Академический Документы
Профессиональный Документы
Культура Документы
Mar
-15
Mar
-14
Mar
-13
Mar
-12
0.6
0.0
2
0.6
0
0.0
9
0.0
3
0.7
0
0.0
9
0.0
2
0.8
6
0.0
6
0.0
1
1.0
9
2.2
4
24.
87
42.
57
20.
92
5.9
1
18.
47
14.
45
2.3
0
27.
21
32.
83
18.
85
5.0
3
15.
44
12.
32
2.8
3
26.
78
39.
25
14.
55
4.3
2
14.
96
12.
40
2.9
7
24.
45
42.
43
31.
90
3.6
2
12.
14
9.6
7
Key Ratios
Debt-Equity Ratio
Long Term Debt-Equity
Ratio
0.02
Current Ratio
Quick Ratio
Turnover Ratios
0.56
Fixed Assets
2.33
22.2
8
52.3
2
71.7
5
Inventory
Debtors
Interest Cover Ratio
APATM (%)
ROCE (%)
RONW (%)
0.01
6.99
24.9
2
17.7
9
DEBT-EQUITY RATIO:
Debt-Equity Ratio is calculated to measure the relative claims of
outsiders and the owners against the firms assets. It is another leverage
ratio that compares a companys total liabilities to its total shareholders
equity.
Debt-Equity Ratio = Outsiders Fund / Shareholders Fund
Interpretation:
The Debt-Equity ratio of Maruti Suzuki India Limited is 0.02:1 in 2016.
Its almost same as in 2015. This means that the company is using little
outsiders fund in financing the firms assets. However, the owners want
to do business with the maximum of outsiders funds in order to take
lesser risk of their investments and to increase their earnings (per share)
by paying a lower fixed rate of interest to the outsiders.
CURRENT RATIO:
It may be defined as the relationship between current assets and current
liabilities. This ratio, also known as working capital ratio, is a measure of
general liquidity and is most widely used to make the analysis of a shortterm financial position or liquidity of a firm. It is calculated by dividing the
total of current assets by total of the current liabilities.
Current Ratio =
Current Liabilities
Total
Current
Assets/
Total
Interpretation:
The current ratio of Maruti Suzuki India ltd. is 0.56:1 in 2016.
Low current ratio represents that the liquidity position of the firm is not
good and the firm shall not be able to pay its current liabilities in time
without facing difficulties.
As a convention the minimum of two to one ratio is referred to as a
bankers rule of thumb.
A low current ratio may be due the firm has not sufficient funds to pay off
liabilities. And the business may be trading beyond its capacity. The
resources may not warrant the activities.
QUICK RATIO:
Interpretation:
Companies with ratios of less than 1 cannot pay their current
liabilities and should be looked at with extreme caution.
Furthermore, if the acid-test ratio is much lower than the working
capital ratio, it means current assets are highly dependent on
inventory. In case of Marui Suzuki Quick ratio in 2009 is 1.26 while
in 2008 it was just 0.66, it almost doubled. So, we can say that the
company is in position to meet its immediate liabilities.
Interpretation:
In case of Maruti Suzuki India Limited the fixed asset turnover ratio in
are 2.33 while in 2015 it was 2.44. This means there is minor decline in
the net sales.
This ratio expresses the number to times the fixed assets are being
turned over in a stated period. It measures the efficiency with which fixed
assets are employed. A high ratio means a high rate of efficiency of
utilisation of fixed asset and low ratio means improper use of assets. So,
we can say that Maruti Suzuki is efficiently utilising its fixed assets.
Interpretation:
Inventory turnover ratio measures the velocity of conversion stock into
sales. In case of Maruti we see that in 2016 the inventory turnover ratio
is 22.28. As we compare it from 2015 there is slight decline. But still it is
good, it shows that there is efficient management because more
frequently the stocks are sold; the lesser amount of money is required to
finance the inventory.
Interpretation:
In case of Maruti Suzuki India Limited the debit turnover ratio in 2016 is
52.32 while in 2015 it was 42.57. So, here see there is a slight decrease
in the ratio. It indicates that the number times the debtors are turned
over during a year. Here we see high value of debtors turnover hence
the firm is more efficient in managing the debtors/sales or more liquid
are the debtors.
Interpretation:
In 2016 the ratio is 71.75 which decreased from 2013 gradually from
14.55. Still the company is in very good position to pay its interest on
long term loans. This ratio expresses the satisfaction to the lenders of
the concern whether the business will be able to earn sufficient profits to
pay interest on long-term loans. This ratio indicates that how many times
the profit covers the interest. It also measures the margin of safety for
the lenders. The higher the number, more secure the lender is in respect
of periodical interest.
Interpretation:
Often, a company's earnings don't tell the entire story. The amount of
profit can increase, but that doesn't mean the company's profit margin is
improving. For example, a company's sales could increase, but if costs
also rise, that leads to a lower profit margin than what the company had
when it had lower profits. This is an indication that the company needs to
better control its costs. In case of Maruti in 2016 it was 6.99% while in
2015 it was 5.91% it declined gradually in the years.
Interpretation:
The ROCE of Maruti Suzuki India Limited is 24.92% in 2016 while in
2015 it was 18.47%. The term capital employed refers to total
investments made in business. A higher percentage on return on capital
will satisfy the owners that their money is profitably utilised. However,
ROCE of Maruti showed a decline in the percentage during the years.
So, we can say that the money is not being profitably utilised as
compared to previous years.
Interpretation:
The RONW of Maruti Suzuki India Limited in 2016 is 17.79% while in
2015 it was 14.45%, in 2007 it was 25.38%. So, there is gradually
decline in the RONW. We can comment after seeing the gradual decline
in RONW that the firm is not using its resources to its optimum level as
the year passed the overall efficiency showed a decrease in the
consecutive years.