owners are interested in various assets to generate sales and profits. The better the management of assets, the larger the amount of sales. Activity ratios are employed to evaluate the efficiency with which the firm manages and utilizes its assets. These ratios are also called turnover ratios because they indicate the speed with which assets are being converted or turned over into sales. Activity ratios, thus, involves a relationship between sales and assets. A proper balance between sales and assets generally reflects that assets are managed well. Several activity ratios are calculated to judge the effectiveness of asset utilization.

48

10. Inventory Turnover Ratio:

Inventory turnover indicates the efficiency of the firm in producing and selling its product. It is calculated by dividing the cost of goods sold by the average inventory:

Cost of goods sold Inventory turnover Ratio = Average inventory (OR) Net sales Inventory

The average inventory is the average of opening and closing balances of inventory. The cost of goods sold may not be available so we can compute inventory turnover as sales divided by inventory In a manufacturing company inventory of finished goods is used to calculate inventory turnover. This inventory turnover ratio indicates whether investment in inventory is efficiently utilized or not. It, therefore, explains whether investment in inventory in within proper limits or not. It is calculated by dividing the cost of goods sales by the average inventory. The inventory turnover shows how rapidly the inventory in turning into receivable through sales. A high inventory turnover is indicative of good inventory management. A low inventory turnover implies excessive inventory levels than warranted by production and sales activities or a slow moving or obsolete inventory.

49

Inventory Conversion Period:

It may also be of interest to see the average time taken for clearing the stock. This can be possible by calculating the inventory conversion period. This period is calculated by dividing the no. of days by inventory turnover ratio:

No. of days in the year Inventory turnover ratio= Inventory turnover ratio

11.Debtors (Accounts Receivable) Turnover Ratio:

A firm sells goods for cash and credit. Credit is used as a marketing tool by number of companies. When the firm extends credits to its customers, debtors Debtors are convertibl e into The liquidity

(accounts receivable) are created in the firms accounts.

cash over a short period and, therefore, are included in current assets.

position of the firm depends on the quality of debtors to a great extent. Financial analyst applies these ratios to judge the quality or liquidity of debtors (a) Debtors Turnover Ratio (b) Debtors Collection Period Debtors turnover is found out by dividing credit sales by average debtors: Credit sales Debtors turnover = Debtors

50

Debtors turnover indicates the number of times debtors turnover each year generally, the higher the value of debtors turnover, the more efficient is the management of credit. To outside analyst, information about credit sales and opening and closing balances of debtors may not be available. Therefore, debtors turnover can be calculated by dividing Total sales by the year-end balances of debtors: Sales Debtors turnover = Debtors

Average Collection Period:

Average Collection Period is used in determining the collectibles of debtors and the efficiency of collection efforts. In ascertaining the firms comparative strength and advantage relative to its credit policy and performance The average number of days for which the debtors remain outstanding is called the Average Collection Period. The Average Collection Period measures the quality of the debtors since it is indicated the speed of their collection.

360 Average Collection Period= Debtors Turnover Ratio

[or]

51

Debtors = Sales
X 360

13. Net Assets Turnover Ratio:

Net assets turnover can be computed simply by dividing sales by net sales (NA) Sales Net Assets Turnover = Net assets

It may be recalled that net assets (NA) include net fixed assets (NFA) and net current assets (NCA), that is, current assets (CA) minus current liabilities (CL). Since net assets equal capital employed, net assets turnover may also be called capital employed, net assets turnover may also be called capital employed turnover.

Total Assets Turnover:

Some analysts like to compute the total assets turnover in addition to or instead of the net assets turnover. This ratio shows the firms ability in generating sales from all financial resources committed to total assets. Thus:

Sales Total Assets Turnover = Total assets

52

Total Assets (TA) include net fixed Assets (NFA) and current assets (CA) (TA=NFA+CA)

15. Current Assets Turnover

A firm may also like to relate current assets (or net working gap) to sales. It may thus complete networking capital turnover by dividing sales by net working capital.

Sales Current assets turnover = Current assets

16. Fixed Assets Turnover:

The firm to know its efficiency of utilizing fixed assets separately. This ratio measures sales in rupee of investment in fixed assets. A high ratio indicates a high degree of utilization in assets and low ratio reflects the inefficient use of assets

Sales Fixed Assets Turnover = Fixed Assets

17. Working Capital Turnover Ratio:

Working Capital of a concern is directly related to sales. The current assets like debtors, bills receivable, cash, and stock etc. change with the increase or decrease in sales. The Working Capital is taken as:

53

Working Capital

= Current Assets Current Liabilities

This Ratio indicates the velocity of the utilization of net working capital. This Ratio indicates the number of times the working capital is turned over in the course of a year. This Ratio measures the efficiency with which the working capital is being used by a firm. A higher ratio indicates the efficient utilization of working capital and the low ratio indicates inefficient utilization of working capital. Sales Working capital turnover = Net working capital

PROFITABILITY RATIOS
A company should earn profits to survive and grow over a long period of time. Profits are essential, but it world be wrong to assume that every action initiated by management of a company should be aimed at maximizing profits, irrespective of concerns for customers, employees, suppliers or social consequences. It is unfortunate that the word profit is looked upon as a term of abuse since some firms always want to maximize profits ate the cost of employees, customers and society. Except such

infrequent cases, it is a fact that sufficient profits must be able to obtain funds from investors for expansion and growth and to contribute towards the social overheads for welfare of the society. Profit is the difference between revenues and expenses over a period of time (usually one year). Profit is the ultimate output of a company, and it will have no future if it fails to make sufficient profits. Therefore, the financial manager should continuously evaluate the efficiency of the company in terms of profit. The profitability ratios are

calculated to measure the operating efficiency of the company. Besides management of

54

the company, creditors and owners are also interested in the profitability of the firm. Creditors want to get interest and repayment of principal regularly. Owners want to get a required rate of return on their investment. This is possible only when the company earns enough profits. Generally, two major types of profitability ratios are calculated: Profitability in relation to sales. Profitability in relation to investment.

16. Net Profit Margin

Net profit is obtained when operating expenses; interest and taxes are subtracted form the gross profit margin ratio is measured by dividing profit after tax by sales: Net Profit Net profit Ratio = Sales Net profit ratio establishes a relationship between net profit and sales and indicates and managements in manufacturing, administrating and selling the products. This ratio is the overall measure of the firms ability to turn each rupee sales into net profit. If the net margin is inadequate the firm will fail to achieve satisfactory return on shareholders funds. This ratio also indicates the firms capacity to withstand adverse economic conditions.A firm with high net margin ratio would be advantageous position to survive in the face of falling prices, selling prices, cost of production . X 100

17. Net Margin Based on NOPAT

The profit after tax (PAT) figure excludes interest on borrowing. Interest is tax deducts able, and therefore, a firm that pays more interest pays less tax. Tax saved

55

on account of payment of interest is called interest tax shield. Thus the conventional measure of net profit margin-PAT to sales ratio- is affected by firms financial policy. It can mislead if we compare two firms with different debt ratios. For a true comparison of the operating performance of firms, we must ignore the effect of financial leverage, viz., the measure of profits should ignore interest and its tax effect. Thus net profit margin (for evaluating operating performance) may be computed in the following way: EBIT (1-T) Net profit margin = Sales = Sales NOPAT

18. Operating Expense Ratio:

The operating expense ratio explains the changes in the profit margin (EBIT to sales) ratio. This ratio is computed by dividing operating expenses viz., cost of goods sold plus selling expense and general and administrative expenses (excluding interest) by sales. Operating expenses Operating expenses ratio= Sales

19. Return on Investment (ROI)

The term investment may refer to total assets or net assets. The funds

employed in net assets in known as capital employed. Net assets equal net fixed assets plus current assets minus current liabilities excluding bank loans. Alternatively, capital employed is equal to net worth plus total debt. The conventional approach of calculating return of investment (ROI) is to divide PAT by investments. Investment represents pool of funds supplied by

56

shareholders and lenders, while PAT represent residue income of shareholders; therefore, it is conceptually unsound to use PAT in the calculation of ROI. Also, as

discussed earlier, PAT is affected by capital structure. It is, therefore, more appropriate to use one of the following measures of ROI for comparing the operating efficiency of firms: BIT (1-T) ROI = ROTA = Total assets = TA EBIT (1-T)

EBIT (1-T) ROI = RONA = Net assets

EBIT (1-T) = NA

Since taxes are not controllable by management, and since firms opportunities for availing tax incentives differ, it may be more prudent to use before tax to measure ROI. Many companies use EBITDA (Earnings before Depreciation, Interest, Tax and Amortization) instead of EBIT to calculate ROI. Thus the ratio is:

EBIT ROI= Total Assets (TA)

57

20. Return on Equity (ROE)

Common or ordinary shareholders are entitled to the residual profits. The rate of dividend is not fixed; the earnings may be distributed to shareholders or retained in the business. Nevertheless, the net profits after taxes represent their return. A

return on shareholders equity is calculated to see the profitability of owners investment. The shareholders equity or net worth will include paid-up share capital, share premium, and reserves and surplus less accumulated losses. subtracting total liabilities from total assets. Net worth also be found by

The return on equity is net profit after

taxes divided by shareholders equity, which is given by net worth:

Profit after taxes ROE = Net worth (Equity) =

PAT

NW

ROE indicates how well the firm has used the resources of owners. In fact, this ratio is one of the most important relationships in financial analysis. The earning of a satisfactory return is the most desirable objective of business. The ratio of net profit to owners equity reflects the extent to which this objective has been accomplished. This ratio is, thus, of great interest to the present as well as the prospective Shareholders and also of great concern to management, which has the responsibility of maximizing the owners welfare. The return on owners equity of the company should be compared with the ratios of other similar companies and the industry average. This will reveal the relative

performance and strength of the company in attracting future investments.

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21. Earnings per Share (EPS)

The profitability of the shareholders investments can also be measured in many other ways. One such measure is to calculate the earnings per share. The

earnings per share (EPS) are calculated by dividing the profit after taxes by the total number of ordinary shares outstanding. Profit after tax EPS = Number of share outstanding

22. Dividends per Share (DPS or DIV)

The net profits after taxes belong to shareholders. But the income,

which they will receive, is the amount of earnings distributed as cash dividends. Therefore, a large number of present and potential investors may be interested in DPS, rather than EPS. DPS is the earnings distributed to ordinary shareholders dividend by the number of ordinary shares outstanding. Earnings paid to shareholders (dividends) DPS= Number of ordinary shares outstanding

23. Dividend Payout Ratio

The Dividend payout Ratio or simply payout ratio is DPS ( or total equity dividends) divided by the EPS ( or profit after tax):

59

Equity dividends Dividend Payout Ratio = Profit after tax Dividends per share = Earnings per share DPS = EPS

60

CHAPTER IV
DATA ANALYSIS AND INTERPRETATION

61

1. CURRENT RATIO
An indication of a company's ability to meet short-term debt obligations; the higher the ratio, the more liquid the company is. Current ratio is equal to current assets divided by current liabilities. If the current assets of a company are more than twice the current liabilities, then that company is generally considered to have good short-term financial strength. If current liabilities exceed current assets, then the company may have problems meeting its short-term obligations. CURRENT ASSETS CURRENT RATIO = ------------------------------CURRENT LIABILITIES

YEAR CURRENT ASSETS

CURRENT LIABILITIES

RATIO

2009

37458958

35737300

1.04

2010

79123668

59518613

1.33

2011

98954704

74765613

1.32

2012

135471895

87613251

1.55

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1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2009 2010 2011 2012
RATIO

INTERPRETATION Table 4.1 establishes relationship between current assets and current liabilities. The ratio of current assets to current liabilities maintained by the company was not considered satisfactory. The ratio was 1.04 in the year 2009 increased to 1.33 in the year 2010. The ratio again dropped to 1.32 in 2011 and increased to 1.55 in 2012. Based on this company is not using the current assets in a proper manner. The company not maintained a standard norm ratio i.e. 2:1 in any year.

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2. NET WORKING CAPITAL RATIO

A measure of a company's operating liquidity expressed current liabilities as current

assets less current

liabilities. Companies with

that exceed current

asset are operating with a working capital deficiency which may prevent them from fulfilling short term obligations such as accounts payables, operational expenses and current interest payments. Analysts track net working capital over time in order

to assess a company's operational efficiency. Also called working capital.

NET WORKING CAPITAL RATIO

NET WORKING CAPITAL = -------------------------------------------*100 NET ASSETS

YEAR

NET WORKING CAPITAL NET ASSETS

RATIO

2009 2010 2011 2012

17216585 19605055 24189091 47858644

37458958 79123668 98954704 135471895

0.45 0.24 0.24 0.35

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0.45 0.4 0.35 0.3 0.25 0.2 0.15 0.1 0.05 0 2009 2010 2011 2012

INTERPRETATION
Networking capitals represents the excess of current assets over current liabilities although networking capital is really not a ratio, it is frequently employed as a measured of a companys liquidity position. An enterprises should have suf ficient networking capital in order to able to meet the claims of creditors and day to day needs of business. In 2009 Networking Capital to asset ratio 0.45 it was decreased to 0.24 in to 2010 and 2011, increased to 0.35 in 2012 but overall bases the Networking Capital to total asset ratio was not considered satisfactory.

65

3. DEBT EQUITY RATIO

A measure of a company's financial leverage. Debt/equity ratio is equal to longterm debt divided by common shareholders' equity. Typically the data from the prior fiscal year is used in the calculation. Investing in a company with a higher debt/equity ratio may be riskier, especially in times of rising interest rates, due to the additional interest that has to be paid out for the debt. A high debt/equity ratio generally means that a company has been aggressive in financing its growth with debt. This can result in volatile earnings as a result of the additional interest expense.

DEBT EQUITY RATIO =

YEAR

DEBTORS FUNDS

SHARE HOLDERS FUNDS

RATIO

2009

81691789

55953280

1.46

2010

71199361

79110401

0.90

2011

108704785

105538626

1.03

2012

228077918

139071901

1.64

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1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2009 2010 2011 2012

RATIO

INTERPRETATION
This is an important tool of financial analysis apprised financial structure of a firm. A high ratio shows a large share financing by the creditors of firm, a low ratio implies a smaller claim of creditors. From the table 4.3 the Debt Equity ratio maintained by the company is considered satisfactory.

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4. EQUITY RATIO
A financial indicator that measures a company's use of stockholders' equity to finance operations. The ratio is calculated by dividing the total equity in the company by its total assets. A high equity ratio indicates more reliance on equity financing than debt financing. A ratio used to help determine how much shareholders would receive in the event of a company-wide liquidation. The ratio, expressed as a percentage, is calculated by dividing total shareholders' equity by total assets of the firm, and it represents the amount of assets on which shareholders have a residual claim. The figures used to calculate the ratio are taken from the company's balance sheet.

EQUITY RATIO =

SHARE HOLDERS FUNDS TOTAL ASSETS

YEAR

SHARE HOLDERS FUNDS

TOTAL ASSETS

RATIO

2009 2010 2011 2012

55953280 79110401 105538626 139071901

37458958 79123668 98954704 135471895

1.49 0.99 1.07 1.03

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1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2009 2010 2011 2011
RATIO

INTERPRETATION This ratio also known as euity ratio. As equity represents the relationship of owners funds to total assets, higher the ratio or share of share holders in the capital of the company, better is the long-term solvency position of the company. This ratio indicates the extent to which the assets of the company can be lost without affecting the interest of creditors of the company. From the table 4.4 the equity ratio of the company is considered well throughout the project period because it was more than 0.80

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5. CAPITAL TURNOVER RATIO

A company's annual sales divided by its average stockholders' equity. Capital turnover is used to calculate the rate of return on common equity, and is a measure of how well a company uses its stockholders' equity to generate revenue. The higher the ratio is, the more efficiently a company is using its capital. Also called equity turnover.

CAPITAL TURNOVER RATIO =

NET INCOME CAPITAL EMPLOYED

YEAR

NET INCOME

CAPITAL EMPLOYED

RATIO

2009 2010 2011 2012

123288048 248904160 277901517 321716095

17216585 19605055 24189091 47858644

7.16 12.69 11.48 6.72

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14 12 10 8 6 4 2 0 2009 2010 2011 2012

RATIO

INTERPRETATION
From the table 4.5 the capital turnover ratio of the company is not satisfactory because the same ratio is decreasing from 8.19 to 5.85 in the year 2009 as compared with 2010, and it also decreasing 5.85 to 5.61 from above standard. In the last year the ratio is lesser than 2.50

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6.

GROSS PROFIT RATIO

What remains from sales after a company pays out the cost of goods sold. To obtain gross profit margin, divide gross profit by sales. Gross profit margin is expressed as a percentage.

GROSS PROFIT RATIO= GROSS PROFIT *100 NET INCOME

YEAR 2009 2010 2011 2012

GROSS PROFIT 123288048 248904160 277901517 321716095

NET INCOME 123288048 248904160 277901517 321716095

RATIO 7.16 12.69 11.48 6.72

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85.5 85 84.5 84 83.5 83 82.5 82 81.5 81 80.5

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

RATIO

INTERPRETATION Higher the ratio, the better it is a low ratio indicates unfavorurable trends in the four of reducation in selling prices not accompanied by proportionate decrease in cost of goods sold or increase I cost of production from the above table, the G.P ratio of the company not considered satisfactory. From table 4.6 the gross profit ratio of the company is decreasing from 31.18 percent and 26.24 percent to 22.84

percent to 28.94 percent , from 28.94 to 26.24 percent in the years 2008 to 2012.

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7.

OPERATING RATIO
A company's operating expenses divided by its operating revenues. More

generally, any of a number of ratios measuring a company's operating efficiency, such as sales to cost of goods sold, net profits to gross income, operating expenses

to operating income, and net profit to net worth.

OPERATING RATIO = OPERATING COST *100 NET INCOME

YEAR

OPERATING COST

NET INCOME

RATIO

2009 2010 2011

123308482 221659395 247035920

123288048 249804160 277901517

98.90 98.73 98.89

2012

287069939

321716095

98.23

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99 98.8 98.6 98.4 98.2 98 97.8 2009 2010 2011 2012

RATIO

INTERPRETATION Lower ratio, the better it is. Higher the ratio, the less favorable it is because it wold leave asmaller margin of operating profit for the payment of dividends and the creation of reserve. From the above table the operation ratio of the company considered not satisfaction because in all the years the operation ratio is almost all 100 percent this means that, the companies of cost is equal to sales.

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8.

OPERATING PROFIT RATIO

Operating profit for a certain period divided indicates how by revenues for effective that period.

Operating

profit

margin

a company is

at controlling the costs and expenses associated with their normal business operations.

OPERATING PROFIT RATIO = OPERATING PROFIT *100 NET INCOME

YEAR

OPERATING PROFIT

NET INCOME

RATIO

2009 2010 2011 2012

12328804 67447123 30599166 417813110

123288048 249804160 277901517 321716095

1.10 1.27 1.11 1.77

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1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2009 2010 2011 2012

RATIO

INTERPRETATION
This ratio indicates the portion remaining out of every rupee worth of sales after all operating cost and expenses have been met. For the calculation of this ratio, nonoperation exp, non-operating income are ignored. Higher the ratio is the better it is. From the above table 4.8 the operating profit ratio is not considered satisfactory, because it is less than 3 percent, the operating profit ratio has been increased from 0.73 percent to 2.07 percent and in the remaining years the ratio is decreasing from 2.07 percent to 1.10 percent, 0.23 percent and 0.28 percent respectively.

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9. NET PROFIT RATIO

Net profit divided by net revenues, often expressed as a percentage.

This number is an indication of how effective a company is at cost control. The higher the net profit margin is, the more effective the company is at converting revenue into actual profit. The net profit margin is a good way of comparing companies in the same industry, since such companies are generally subject

to similar business conditions. However, the net profit margins are also a good way to to compare companies in different industries in order to gauge which industries are relatively more profitable.

NET PROFIT RATIO = NET PROFIT AFTER TAX*100 NET INCOME

YEAR

NET TAX

PROFIT AFTER

NET INCOME

RATIO

2009 2010 2011 2012

202836 23353943 31798817 33099669

123288048 249804160 277901517 321716095

1.64 0.94 1.14 1.02

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2 1.5 1 0.5 0 2009 2010 2011 2012

RATIO

INTERPRETATION Higher the ratio, the better it is because it gives idea of improved efficiency of the concern from the above table, we can say that up ratio of the company not considered satisfactory because the ratio is allwas less 2 percent in all the year

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10.INVENTRY TURNOVER RATIO

The ratio of a company's annual sales to its inventory; or equivalently, the

fraction of a year that an average item remains in inventory. Low turnover is a sign of inefficiency, since inventory usually has a rate of return of zero.

INVENTRY TURNOVER RATIO =

COST OF GOODS SOLD AVERAGE INVENTORY

YEAR

COST SOLD

OF

GOODS

INVENTORY

RATIO

2009 2010

18297472 43479185

10887565 17775970

1.60 2.44

2011 2012

49196731 55040516

25579960 36655060

1.92 1.50

80

2.5 2 1.5 1 0.5 0 2009 2010 2011 2012

RATIO

INTERPRETATION From the above table the inventory turnover ratio is not considered good because year 2010 2:1 and 2011 to 2:1 good but 2012,2009 is not good. The inventory turnover ratio is decreased 2011,2012.

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CHAPTER- V SUMMARY, FINDINGS AND SUGGESTIONS

82

5.1 SUMMARY

The total project summary is divided into 5 chapters

Chapter 1 : Explains, introduction, objectives,methodology, main Limitation of the study, introduction to financial statement analysis is the analysis of financial statement is process of evaluating relationship between component parts of financial

statement to obtain a better understanding of the firms position and performance.

The first task of financial analysis is to select the information relevant to the decision under consideration from the total information contained in the financial statement.

Second step is to arrange the information in a way to highlight significant relationship.

Final step is interpretation and drawing of inferences and conclusion. Financial analysis is the process of selection, relation and evaluation.

The focus of the study is on ratio analysis as the most widely used technique of financial statement common size statements as method of analysis statement.

The importance of ratio analysis and its limitation are briefly out lined in the major points are summrised in the last of the study.

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The ratio analysis technique is the most convenient and acceptable technique for the analysis and interpretation of financial statement.

Chapter2:It is a health care industry. Health care is one of the largest sectors, in term of revenue and employment, and this sector is expanding rapidly according to technopak advisors in their reports India health trends 2008 healthcare, which is a US$ 35 billion industry in India, is expected to reach over US$ 75 billion by 2012 and US$ 150 billion by 2017. The industry has today become a growth engine for the Indian economy, contributing substantially to the increase in the GDP, urban employment, to achieve the vision of the powerful and resilient India. the increase in the number of affordable middle class, rise in insured population , widening demand supply gap, growing number of life style diseases especially cancer, cardiovascular

diseases, diabetes and chronic health care industry. Other like wellness programmes, fitness programmes, health management, and preventive medicine- synonyms of healthcare are growing more and more familiar with each passing heart beat. A growing elderly population and rise in income levels are also pushing for better facilities in the country. To meet this growing demand, the country needs US$50 billion annually for the

next 20 years, says a confederation of Indian industry (CII) study. India needs to add 3.1 million beds by 2018 to the existing 1.1 million, and requires immediate investment of US$82 billion, as per the technopak advisors report. It clearly indicates the continuing potentiality in the health sector.

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Chapter 3 : It deals with theoretical framework to financial statement analysis and various technique of financial statement is ratio analysis, meaning of ratio, classification of Ratio, importance etc...

Chapter 4 : It deals with data analysis ,by using different ratios, current ratio, networking capital ratio, debt eqity ratio, prorietory ratio , capital turnover ratio, grass profit ratio, operating ratio, operating profit ratio, net profit ratio.

Chapter 5 : It deals with Findings, suggestion, summary based on the four units band bibliography.

85

5.2 FINDINGS

The current ratio of the organization is comparatively high and stable

The prorietory ratio of the organization is considered good throughout the year2010-2011 because it was more then 0.80 the gross profit ratio of the organization was increase in the first two years and decreased. the reaming years

The operating ratio for all the years not considered satisfactory the operating cost in all the years i.e., from 2008 to 2012 is equal to income.

The operating profit ratio for all the years of the orgnization was not considered satisfactory.

Major part source of fund and cash are utilizing towards the purchjages of fixed assets and payment of borrowed funds

The working capital ratio of the organization was not satisfactory ,it is decreasing year to year .

The capital turnover ratio of the organization considered good in all the year expect 2012.

Net profit ratio of the organization is considered less then 2 percent in all the years2008-2011

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5.3 SUGGESSTIONS
On the basis of above findings, the following features are suggested to Indus hospital for future growth

The organization is maintaining a current ratio of above the standard norm of 2:1 .except 2008 and 2010 thus it was suggested that the organization checks its current ratio, so that the funds are not blocked, because it makes the firm funds unnecessarily tied up in current assets and idle assets earn nothing.

The organization should tries to increase its quick assets ratio, because if the inventory of the organization do not sell them, it could be very difficult.

The firm should increase its cost of goods sold , so as to earn of net profit

It was suggested that the organization must reduce its operating cost ,because the operation cost of the organization is almost all or equal to net sales

The organization must reduce its cost of goods expenditure so as to increase the profit as well as net profit

87

ANNEXURES

88