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Profitability on sales and Investment : -

45.85% PROFITABLITY ON SALES AND


50.00%
37.76%
40.00%

30.00% 25.61%
20.70% 20.64%
20.00%
9.94%
10.00% 7.10%6.93% 5.85%6.52%

0.00%
GROSS PROFIT RATIO OPERATING PROFIT RATIO NET PROFIT RATIO RETURN
-2.02% ON ASSETS
-10.00%
JINDAL STEEL & POWER TATA-7.29%
STEEL JSW STEEL

From the above graph it can be clearly seen and judged that the financial health and
business model of JSW Steel is good as compared to Jindal steel and Tata Steel. The
proportion of money left over from revenues after accounting for the cost of goods
sold is more in JSW Steel as compared to other two.

But if we are comparing Tata Steel with JSW Steel and Jindal Steel & Power the
operating ratio of Tata steel is more favourable than other two. This ratio is
important to both creditors and investors because it helps show how strong and
profitable a company's operations are. Here, Tata Steel receives 25.61 percent of its
revenue from its operations means that it is running its operations smoothly and this
income supports the company. It also means this company depends on the income
from operations.

If we are comparing through Net profit ratio Tata Steel looks favourable to invest.
JSW is also quite close with Tata Steel. But the overall results of Tata Steel looks
good.

Tata Steel and JSW Steel are also neck to neck in ROA. For Tata Steel it is 5.85 % and
for JSW steel it is 6.52% . It clearly shows JSW steel is using its assets more to
generate earnings.

So, considering these above points as an analyst point of view .He/ She should invest in Tata
Steel as their operations are in strong position and they are actually generating good income
from their assets. Also Gross profit ratio and Net profit ratio % are good for Tata Steel
Debt to Equity Ratio : -

DEBT TO CAPITAL RATIO

0.55 0.76

0.31

JINDAL STEEL & POWER TATA STEEL JSW STEEL

Tata Steel have Debt to Equity ratio 0.31 which is the lowest among all the three JSW Steel
and Jindal Power & Steel . A lower debt to equity ratio usually implies a more financially
stable business . Hence, Tata steel is at less financial risk as compared to other two.
And its is considered less risky for the creditors and the investors as well.

Quick Ratio and the current Ratio : -

SHORT TERM LIQUIDITY RATIO

0.33
QUICK RATIO 0.43
0.07

0.68
CURRENT RATIO 0.87
0.20

0.00 0.10 0.20 0.30 0.40 0.50 0.60 0.70 0.80 0.90 1.00

JSW STEEL TATA STEEL JINDAL STEEL & POWER

The quick ratio of Tata Steel is also high as compared to other two companies.It can
easily pay its short term debts.
From the graph, it can be observed that Tata Steel has better growth in current ratio
over the period of study than the other two companies. When a situation of solvency
arises,Tata Steel can resolve the issue easily by liquidating the available current
assets.
Measure of Investment and operation Efficiency : -

250.00
MEASURE OF INVESTMENT AND OPERATIONAL EFFICIENCY

200.00 206.18
173.88
150.00 151.35

100.00

50.00

0.00 2.62
0.94
0.54 9.11
2.10 0.94
0.84
0.33 0.21 -3.04
-6.22
-16.22
ASSET TURNOVER EQUITY TURNOVER CAPITAL EMPLOYED DAYS INVENTORY WORKING CAPITAL
-50.00 RATIO RATIO
JINDAL STEEL & POWER TURNOVER RATIO
TATA STEEL JSW STEEL TURNOVER

According to the graph ,Jindal Steel and power is using its assets more in
generating sales revenue or sales income to the company.

In general, a high debt-to-equity ratio indicates that a company may not be able to
generate enough cash to satisfy its debt obligations. Hence, Equity turnover ratio of
Jindal Steel is too high as compared to other two companies .So, it is unfavourable to
invest.

Per the graphs , Tata Steel is efficient enough and can generate profits from
its capital employed by comparing net operating profit to capital employed.

Days inventory of Tata steel is high as compared to other two companies (206.18)
which raises a concern about the inventory management of the company or they are
spending much on having inventories. It also raises concern regarding the sales of
the company.

Considering all the parameters and graph charts as an Analyst would suggest in investing in
Tata Steel.