Вы находитесь на странице: 1из 6

Current ratio is used to measure the liquidity of a firm ie. whether it is in a position to meet its current obligation.

It is calculated as Current ratio= Current assets/Current liabilities Here, the CR in the year 2010-11 increases from 2.4 in 2009-10 to 3.54 in 2010-11.This is mainly attributed to 8% increase in inventories from the previous year.

Debt-Equity ratio= indicates what proportion of debt and equity a company is using to finance its assets. It is calculated as Debt-Equity = Total Debt/Equity Debt-Equity ratio is highest in 2008-09 and 2009-10 the reason for this is that there is an increase of approximately 892 cr in the debt during the years.But in the year 2010-11 there is a marginal decrease in the debt by approximately 150 cr so this is the reason for reduction of the Debt-Equity ratio.

Return on capital employed(ROCE)= It indicates the efficiency and profitability of the companies capital investment .It is calculated as ROCE= Earnings before interest and tax/total assets- current liabilities Here,ROCE has reduced drastically in the last two years because of the negative earnings of the company ie. The company is making loss. This shows that the company is highly inefficient in using its assets to its full capacity.

8 6
Earnings per share (EPS)=- It indicates the profit earned by each share.It is calculated as EPS-Profit after tax-preference dividend/No. of equity share Dividend per share- is the total dividends paid out over an entire year divided by the number of outstanding ordinary shares issued. Here,EPS is the highest in the year 2007-08 and this is the year when the company has made the highest earnings.But in the year 2009-10 and 2010-11 the company has made substantial losses.The main reason for this is that the company could not cope up with the increasing demand for dynamic and innovative technology .In 2007-08, dividend was given at 1.5 per share. Regards to the operating profit in the current year 2010-11 ,the directors did not recommend any dividend in the year 2010-11.

6.59

4 2 0

0.28

-2 -4

2006-07

2007-

PROFIT AND LOSS RATIOS

Operating profit margin-is used to measure the companies pricing strategy and operating efficiency. Operating profit margin-Operating Income/Net sales Net profit margin-indicates what portion of sales contribute to the income of the company. Net profit margin-Net profit/sales Here,the Operating profit margin has reduced by approximately 8% from 2008-09 and 2009-10. The main reason for this is the continued rise in the key commodity prices such as silver,polycarbonate,chemicals and also

adverse foreign movement. Another reason for the reduction in operating profit margin is the decrease in the gross revenue by 12.81%. This declining margin resulted into a loss after tax by approximately 4007 million rupees

Вам также может понравиться