1. Current Ratio: Current asset/Current liability

Implication- The greater the number, the ratio indicates that the company is liquid and is able to meet its financial obligation on time.

If assets are greater than liabilities the ratio will be greater than one.

Current Assets/Current Liabilities 2010 2011 2012

Current Assets 1,143 1,102 1,684 Current Liabilities 631 855 2,681 1.81141046 1.288888889 0.628123834

Analysis- If we see project vision its current liabilities has grown more than its current asset, which has a direct impact on its liquidity which has gone from 1.81 in 2010 to 0.62 in 2012. This is largely due to increase in short term borrowings which has gone from 116 to 776 and other current liabilities has also increase significantly from just 486 in 2010 to 1353 in 2012. This shows that company has undergone an expansion programme.

2. Asset turnover ratio: Sales/Total asset

Implication- How effectively a company is using its asset. The greater the ratio better it is.

If more sales can be achieved by given set of asset better it is.

Sales/Total assetsTotal Assets ₹ 3,548.00 ₹ 5,215.00 ₹ 8,821.00Sales ₹ 1,584.00 ₹ 3,131.00 ₹ 4,688.00 0.446448703 0.600383509 0.531459018

Fixed asset turnover ratio: Sales/Fixed assets

Sales/Fixed AssetsSales ₹ 1,584.00 ₹ 3,131.00 ₹ 4,688.00Fixed Assets ₹ 2,405.00 ₹ 3,528.00 ₹ 5,513.00 0.658627859 0.887471655 0.850353709

Analysis- Company has been able to effectively use its fixed assets over the period, In 2010 there has been expansion programme which has slightly impacted the ratio.

3. Inventory turnover ratio

Sales/InventoryInventory ₹ 215.00 ₹ 437.00 ₹ 735.00Sales ₹ 1,587.00 ₹ 3,131.00 ₹ 4,688.00 7.381395349 7.164759725 6.378231293

Implication- More sales with a lower inventory better it is.

Analysis- Again here due to expansion programmes there has been increase in inventory holding, inventory here includes implants, traded goods and hospital and lab consumables.

Profitability ratios

4. Profit on Sales

Implication: How much profit we are able to generate for increase in sales. Also indicates to what extent profit will go up if the sales go up by specific quantum.

A comparison with previous years throws light on cost control.

Higher the better it is

Profit/Sales Profit (PAT) ₹ 256.00 ₹ 297.00 -₹ 37.00Sales ₹ 1,587.00 ₹ 3,131.00 ₹ 4,688.00 0.161310649 0.094857873 -0.00789249

Analysis- We can see clearly that there is a dip in performance from 2011 to 2012, it shows company expenses have increased during the period which has not resulted in corresponding increase in profits

5. ROCE

Implication: A high ratio indicates that the basic earning power of the project is high.

Reassures profit potential of the project/company

PBIT/Total Assets PBIT ₹ 402.00 ₹ 661.00 ₹ 314.00Total Assets ₹ 3,548.00 ₹ 5,215.00 ₹ 8,821.00 0.113303269 0.12674976 0.035596871

Analysis- Again as in above case profit over the period has not increased as much as its expenses and hence ROCE has gone down considerably

6. ROA

Implication- The ratio needs to be going up year after year, if not reasons should be investigated

PAT/Total Assets Profit (PAT) ₹ 256.00 ₹ 297.00 -₹ 37.00Total Assets ₹ 3,548.00 ₹ 5,215.00 ₹ 8,821.00ROA 7.22% 5.70% -0.42%

Analysis-Here company has low profitability and when it comes to year 2012 its negative as its has a new subsidary which is currently not making profit.

7. ROE

Implication: A high ROE is desirable for shareholder and will also have an impact on market value.

PAT/Equity Profit (PAT) ₹ 256.00 ₹ 297.00 -₹ 37.00Equity ₹ 1,772.00 ₹ 2,066.00 ₹ 2,690.00ROE 14.45% 14.38% -1.38%

Analysis- It was strong and consitent in year 2010 and 2011 with profit of 14% which covers its cost of capital but in year 2012 its negative and that is due to adding a new subsidiary.

Leverage Ratios

8. Debt Ratio

Implication- Indicates capital structure of the firm

Debt/Total AssetsTotal Assets ₹ 3,548.00 ₹ 5,215.00 ₹ 8,821.00Non-current Liability ₹ 1,144.00 ₹ 2,273.00 ₹ 3,449.00 0.322435175 0.435858102 0.390998753

Analysis- This ratio show the company leverage and it is little high in year 2011 as it raise funds for new subsidary.

9. Debt equity ratio

Implication- Shows how liabilities side of the balance sheet is split between debt and equity. A greater than one ratio indicates debt is higher than equity

Total Debt/Equity Non-current Liability ₹ 1,144.00 ₹ 2,273.00 ₹ 3,449.00Equity ₹ 1,772.00 ₹ 2,066.00 ₹ 2,690.00 0.645598194 1.100193611 1.282156134

Analysis- Company is using a lot of debt to finance its operations and in year 2011 and 2012 it is higher than 2010 because capital was raised for new subisdary and it will generate more earnings in the coming years.

Working Capital Ratios

10. Days sales outstanding

Implication- No. of days of sale that is represented by the receivables that are to be collected. It shows number of days of sales that are waiting to be collected.

Inventory/Daily Sales

Inventory ₹ 215.00 ₹ 437.00 ₹ 735.00Sales ₹ 1,587.00 ₹ 3,131.00 ₹ 4,688.00Daily Sales 4.35 8.58 12.84 49.44864524 50.94378793 57.2258959

Analysis- As can be seen DSI has gone up in subsequent years, largely due to expansion which has resulted in holding more inventory.

Du Pont Analysis

Implication- Useful in strategic context with many divisions, divides in three segments

Profitalbility- pat/sales

Asset turn over ratio- sales/total asset

Equity multiplier- total asset/equity

Du-Pont Analysis 2010 2011 2012

Net profit/Sales0.16131

10.09485

8-

0.00789249

Sales/Total Asset0.44644

90.60038

40.53145901

8Total Asset/Total Equity

2.002257

2.524201 3.279182

ROE 0.1440.14375

6-

0.01375465

Analysis- ROE has gone down as it can be seen from above calculations that company profitability has gone down, sales has not increased in relation to its cost. Further due to expansion company has added new assets and taken debt which has also impacted the roe.