3.

Pidilite Industries Ltd

3.1 Current ratio
Current assets
Current ratio =

-------------------------Current liabilities

PARTICULAR

2014

2013

2012

2011

2010

Current Assets

1220.99

1009.37

1075.42

813.12

624.05

Current Liability

771.52

723.24

609.19

523.53

407.87

1.58

1.39

1.76

1.55

1.53

Current Ratio

14
12
10
8
6
4
2
0
Particular 2014

2013

2012

2011

2010

Interpretation:
Current Ratio of the Alkyl Amines Chemicals is 1.58 in the current year. Reason is that the
company has changed their R&D department. The higher current ration show the healthy business
so from this ration shareholder are aware that company has able to fulfill their liabilities.
Page
1

3.2 Quick Ratio

Current assets inventories
--------------------------------------------Current liabilities

Quick ratio =

PARTICULAR

2014

2013

2012

2011

2010

Current Assets - inventories

694.79

558.21

679.12

458.68

373.42

Current Liability

771.52

723.24

609.19

523.53

407.87

1.11

0.87

0.91

Quick ratio

0.90

0.77

14
12
10
8
6
4
2
0
Particular 2014

2013

2012

2011

2010

Interpretation:
Quick Ratio is an indicator of company's short-term liquidity. A common rule of thumb is that
companies with a quick ratio of less than 1.0 are not able to meet their short-term liabilities. Here
the Quick Ratio is 0.90, which is less than 1.

Page
2

2. Cash Ratio

Cash ratio =

Cash + Marketable securities

------------------------------------------Current liabilities

PARTICULAR

2014

2013

2012

20111

2010

Cash+Marketabal securities

145.18

136.82

257.72

92.34

33.12

Current Liability

771.52

723.24

609.19

523.53

407.87

0.18

0.19

0.42

0.17

0.08

Cash ratio

14
12
10
8
6
4
2
0
Particular 2014

2013

2012

2011

2010

Interpretation:
The cash ratio is most commonly used as a measure of company liquidity. It can therefore
determine if, and how quickly, the company can repay its short-term debt. A cash ratio of 1.00 and
above means that the business will be able to pay all its current liabilities in immediate short term.
But here this industry is not able to pay all its current liabilities in immediate short term.

Page
3

3. Debt Ratio
Total debt
Debt ratio = -----------------------Net Assets

PARTICULAR

2014

2013

2012

2011

2010

Total Debt

7.68

60.24

264.14

286.73

421.43

Net Assets

431.48

286.13

466.23

289.59

196.18

Debt ratio

0.01

0.21

0.56

0.99

2.14

14
12
10
8
6
4
2
0
Particular 2014

2013

2012

2011

2010

Interpretation:
The Debt Ration if Higher than the previous 3 years. here ratio is high so the leverage used by
company is also high.

Page
4

4. Debtors turnover

Debtors turnover =

PARTICULAR

Sales
---------------------Debtors

2014

2013

2012

2011

2010

Sales

4125.87

3548.60

2974.68

2501.61

2024.04

Debtors

453.6

366.76

326.12

286.59

238.76

9.67

9.12

8.73

8.47

Debtors turnover

9.09

14
12
10
8
6
4
2
0
Particular 2014

2013

2012

2011

2010

Interpretation:
Higher debtor turnover ratio is good because higher debtor turnover ratio means, more soon, we
are collecting Money. Lower debtor turnover ratio is not good because it tells us that we have not
managed debtors better ways. Money from debtors are not collected Soon. Here, Debtor Ration
is higher so we can say that collecting the money process is very fast from this company.

Page
5

5. Assets turnover Ratios

Sales
-------------------------Net assets

Net assets turnover =

PARTICULAR

2014

2013

2012

2011

2010

Sales

4125.87

3548.60

2974.68

2501.61

2024.04

Net assets

431.48

286.13

466.23

289.59

196.18

Net assets turnover

9.57

12.41

6.39

8.63

10.31

14
12
10
8
6
4
2
0
Particular 2014

2013

2012

2011

2010

Interpretation:
It is an efficiency ratio which tells how successfully the company is using its assets to generate
revenue. If a company can generate more sales with fewer assets it has a higher turnover ratio
which tells it is a good company because it is using its assets efficiently and vise a versa. Here,
turnover ratio is high so we can say that company using their assets effectively and efficiently.

6. Gross profit Margin

Page
6

Gross profit margin =

PARTICULAR

Gross profit
--------------------Sales

2014

2013

2012

2011

2010

Gross profit

699.63

672.81

492.05

441.79

375.26

Sales

4125.87

3548.60

2974.68

2501.61

2024.04

Gross profit margin

0.17

0.19

0.16

0.17

0.18

7
6
5
4
3
2
1
0
Particular 2014

2013

2012

2011

2010

Interpretation:
High gross profit margin indicates that the company can make a reasonable profit, as long as it
keeps the overhead cost in control. Low gross profit margin indicates that the business is unable
to control its production cost. Gross margin ratio is a profitability ratio that measures how
profitable a company can sell its inventory. It only makes sense that higher ratios are more
favorable. Higher ratios mean the company is selling their inventory at a higher profit percentage.
Here, this ratio is lower than the previous year ratio.

Page
7