ADANI PORTS & SEZ LTDAN ANALYSISCourse: Accounting for

Decision Making

INTRODUCTION

India’s largest private multi-port Operator

Operates in 8 national and 4 international ports.

Services handled at Adani ports Dry Bulk Cargo, Break Bulk Cargo, Liquid Cargo, Container Cargo ,Dredging & Marine Services

Turnover for FY-2015 47401.50Mn

1.COMPARATIVE

ANALYSIS

FORMULAE APPLIED

COGS= OPERATING INCOME – GROSS MARGIN

BREAKEVEN SALES= FIXED COSTS + VARIABLE SALES

P/V RATIO = (OPERATING INCOME – VARIABLE COSTS)OPERATING INCOME

SALES TURNOVER = COST OF GOODS SOLD / AVERAGE INVENTORY

In INR Million 2013 2014 2015

Operating Income (Sales) 35642.90 50322.90 47401.50

COGS 8765.70 15518.80 12284.40

Gross Margin 26877.20 34804.10 35117.10

Fixed Costs 18285.10 28426.70 31038.60

Variable Costs 4746.50 12986.00 8273.20

Breakeven Sales 23031.60 41412.70 39311.80

P/V Ratio 0.87 0.74 0.83

Sales Turnover 4.07 3.24 3.86

The change in OI in 2014 is 0.41 percent and in 2015 is -0.06 ,the reason is the turbulent time in global economy.

The change in COGS are 0.77 and -0.21 in year 2015, the decrease in COGS is the increasing debt.

There is the positive increase in the amount sale done.

INFERENCE

2. FLEXIBLE BUDGET

2015

FLEXIBLE BUDGET

In INR Million 2015Operating Income (Sales) 44696.40COGS 4190.37Gross Margin 40506.03Fixed Costs 38670.30Variable Costs 12195.27Breakeven Sales 50865.57P/V Ratio 0.73Sales Turnover 10.67

VARIANCE ANALYSIS

Mar 15 (Actual) Variance Mar 15 (Budgeted)

Net Revenue 47401.50 2705.10 44696.40

Less: Variable Expense

8273.20 3922.07 12195.27

Contribution Margin 39128.30 6627.17 32501.13

Less: Fixed Manufacturing costs

31038.60 7631.70 38670.30

Operating Income 8089.70 14258.87 -6169.17

Thanks!Any questions?