1

EVALUATION CRITERIA FAILS TO MEETS EXCEEDS SCORE

MEET EXPECTATION EXPECTATIO
EXPECTATIO S (2-3 Marks) N (4-5 Marks)
NS (0-1 Mark)
1.Company Profile (5 Marks) All the required Some of the All the required
● Vision of the Company. information not required information
● Mission of the Company presented. information presented in a
● Business of the Company presented Or well-organized
(Products). The presented manner along
information is not with proper
● Management of the
well organized formatting.
Company (BOD).
and formatted.
● Competitors
2. Common Size Income Incorrect or Correct data used Correct data used
Statement Analysis (5 Marks) (3 inappropriate with minimal without any errors
Marks for Statement, 2 Marks for data used. errors and some and proper
Analysis) analysis. analysis is done.
The Analysis part should include
the analysis of
● Overall profitability
3. Comparative Income Incorrect or Correct data used Correct data used
Statement Analysis (5 Marks) (3 inappropriate with minimal without any errors
Marks for Statement, 2 Marks for data used errors and some and the analysis is
Analysis) analysis done
The Analysis part should include
the analysis of
● Overall profitability
4. Common Size Balance Sheet Student is not Student is Student can
Analysis. (5 Marks) (3 Marks for able to analyse partially able to analyse and
Statement, 2 Marks for Analysis) and interpret the analyse and interpret the
The Analysis part would include: position of interpret the position of
● Overall Financial position company, position of company,
analysis. including company, including
indications including indications where
where the indications where the company is
company is the company is lacking.
lacking. lacking.
5. Comparative Balance Sheet Student is not Student is Student can
Analysis. (5 Marks) (3 Marks for able to analyse partially able to analyse and
Statement, 2 Marks for Analysis) and interpret the analyse and interpret the
The Analysis part would include: position of interpret the position of
● Overall Financial position company, position of company,
analysis. including company, including
indications including indications where
where the indications where the company is
company is the company is lacking.
lacking. lacking.
6. Ratio Analysis. (5 Marks) Incorrect or Correct data used Correct data used
The analysis would include the inappropriate with minimal without any
following ratio and the data used for errors; generally errors, or
interpretation for the same: ratio calculation; correct assumption(s)
● Current Ratio incorrect comparison and made for
comparison and unavailable data;

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.

 2

● Net profitability ratio conclusions conclusions correct

● Debt Equity Ratio drawn. drawn. comparison and
● Debtor Turnover Ratio conclusions
drawn.
● Earning Per Share

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.

 3

CONTENTS

INTRODUCTION
1. Company’s Profile
2. Vision of the Company.
3. Mission of the Company
4. Business of the Company (Products).
5. Management of the Company (BOD).
6. Competitors

Common Size Income Statement

Common Size Income Statement Interpretation
Comparative Income Statement
Comparative Income Statement Interpretation
Common Size Balance Sheet Analysis.
Common Size Balance Sheet Analysis Interpretation.
Comparative Balance Sheet Analysis
Comparative Balance Sheet Interpretation.
Ratio Analysis.
1. Current Ratio
2. Net profitability ratio
3. Debt Equity Ratio
4. Debtor Turnover Ratio
5. Earnings Per Share

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.

 4

INTRODUCTION

Company’s Profile

Emami Limited is one of the leading and fastest growing personal and healthcare businesses in
India established in 1974 with an enviable portfolio of household brand names such as BoroPlus,
Navratna, Fair and Handsome, Zandu Balm, Mentho Plus Balm, Fast Relief and Kesh King. The
current operations comprise more than 60+ countries including. SAARC, MENAP, SEA, Africa,
Eastern Europe and the CIS countries.

Vision of Emami Ltd.

Making people healthy and beautiful, naturally.

Mission of The Emami Ltd.

 To contribute whole heartedly towards the environment and society integrating all our
stakeholders into the Emami family
 To make Emami synonymous with natural beauty and health in the consumer’s mind
 To drive growth through quality and innovation in products and services.
 To strengthen and foster in the employees, strong emotive feelings of oneness with the
company through commitment to their future
 To uphold the principles of corporate governance and to encourage decision making ability at
all levels of the organizatio

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.

 5

Business of The Emami Ltd.

For more than 35 years Emami has been innovating and launching brands meeting multiple
consumer needs, spanning across various income groups, for young to old and everyone in -
between. They are passionate about creating best in class and affordable brands in health and
personal care markets.

Its major brands and products are.

 Boroplus
 Navratna

 Zandu balm

 Fair and Handsome

 Mentho plus balm

 Fast Relief

 Zandu Sona Chandi

 Kesari Jivan

 Vasocare

 Zandu Healthcare

 7 Oils in OneKesh King

 HE

 Damond Shine

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.

 6

Management of Emami Ltd.

 N H Bhansali - CEO - Finance Strategy & Business Development and CFO

 AK Joshi - Company Secretary & VP - Legal
 Dhiraj Agarwal - Head - Media Planning
 Chandra Kant Katiyar - CEO Technical - Health Care Division
 Punita Kalra - CEO - Research & Innovation Strategy and Corporate Quality Assurance
 Mohan Rajabhau Panchabhai - COO - Operations and Purchase
 Rana Banerjee- President - Health Care Division
 Vivek Dhir - CEO - International Marketing Division
 Venkata Rao Damera - President - IT
 Nihar Ranjan Ghosh - President - Human Resources

CEO - Finance President - Human

CEO Technical - Resources
Strategy & Business Health Care Division
Development and
CFO

CEO - Research &

Innovation Strategy
and Corporate
Quality Assurance

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.

 7

COMPETITIORS

Company Market Cap(in cr.) Rank

HUL 461830.18 1

Dabur India 83016.66 2

Godrej Consumer 73018.52 3

Marico 50921.30 4

Colgate 42539.91 5

P&G 38912.14 6

Gillette India 25633.65 7

Emami 15234.07 8

VIP Industries 6960.58 9

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.

 8

Comparative analysis of Profit & Loss account of Emami

Differcen Percenta Differen Percenta
Mar '19 Mar '18 Mar '17
ce ge ce ge
12 12 12
19-18 19-18 18-17 18-17
mths mths mths

Income
2,483. 2,364. 2,341.
119.00 5% 22.99 1%
Sales Turnover 27 27 28
Excise Duty 0 10.28 39.57 -10.28 -100% -29.29 -74%
2,483. 2,353. 2,301.
Net Sales 129.28 5% 52.28 2%
27 99 71
Other Income 36.39 30.24 45.78 6.15 20% -15.54 -34%
Stock Adjustments 14.47 10.48 13.2 3.99 38% -2.72 -21%
2,534. 2,394. 2,360.
Total Income 139.42 6% 34.02 1%
13 71 69
Expenditure
Raw Materials 894.93 835.26 812.39 59.67 7% 22.87 3%
Power & Fuel Cost 22.18 17.82 14.51 4.36 24% 3.31 23%
Employee Cost 237.29 215.94 194.96 21.35 10% 20.98 11%
Selling and Admin
398.6 404.9 365.78 -6.30 -2% 39.12 11%
Expenses
Miscellaneous
243.75 191.1 188.25 52.65 28% 2.85 2%
Expenses
1,796. 1,665. 1,575.
Total Expenses 131.73 8% 89.13 6%
75 02 89
700.99 699.45 739.02 1.54 0% -39.57 -5%
Operating Profit
PBDIT 737.38 729.69 784.8 7.69 1% -55.11 -7%
Interest 19.29 33.17 57.62 -13.88 -42% -24.45 -42%
PBDT 718.09 696.52 727.18 21.57 3% -30.66 -4%
Depreciation 318.04 305.31 304.67 12.73 4% 0.64 0%
Profit Before Tax 400.05 391.21 422.51 8.84 2% -31.30 -7%
PBT (Post Extra-ord
400.05 391.21 422.51 8.84 2% -31.30 -7%
Items)
Tax 91.25 79.72 75.54 11.53 14% 4.18 6%
Reported Net Profit 305.24 309.52 346.37 -4.28 -1% -36.85 -11%
Total Value Addition 901.81 829.77 763.51 72.04 9% 66.26 9%
Equity Dividend 158.88 119.16 198.6 39.72 33% -79.44 -40%
Corporate Dividend
31.34 22.98 36.83 8.36 36% -13.85 -38%
Tax

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.

 9

Comparative Income Statement Interpretation.

 The cost of goods sold (raw materials, power and fuel cost) has increased from 3% in 2017-
2018 to 7% in 2018-2019 which means that the cost of production is increasing.
 The other operating expenses like selling and administration has decreased from 11% in
2017-2018 to -2% in 2018-2019 which mean the sales of the company has reduced and the
expenses related to selling has also been reduced.
 Net profit of the company has however reduced from negative 11% to negative 1%.
Which indicates that the company is trying to revive from the negative profit and convert
it into the higher profit but that will require some changes in the company’s policy.

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.

 10

Profit & Loss account of Emami common size analysis

Mar '19 Mar '18 Mar '17 Percentage Percentage Percentage

12 mths 12 mths 12 mths 2019 2018 2017

Income
2,483.27 2,364.27 2,341.28 100% 100% 102%
Sales Turnover
Excise Duty 0 10.28 39.57 0% 0% 2%
Net Sales 2,483.27 2,353.99 2,301.71 100% 100% 100%
Other Income 36.39 30.24 45.78 1% 1% 2%
Stock Adjustments 14.47 10.48 13.2 1% 0% 1%
Total Income 2,534.13 2,394.71 2,360.69 102% 102% 103%
Expenditure
Raw Materials 894.93 835.26 812.39 36% 35% 35%
Power & Fuel Cost 22.18 17.82 14.51 1% 1% 1%
Employee Cost 237.29 215.94 194.96 10% 9% 8%
Selling and Admin
398.6 404.9 365.78 16% 17% 16%
Expenses
Miscellaneous
243.75 191.1 188.25 10% 8% 8%
Expenses
Total Expenses 1,796.75 1,665.02 1,575.89 72% 71% 68%
700.99 699.45 739.02 28% 30% 32%
Operating Profit
PBDIT 737.38 729.69 784.8 30% 31% 34%
Interest 19.29 33.17 57.62 1% 1% 3%
PBDT 718.09 696.52 727.18 29% 30% 32%
Depreciation 318.04 305.31 304.67 13% 13% 13%
Profit Before Tax 400.05 391.21 422.51 16% 17% 18%
PBT (Post Extra-ord
400.05 391.21 422.51 16% 17% 18%
Items)
Tax 91.25 79.72 75.54 4% 3% 3%
Reported Net Profit 305.24 309.52 346.37 12% 13% 15%
Total Value Addition 901.81 829.77 763.51 36% 35% 33%
Equity Dividend 158.88 119.16 198.6 6% 5% 9%
Corporate Dividend
31.34 22.98 36.83 1% 1% 2%
Tax

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.

 11

Interpretation of Common Size Analysis of Income statement.

 The cost of goods sold (raw materials, power and fuel) is seen to be stable because the
change is very minimum which can be justified.
 The other operating expenses like selling and administration expenses is seen to be
fluctuating by increasing and decreasing trend.
 Percentage of net profit is decreasing from 15% in 2017 to 13% in 2018 to 12% in 2017
which clearly the company is not able to make higher profits and somewhat in profit
declining phase.

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.

 12

Comparative Balance Sheet Balance sheet analysis of Emami

Mar '19 Mar '18 Mar '17 Differcence Percentage Difference Percentage

SOURCES OF FUND 12 mths 12 mths 12 mths 19-18 19-18 18-17 18-17

45.39 22.7 22.7 22.69 100% 0 0%

Total Share Capital

Equity Share Capital 45.39 22.7 22.7 22.69 100% 0 0%

Reserves 2,019.01 1,948.54 1,689.86 70.47 4% 258.68 15%

Networth 2,064.40 1,971.24 1,712.56 93.16 5% 258.68 15%

Secured Loans 54.34 57.82 24.9 -3.48 -6% 32.92 132%

Unsecured Loans 0 221.55 109.8 -221.55 -100% 111.75 102%

Total Debt 54.34 279.37 134.7 -225.03 -81% 144.67 107%

Total Liabilities 2,118.74 2,250.61 1,847.26 -131.87 -6% 403.35 22%

Mar '19 Mar '18 Mar '17 Differcence Percentage Difference Percentage

12 mths 12 mths 12 mths 19-18 19-18 18-17 18-17

Application Of Funds

1,845.51 1,902.15 2,031.79 -56.64 -3% -129.64 -6%

Gross Block

Less: Accum.
202.16 138.8 79.41 63.36 46% 59.39 75%
Depreciation

Net Block 1,643.35 1,763.35 1,952.38 -120 -7% -189.03 -10%

Capital Work in
36.33 30.02 19.94 6.31 21% 10.08 51%
Progress

Investments 187.03 315.32 128.15 -128.29 -41% 187.17 146%

Inventories 213.54 183.85 169.2 29.69 16% 14.65 9%

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.

 13

Sundry Debtors 142.25 70.03 34.13 72.22 103% 35.9 105%

Cash and Bank Balance 110.67 21.55 8.53 89.12 414% 13.02 153%

Total Current Assets 466.46 275.43 211.86 191.03 69% 63.57 30%

Loans and Advances 249.86 213.76 128.64 36.1 17% 85.12 66%

Total CA, Loans &

716.32 489.19 340.5 227.13 46% 148.69 44%
Advances

Current Liabilities 416.38 307.09 547.95 109.29 36% -240.86 -44%

Provisions 47.91 40.18 45.76 7.73 19% -5.58 -12%

Total CL & Provisions 464.29 347.27 593.71 117.02 34% -246.44 -42%

Net Current Assets 252.03 141.92 -253.21 110.11 78% 395.13 -156%

Total Assets 2,118.74 2,250.61 1,847.26 -131.87 -6% 403.35 22%

Interpretation of Comparative Analysis of Balance Sheet.

 The percentage change and absolute change of gross profit are negative. In 2017-
2018 it was negative 6% and in 2018-2019 it was negative 3%
 Long liabilities is decreasing from 66% in 2017-2018 to 17% in 2018-2019 which
means the downsizing of the business. The company is contracting in worth.
 The reserves is decreasing from 15% in 2017-2018 to 4% in 2018-2019 which
indicates that the funds of the company is decreasing.

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.

 14

Common Size Analysis of Balance Sheet of Emami

Mar Mar Mar Percenta Percenta Percenta
'19 '18 '17 ge ge ge
12 12 12
Sources Of Funds 2019 2018 2017
mths mths mths

Total Share Capital 45.39 22.7 22.7 2% 1% 1%

Equity Share Capital 45.39 22.7 22.7 2% 1% 1%
2,019.0 1,948.5 1,689.8
Reserves 95% 87% 91%
1 4 6
2,064.4 1,971.2 1,712.5
Networth 97% 88% 93%
0 4 6
Secured Loans 54.34 57.82 24.9 3% 3% 1%
Unsecured Loans 0 221.55 109.8 0% 10% 6%
Total Debt 54.34 279.37 134.7 3% 12% 7%
2,118.7 2,250.6 1,847.2
Total Liabilities 100% 100% 100%
4 1 6
Mar Mar Mar Percenta Percenta Percenta
'19 '18 '17 ge ge ge
Application Of Funds 12 12 12
2019 2018 2017
mths mths mths
1,845.5 1,902.1 2,031.7
Gross Block 87% 85% 110%
1 5 9
Less: Accum. Depreciation 202.16 138.8 79.41 10% 6% 4%
1,643.3 1,763.3 1,952.3
Net Block 78% 78% 106%
5 5 8
Capital Work in Progress 36.33 30.02 19.94 2% 1% 1%
Investments 187.03 315.32 128.15 9% 14% 7%
Inventories 213.54 183.85 169.2 10% 8% 9%
Sundry Debtors 142.25 70.03 34.13 7% 3% 2%
Cash and Bank Balance 110.67 21.55 8.53 5% 1% 0%
Total Current Assets 466.46 275.43 211.86 22% 12% 11%
Loans and Advances 249.86 213.76 128.64 12% 9% 7%
Total CA, Loans &
716.32 489.19 340.5 34% 22% 18%
Advances
Current Liabilities 416.38 307.09547.95 20% 14% 30%
Provisions 47.91 40.18 45.76 2% 2% 2%
Total CL & Provisions 464.29 347.27593.71 22% 15% 32%
-
Net Current Assets 252.03 141.92 12% 6% -14%
253.21
2,118.7 2,250.6 1,847.2
Total Assets 100% 100% 100%
4 1 6

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.

 15

Interpretation of Common Size Analysis of Balance Sheet.

 The percentage of long-term liabilities is increasing from 7% in 2017 to 9% in 2018 to 12%

in 2019.
 The percentage of current liabilities is fluctuating by decreasing from 30% in 2017 to 14%
in 2108 and again increasing to 20% in 2019.
 The current assets is increasing from 11% in 2017 to 12% in 2108 to 22% in 2019.
 The current ratio has improved which means the working capital has increased. Therefore,
the company can easily pay off its short term loans.
 The cash in hand and bank balance has increased therefore the liquidity of the company
has increased.

RATIO ANALYSIS

RATIOS 2019 2018

CURRENT RATIO 1.44 0.97
NET PROFITABILITY 12.29 13.14
RATIO
DEBT EQUITY RATIO 0.03 0.14
DEBTOR TURNOVER 23.40 45.20
RATIO
EARNING PER SHARE 13.75 27.09

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.

 16

RATIO INTERPRETATION

CURRENT RATIO:

Current Ratio = Current Asset

Current Liabilities
Interpretation: The current ratio of the company has increased to 1.44 in the year 2019 from 0.97
in 2018 which is a good sign. The company is having the current ratio 1.44 signifies that the current
asset of the company is more than that of its liabilities and the company is able to repay its short
term liabilities. It can be expected that the company will gain the ideal current ratio situation i.e.
2:1.

NET PROFITABILITY RATIO:

Net profitability ratio = Net Profit

Net Sale

Interpretation: The net profitability ratio or the net profit ratio the company has slightly decreased
to 12.29 in the year 2019 from 13.14 in 2018. This indicate the is not making more of profit rather
is on declining profit phase. So it has to revise the marketing plan and strategy of the company.

DEBT EQUITY RATIO

Debt Equity Ratio = Total Debt

Shareholder’s fund
Interpretation: The Debt Equity ratio in the year 2019 has decreased to 0.03 from 0.14 which is
a good sign for the company indicating more financial stability of the business. This ratio also
indicates that the assets of the company are more funded by equity. The drop in the debt equity
ratio also indicates that company is reducing its reliance on debt to fund its assets and its leverage
is going down. It also means that the ownership % of assets is going up.

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.

 17

DEBTOR TURNOVER RATIO:

Debtor Turnover Ratio = Credit Sales

Average Debtor
Interpretation: Since the Debtor Turnover ratio of the company has decreased to 23.40 in the
year 2019 from 45.20 in 2018, this signifies that the debt collection of the company has slowed
down in the year 2019. This also shows that the credit sales of the company are not being converted
into cash quickly in comparison to the previous year. The decrease in this ratio has indicated the
sluggish and inefficient collection leading to doubts that receivables might contain significant
doubtful debt. Therefore, the company has to look forward to change its credit policy.

EARNING PER SHARE:

Earnings Per Share = Net Profit after tax – Preference dividend

Total number of equity shares
Interpretation: The earning per share ratio of the company has fallen down to 13.75 in the year
2019 from 27.09 in 2018. This indicates that the company is not making higher profits in this year
with regard to the previous year. This also shows that the profits made by the company per each
share has been reduced. The company has to adopt the profit making policy in order to increase
the earning per share ratio.

CONCLUSION
By the study of the financial statement of Emami Ltd, and interpreting the common size,
comparative and ratio analysis we can come to conclude that the overall profitability of the
company has not been increased rather facing a steep downfall which may also be the sign of
recession approaching. The company should reframe the strategy and policies in order to increase
the profit and reduce its extra and non-operating expenses.

REFERENCES

 Money Control Website

 Emami ltd official website.

REPORT ON FINANCIAL STATEMET ANALYSIS OF EMAMI LTD.