COMPARATIVE ANALYSIS

PRESENTED BY- GROUP 5

 How a Ratio is expressed?
As Percentage - such as 25% or 50%
. For example if net profit is Rs.25,000/-
and the sales is Rs.1,00,000/- then the
net profit can be said to be 25% of the
sales.
As Proportion - The above figures may
be expressed in terms of the relationship
between net profit to sales as 1 : 4.
As Pure Number /Times - The same
can also be expressed in an alternatively
way such as the sale is 4 times of the net
profit or profit is 1/4th of the sales.
 Classification of Ratios
Balance Sheet RatioP&L Ratio or Balance Sheet and
Income/Revenue Profit & Loss Ratio
Statement Ratio

Financial Ratio Operating Ratio Composite Ratio

Current Ratio Gross Profit Ratio Fixed Asset Turnover
Quick Asset Ratio Operating Ratio Ratio, Return on Total
Proprietary Ratio Expense Ratio Resources Ratio,
Debt Equity Ratio Net profit Ratio Return on Own Funds
Stock Turnover Ratio Ratio, Earning per
Share Ratio, Debtors’
Turnover Ratio,
 Current Ratio = Current
Assets
Current
• Tata Power Liabilities
• Reliance Power
• •
1.123
  0.334

quisite for the very survival of a firm. A proper balance betw

Quick Ratio = Quick
Current Assets
Current Liabilities
• •
• •
• 0.812 • 0.335
•
it is a measurement of a firms ability to convert its assets
quickly into cash in order to meet its current liabilities.
Acid test ratio is a rigorous measure of firm’s
ability to service short term liabilities. The
usefulness of the ratio lies in the fact that it
is widely accepted as the best available test of
liquidity position of a firm.
 Interval Measure = Current
Asset – Inventory/ Avg. Daily
Cash Opt. Exp.
• •
• •
• 99 Days • Nil
 Total debt ratio = total
debt/Capital employed
• •
• •
• 0.598 • 0.0031
DEBT EQUITY RATIO = Total
Debt
Net Worth
• •
• •
• 0.64 • 0.0032
•
 Capital equity ratio = Capital
employed /Net worth
• •
• •
• 1.07 • 2.158
 Inventory Turnover= COGS /
Inventory
• •
• •
• 12.94 • NA
Debtor Turnover Ratio = Credit
Sales / Debtors
• •
• •
• 4.56 • NA
 Assets turnover = Sales /
Net assets
• •
• •
• 0.83 • NA
 Net Margin = Profit After Tax /
Sales
• •
• •
• 0.13 • 0.75
•
•
 Gross Margin = Gross
Profit / Sales
• •
• •
• 0.14 • 0.50
 PAT to EBIT Ratio = PAT /
EBIT
• •
• •
• 0.84 • 0.97
•
 ROI before Tax = EBIT / Net
Asset
• •
• •
• 0.13 • 0.018
Return on Equity = PAT / Net
Worth
• •
• •
• 0.114 • 0.018
 EPS = PAT / No. of Shares
• •
• •
• 4.06 • 1.04
 DPS = Profit Distributed / No.
of Shares
• •
• •
• 4.26 • NA
Price To Earning Ratio = Market
Value of Share / EPS
• •
• •
• 325.23 • 138.5
Mkt. Value to Book Value Ratio
= Mkt. Value of Sh. / Book
Value of Sh.
•
•
•