C !!!

MARUTI SUZUKI INDIA LIMITED 2009 -2010
ACKNOWLEDGEMENT
I would like to express my deep and sincere gratitude to our Professor ,
Mrs. Neha Bhatia, Her wide knowledge and her logical way of
thinking have been of great value for us. Her understanding,
encouraging and personal guidance have provided a good basis for the
Project.
I wish to express my warm and sincere thanks to Professor who
introduced us to the field of Financial Management & Management
Accounting. The ideals and concepts will have a remarkable influence
on our entire career
Contents
Automobile Sector
Why Maruti Suzuki ??
Company Analysis
Tools for Company analysis
Comments on Balance Sheet 09 - 10
Pie Chart
Comments on Profit & Loss 09 - 10
Ratio Analysis & Comments
Common size Statement
Comparative Statement
Trend Analysis
Working Capital
Cash Flow
Valuation of Shares
Investment In Maruti Suzuki Ltd.
Future Comments
Effect of Budget on Share Price
Conclusion
Bibliography
AUTOMOBILE SECTOR
The data obtained from ministry of commerce and industry, shows high growth obtained since
2008- 09 in automobile production continuing in the first three quarters of the 2004-05.
Annual growth was 16.0 per cent in April-December, 2009; the growth rate in 2003-04 was
15.1 per cent The automobile industry grew at a compound annual growth rate (CAGR) of 22
per cent between 2000- 2010 With investment exceeding Rs. 50,000 crore, the turnover of the
automobile industry exceeded Rs. 59,518 crore in 2009-10. Including turnover of the auto-
component sector, the automotive industry's turnover, which was above Rs. 84,000 crore in
2009-10, is estimated to have exceeded Rs.1,00,000 crore ( USD 22. 74 billion) in 2003-04.
In terms of Car dealer networks and authorized service stations, Maruti leads the pack with
Dealer networks and workshops across the country. The other leading automobile
manufactures are also trying to cope up and are opening their service stations and dealer
workshops in all the metros and major cities of the country. Dealers offer varying kind of
discount of finances who in tern pass it on to the customers in the form of reduced interest
rates.
WHY MARUTI SUZUKI ??

Maruti Suzuki India Limited (MSIL, formerly known as Maruti Udyog Limited) is a
subsidiary of Suzuki Motor Corporation, Japan. MSIL has been the leader of the Indian car
market for over two and a half decades. The company has two manufacturing facilities located
at Gurgaon and Manesar, south of New Delhi, India. Both the facilities have a combined
capability to produce over a 1.2 million (1,200,000) passenger car units annually. The
company plans to expand its manufacturing capacity to 1.75 million by 2013. For this the
company will be investing around Rs. 60 Billion (Rs 6,000 Crores) over the period till 2013.
The company offers a wide range of cars across

different segments. It offers 14 brands and over 150
variants - Maruti 800, people movers, Omni and
Eeco, international brands Alto, Alto-K10, A-star,
WagonR, Swift, Ritz and Estilo, off-roader Gypsy,
SUV Grand Vitara, sedans SX4 and Swift DZire In an
environment friendly initiative, in August 2010 Maruti Suzuki introduced factory fitted CNG
option on 5 models across vehicle segments. These include Eeco, Alto, Estilo, Wagon R and
Sx4.
In fiscal 2009-10 Maruti Suzuki became the only Indian company to manufacture and sell One
Million cars in a year. Maruti Suzuki has employee strength over 7,600 (as at end March
2010), In 2009-10, the company sold a record 10,18,365 vehicles including 1,47,575 units of
exports. With this, at the end of March 2010, Maruti Suzuki had a market share of 53.3 per
cent of the Indian passenger car market (including C segment).
Maruti Suzuki's revenue has grown consistently over the years.
COMPANY ANALYSIS
Ultimately, Company analysis want to achieve the following outcomes:
Reduce waste
Create solutions
Complete projects on time
Improve efficiency
Document the right requirements
Helps Investor
Helps in interpretation of Future Price
Rework is a common industry headache and it has become so common at many organizations
that it is often built into project budgets and time lines. It generally refers to extra work needed
in a project to fix errors due to incomplete or missing requirements and can impact the entire
software development process from definition to coding and testing. The need for rework can
be reduced by ensuring that the requirements gathering and definition processes are thorough
and by ensuring that the business and technical members of a project are involved in these
processes from an early stage.
TOOLS FOR COMPANY ANALYSIS
COMMENTS ON BALANCE SHEET

2009 -2010
(Rs. In Million)
I Sources of funds
The company acquires fund in two ways shareholders (owner of the company) and other in
form of Borrowed fund (from banks, debentures)
Share Capital (Schedule 1)

The company has not raised any funds through issuing shares. The company equity capital
remains same in current year 2010 compare to previous year 2009.
The Company has 28,89,10,060 Equity Share of Rs 5 Each. These shares were issued in cash
& also given to Suzuki Motor Corporation the Holding Company
Reserves and Surplus (Schedule 2)

Reserve and surplus includes any transfer of profit to reserve, general reserve, share premium,
capital reserve, Hedge Reserve Account. The reserve and surplus in the previous year 2009
was 92,004 and in the current year it is 116,906 it was increased by 24,902.
Reserves & Surplus Schedule Rs
Share Premium Account Schedule 2 Rs.4,241

Hedge Reserve Account Rs.238
General Reserve Account Rs.11,928
Balance as per Profit & Rs.100,499
Loss
Net worth (Share Capital + Reserve & Surplus)

It basically includes share capital, reserves and surplus if any fictitious assets are owned by the
firm have to be subtracted. Net worth is also known a shareholders funds, owned funds,
proprietors fund. In the previous year 2009 it was 101,989 and in current year it was 127,935
and it was increased by 25,946
Borrowed funds
The funds which are raised from the outsiders who are not the owner of the firm is termed as
borrowed funds . Borrowed funds are of two types secured and unsecured loans.
Secured Loans (schedule 3)

The Loans were taken From banks which was secured against book debt, current Assets
& the company have also taken Loan From Sundram Finance , which is payable within 1
Year, & Secured against the vehicles of the Firm
The Company have take Secured Loan of Rs 265 Million in the Current Year
Unsecured Funds (Schedule 4)

The Company have taken short term Loans from Indian Banks & Long term Loans From
Foreign Banks.The Company have Taken Unsecured Loan of Rs 7,949 Million in the current
Year, while in Previos year the Loan taken was only Rs 6,988 Million
Total fund (Net Worth + Borrowed Fund)

It includes net worth and borrowed. It basically tells what are the sources from which the
company have acquired the fund.
II) Application Of Funds

Fixed Assets (schedule 5)
Fixed assets are the biggest source for the company from land, building, plant and machinery,
furniture, office equipment, computers. And there was also provision for depreciation on
certain assets. The fixed assets have been increased from Rs.40,708 in Mar’09 to Rs. 46,498 in
Mar’10 by Rs. 5,788. It shows that company invested continuously to create a sizeable fixed
asset base.
Fixed Assets as on 1.4.2009
(+) Purchases of Fixed Assets
(-) Sale of Fixed Assets
(-)Depreciation for the Current Year
Net Fixed Assets as on 31.3.2010
Fixed Assets Schedule Rs

Building Schedule 5 Rs. 5,901
Plant & Machinery Rs. 35,697
Furniture & Fixture Rs. 455
Vehicles Rs. 511
Intangible Assets 159
Investment (Schedule 7)
Company has invested in many subsidiaries like Equity Shares Fully Paid up, Mutual Funds,
Bonds. Total investments are increased from Rs.1,087 in Mar’09 to Rs.2,151 in Mar’10 by
Rs.1,064
The Company have not sold any Investment in the current Year, There have been only
addition, No deduction.
Working capital
Working capital is equal to Current Assets less Current liabilities.
WC = CA – CL
Working capital has Increased from Rs.34,165 in Mar’09 to Rs.35,678 in Mar’10.
Current Assets
Current assets include inventories, cash and bank balance, loan and advances. Current assets
decrease from Rs.55,100 in Mar’09 to Rs.37,724 in Mar’10.
The current assets is decreased By 17,376
Current Assets Schedule Rs
Inventories Schedule 8 Rs.12,008

Sundry Debtors Schedule 9 Rs.8,099
Cash & Bank Balances Schedule 10 Rs.982
Other Current Assets Schedule 11 Rs.848
Loan & Advances Schedule 12 Rs.15,707
Current Liabilities
Current liabilities include sundry creditors, Provision for Tax, unclaimed share application
money refunds. Current liabilities decrease from Rs.20,935 in Mar’09 to Rs.2046 in Mar’10.
Current Liability Schedule Rs
1.Creditors Schedule 13 Rs.69

2.Bank Overdraft Rs.675
3.Unclaimed Dividend Rs.1,124
4.Interest Accrued but Rs.43
not Due
Capital Employed
It includes fixed assets, investment, capital work in progress, and working capital and the total
capital employed have increase from Rs.13792.81 in Mar’09 to Rs.14066.04. in Mar’10 by
273.23.
Pie Charts
The Above Pie Chart Shows the Sources of Fund, & How is the application made of that.
Sources of Funds
64% are from the source of Reserve & Surplus
30% From Unsecured Loan
5% From shareholders
& 1% From Secured Loans
Application of Funds
40% of Total Fund is Employed in Fixed assets
32% of fund is invested in Shares, Mutual Fund, and Government Securities.
28% of Fund is for Working Capital, For running of Day to day Business
COMMENTS ON PROFIT & LOSS

2009 -2010
(Rs. In Million)
Profit and Loss Account shows how much profit or losses have the bank incurred from its
income after providing for all its expenditure within a particular financial year. This gives an
idea how much profit is available for appropriation and to calculate dividend given to
shareholder. The income of the bank includes interest, discount on advances .commission, and
income of investment.
Sales (Schedule 15)

Company has sale of Rs.23085 in Mar’09, & Sale of Rs.318,073 in March 2010.
The Company Pays Excise Duty of around 16% on Sales. The Company have paid Rs.28,488
Of Excise Duty in The current year 2010.
Income From Services (Schedule 16)

Company have Earned a Income of Rs.954 in the Previous Year & Rs.1,404 In the current
year. The Income of Company have increased in the current year. This is a positive sign that
with the Net sales, company’s Other Income have also increased.
TOTAL INCOME OF COMPANY
The Company Earns Maximum from Sales & rest from Other Income
The Company’s income from sales has increased in the current year as we can see in
the above graph. But the Income from other sources remains almost constant no major
changes have been seen in the income from other sources
Expenditure
The expenses which form high proportion are personal expenses, manufacturing expenses,
interest, financial charges, and depreciation. All expenses during the year 2009 were
Rs.187,610 has increase to Rs.258,917 in Mar’10 by Rs.71,307
Employees Remuneration & Benefits (Schedule 17)

All the details of Employee’s Remuneration & Benefits is explained under the schedule 17.
The Expenditure inquired on Employees Remuneration & Benefits were Rs. 4,711 in March
2009 & March 2010 is Rs.5,456
Manufacturing & Administrative Expenses (Schedule 18)

All the details of Manufacturing & Administrative Expenses is explained under the schedule
18. The Expenditure inquired on Manufacturing & Administrative Expenses were Rs. 15,685
in March 2009 & March 2010 is Rs.17,938
Selling & Distribution (Schedule 19)

All the details of Selling & Distribution is explained under the schedule 19. The Expenditure
inquired on Selling & Distribution Expenses were Rs.7,382 in March 2009 & March 2010 is
Rs.9160
TOTAL EXPENDITURE
The Above Graph Clearly explains the expenses which are inquired in the financial
year 2008-2009 & 2009-2010
The Expenses of the Company have increased in the current year
The major expenses are on manufacturing & Administrative
RATIO ANALYSIS
Sr Ratio 2009 2010 Comments

.
No
Liquidity Ratios
1 Current Ratio = Current Assets 1.53 : 1 1.02 :1 The standard Current Ratio
Current Liability is 2:1, it tells about the
short term in solvency of
the Company.
2 Quick Ratio = Quick Assets 1.26 : 1 0.67 : 1 The standard Quick Ratio
Quick Liability is 1:1, it tells about the
Immediate obligation of
the company
3 Inventory Turnover Ratio = 30.46 30.47 The Inventory Turnover

Cost of Goods Sold Ratio tells the relationship
Average Inventory between Cost of goods
Sold & Average Inventory
4 Debtors Turnover ratio = 29.07 14.07 Debtors turnover Ratio

Net Credit Sales indicates that how much
Average Accounts Receivable frequently Company have
to collect money From
Debtors.
5 Fixed Assets Turnover Ratio = 2.38 2.82 Fixed Assets Turnover

Net Sales Ratio, helps to find out the
Net fixed Assets how efficiently FA are
used.
6 Total Assets Turnover Ratio = 3.86 3.06 Total Assets turnover

Net Sales Ratio, help us to find, how
Total assets efficiently is Total Assets
used, Compare to Sales
Leverage Ratios
7 Debt Equity Ratio = Total Debt 0..06 0.03 The Standard Debt Equity
Equity Ratio is 2:1
It Shows that how much
does a Firm depend on
borrowing Funds.
8 Debt Assets Ratio = Total Debt 0.07 0.06 The Debt Assets Ratio,
Total Assets help us to find out what the
total Debt Compared to
total Assets of the Firm.
9 Interest Coverage Ratio = 2.56 1.86 Interest Coverage Ratio

Earning Before Interest & Tax help us to find out that how
Interest much Interest is Company
paying out of its Net Profit.
Profitability Ratios
10 Gross Profit Ratio =

Gross Profit X 100 5.77 % 9.93% Gross Profit Ratio Indicate
Net Sales Profit earned before
encoring any Indirect
Expenses.
11 Net Profit Ratio = 5.72% 8.43% Net Profit Ratio Indicate

Net Profit X 100 the profit earned after
Net Sales encoring all direct &
Indirect Expenses.
12 Return on Total Assets = 10.45 11.33 Return on total Assets, tell

Profit Before Interest & Tax us that what is the return
Fixed Assets + Current Assets we will get on Assets
employed by the firm
Compared to Net profit
before Interest & Tax
Return on Capital
13 Return on Capital Employed = 14.63 19.78 Employed, shows that what
Net Profit After Tax return are the shareholders
Total Capital Employed going to get on Capital
Employed by them
14 Return on Shareholder’s Equity = 13.04 21.10 Return on Shareholders

Net Profit After Tax Equity tell that What return
Net worth will Shareholders get on
Funds Invested by them.
15 EPS = 42.18 86.45 Earning Per share Indicates

Net Profit Available To shareholders that what is Company
Number of Share actually earning on Per
share as pr the profit
earned by the firm.
16 Profit Earning Ratio = 65.88 128.00 Profit Earning Ratio tells

Net Market Price us that how much profit the
EPS company is earning
compared to Market Price
of Share.
17 Dividend Payout Ratio = 8.60 9.39 Dividend Payout Ration

Dividend Per Share X 100 Tells that how much
EPS dividend is Company
Going to Payout in the
financial year to the
Shareholders
COMMON SIZE
Common Size Statement - Balance Sheet

Particulars 2009 (Rs) 2009 (%) 2010 (Rs) 2010 (%)
Sources of Fund
1) Owner’s Fund
Equity Share Capital 1445 1.41% 1445 1.78%
Preference Share Capital - - - -
Reserve & Surplus 92004 90.20% 116906 91.37%
Net Worth 93449 92.19% 118351 93.83%
2) Loan Fund
Secured Loan 1 0.001% 265 0.20%
Unsecured Loan 6988 6.85% 7949 6.21%
Borrowed Fund 6989 6.86% 8214 6.42%
Total Funds ( 1 + 2 ) 101989 100% 127935 100%
Application Of Funds
1) Fixed Assets 87206 85.50% 104067 81.34%

(-) Depreciation on fixed Assets (46498) 45.91% (53820) 42.06%
Net Fixed Assets 40708 39.91% 50247 39.27%
2) Capital Work in Progress 8613 0.46% 3876 3.02%
3) Investment 31733 31.11% 71766 56.09%
4) Working Capital
(CA – CL )
Current Assets 55100 54.02% 37724 29.48%
(-) Current Liability (34165) 33.49% (35678) 27.88%
WC 20935 20.52% 2046 1.59%
Capital Employed 101989 100% 127935 100%

(1+2+3+4)
Common Size Statement – P&L

Particulars 2009 (Rs) 2009 (%) 2010 (Rs) 2010 (%)
Gross Sales 2,30,852 107.60% 3,18,073 105.60%

(-)Excise Duty 27,298 12.72% 28,488 9.45%
Net Sales 2,03,583 94.89% 2,89,585 96.14%
Other Income 10,955 5.10% 11,613 3.85%
. - . -
Total Income 2,14,538 100% 3,01,198 100%
(-) Expenditure
Raw Material 1,50,598 70.19 2,14,881 71.34%
Employees Remuneration 4,711 2.19 5,456 1.81%
Manufacturing, Administrative 15,685 7.31% 17,938 5.95%
Selling & distribution 7,382 3.44% 9,160 3.04%
Other Expenses 9234 4.30% 11,482 3.81%
Earning Before Tax, . . . .

Depreciation & Interest 24,333 11.34% 44,510 14.77%
(-)Interest 510 0.23% 335 0.11%

(-)Depreciation 7,065 32,91% 8,250 2.73%
. . . .
Profit before Tax 16,758 7.81% 35,925 11.92%
(-) Tax 4,592 2.14% 11230 3.72%

. . . .
Profit After Tax 12,187 5.68% 24,976 8,29%
(+) Op Bal 70,257 32.74% 80,042 26.5%

(-) Appropriation 2,402 1.11% 16,001 5.31%
. . . .
Retained Earnings 80,042 37.30% 1,00,499 33.36%
A company financial statement that displays all items as percentages of a common base figure.
This type of financial statement allows for easy analysis between companies or between time
periods of a company
The values on the common size statement are expressed as percentages of a statement
component such as revenue. While most firms don't report their statements in common size, it
is beneficial to compute if you want to analyze two or more companies of differing size against
each other.
Formatting financial statements in this way reduces the bias that can occur when
analyzing companies of differing sizes. It also allows for the analysis of a company over
various time periods, revealing, for example, what percentage of sales is cost of goods sold and
how that value has changed over time.
COMPARATIVE STATEMENT
Comparative Statement – Balance Sheet

Particulars 2009 2010 Increase / Increase /
Decrease Decrease (%)
(Rs)
Sources of Fund
1) Owner’s Fund
Equity Share Capital 1445 1445 -
Preference Share Capital - - -
Reserve & Surplus 92004 116906 ^ 24902 ^ 27.06%
Net Worth 93449 118351 ^ 24902 ^ 26.64%
2) Loan Fund
Secured Loan 1 265 ^ 264 ^ 0.001%
Unsecured Loan 6988 7949 ^ 961 ^ 13.75%
Borrowed Fund 6989 8214 ^ 1225 ^ 17.53%
Total Funds ( 1 + 2 ) 101989 127935 ^ 25946 ^ 25.43%
1) Fixed Assets 87206 104067 ^ 16861 ^ 19.33%

(-) Depreciation on fixed Assets (46498) (53820) ^ 7322 ^ 15.74%
Net Fixed Assets 40708 50247 ^ 9449 ^ 23.16%
2) Capital Work in Progress 8613 3876 v (4737) v 54.99%
3) Investment 31733 71766 ^ 40033 ^ 126.15%
4) Working Capital
(CA – CL )
Current Assets 55100 37724 v (17376) v 21.54%
(-) Current Liability (34165) (35678) ^ 1513 ^ 4.42%
WC 20935 2046 ^ 16880 ^ 87.32%
Capital Employed 101989 127935 ^ 25946 ^ 25.43%

(1+2+3+4)
Comparative Statement – P&L

Particulars 2009 2010 Increase / Increase /

Decrease Decrease (%)
(Rs)
Gross Sales 2,30,852 3,18,073 ^ 87,221 37.78%

(-)Excise Duty 27,298 28,488 ^ 1,190 4.35%
Net Sales 2,03,583 2,89,585 ^ 86,002 42.24%
Other Income 10,955 11,613 ^ 658 6.01%
. . .
Total Income 2,14,538 3,01,198 ^ 95,660 44.56%
(-) Expenditure
Raw Material 1,50,598 2,14,881 ^ 64,238 ^ 42.65%
Employees Remuneration 4,711 5,456 ^ 745 ^ 15.81%
Manufacturing, Administrative 15,685 17,938 ^ 2,253 ^ 14.36%
Selling & distribution 7,382 9,160 ^ 1,778 ^ 24.08%
Other Expenses 9,234 11,482 ^ 2,248 ^ 24.34%
Earning Before Tax, . . .

Depreciation & Interest 24,333 44,510 ^ 20,177 ^ 82.92%
(-)Interest 510 335 v 175 v 34.31%

(-)Depreciation 7,065 8,250 ^ 1,185 ^ 16.77%
. . .
Profit before Tax 16,758 35,925 ^ 19,167 ^ 114.37%
(-) Tax 4,592 11230 ^ 6,638 ^ 144.55%

. . .
Profit After Tax 12,187 24,976 ^ 12,789 ^ 104.93%
(+) Op Bal 70,257 80,042 ^ 9,785 ^ 13.92%

(-) Appropriation 2,402 16,001 ^ 13,599 ^ 566.15%
. . -
Retained Earnings 80,042 1,00,499 ^ 20,457 ^ 25.55%
The comparative statement lines up a section of the income statement, balance sheet or
cash flow statement with its corresponding section from a previous period. It can also
be used to compare financial data from different companies over time, thus revealing
the trend in the financials.
Analysts like comparative statements because they show the effect business decisions
have on a company's bottom line. Analysts can identify trends and evaluate the
performance of managers, new lines of business on one statement instead of having to
flip through individual financial statements from different periods of time.
When comparing different companies, a comparative statement can show how
businesses react to market conditions affecting an entire industry.
TREND ANALYSIS
Trend analysis is a form of comparative analysis that is often employed to identify current and
future movements of an investment or group of investments. The process may involve
comparing past and current financial ratios as they related to various institutions in order to
project how long the current trend will continue. This type of information is extremely helpful
to investors who wish to make the most from their investments.
The term "trend analysis" refers to the concept of collecting information and attempting to
spot a pattern, or trend, in the information. In some fields of study, the term "trend analysis"
has more formally-defined meanings
Although trend analysis is often used to predict future events, it could be used to estimate
uncertain events in the past, such as how many ancient kings probably ruled between two
dates, based on data such as the average years which other known kings reigned.
TREND OF AUTOMOBILE SECTOR IN INDIA

Nearly every automobile company is investing at a higher rate than ever before to achieve a
high growth trajectory. The overall investment in the sector has been increasing quite rapidly.
It is expected that by the end of 2010 Indian automobile sector will be investing a huge amount
as Rs. 30,000 crores.
For example, Maruti Udyog has plans of investing Rs. 6,500 crores; the Tata Motors is coming
up with more investment of Rs. 2,000 crores in its compact car project. Not only the Indian
companies but also foreign players like Hyundai are coming up with the investment of more
than Rs. 3,800 crores in India
At present the industry is enjoying a growth rate of 14-17% per annum, with domestic sales
growth at 12.8%. The growth rate is predicted to double by 2015.
As it is seen, the total sales of passenger vehicles - cars, utility vehicles and multi-utility
vehicles - in the year 2005 reached the mark of 1.06 million. The current growth rate indicates
that by 2012 India will overtake Germany and Japan in sales volumes.
Financing schemes have become an important factor in the growth of automobile sales. More
and more financial schemes are coming up with easy installment plans to lure the customers.
Trend Analysis – Balance Sheet

Particulars 2008 2009 2010 2008 2009 2010
(Rs) (Rs) (Rs) (%) (%) (%)
Sources of Fund
1) Owner’s Fund
Equity Share Capital 1445 1445 1445 100% 100% 100%
Preference Share Capital - - - - - -
Reserve & Surplus 89017 92004 116906 100% 103.35 131,13%
Net Worth 90462 93449 118351 100% % 130.82%
103.35
2) Loan Fund %
Secured Loan - 1 265
Unsecured Loan 4900 6988 7949 100% 162.24%
Borrowed Fund 4900 6989 8214 100% - 167.63%
142.61
Total Funds ( 1 + 2 ) 95362 100438 127935 100% % 134.15%
142.63
%
105.32
%
1) Net Fixed Assets 30767 40708 50247 100% 132.31 163.31%

%
2) Capital WIP 8099 8613 3876 100% 47.85%
106.34
3) Investment 31733 31733 71766 100% % 226.15%
4) Working Capital 100%

(CA – CL )
Current Assets 53973 55100 37724 100% 69.69%
(-) Current Liability (29210) (34165) (35678) 100% 122.14%
WC 24763 20935 2046 100% 102.08 8.26%
%
Capital Employed 116.96
(1+2+3+4) 95362 100438 127935 100% % 134.15%
84.54%
105.32
%
Trend Analysis – Profit & Loss Statement

Particulars 2008 2009 2010 2008 2009 2010
(Rs) (Rs) (Rs) (%) (%) (%)
Gross Sales 1,95,855 2,30,852 3,18,073 100 117.86 162.40%

(-)Excise Duty 26,176 27,298 28,488 100 % 108.83%
Net Sales 1,69,679 2,03,583 2,89,585 100 104.28 170.66%
Other Income 09,595 10,955 11,613 100 % 121.03%
. . . 119.98
Total Income 1,79,274 2,14,538 3,01,198 100 % 168.09%
114.17
(-) Expenditure %
Raw Material 1,40,524 1,50,598 2,14,881 100 152.91%
Employees Remuneration 4,004 4,711 5,456 100 119.67 136.26%
Manufacturing, 5,885 15,685 17,938 100 % 304.80%
Administrative 5,082 7,382 9,160 100 180.24%
Selling & distribution 6,209 9234 11,482 100 184.92%
Other Expenses 107.16
. . . %
Earning Before Tax, 17,570 24,333 44,510 100 117.65 253.32%
Depreciation & Interest %
266.52
(-)Interest 567 510 335 100 % 59.08%
(-)Depreciation 7,065 7,065 8,250 100 145.25 116.77%
Profit before Tax 9,938 16,758 35,925 100 % 361.49%
148.71
(-) Tax (3,998) (4,592) (11230) 100 % 280.89%
Profit After Tax 5,940 12,187 24,976 100 420.47%
(+) Op Bal 65,788 70,257 80,042 100 138.49 121.66%

(-) Appropriation 1987 2,402 16,001 100 % 805.28%
. . .
Retained Earnings 69,741 80,042 1,00,499 100 144.10%
89.94%
100%
168.62
%
114.85
%
205.16
%
106.79
%
120.85
%
114.77
%
TREND OF MARUTI SUZUKI LTD.

TREND OF AUTOMOBILE SECTOR
The performance of Maruti & Mahindra were comparatively good in the automobile
sector.
Maruti Suzuki Ltd had less borrowing, if it is compared to Tata & Mahindra
Maruti Suzuki Ltd. had good Reserve & surplus, Assets which we had come toknw
while comparing the trend
Maruti Suzuki Ltd. have shown the Upward Trend in the whole automobile sector
which is very good point from view of company as well as shareholders
WORKING CAPITAL
Working capital (abbreviated WC) is a financial metric which represents operating liquidity
available to a business, organization, or other entity, including governmental entity. Along
with fixed assets such as plant and equipment, working capital is considered a part of
operating capital. Net working capital is calculated as current assets minus current liabilities. \
It is a derivation of working capital, that is commonly used in valuation techniques
such as DCFs (Discounted cash flows).
If current assets are less than current liabilities, an entity has a working capital
deficiency, also called a working capital deficit.
Working Capital = Current Assets

Net Working Capital = Current Assets − Current Liabilities
Equity Working Capital = CA −CL − Long-term Debt
A company can be endowed with assets and profitability but short of liquidity if its assets
cannot readily be converted into cash. Positive working capital is required to ensure that a firm
is able to continue its operations and that it has sufficient funds to satisfy both maturing short-
term debt and upcoming operational expenses. The management of working capital involves
managing inventories, accounts receivable and payable and cash.
WORKING CAPITAL STATEMENT

Particulars 2009 2010
Rs. Rs. Rs. Rs.
Current Assets
1. Stock
Raw Material
Work in Progress 2,418 3,898
Raw Material (100 %)
Wages (50%) - -
Overheads (50%) - -
.Finished goods - -
3,416 5,834 3651 7,549
2. Debtors
3,124 2900
3. Preliminary Expenses
672 893
4. Cash / Bank
1,976 1,325
Gross Working Capital
. .
(-) Current Liability 11,606 12,667
1. Creditors For Raw Material
2. Time Lag in Payment of (3,981) (3,819)

Wages
Overheads
- -
(+) Provision for Contingency - -
Net Working Capital

673 -
. .
8,298 8,848
CASH FLOW
Cash Flow Statement
Accounting Standard – 3
Section 211(3c) of The companies Act, 1956
Particulars Rs. Rs.
Cash Flow From Operations

Indirect Method 39,153
Tax Paid (10,279) 28,874
Cash Flow from Investing Activity

Purchase of Assets (13,597)
Sale of Assets 488
Purchase of Investment (206,591)
Sale of Investment 1,67,804
Interest Received 4113 (47,833)
Cash Flow From Financing Activity

Proceeds from short term borrowings 4,014
Repayment of Short term borrowings (661)
Repayment of Long term borrowings (1,472)
Interest Paid (319)
Dividend Paid (1,011) 551
Net Increase/ Decrease In Cash (18,408)
Cash @ the Beginning of the Year

Cash 19,390
Bank
Bank o/d
Cash @ the End of the year

Cash 982
Bank
Bank o/d
Net Decrease in Cash Flow (18,408)

Indirect Method
Particulars Rs. Rs.

Net Profit 35,925
(+) Non Cash Items

Depreciation 8,250 8,250
(+) Non Operating Items

Profit on sale of investment (1,627)
Loss on Sale of fixed Assets 97
Interest Expense 335
Interest Income (2,150)
Dividend Income (1,560) (4,905)
Net Profit before Working Capital Changes 39,270
Add: Increase in Liability & Decrease in Assets

Increase in Current Liability 915
Decrease in Debtors 1,279
Decrease in Current assets 754 2,948
Less: Decrease in Liability & Increase in Assets

Increase in Inventories 3065 (3,065)
Cash Flow From Operation (Indirect Method ) 39,153
VALUATION OF SHARES
The market price quotation in the stock market is considered to be the value of the share,
because there is considerable body of evidence to support the contention that the stock market
is relatively efficient. The shares of the company have to be valued in case the shares are not
listed on the stock exchange. The shares of Private limited company are also required to be
valued fore different purposes at different times.
Sometimes, market values of shares listed on the stock exchange also do not serve the purpose
because in market there is Malpractices, Price rigging, Speculation etc. therefore different
methods have been followed for the purpose of valuation etc.
Methods for valuation of Equity Shares.
1. Intrinsic Value Method

2. Yield Value Method
3. Fair Value Method
Intrinsic Value = Balance Available to Equity share holders
No. of Equity shares
= Assets @ Market value – Outside Labiality – Preference Share Capital

No. of Equity shares
= 79794000000
744000000
= Rs 107.25 / -
Yield Value = Expected Rate of Return X paid up value of share

Normal Rate of Return
= 98.65 X 5
6
= Rs. 82.20 / -
Fair Value = Intrinsic Value + Yield Value

2
= 107.25 + 82.20
2
= Rs. 94.725 / -
As the share price is higher when it is valued at Net Assets Method, so the dividend
declared will also be higher when the shares are valued at Net assets Value Method.
But generally company does not follow this method for valuation.
Mostly all the listed company’s follow the Yield Value Method, which is more
accurate & the dividend paid on them is also accurate.
Fair value method is mostly adopted by the firm which are not listed in the stock
exchange.
Valuation of Stock is very necessary as the dividend is declared on that price, & to give
True & Fair Result to shareholders, who are actually the owners of the firm.
Maruti Suzuki Ltd Values it shares as per yield Value Method.
The dividend declared by the Maruti Suzuki Ltd was the highest in the year 2009-2010
if it is compared to Automobile sector
INVESTMENT IN MARUTI SUZUKI
Date Amount Time Return

Invested
15th March 2010 Rs. 1,00,000 1 week ^ 1,08,302
– 22nd March
2010
1st March 2010 Rs. 1,00,000 1 Month ^ 1,06,337

– 31st March
2010
1st Oct 2009 – Rs. 1,00,000 6 Months v 94,783

31st March 2010
1st April 2009 – Rs. 1,00,000 1 Year ^ 1,23,089

31st March 2010
Highest Return Rs. 1,00,000 1 Day ^ 105,119

28th September
2009
Lowest Return Rs. 1,00,000 1 Day v 89,091

12th November
2009
Maruti Suzuki Ltd have Give good

returns to the shareholders who
have invested in their company.
If we compare the share price of
the company with the Sensex &
with the whole Automobile Sector. The performance was Average in the Current Financial
year
The Company have given highest return on 28th September 2009, the main reason was the
company was going to announce an interim dividend on 30th September 2009
The Company’s Share Price have gone down & have given lowest return on 12th November
2009, the reason was the dependence on Sensex on European & American Markets.
The above Table & Graph gives us the Clear result of Investing in Maruti Suzuki Ltd.
FUTURE COMMENTS
Investment is leading to the employment growth in the sector. With the emergence of new
projects and introduction of technological advancements, the focus is more on the skilled and
experienced human resource. The companies are looking for skilled and hard working people
who can give their best to the organization.
The engineers in the automotive or electrical or mechanical field are in demand. Some of the
firms going for automation, i.e. planning for CAD (Computer Aided Designs) systems, are
also recruiting people with IT specializations.
Nearly every automobile company is investing at a

higher rate than ever before to achieve a high growth
trajectory. The overall investment in the sector has
been increasing quite rapidly. It is expected that by
the end of 2010 Indian automobile sector will be
investing a huge amount as Rs. 30,000 crores.
For example, Maruti Udyog has plans of investing Rs.

6,500 crores; the Tata Motors is coming up with more
investment of Rs. 2,000 crores in its compact car project.
Not only the Indian companies but also foreign players like
Hyundai are coming up with the investment of more than
The best performing Company in the Rs. 3,800 crores in India
sector of Automobile & Guarantee same At present the industry is enjoying a growth rate of 14-17% per
for Future annum, with domestic sales growth at 12.8%. The growth rate is
predicted to double by 2015.
As it is seen, the total sales of passenger vehicles - cars, utility vehicles and multi-utility
vehicles - in the year 2005 reached the mark of 1.06 million. The current growth rate indicates
that by 2012 India will overtake Germany and Japan in sales volumes.
Financing schemes have become an important factor in the growth of automobile sales. More
and more financial schemes are coming up with easy installment plans to lure the customers.
EFFECT OF BUDGET ON SHARE PRICE

While the external outlook remains somewhat uncertain, the expectation is that global
economic activity will continue to recover at a reasonably solid pace in the coming years.
However, growth throughout this period is expected to remain uneven, with the recovery being
led by developments in the emerging economies which were, for the most part, not directly
affected by the financial crisis. By comparison, activity will increase at a somewhat more
modest pace in many of the advanced economies, which comprise the bulk of Ireland’s current
export markets. This reflects the continued existence of headwinds linked to the crisis, notably
weak labour markets, the need for further deleveraging in the private sector, and budgetary
adjustment to bring public deficits to more sustainable levels. Weighted by their share in Irish
exports, GDP in our main export markets is projected to increase by just under 2% next year.
CONCLUSION
The automobile sector registered a mixed performance in August 2008. The two-wheeler
segment continued to take advantage of a low base and posted better y-o-y numbers, while the
four-wheeler segment continued its lackluster performance and clocked low volumes.
Maruti Suzuki posted 9.2% y-o-y decline in total volumes
to 59,908 units in August 2008. Exports also clocked a
subdued 1% growth to 5,795 units (5,739).On the
domestic front, the company reported 10.2% y-o-y decline
in sales to 54,113 vehicles (60,229). The drag came in the
dominant A2 segment, which registered a y-o-y decline of
9.7% to 37,667 units (41,736).
Combined sales of Omni and Versa showed a decrease of
17.1% y-o-y to 6,540 units (7,889). The A1 segment
continued to be sluggish with sales of 3,717 vehicles, a
decline of 32.2%.However, the A3 segment clocked a
good sales growth of 12.2% y-o-y to 5,427 vehicles on
the back of the success of SX4 and Dezire. We feel the
biggest point of contention remains the increased
payment of royalty to Suzuki Motors. Maruti has
increased the royalty to 5.1% of Sales for the Q1 FY11
compared to an average of 3.4-3.7% in the previous
quarters. The total royalty Q1 FY11 included additional
non- recurring 0.8% arrears for FY 2010. This has impacted the company’s margin
significantly. Going forward, we expect the margin to remain under pressure due to higher
royalty and increasing competition though anticipated reduction in raw material costs will
partially offset this impact.
In an environment friendly initiative, in August 2010 Maruti
Suzuki introduced factory fitted CNG option on 5 models across
vehicle segments. These include Eeco, Alto, Estilo, Wagon R and
Sx4. The total royalty Q1 FY11 included additional non- recurring
0.8% arrears for FY 2010. This has impacted the company’s
margin significantly.
BIBLIOGRAPHY
www.moneyrediff.com
Money Control
Financial Management – FY.BAF (Semester – II)
Management Accounting – SY.BAF (Semester - IV)
NCFM – Financial Module
Investment Analysis & Portfolio Management – P.C.Chandra

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MARUTI SUZUKI INDIA LIMITED 2009 -2010

WHY MARUTI SUZUKI ??

The company offers a wide range of cars across

TOOLS FOR COMPANY ANALYSIS

COMMENTS ON BALANCE SHEET

Share Capital (Schedule 1)

Reserves and Surplus (Schedule 2)

Reserves & Surplus Schedule Rs

Share Premium Account Schedule 2 Rs.4,241

Net worth (Share Capital + Reserve & Surplus)

Secured Loans (schedule 3)

Unsecured Funds (Schedule 4)

Total fund (Net Worth + Borrowed Fund)

II) Application Of Funds

Fixed Assets Schedule Rs

Current Assets Schedule Rs

Inventories Schedule 8 Rs.12,008

Current Liability Schedule Rs

1.Creditors Schedule 13 Rs.69

COMMENTS ON PROFIT & LOSS

Sales (Schedule 15)

Income From Services (Schedule 16)

TOTAL INCOME OF COMPANY

Employees Remuneration & Benefits (Schedule 17)

Manufacturing & Administrative Expenses (Schedule 18)

Selling & Distribution (Schedule 19)

Sr Ratio 2009 2010 Comments

3 Inventory Turnover Ratio = 30.46 30.47 The Inventory Turnover

4 Debtors Turnover ratio = 29.07 14.07 Debtors turnover Ratio

5 Fixed Assets Turnover Ratio = 2.38 2.82 Fixed Assets Turnover

6 Total Assets Turnover Ratio = 3.86 3.06 Total Assets turnover

9 Interest Coverage Ratio = 2.56 1.86 Interest Coverage Ratio

10 Gross Profit Ratio =

11 Net Profit Ratio = 5.72% 8.43% Net Profit Ratio Indicate

12 Return on Total Assets = 10.45 11.33 Return on total Assets, tell

14 Return on Shareholder’s Equity = 13.04 21.10 Return on Shareholders

15 EPS = 42.18 86.45 Earning Per share Indicates

16 Profit Earning Ratio = 65.88 128.00 Profit Earning Ratio tells

17 Dividend Payout Ratio = 8.60 9.39 Dividend Payout Ration

Common Size Statement - Balance Sheet

Total Funds ( 1 + 2 ) 101989 100% 127935 100%

1) Fixed Assets 87206 85.50% 104067 81.34%

2) Capital Work in Progress 8613 0.46% 3876 3.02%

3) Investment 31733 31.11% 71766 56.09%

Capital Employed 101989 100% 127935 100%

Common Size Statement – P&L

Gross Sales 2,30,852 107.60% 3,18,073 105.60%

Earning Before Tax, . . . .

(-)Interest 510 0.23% 335 0.11%

(-) Tax 4,592 2.14% 11230 3.72%

(+) Op Bal 70,257 32.74% 80,042 26.5%

Comparative Statement – Balance Sheet

Total Funds ( 1 + 2 ) 101989 127935 ^ 25946 ^ 25.43%

1) Fixed Assets 87206 104067 ^ 16861 ^ 19.33%

2) Capital Work in Progress 8613 3876 v (4737) v 54.99%

3) Investment 31733 71766 ^ 40033 ^ 126.15%

Capital Employed 101989 127935 ^ 25946 ^ 25.43%

Comparative Statement – P&L

Particulars 2009 2010 Increase / Increase /

Gross Sales 2,30,852 3,18,073 ^ 87,221 37.78%

Earning Before Tax, . . .

(-)Interest 510 335 v 175 v 34.31%

(-) Tax 4,592 11230 ^ 6,638 ^ 144.55%