Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
Specialization: Finance
Subject: Analysis of Financial Statement
INDEX
SR.NO PARTICULARS
PG.NO
4-5
Auditors report
6-7
8-9
10 - 13
Trend analysis
14 - 16
Ratio analysis
17 - 23
Peer analysis
24 - 26
Auditors report
5
k) The company has not given any guarantee for loans taken by others from
banks or financial institutions.
l) According auditors overall examination of the Balance Sheet of the
company, we report that funds raised during the year on short-term basis
have not been used for long term investments.
m) The company has not issued any debentures during the current financial
year.
n) The company has not made any public issue during the current financial
year.
o) No fraud on or by the company has been noticed or reported during the
course of audit.
The company is in growth stage as company is earning profit as well as they are
investing in purchasing of fixed assets.
Particulars
in Rs. '000
Mar '14
Amount
242041.
4
9742.22
251783.
6
Percen
t
Mar '13
Amount
Percent
96%
4%
178609.8
6
5264.54
97.14%
2.86%
100%
183874.4
100.00%
Mar '12
Amount
Percent
124547.
04
323.64
124870.
68
100%
0%
100%
9
EXPENSES
Production Expenses
Decrease/(Increase) in
Stock
Employee Benefit Expense
Finance Cost
Depreciation/Amortization
Other expenses
Total Expenses
Profit/(Loss) before
exceptional Items
Exceptional Items (Incomes)
Exceptional Items
(expenses)
154575.
8
61.39
%
102584.3
6
56%
96987.4
9
78%
0
43525.1
5
0.00%
17.29
%
0%
0%
41998.86
23%
25%
240.5
9665.47
33130.9
2
241137.
8
0.10%
3.84%
13.16
%
95.77
%
6191.25
9645.59
3%
5%
32655.9
193075.9
6
18%
105%
31370.6
11458.4
9
9691.84
23125.1
8
172633.
6
138%
42762.9
2
-34%
10645.7
3
4.23%
-9201.56
-5%
0
10645.7
3
0%
6.89%
-9201.56
-5%
0%
5566.38
2.21%
4303.5
2%
5079.35
2.02% -13505.06
-7%
9%
8%
19%
1074.2
48837.1
2
1%
39%
0
16286.9
1
48837.1
2
0%
-13%
-39%
Out of total revenue of the company which is assumed to be 100% revenue from
operations form a major part in all three years i.e. 100%, 97% & 96% in 2012,
2013 & 2014 respectively.
Total expenses for the year 2014 has decreased by 9.23% which shows that the
company is making profits with reduced expenses.
Assuming sales 100% for the year in which production expenses has increased
to 61.93% since last year i.e. 56% 2013.
Employee Benefit expenses have also reduced comparing current years
17.29% which is less than the previous year i.e. 23% 2013.
Other expenses, Depreciation, finance cost also have reduced which shows
signs of profit with increased sales for the year 2014 compared to 2013 and
2012.
Deferred tax liability is a liability which may or may not be realized during any
given year, which makes the deferred status appropriate. So looking after the
Profit and loss for the year the company is making profit even after deducting
the deferred tax liability for the year which had a negative balance in the
previous year.
Rupees In '000
12
Mar '14
Particulars
Mar '13
Amou
nt
Perc
ent
Amou
nt
285946.
82
117929.
17
48.78%
254359.
82
98824.2
6
Perc
ent
Mar '12
Amou
nt
Perc
ent
Sources Of Funds
shareholders fund
Share capital
Reserves & Surplus
Money received against share
warrant
Share application money
pending allotment
20.12%
0.00%
0
0.00%
0
44.79%
17.40%
143859.
82
97298.3
2
39622.4
7%
17543.4
0.00%
75625
27.65%
18.70%
3%
14.54%
Non-Current Liabilities
0.00%
Long term Borrowings
other Long term liabilities
Long term Provision
Current Liabilities
Short term borrowings
0
2657.95
3631.13
0.45%
0.62%
36518.6
6
4287.67
4427.2
0.00%
19.73%
12.24
115668.
18
60349.3
4
0
0.00%
12.24
88869.0
8
40957.0
2
0
TOTAL
58619
4.84
100.00
%
56787
8.35
142420.
3
0
63600
73698.6
5
24.30%
151342.
71
0
63600
79265.0
3
47374.5
5
2645.3
Trade payables
10.30%
6%
0.76%
1%
0.00%
103551.
7
8941.82
3544.03
20%
1.72%
0.68%
0.03%
0.00%
154.92
38680.0
8
31095.2
7
0
100.00
%
52029
4.36
100.00
%
15.65%
7%
7.43%
6%
0.00%
Application of
Funds
Non-Current Assets
Fixed Assets
a)Tangible Assets
b)Intangible Assets
Noncurrent Investments
Deferred Tax Assets ( Net)
Long term loans and advances
Other non-current assets
47859.3
0.00%
10.85%
12.57%
8%
2645.3
0.45%
233685.
68
1287.76
39.86%
0.47%
159725.
24
0
63600
83568.5
3
47059.2
5
2645.3
33.38%
151269
0.71%
4159.3
26.65%
0.00%
11.20%
13.96%
8%
30.70%
0.00%
12.22%
16.06%
9%
0.51%
Current Assets
Trade receivables
Cash and cash equivalents
0.22%
189562.
5
4048.47
13
29.07%
0.80%
15203.6
3
5794.21
58619
4.84
3%
1%
100%
25604.4
2
4435.37
56787
8.35
4.51%
4707.48
1%
3559.93
52029
4.36
100%
14
0.90%
1%
100%
in Rs. '000
Mar '13
Mar '14
Particulars
Revenue From
Operations
Other Income
Total Revenue
Mar '12
Amoun
t
Incr/de
cr
Percen
t
Amoun
t
Incr/de
cr
Perce
nt
Amoun
t
Perce
nt
24204
1.4
9742.2
2
25178
3.6
63431.
49
4477.6
8
67909.
17
35.513
99
85.053
58
36.932
37
17860
9.9
5264.5
4
18387
4.4
54062.
8
12454
7
100
4940.9
59003.
7
43.40
76
1526.
67
47.25
19
323.64
12487
0.7
15457
5.8
51991.
45
50.681
65
10258
4.4
5596.8
7
5.770
71
96987.
49
0
43525.
15
0
1526.2
9
5950.7
5
0
3.6341
22
96.115
5
0
41998.
86
9645.5
9
32655.
9
19307
6
-46.25
9530.7
2
20442.
4
0
33.87
97
45.96
8
0.477
21
41.21
36
11.84
15
0
31370.
6
6191.2
5
0
10628.
3
5267.2
4
33561.
4
78.48
24
42762.
9
100
33561.
4
-100
78.48
24
1074.2
42762.
9
100
100
100
100
EXPENSES
Production Expenses
Decrease/(Increase)
in Stock
Employee Benefit
Expense
Finance Cost
240.5
Depreciation/Amortiz
ation
9665.4
7
33130.
92
24113
7.8
475.02
48061.
88
0.2061
05
1.4546
22
24.892
73
Profit/(Loss) before
exceptional Items
Exceptional Items
(Incomes)
Exceptional Items
(expenses)
10645.
73
19847.
29
215.69
5
9201.5
6
Profit/(Loss) before
tax
Tax expenses
a)Current Tax
10645.
73
19847.
29
0
215.69
5
0
9201.5
6
Other expenses
Total Expenses
19.88
1074.2
100
100
100
11458.
49
100
9691.8
4
23125.
18
17263
3.6
100
100
100
15
Deferred tax
Liabilities/(assets)
5566.3
8
1262.8
8
5079.3
5
18584.
41
29.345
42
137.61
1
4303.5
13505.
1
3229.3
35332.
1
300.6
24
72.34
67
1074.2
48837.
1
100
100
Balance Sheet
of Jain Studio
Mar '14
Particulars
Mar '13
Amt
Inc/D
ec
285946.
82
117929.
17
0
31587
12.42
%
19.33
%
100.00
%
Mar '12
Amt
Inc/De
c
Amt
25435
9.8
98824.
26
39622.
4
110500
76.81
%
1.57%
125.8
5%
14385
9.8
97298.
32
17543.
4
100
%
100
%
100
%
-75625
75625
100
%
36518.
66
67033.
04
4654.1
5
883.17
64.73
%
52.05
%
24.92
%
10355
1.7
100
%
8941.8
2
100
%
3544.0
3
100
%
Sources Of
Funds
shareholders
fund
Share capital
Reserves & Surplus
Money received
against share
warrant
Share application
money pending
allotment
Non-Current
Liabilities
Long term
Borrowings
2657.95
3631.13
19104
.91
39622
.4
0
36518
.66
1629.
72
796.0
100.00
%
38.01
%
17.98
4287.6
7
4427.2
1525.9
4
22079
16
7
Current
Liabilities
Short term
borrowings
Trade payables
Other Current
liabilities
Short term
provisions
TOTAL
12.24
0.00%
12.24
-142.68
115668.
18
60349.3
4
0
26799
.1
19392
.32
0
30.16
%
47.35
%
0.00%
88869.
08
40957.
02
0
50189
9861.7
5
0
586194
.84
1831
6.49
3.23%
56787
8.4
142420.
3
5.90%
15134
2.7
0.00%
100
%
100
%
92.10
%
129.7
5%
31.71
%
154.92
47583.
99
9.15%
52029
4.4
100
%
100
%
100
%
100
%
5.25%
15972
5.2
100
%
8382.5
3
0
0.00%
100
%
100
%
100
%
38680.
08
31095.
27
0
Application of
Funds
Non-Current Assets
Fixed Assets
a)Tangible Assets
b)Intangible Assets
8922.
41
0
Noncurrent
Investments
Deferred Tax Assets
( Net)
63600
0.00%
63600
0.00%
63600
73698.6
5
5566.
38
484.7
5
0
7.02%
79265.
03
-4303.5
5.15%
83568.
53
1.02%
47374.
55
2645.3
315.3
0.67%
0.00%
47059.
25
2645.3
100
%
100
%
233685.
68
1287.76
44123
.18
2760.
71
18956
2.5
4048.4
7
38293.
5
-110.83
25.31
%
2.66%
15126
9
4159.3
100
%
100
%
15203.6
3
10400
.7
25604.
42
20896.
94
443.9
1%
4707.4
8
100
%
other current
assets
TOTAL
5794.21
1358.
84
1831
6.4
23.28
%
68.19
%
40.62
%
30.64
%
3.23%
4435.3
7
56787
8.4
875.44
24.59
%
9.15%
3559.9
3
52029
4.4
100
%
100
%
47859.3
2645.3
586194
.84
0.00%
47583.
99
17
18
Current Ratio
4
3.5 3.61
3
2.5
2
1.5
1
0.5
0
2012
2.59
2.09
2013
2014
Current ratio of Jain Studio for financial year 2014 is 2.09 for financial year
2013 is 2.55 and for financial year 2012 is 3.61. Hence we can say, Jain studio
has a better financial position and in a position to pay off its Current liabilities.
Quick ratio:
Quick Ratio
3
2.5 2.59
2
1.98
1.5
1.68
1
0.5
0
2012
2013
2014
Quick ratio of Jain Studio for financial year 2014 is 1.68, for financial year
2013 is 1.98, and for financial year 2012 is 2.59. This ratio indicates solvency
position. From given trend it is seen that quick ratio is reducing but still it is
greater than the standard ratio so we can say that the Company is in good
solvency position.
19
0.43
0.3
0.2
0.1
0.1
0
2012
2013
0
2014
Debt Equity ratio of Jain Studio for financial year 2014 is zero, for financial
year 2013 is 0.1, and for financial year 2012 is 0.43. It shows the in business
how much borrowed and owned fund is there. The lower the percentage, the
less leverage a company is using and the stronger its equity position. From this
we can say that Jain studio Ltd is not dependent on out siders fund.
Profitability ratios
Operating Profit Margin:
Operating Profit Margin Ratio
10
5
4.46
0
2012
-5
0.76
2013
2014
-10
-15
-20
-21.62
-25
The operating profit margin gives the business owner a lot of important
information about the firm's profitability, particularly with regard to cost
control. It shows how much cash is thrown off after most of the expenses are
met. A high operating profit margin means that the company has good cost
control and/or that sales are increasing faster than costs, which is the optimal
situation for the company. As it can be seen with Jain studios the operating
profit margin has gone up from 0.76 in March 13 to 4.46 in March 14. This
shows that the company has good cost control which has improved a great deal
from the previous year.
20
2013
-4.5
0.45
2014
-10
-15
-20
-25
-22.93
Profit before interest and tax(PBIT) or Earnings before interest and tax(EBIT)
Margin is the ratio of Earnings before Interest and Taxes to net revenue earned. It is a measure of a company's profitability on sales over a specific time
period. This indicator gives information on a company's earnings ability. The
EBIT of Jain studios has increased tremendously from -29.33% in March 12 to
0.45% in March14.This increase in EBIT is due to growth of net revenue, good
cost control and strong productivity.
Gross Profit Margin (%):
Gross profit Margin
5
0
2012
-5
2013
-4.63
0.47
2014
-10
-15
-20
-25
-30 -29.4
-35
5
0
2012
-5
2013
-2.09
2014
-10
-15
-17.44
-20
The Cash Flow Margin is a measure of how efficiently a company converts its
sales dollars to cash. Since expenses and purchases of assets are paid from cash,
this is an extremely useful and important profitability ratio. The cash profit
margin has grown from -17.44% in March12 to -2.09% in March13 to a
positive 5.85%.The higher the percentage, the more cash available from sales.
2013
0.01
2014
-7.34
-15
-20
-25 -26.06
-30
Net profit margin is the percentage of revenue remaining after all operating
expenses, interest, taxes and preferred stock dividends (but not common stock
dividends) have been deducted from a company's total revenue
22
Net profit margin is one of the most closely followed numbers in finance.
Shareholders look at net profit margin closely because it shows how good a
company is at converting revenue into profits available for shareholders. The
net profit margin has increased from -26.06% in March12 to 2.01% in
March14.
Adjusted Net Profit Margin (%)
Adjusted net profit margin is a financial ratio used by stockholders to determine
the true profitability of the stocks they own. Although the metric is not directly
used by small-business owners in their day-to-day operations, it can be very
useful to understand the considerations that your shareholders make when
determining whether to buy or sell stock in your company. To calculate the
adjusted net profit margin of a stock, you must first determine the price paid for
the stock, the profit margin of the underlying company and the price-to-sales
ratio of the stock. The trend of change in adjusted net profit margin has
remained the same as the net profit margin.
2
0
2012
-2
-0.7
2013
2014
-4
-6
-8 -8.28
-10
23
1.25
2013
2014
-3.82
The ROE is useful for comparing the profitability of a company to that of other
firms in the same industry. . It has improved from -13.49% in March12 to
1.25% in March14.
Return on Long Term Funds (%):
Return on Long term Funds
4
2.69
2
0
2012
-2
-0.77
2013
2014
-4
-6
-8
-10 -10.52
-12
The return is calculated as the annual percentage return based on the yields of
all the underlying securities in the portfolio, but is weighted to account for each
security's market value and maturity. The return is presented net of estimated
fees and the maximum offering price, but does not account for delays in income
distributions from the fund. This has increased from -10.52% in March12 to
2.69% in March14.
24
1.14
0.8 0.81
0.6
0.4
0.2
0
2012
2013
2014
Debtor turnover ratio is the relationship between net sales and average debtors.
Higher debtor turnover ratio is good because it shows that the company is
collecting money quickly from our debtors, which is the case with Jain Studios
as it is seen that the ratio has improved from 0.81 in March12 to 1.14 in
March14.
Interest coverage ratio:
Interest Coverage Ratio
50
45.26
40
30
20
10
0
-3.17
2012
-10
-0.49
2013
2014
Interest coverage ratio is a ratio used to determine how easily a company can
pay interest on outstanding debt. The lower the ratio, the more the company is
burdened by debt expense. When a company's interest coverage ratio is 1.5 or
lower, its ability to meet interest expenses may be questionable. An interest
coverage ratio below 1 indicates the company is not generating sufficient
revenues to satisfy interest expenses. In case of Jain studio, they have a very
healthy Interest coverage ratio of 45.26 in March14 which shows that they are
25
generating sufficient funds to pay the interest expenses. The ratio has improved
drastically from -3.17 in March12, -0.49 in March13 to 45.26 in March14.
Peer Analysis (Jain Studio, Mukta Arts, Pritesh Nandy)
Ratios
Jain Studio
Mukta
Arts
Pritesh Nandy
2.09
0.96
4.78
Quick ratio
1.68
1.47
2.89
0.39
4.46
1.46
9.26
0.45
-0.48
8.33
0.47
-0.49
8.77
5.85
1.7
11.57
2.01
-0.51
11.11
-0.51
11.11
Profitability ratios
2.01
2.69
2.61
6.33
1.25
-1.27
5.3
2.69
3.21
6.33
1.14
7.25
47.7
45.26
0.7
14
Current Ratio
Current ratios of Jain Studio, Mukta Arts and Pritesh Nandy for financial year
2014 are 2.09, 0.96 & 4.78 respectively. Hence we can say, Jain studio has a
better financial position and in a position to pay off its Current liabilities as
compared to Mukta arts whereas Pritesh Nandy has better current ratio which is
4.78% i.e. 2.78% more than ideal Current ratio.
Quick ratio
Quick ratio indicates solvency position of the company. Quick ratios of Jain
Studio, Mukta Arts and Pritesh Nandy for financial year 2014 are 1.68, 1.47 &
2.89 respectively. Hence we can say, Jain studio is in good solvency position as
compared to Mukta arts but Pritesh Nandy is in better condition. This indicates
Pritesh Nandy has better short term liquidity position than other two
competitors.
26
Profitability ratios
Operating Profit Margin
Operating profit margin of Jain Studio, Mukta Arts & Pritesh Nandy for
financial year 2014 are 4.46, 1.46 & 9.26 respectively. Hence we can say, Jain
studio has good cost control and their sales are increasing faster than costs as
compared to Mukta Arts but Pritesh Nandy has better cost control than other
two competitors with 9.26%.
Profit before Interest and Tax Margin
We can conclude that profitability on sales over a specific time period of Jain
studio (0.45) is better than Mukta Arts (-0.48) but Pritesh Nandy has highest
profitability (8.33). As we can say that Pritesh Nandy has better earnings ability
as compared to Jain Studio and Mukta Arts.
Gross Profit Margin
Gross profit margins of Jain Studio, Mukta Arts & Pritesh Nandy for financial
year 2014 are 0.47, -0.49 & 8.77 respectively. Hence we can say that as Pritesh
Nandy has highest gross profit margin among three competitors so they are
financially successful & highly profitable company than Jain Studio and Pritesh
Nandy.
Net Profit Margin
Net profit margins of Jain Studio, Mukta Arts & Pritesh Nandy for financial
year 2014 are 2.01, -0.51 & 11.11 respectively. Hence we can say Pritesh Nandy
has highest revenue after deducting all operating expenses, interest, taxes and
preferred stock dividends. Jain studio has positive margin whereas Mukta Arts
has negative margin which indicates their expenses are more than their revenue.
Return on Capital Employed
27
ROCE of Jain Studio, Mukta Arts & Pritesh Nandy for financial year 2014 are
2.69, 2.61 & 6.33 respectively which indicates that Pritesh Nandy is the most
profitable company based on the amount of capital they use among the 3
competitors.
Return on Net Worth
Pritesh Nandy generates highest profit with the money that the equity
shareholders have invested as it has higher return on net worth (5.3) as
compared to Jain studio (1.25) & Mukta Arts (-1.27).
Return on Long Term Funds
Pritesh Nandy has highest return on long term funds (6.33) among the 3
competitors. Mukta Arts (3.21) has better returns on long term funds than Jain
studio (2.69).
Debtors turnover ratio
Debtors turnover ratios of Jain Studio, Mukta Arts & Pritesh Nandy for
financial year 2014 are 1.14, 7.25 & 47.7 respectively. Hence we can say that,
Pritesh Nandy is collecting money quickly from the debtors whereas Jain Studio
fails to collect money quickly from the debtors.
Interest coverage ratio
Interest coverage ratios of Jain Studio, Mukta Arts & Pritesh Nandy for
financial year 2014 are 45.26, 0.7 & 14 respectively. Hence we can say that
Mukta Arts is burdened by debt expenses whereas Jain studio with highest
Interest coverage ratio is generating sufficient revenues to satisfy interest
expenses.
28