TREND ANALYSIS

GROUP

• ABHISHEK CHOWDHURY -117• ABHIVANDANA JAIN - 92• ANSHITA SHEDHA - 64• HONEY AGARWAL - 82• JAYSHREE - 99 • SHRAY TANEJA - 89

CONTENT…

• Introduction• Liquidity Ratio • Leverage Ratio• Activity Ratio • Profitability Ratio • Conclusion

OVERVIEW…• A fully integrated producer of steel in India.• About 86% outstanding shares owned by Indian

government.• With a turnover of 48,681 crore.• Company is among top five highest earning

corporate of the country.• Company manufactures broad range of steel

products, sheets, structural, railway products etc.

SCOPE…

• Company’s strengths and weaknesses and areas of development or decline are analyzed.

• Financial ratios include profitability, margins and returns, liquidity and leverage, financial position and efficiency ratios.

• Financial, strategic and operational factors are considered.

PROFIT / LOSS A/C

BALANCE SHEET

Liquidity Ratio

•Liquidity ratio is the ability of a firm to satisfy its short term obligations as they become due and reflect the financial strength..

31/3/2006 31/3/2007 31/3/20080

0.5

1

1.5

2

2.5

1.42

1.82 1.91

Current Ratio

31/3/2006 31/3/2007 31/3/20080

0.5

1

1.5

2

2.5

3

1.66

2.37

2.8

Quick Ratio

Leverage Ratio

• It show the long term solvency of a firm as reflected its ability to assure the ability to assure the long term lenders.•Here is relationship between borrowed funds and owner’s capital.

31/3/2006 31/3/2007 31/3/20080

0.05

0.1

0.15

0.2

0.25

0.3

0.27

0.19

0.09

Debt/Equity ratio

31/3/2006 31/3/2007 31/3/20080

5

10

15

20

25

30

35

40

45

50

13.44

28.05

44.06

Interest Coverage

Activity Ratio

•It’s a relationship between sales and various assets of a firm.•It measure the speed with which various accounts / assets are converted into sales or cash.

31/3/2006 31/3/2007 31/3/200850

51

52

53

54

55

56

57

58

52.44

54.2

56.73

Inventory (days)

31/3/2006 31/3/2007 31/3/200819

20

21

22

23

24

25

20.9821.37

24.17

Receivables (days)

31/3/2006 31/3/2007 31/3/200837

38

39

40

41

42

43 42.69

39.1339.56

Creditors (days)

Profitability Ratio

•It measures the operating efficiency of the company.•It also depicts the Earning Per Share and Dividend Per Share

31/3/2006 31/3/2007 31/3/200824

25

26

27

28

29

30

31

32

26.73

31.05 31.34

Gross Margin (%)

31/3/2006 31/3/2007 31/3/20080

5

10

15

20

25

30

17.94

23.65 24.55

Operating Margin (%)

31/3/2006 31/3/2007 31/3/20080

2

4

6

8

10

12

14

16

18

20

10.96

18.05 18.85

Net Profit Margin (%)

Return Related Ratio

31/3/2006 31/3/2007 31/3/20080

5

10

15

20

25

30

35

40

27.63

35.38 35.48

Return on Investment or Total Assets (%)

31/3/2006 31/3/2007 31/3/200829

30

31

32

33

34

35

36

37

31.93

35.84

32.67

Return on Equity or Networth (%)

31/3/2006 31/3/2007 31/3/20080

2

4

6

8

10

12

14

16

18

20

9.72

14.98

18.25

Earnings Per Share (Rs)

31/3/2006 31/3/2007 31/3/20080

0.5

1

1.5

2

2.5

3

3.5

4

2

3.1

3.7

Dividend Per Share (Rs)

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