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CHAPTER-1 INTRODUCTION

INTRODUCTION
Meaning of Finance

Finance may be defined as the provision of money at the time when it is required. Finance refers to management of flows of money through an organization. It concerns with the application of skills in the manipulation, use and control of money. Different authorities have interpreted the term Finance differently. However, there are three main approaches to finance. 1) The first approach views finance to providing of funds needed by a business on most suitable terms. This approach confines finance to the raising of funds and to the study of financial institutions and instruments from where funds can be procured. 2) The second approach relates to finance cash requirements. 3) The third approach views finance as being concerned with raising of funds and their effective utilization.

Definition of Finance

According to Guthmann and Dougall, Business finance can be broadly difined as the activity concerned with the planning, raising, controlling, and administering the funds used in business. In the words of panther and wert, Business finance deals primarily with raising, administering and disbursing funds by privately owned business units operation in nonfinancial fields of Industry. According to the encyclopedia of social Sciences, Corporation finance deals with the financial problems of corporate enterprises. These problems include the financial aspects

According to the encyclopedia of Social Sciences, Corporation finance deals with the financial problems of corporate enterprises. These problems include the financial aspects of the promotion of new enterprises and their administration during early development, the accounting problems connected with the distinction between capital and income, the administrative questions created by growing and expansion of a corporation which has come into financial difficulties.

Importance of Finance

Finance is the lifeblood and never center of business, just a circulation of blood is essential in the human body for maintaining life, finance is a very essential to smooth running of the business. It has been rightly termed as universal lubricant, which keeps the enterprise dynamic. No business, whether big, medium or small can be started without an adequate amount of finance. Right from the very beginning, i.e. conceiving an idea to business, finance is needed to promoter or establish the business, acquire fixed assets, make investigations such as market surveys, etc., develop product, keep men and machine at work, encourage management to make progress and create values. Even an existing concern may require further finance for making improvements or expanding the business. Thus the importance of finance cannot be overemphasized and the subject of business finance has become utmost both to the academicians and practicing managers. The importance of corporation finance (which is a constituent of business finance) has arisen because of the fact that present day business activities are predominantly carried on company or corporate form of organization. The advent of corporate enterprises has resulted into: i. The increase in size and influenced of the business enterprises.

ii.

Wide distribution of corporate ownership, and

iii.

Separation of ownership and management.

Finance management is applicable to every type or organization, irrespective of its size, kind or nature. It is as useful to a small concern as to a big unit. A trading concern gets the same utility from its application as a manufacturing unit may expect. There is a use of finance, financial management is helpful. Every management aims to utilize its funds in a best possible and profitable way. So this subject is acquiring a universal applicability. It is indispensable in any organization as it helps in:

i.

Financial planning and successful promotion of an enterprise:

ii.

Acquisition of funds as and when required at the minimum possible cost:

iii.

Proper use and allocation of funds:

iv.

Taking sound financial decisions:

v.

Improving the profitability through financial controls:

vi.

Increasing the wealth of the investors and the nation: and

vii.

Promoting and mobilizing individual and corporate savings.

Scope of Finance
The main objective of financial management is to arrange sufficient finance for meeting shortterm and long term needs. These funds are procured at minimum costs so that profitability of business is maximized.

Different Types of Financial Statements

Income statement:
The income statement or profit and loss Account is considered as a very useful statement of all financial statements. It depicts the expenses incurred on production, sales and distribution and sales revenue and the net profit or loss for a particular period. It shows whether the operations of the firm resulted in profit or loss at the end of a particular period.

Balance Sheet:
Balance sheet is a statement which shows the financial position of a business as on a particular date. It represents the assets owned by the business and the claims of the owners and creditors against the assets in the form of liabilities as on the date of the statement.

Statement of Retained Earnings:


The statements of retained earnings is also called the profit and loss approbation account. It is a link between the income statement and the balance sheet. Retained earnings are the accumulated excess of earnings over losses and dividends. The balance shown by the income statement is transferred to the balance sheet through this statement after making the necessary appropriations.

Funds Flow Statement:


According to Anthony, The funds flow statement described the sources from which additional funds were derived and the use to which these funds were put. Funds flow statement helps the financial analyst in having a more detailed analysis and understanding the changes in the distribution of resources between two balance sheet periods. The statement reveals the sources of funds and their application for different purposes.

Cash flow Statement:


A Cash flow statement depicts the changes in cash position from one period to another. It shows the inflow and outflow of cash and helps the management in making plans for immediate futures. An estimated cash flow statement enables the management to ascertain the availability of cash to meet business obligations. This statement is useful for short-term planning by the management.

Schedules:
These are the statements which explain the items given in income statement and balance sheet. Schedules are a part of financial statements which give detailed information about the financial position of a business organization.

Limitations of Financial Statements


In profit and loss account net profit is ascertained on the basis of historical costs. Profit arrived at by the profit and loss account is of interim nature. Actual profit can be ascertained only after the firm achieves its maximum capacity. The net income disclosed by the profit and loss account is not absolute but only relative.

The profit and loss account does not disclose factors like quality of product, efficiency of the management etc. The net income is the result of personal judgment and bias of accountants cannot be removed in the matters of depreciation, stock valuation, etc. There are certain asset and liabilities which are not disclosed by the balance sheet. For example, the most tangible asset of a company is its managements force and a dissatisfaction labour force is its liability which are not disclosed by the balance sheet. The book value of assets us shown as original cost less depreciation. But in practice, the value of the assets may differ depending upon the technological and economic changes. The assets are valued in a balance sheet on a going concern basis. Some of the assets may not realize their value on wining up. The accounting year may be fixed to show a favourable picture of the business, in case of sugar industry the balance sheet prepared in off-season depicts a better liquidity position than in the crushing season. An investor likes to analyse the present and future prospects of the business, while the balance sheet shows past positions. As such the use of a balance sheet is only limited. Due to flexibility of a accounting principles, certain liabilities like provisions for gratuity etc. are not show in the balance sheet, giving the outsiders a misleading picture. The financial statements are generally prepared from the point of view of shareholders and their use in limited in decision making by the management, investors and creditors. Even the audited financial statements does not provide complete accuracy. Financial statements do not disclose the changes in management, loss of markets, etc. which have a vital impact on the profitability of the concern. The financial statements are based on accounting policies which may vary from company to company and as such cannot be formed as a reliable basis of judgment.

Methods of analyzing Financial Statements


For analysis of financial statements, they should be re-arranged to reveal the relative significance and effect of various items of data in relation to time period and for making interfirm comparisons. While re-arrangement the data, logical relationship and sequence should be given consideration. The analysis of financial statements will help in interpretation should logical conclusions. The important methods used in analysis of statements are as follows: Comparative financial statements

Comparative financial statement are statements of financial position of a business designed to provide time perspective to the consideration of various elements of financial position embodied in such statements. Comparative financial statements reveal the following: 1. 2. 3. 4. 5. Absolute data (money value or rupee amounts) Increase or reduction in absolute data in terms of money values Increase or reduction in absolute data in terms of percentages Comparison in term of ratios Percentage of totals

Common size statements


The financial statements viz. profit and loss account and balance sheet are converted to percentages so as to establish each element to the total figure of the statement and these statement are called common size statements. These statements are useful in analysis of the performance of the company by analyzing each individual element to the total figure of the statement. These statement will also assist in analyzing the performance over years and also with the figures of the competitive firm in the industry for making analysis of relative efficiency. The following statement show the method of presentation of the data.

Common size Income Statement Common size Balance sheet

Trend ratios
The trend ratios of different items are calculated for various periods for comparison purpose. The trend ratios are the index numbers of the movements of reported financial items in the financial statements which are calculated for more than one financial year. The calculation of trend ratios are based on statistical technique called index numbers the trend ratios help in making horizontal analysis of comparative statements. It reflects the behavior of items over a period of time. the accounting principles and policies should be consistently followed throughout the period for which the trend ratios are calculated.

Ratio analysis
According to J. Batty the term accounting ratio is used to describe significant relationships which exist between figures shown in a balance sheet, in a profit and loss account, in a budgetary control system or in any other part of the accounting organization. the accounting ratios indicate a quantitative relationship which is used for analysis and decision making. It provides basis for inter-firm as well as intra-firm comparison. The ratios will be effective only when they are compared with ratios of base period or with standards or with the industry ratios. The financial statement viz. income statement, and Balance sheet report what has actually happened to earnings during a specific period and presents a summary of financial position of the company at a given point of time. the statement of retained earnings reconciles income earned during the year and any dividends distributed with the change in retained earnings between the start and end of the financial year under study.

Funds flow analysis


The profit and loss account and Balance sheet statement are the common important accounting statements of a business organization. The profit and loss account provides financial information relating to only a limited range of financial transactions entered into during an accounting period and its impact on the profits to be reported. The Balance sheet contains information relating to capital or debt raised or assets purchased. But both the above two statements do not contain sufficiently wide range of information to make assessment of organization by the end user of the information. In view of recognized importance of capital inflows and outflows, which often involves large amounts of money should be reported to the stakeholders, the funds flow statement is devised. In a funds flow analysis, the details of financial resources availed and the ways in which such resources are used during a particular accounting period, are given in a statement from called Funds Flow Statement the sources of funds also include the funds generated from operations internally. The funds flow statement can explain the reasons for liquidity problems of the firm even through it is earning profits.

Cash flow analysis


Cash flow statement provides information about the cash receipts and payments of a firm for a given period. It provides important information that compliments the profit and loss accounting and balance sheet. The information about the cash flow of a firm is useful in providing users or financial statements with a basis to assess the ability of the enterprise to generate cash and cash equivalents and the needs of the enterprise to utilize these cash flow. The economic decisions that are taken by users require an evaluation of the ability of an enterprise to generation. The statement deals with the provision of information about the historical changes in cash

equivalents of an enterprise by means of a cash flow statement which classifies cash flows during the period from operating, investing and financing activities.

Break-even and cost-volume profit analysis


Break even analysis to ascertainment of level of operations where total revenue equals to total costs. It is an analysis is a determine the probable profit or loss at any level of operations. Break even analysis is a method of studying the relationship among sales revenue, variable cost and fixed cost to determine the level of operation at which all the costs are equal to its sales revenue and it is the no profit no loss situation. This is an important made through graphical charts. Break even chart indicates approximate profit or loss at different levels of sales volume within limited range. The break even charts show fixed and variable costs and sales revenue so that profit or loss at any given level of production or sales can be ascertained.

Value added analysis


Value added is described as the wealth created by the reporting entity by its own and its employees efforts and comprises salaries and wages, fringe benefits, interest, dividend, tax, depreciation and net profit (retained). It is also defined as the increase in market value resulting from an alteration in the from, location or availability of a product or service excluded the cost of goods and services purchased from outside.

Chapter-2 Research design

Research design
A COMPARATIVE STUDY OF FINANCIAL PERFORMANCE OF SELECT AUTOMOBILE INDUSTRIES IN INDIA (four wheelers)

Introduction:A well developed transport network indicates a well developed economy. For rapid development a well-developed and well-knit transportation system is essential. As India's transport network is developing at a fast pace, Indian Automobile Industry is growing too. Also, the Automobile industry has strong backward and forward linkages and hence provides employment to a large section of the population. Thus the role of Automobile Industry cannot be overlooked in Indian Economy. All kinds of vehicles are produced by the Automobile Industry. India Automobile Industry includes the manufacture of trucks, buses, passenger cars, defense vehicles, two-wheelers, etc. The industry can be broadly divided into the Car manufacturing, two-wheeler manufacturing and heavy vehicle manufacturing units. The major Car manufacturer are Hindustan Motors, Maruti Udyog, Fiat India Private Ltd., Ford India Ltd ., General Motors India Pvt. Ltd., Honda Siel Cars India Ltd., Hyundai Motors India Ltd., Skoda India Private Ltd., Toyota Kirloskar Motor Ltd., to name a few.

The two-wheeler manufacturing is dominated by companies like TVS, Honda Motorcycle & Scooter India (Pvt.) Ltd., Hero Honda, Yamaha, Bajaj, etc. The heavy motors like buses, trucks, defense vehicles, auto rickshaws and other multi-utility vehicles are manufactured by Tata-Telco, Ashok Leyland, Eicher Motors, Bajaj, Mahindra and Mahindra, etc.

Statement of problem:The study is focused on analysis and interpretation with respect to growth of Automobile industry. The various factors affecting the automobile industry. The Profitability, competition, market condition, future prospective market condition for this industry. This study will also deals with reviewing the performance of domestic automobile companies against foreign automobile companies.

Objectives:1) To study the growth of Automobile industry 2) To examine profitability status. 3) To know the strengths of financial ratios in identifying financial efficiency of the Industry.

4) To make comparative study on financial performance of Automobile Industries.

Scope of the study:The study will be done in Automobile Industry order to analyze the current position of profitability of Industry. The study helps to know liquidity position as well as maintain the profitability of the Industry. This study is confined to only the branch and it can be further extended to other centers. The study is based on the annual reports of the company Balance sheets, Profit and loss accounts for a period of 5 years. And performance rate of selected Automobile Industries.

Research Methodology: Survey method is proposed to use for studying the samples. Detailed study is used for studying the behavior of risk and return. Statistical method.

Data collection:Data collection is a key in marketing research. The design of the data collection method is the back bone of the research design. Normally the sources of data are classified in 2 types:

Primary data. Secondary data

Primary data:The primary data has been collected from the Managers Dealers of popular cars. through direct interview

Secondary data:The required secondary data has been collected from the published books, hand

bills, journals, project reports, internet Databanks, Internet, capital line software, etc.

Chapter scheme
Introduction Research design Industry profile and company profile Analysing and interpretation of data Summary of finding and recommendation Bibliography Annexure

Expectation of the study


Proper management of Automobile Industry is very essential for business. The following can be stated as the need for the study 1) To get more knowledge of the study. 2) To analyse the financial market condition. 3) To find out different Industry of the firm related to financial position and check their effects. ensuring growth

CHAPTER-3 Industry profile

Introduction of Automobile Industry

The automobile History dates back to the late 18th century. Nicolas Joseph Cugnot, a French engineer is credited with investing the first self-propelled automobile.

Cugnots vehicle used steam power for locomotion. The vehicle found military application in the French army. Cugnots Automobile was never commercially sold.

In the beginning automobile industry was dominated by steam-powered vehicle. The vehicles were expensive and difficult to maintain. The incidence of frequent boiler expansions also kept potential purchasers away. Commercial history of automobiles started with the invention of gasoline powered internal combustion engines. The German inventor, Karl Benz constructed his first gasoline powered vehicle in 1885. At Mannheim, Germany. Commercial production of Benz cars stated in 1888. Panhard et Levassor of France was the first company to exclusively build and sell motor cars from 1889.

The early 1900 s saw many automobile manufacturing companies coming into existence in a number of European countries and the United States. The first mass production automobile in the United States was the curved-dash Oldsmobile. It was a three-horsepower machine and sold 5,000 units by 1904. The economies of the US car market was disrupted by the arrival of Henry Ford and his Model T car. The Model T was the worlds first mass produced vehicle-a million units were sold by 1902- a space of 10 years.

Automobile History
Horses had dreams of them since time immemorial, but it was only in the 18th century that the first horseless carriage actually hit the roads. Thats not to say that the idea never struck anyone. Seeds of the idea, in fact, originated long before the first contraption was rolled. The History of the automobile actually began 4,000 years ago when the first wheel was used for transportation in India. Several Italians recorded designs for wind-driven cars. The first was Guido da Vigevano in 1335. It was a windmill-type drive to gears and thus to wheels. Vaturio designed a similar car that was also never built. Later Leonardo da vinci designed clockworkdriven tricycle with tiller steering and a differential mechanism between the rear wheels. In the early 15th century, the Portuguese arrived in china and the interaction of the two cultures led to a variety of new technologies, including the creation of a wheel that turned under its own power. By the 1600s, small steam-powered engine models were developed, but it was another century before a full-sized engine- powered automobile was created. A Catholic priest named Father Ferdinan Verbiest is credited to have built a steam-powered car for the Chinese Emperor Chien Lung in about 1678. There is no information about the automobile. Only the event. Since James watt didnt invent the steam engine until 1705, we can guess that this was possibly a model automobile powered by a mechanism like Heros steam engine-a spinning wheel with jets on the periphery.

Although by the mid-15th century the idea of a self-propelled automobile had been put into practice with the development of experimental car is powered by means of springs, clockworks, and the wind, Nicolas-Joseph Cugnot of France in considered to have built the first true automobile in 1769. Designed by Cugnot and constructed by M. Berzin it is also the first automobile to move under its own power for which there is a record. Cugnots three- wheeled steam-powered automobile carried four persons and was meant to move artillery pieces. It had a top speed of a little more than 3.2km/h (2mph) and had to stop every 20 minutes to build up a fresh head of steam.

Evens was the first American who obtained a patent for a self-propelled carriage. He, in fact, attempted to create a two-in-one combination of a steam wagon and a flat-bottomed boat, which didnt receive any attention in those days. During the 1830s, the steam car had made great advances. But stiff competition from railway companies and crude legislations in Britain forced the poor steam automobile gradually out of use on roads. The early steampowered automobile s were so heavy that they were only practical on a perfectly flat surface as strong as iron. A road thus made out of iron rails became the norm for the next hundred and twenty-five years. The automobile s got bigger and heavier and more powerful and as such they were eventually capable of pulling a train of many car s filled with freight and passengers

Changing Faces of the Car

Mass production of cars led to cheaper vehicles. This made cars more affordable to the common American and European citizen. The British automobile manufacturing history was revolutionized by assembly line production methods employed by two separate car makersWilliam Morris and Herbert Austin. Austin Seven was the world's first compact car. The Morris manufactured vehicles had engine mounted on front.

The 1960s saw rapid developments in automobile manufacturing technology. A milestone in the history of automobiles was achieved by the invention of efficient fuel injection processes, independent suspensions and turbochargers. Pontiac Trans Am was the best selling car from 1969 to 1980. Computer Aided Design (CAD) was introduced for designing vehicles from the 1980s. Ford Taurus was the first vehicle to be built using CAD.

Company profile

Tata Motors

Tata Motors launches its first truck in collaboration with Mercedes-Benz Tata Motors is a part of the Tata and Sons Group, founded by Jamshedji Nussarwanji Tata and J. Baker. The company was established in 1945 as a locomotive manufacturing unit and later expanded its operations to commercial vehicle sector in 1954 after forming a joint venture with Daimler-Cars.

After years of dominating the commercial vehicle market in India, Tata Motors entered the passenger vehicle market in 1992 by launching the Tata Sierra, a multi utility vehicle. After the launch of three more vehicles, namely, Tata Estate (1992, a station wagon design based on the earlier 'TataMobile' [1989] a light commercial vehicle which some people may still think of as Tata's first passenger car), Tata Sumo (LCV, 1994) and Tata Safari (1998, India's first sports utility vehicle); In 1998 Tata launched the Indica, the first fully indigenous passenger car of India. Though the car was initially panned by auto-analysts, the car's excellent fuel economy, powerful engine and aggressive marketing strategy made it one of the best selling cars in the history of the Indian automobile industry. A newer version of the car, named Indica V2, was a major improvement over the previous version and quickly became a mass-favorite. A badge engineered version of the car was sold in the United Kingdom as the Rover City Rover. Tata Motors also successfully exported large quantities of the car to South Africa. The success of Indica in many ways marked the rise of Tata Motors. Note: In 1996-97 Tata launched the Tata Sumo Deluxe and the Tata Sierra Turbo variants respectively.

Tata Pick Up, unveiled in 2007, is expected to enter European and American market by 2009.In 2007, Tata Motors generated revenues of Rs 31,884.69 crore.

In 2007, Tata Motors launched several concept models and future designs of existing models. It also formed joint ventures with various local companies in several countries to assemble Tata cars. Tata Motors launched a re-designed version of Tata Xenon TL during Motor Show Bologna which would be assembled in Thailand and Argentina. A pick-up variant of Tata Sumo was also launched under the program 'Global Pick-Up'. The company plans to launch the new pick-up model in India, Southeast Asia, Europe, South Africa, Turkey and Saudi Arabia. Tata Motors also unveiled newer model of Tata Indigo and Tata Elegante concept-car during the Geneva Auto Show.

Tata Motors also formed a joint venture with Fiat and gained access to Fiats diesel engine technology. Tata Motors is looking to extend its relationship with Fiat and Iveco to other segments like the 'Global Pick-Up' program. The launch of the 'Global Pick-Up' will mark the entry of the company into developed markets like Europe and the United States. The project was initially a collaboration between Tata Motors and its subsidiary Tata Daewoo Commercial Vehicles, but later Tata Motors decided to work with Iveco as Daewoos design was not in sync with the needs of sophisticated European customers. The company has formed a joint venture with Thailands Thonburi Company, an independent auto assembler, in which Tata Motors will hold a 70% stake.

Tata motors

Type Founded Founder(s) Headquarters Key people Products Revenue Net income Parent Subsidiaries

Public BSE: 500570 1945 JRD Tata Mumbai, India Ratan Tata, Chairman

(NYSE: TTM)

Automobiles and Engines USD $9.07 billion (2006) USD $474.0 million (2006) Tata Group Jaguar Cars , Land Rover ,

Tata Daewoo Commercial Vehicle Website TataMotors.com

Tata Motors have some distinct advantages in comparison to other multi-national competitors. There is definite cost advantage as labor cost is 8-9 percent of sales as against 30-35 percent of sales in developed economies. Tata motors have extensive backward and forward linkages and it is strongly interwoven with machine tools and metals sectors. Tata Group's strong expertise in the IT based engineering solution for products and process integration has helped Tata Motors. India has a large auto component industry noted for its world class capabilities. There is huge demand in domestic markets due to infrastructure developments and Tata Motors is able to leverage its knowledge of Indian market. There are favorable Government polices and regulations to boost the auto industry.

Maruti udyog Limited

Maruti Udyog Ltd Profile Office Address #11th Floor, Jeevan Prakash 25 Kasturba Gandhi Marg New Delhi Delhi 110001 Phone Business Summary 011-23316831

Maruti Udyog Ltd., (MUL) incorporated in 1981, is a private foreign company primarily engaged in the manufacture of passenger cars. Formed by a joint venture between the Indian Government and Suzuki Motor Company of Japan, the company has established itself amongst the leaders in the Indian Auto market. Its plant located in Gurgaon, has a capacity of manufacturing 350000 units per annum. MUL's product range includes 10 basic models with over 50 variants, of which nine models are manufactured by the company inhouse and one is imported from Suzuki. Over the last decade, MUL has launched various models such as Omni, 1000, Zen, Esteem, WagonR, Gypsy, Alto, Baleno, Vitara etc. targeting all segments of customers. In addition to domestic sales, Maruti also exports to many European markets. Through it's subsidiaries, the company also provides allied services like sale and purchase of pre-owned cars, lease and fleet management service for corporates, insurance and finance services,etc. The company functions through a network of 303 sales outlets across 189 Indian cities, owned and managed by its channel partners. The 1923 authorised service outlets cover a network of over 1000 towns and cities in the country. The company is headed by Mr Shinzo Nakanishi, the chairman and director. As on June 2005, the President of India owns 18.28% of the company while Suzuki Motor Corporation and the Indian Public own 54.21% and 2.85% respectively.

Around 1970, Sanjay Gandhi, the then Prime Minister of India Indira Gandhi's younger son, envisioned the manufacture of an indigenous, cost-effective, low maintenance compact car for the Indian middle-class. Indira Gandhi's cabinet passed a unanimous resolution for the development and production of a "People's Car". Sanjay Gandhi's company was christened Maruti Limited. The name of the car was chosen as "Maruti", after a Hindu deity named Maruti.

At that time Hindustan Motors' Ambassador was the chief car, and the company had come out with a new entrant, the Premier Padmini which was slowly gaining a part of the market share dominated by the Ambassador. For the next ten years, the Indian car market had stagnated at a volume of 30,000 to 40,000 cars for the decade ending 1983. Sanjay Gandhi was awarded the exclusive contract and licence to design, develop and manufacture the "People's Car". This exclusive rights of production generated some criticism in certain quarters, which was directly targeted at Indira Gandhi. Over the next few years, the company was sidelined due to the Bangladesh Liberation War and emergency.

In the early days under the powerful patronage of Sanjay Gandhi, the company was provided with free land, tax breaks and funds. Till the end of 1970s, the company had not started the production and a prototype test model was welcomed with criticism and skepticism. The company went into liquidation in 1977. The media perceived it to be another area of growing corruption. Unfortunately, Maruti started to fly only after the death of Sanjay Gandhi, when Suzuki Motors joined the Government of India as a joint venture partner with 50% share.

After his death, Indira Gandhi decided that the project should not be allowed to die. Maruti entered into this collaboration with Suzuki Motors, The collaboration heralded a revolution in the Indian car industry by producing the Maruti 800. The car went on sale on December 14, 1983. It created a record by taking 13 months time to go from design to rolling out cars from a production line.

1980s
The introduction of the Maruti 800 in 1983, marked the beginning of a revolution in the Indian automobile industry. Maruti Udyog brought in the latest technology then available, more fuel-efficient cars, and brought down the prices of cars in India. This led to the creation of a huge market for all car segments as the Indian middle class grew in size. This in-turn brought in more players to this segment. A number of auxiliary car parts making units were setup as most car manufacturers realised it was more cost effective to make their car parts in India rather than import them. Maruti's most major influence was in helping the component industry in the country because of its emphasis on localization and indegenisation. As in the beginning that sector hadn't grown much, Maruti had to start a dozen joint ventures with Indian entrepreneurs. It got them foreign collaborations, that led to collaborations for other manufacturers so that over a period of time the whole component industry was able to upgrade itself and improve its quality. Leading to a major existing export potential in vehicle components. It also brought in better methods of financing that allowed more people, who given their income levels could not afford to buy a car on their own, to buy cars. It still remains the leader not only in terms of market share but also in customer satisfaction surveys - it has consistently topped J. D. Power quality surveys, including 2005.

1990's
By the year 1993 the company had sold up to 1,96,820 cars, mostly by selling its chief product the Maruti 800s. By March 1994, it produced one million vehicles, becoming the first Indian company to cross this milestone. It reached the two million mark in October, 1997 and rolled out its 4 millionth vehicle, an Alto-LX, on April 19, 2003.

Mahindra & Mahindra


Mahindra Group is one of the largest corporate groups of India. It is a US $4.5 billion conglomerate with employee strength of over 40,000. The group has diverse business interests such as automotive, farm equipments, infrastructure, information technology, hospitality, and financial services. Mahindra Group has global presence and it is ranked amongst Forbes Top 200 list of the World's Most Reputable Companies and in the Top 10 list of Most Reputable Indian companies. The origins of Mahindra Group can be traced back to October 2, 1945 when Mahindra brothers J.C. Mahindra & K.C. Mahindra joined hands with Ghulam Mohammad, and Mahindra & Mohammad was set up as a franchise for assembling jeeps from Willys, USA. After India's independence in 1947, Mahindra & Mohammad changed its name to Mahindra & Mahindra. Ghulam Mohammad migrated to Pakistan post-partition and became the first Finance Minister of Pakistan. Since then, Mahindra Group has gone from strength to strength and today it has evolved Into a giant group.

Business Interests of Mahindra Group Automotive Sector: Mahindra Group is the market leader in utility vehicles in India since inception. Mahindra also manufactures and markets utility vehicles and light commercial vehicles, including three-wheelers. Some of the famous automobile brands of Mahindra are: Scorpio and Bolero. Recently, Mahindra joined hands with French automobile major Renault to enter passenger car segment. It has launched a car called Mahindra Farm Equipment Sector: Mahindra is the largest producer of tractors in India and is among the top five tractor brands in the world. It has its own state-of-the-art plants in India, USA, China and Australia, and a capacity to producr 1,50,000 tractors a year.

Trade & Financial Services: Mahindra Intertrade Limited and its subsidiaries have specialized domain knowledge in imports and exports of commodities, domestic trading, marketing and distribution services. Mahindra Finance is one of the largest Non Banking Finance Companies in India with an asset base of about Rs. 5000 crores. Mahindra Insurance Brokers offer Life and Non-life Insurance plans to retail and corporate customers. Mahindra Steel Service Centre is the first steel service centre in the organized sector in India.

Infrastructure Development: Mahindra Group has interests in real estate, special economic zones, hospitality industry, infrastructure development, project engineering consultancy and design. Mahindra Holidays & Resorts is the leader in the lifetime holiday market in India. Mahindra Gesco is fastest growing Construction Company in India. Mahindra World City is developing and promoting India's first Integrated Business City. Mahindra Acres Consulting Engineers is a multidisciplinary engineering consultancy organisation.

Information Technology: Mahindra Group entered into IT sector in 1986 when it formed a joint venture with British Telecommunications plc. The company was called MahindraBritish Telecom. The Company has recently changed its name to Tech Mahindra. Tech Mahindra is a leading provider of telecommunication solution and service industry worldwide. It is India's 8th largest software exporter.

Speciality Businesses: Mahindra Group companies such as Mahindra AshTech, Mahindra Defence, Spares Business Unit and Mahindra Logistics are into Speciality Businesses. Mahindra AshTech undertakes turnkey contract execution for Ash Slurry System and Travelling Water Screens. Mahindra Defence Systems looks after the requirements of India's defence and security forces. Mahindra Logistics provide complete logistics solutions to complex transportation needs of clients across the world.

Major Achievements of Mahindra Group


Mahindra & Mahindra made the first indigenous Jeep in the country in 1949. Fourth largest tractor company in the world. Largest manufacturer of tractors in India. Largest manufacturer of MUVs, offering over 20 models

Note: The above information was last updated on 21-07-2007 or limited Financial ratios are tools for interpreting financial statements to provide a basis for valuing securities and appraising financial and management performance. A good financial analyst will build in financial ratio calculations extensively in a financial modeling exercise to enable robust analysis. Financial ratios allow a financial analyst to:

Standardize information from financial statements across multiple financial years to allow comparison of a firms performance over time in a financial model.

Standardize information from financial statements from different companies to allow an apples to apples comparison between firms of differing size in a financial model.

Measure key relationships by relating inputs (costs) with outputs (benefits) and facilitates comparison of these relationships over time and across firms in a financial model.

In general, there are 4 kinds of financial ratios that a financial analyst will use most frequently, these are:

Performance ratios Working capital ratios Liquidity ratios Solvency ratios

These 4 financial ratios allow a good financial analyst to quickly and efficiently address the following questions or concerns:

Performance ratios

What return is the company making on its capital investment? What are its profit margins?

Working capital ratios


How quickly are debts paid? How many times is inventory turned?

Liquidity ratios

Can the company continue to pay its liabilities and debts?

Solvency ratios (Longer term)


What is the level of debt in relation to other assets and to equity? Is the level of interest payable out of profits?

There is also an excellent financial ratio analysis template available in the Finance 3.0 forums, that allows you to calculate, analyze and compare a set of business & financial ratios to assess & measure the operating performance of your own business or businesses / stocks that you intend to invest in.

Hindustan Motors
Hindustan Motors (HM) is the flagship company of the C.K. Birla Group, established by Mr. B.M. Birla. Ambassador, Contessa and Mitsubishi Lancer are the most successful brands in the Indian market. In MUV segment the company has given Trekker, Porter and Pushpak. RTV is also one of the remarkable brand of HM. Quick Facts

Founder Country Year of Establishment Business Group Listings & its codes Work Station

B.M. Birla India 1942 CK Birla Group NSE: HINDMOTOR; BSE: 500500 Uttarpara (West Bengal), Thiruvallar (Tamil Nadu), Pithampur (Madhya Pradesh)

Website

www.hindmotor.com

Hindustan Motors Limited (HML), was established by Mr. B.M. Birla of the industrious Birla family in 1942. It is the pioneering automobile manufacturing company and Flagship Company of the C.K. Birla Group. The company commenced its operations in a small assembly plant in Port Okha near Gujarat. Later the manufacturing facilities moved to Uttarpara in West Bengal in 1948, where it began the production of - the Ambassador. In addition to passenger cars (Ambassador, Contessa), Multi Utility Vehicles (Trekker, Porter, and Pushpak) and the RTV, the company also manufactures passenger cars in the mid size premium segment (Mitsubishi Lancer) and has brought in Sports Utility Vehicle (Mitsubishi Pajero) into the Indian market in collaboration with Mitsubishi Motors of Japan. Contributing significantly for over five decades to the Indian Automotive industry, Hindustan Motors manufacturing facilities are situated in the states of Madhya Pradesh, Tamil Nadu and West Bengal. It functions with a commitment to core values such as quality, safety, and environmental care, in combination with customer-oriented total solutions.

Hindustan Motors Ltd (Hindustan Motors) was established in 1942 as a small assembly plant for passenger cars. In 1986, the company began manufacturing HCVs. The company is primarily engaged in the manufacture and sale of passenger cars, UVs and trucks, and components & accessories.

Hindustan Motors manufactures passenger cars in the mid-size premium segment - namely, Mitsubishi Lancer, Lancer Select, and Lancer Cedia and has brought the SUV Mitsubishi Pajero into the Indian market in collaboration with Mitsubishi Motors, Japan. Hindustan Motors has a remote services division engaged in engineering services. The company operates with three manufacturing units at Uttarpara in WB; Chennai in TN; and a roadtrusted vehicle plant in MP. The Uttarpara plant focuses on auto components and supplies castings, forgings, and stampings to other manufacturers. The Chennai car plant only manufactures Mitsubishi Lancer cars and spare parts, while the plant in MP manufactures the RTV brand of MUVs and spare parts in technical collaboration with OKA Motor Company, Australia. The plants have a cumulative installed capacity of 63,000 vehicles p.a.

During FY07, the company sold 13,775 vehicles. During FY07, it also entered the African market with an export order of 25 vehicles. In 2007, the company tied up with Shriram Properties Ltd of Bangalore for the development of an integrated IT township and auto park in Uttarpara.

1942

Incorporation at Port Okha in Gujarat as a small assembly plant for passenger cars. Shifted its activities to Uttarpara in West Bengal (close to Howrah) and set up facilities for manufacture of cars. The company further diversified its activities by setting up an Earthmoving Equipment Division at Tiruvallur, near Chennai, Tamil Nadu for the manufacture of Earthmoving equipment such as dumpers, front-end loaders, crawler tractors and so on. The company commenced a Power Products Division at Hosur (Karnataka) for manufacture of heavy duty transmission required for Earth moving Equipments. Commencement of the manufacture of Heavy Commercial Vehicles at Commercial Vehicle Division, Vadodara (Gujarat). Commenced production of petrol engines and transmissions at Pithampur (Madhya Pradesh) in collaboration with Isuzu Motor Company, Japan. The company modernized, upgraded and expanded its three existing divisions Earthmoving Equipment Division, Power Plant Division and the Uttarpara Plant. Began the production of the Road Trusted Vehicle. Commenced the Mitsubishi Lancer Car project. Earthmoving Equipment Division plant was sold off to Caterpillar (USA). Launched Mitsubishi Pajero, collaboration with Mitsubishi Motors (Japan), in India. Components Business (PUP-Pithampur and PPD - Hosur) transferred to AVTEC, a company jointly held by HM, Actis and CK Birla Group.

1948

1971

1985

1986

1987

1996

1997 1998 2001

2002

2004

TOYOTA KIRLOSKAR MOTOR LTD.

As a joint venture between Kirloskar Group and Toyota Motor Corporation, Toyota Kirloskar Motor Private Limited (TKM) aims to play a major role in the development of the automotive industry and the creation of employment opportunities, not only through its dealer network, but also through ancillary industries.

TKM's growth since inception can be attributed to one simple, yet important aspect of its business philosophy - "Putting Customer First". While managing growth, TKM has maintained its commitment to provide quality products at a reasonable price and has made every effort to meet changes in customer needs..

TKM firmly believes that the success of this venture depends on providing high quality products and services to all valued customers through the efforts of its team members.

TKM, along with its dedicated dealers and suppliers, has adopted the "Growing Together" philosophy of its parent company TMC to create long-term business growth. In this way, TKM aims to further contribute to progress in the Indian automotive industry, realise greater employement opportunities for local citizens, improve the quality of life of the team members and promote robust economic activity in India.

All Toyota employees are expected to embody these values in their daily work, including environmental protection activities. To "respect" the environment, we go to the source to identify and analyse problems ("Genchi Genbutsu"), move forward to "challenge" conventional ideas and old habits, to improve further ("kaizen") through "teamwork."

The framework provided by The Toyota Way enables our company to respond to, among other things, the environmental challenges at various stages of the life-cycle of a vehicle. These include greenhouse gas emissions, waste reduction, increased recycling and the banning of hazardous substance use in parts and components. These challenges will have inevitable consequences for Toyota's organisation and employees, and we must balance them with our desire for future growth. In 1992, the Toyota Guiding Principles were established in direct response to the international initiatives agreed to at the Rio 'Earth Summit.' This summit focussed on the potential for a clash between trade and environmental rules, and resulted in a statement of principles about forest management, conservation and sustainable development.

The Toyota Guiding Principles are a cornerstone of our corporate management philosophy. These principles were updated in 1997, to ensure they continue to provide Toyota with a clear path towards achieving sustainable development.

These principles have been explored and developed in Toyota's Global Vision 2010, adopted in April 2002, which proposes a series of long-term policies on the theme of "Innovation into the Future." Toyota's Global Vision 2010 guides management in its response to long-term social changes, combining consideration for the environment, the benefit to our customers of value-added products and the encouragement of our employees through shared prosperity and social involvement.

Based on the Guiding Principles, which codify Toyota's business spirit, the Toyota Earth Charter (adopted in 1992 and revised in 1997) embodies a comprehensive approach to global environmental issues. It outlines Toyota's basic policy and action guidelines towards effective environmental management and improvements. The Toyota Earth Charter underlines a commitment to environmental excellence, not only through broad principles, but in concrete examples of what can be done through action guidelines. In connection with the Toyota Guiding Principles and the Toyota Earth Charter, a European Environmental Policy was developed as a means of linking principles, goals, targets and action plans with management structures and systems.

Recognition At TKM, we look to continuously improve not only our products but also our processes and service. Our obsession with perfection has been recognised by various institutions such as JD Power and TNS Automotive, as well as automotive publications like Overdrive, as the reason for the success of Toyota products in India and across the globe

Chapter-4 Data analysis

Data Analysing and Interpretation

Ratio Analysis
According to J. Batty the term accounting ratio is used to describe significant relationships which exist between figures shown in a balance sheet, in a profit and loss account, in a budgetary control system or in any other part of the accounting organization. the accounting ratios indicate a quantitative relationship which is used for analysis and decision making. It provides basis for inter-firm as well as intra-firm comparison. The ratios will be effective only when they are compared with ratios of base period or with standards or with the industry ratios. The financial statement viz. income statement, and Balance sheet report what has actually happened to earnings during a specific period and presents a summary of financial position of the company at a given point of time. the statement of retained earnings reconciles income earned during the year and any dividends distributed with the change in retained earnings between the start and end of the financial year under study.

1) Liquidity Ratio
The liquidity Ratios measures the liquidity of the firms and its ability to meet its maturing short term obligations. Liquidity is defined as the realise value in money, the most liquid of assets. It refers to the ability to pay in cash, the that are due. The corporate liquidity has two dimensions viz., quantitative and qualitative concepts. The qualitative aspects includes the quantum, structure and utilization of liquid assets and in the qualitative aspect, it is the ability to meet all present and potential demands on cash from any source in a manner that minimizes cost and maximises the value of the firm. Thus, corporate liquidity is a vital factor in business. a) Current Ratio b) Quick Ratio c) Absolute Liquid Ratio d) Defensive- Interval Ratio.

4.1) Current Ratio: This ratio measure the solvency of the company in short-term. Current assets are those assets which can be converted into cash within a year. Current liabilities and provisions are those liabilities that are payable within a year.

Table no: 4.1 The table showing comparative current ratio:


Company Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar Current assets 10383.78 3837.9 3655.37 192.16 6.09 Current liabilities 8667.2 2449.2 2307.55 173.93 0.83 Ratios 1.198 1.567 1.584 1.104 7.337

The current ratio revels the ability of the firm to meet all the obligations maturing within a year. Conventionally it is said that the current ratio should be 2:1. It means that for every one rupee for current liability the firm must have two rupees worth of current assets. The reasons for this conventional norm is that, all the current assets con not be converted into cash immediately.

Chart no: 4.1 The chart showing comparative current ratio:

current Ratios
current Ratios

7.337 1.567 Maruti Udyog Ltd 1.584 Mahindra & Mahindra

1.198 Tata Motors

1.104 Hindustan Motors Toyota Kirloskar

Interpretation: A current ratio of 2:1 indicates a highly solved position. A current ratio of 1.33:1 is considered by banks as the minimum acceptable level for providing working capital finance. The constituents of the current asset are as important as the current assets themselves for evaluation of a companys solvency position. Toyota kirloskar Ltd very high current ratio (7.337) will have adverse impact on the profitability of the organization. A high current ratio may be due to the piling up of inventory, inefficiency in collection of debtors, high balance in cash and bank accounts without proper investment etc. Hindustan Motors is low current ratio(1.104) current assets are highly liquid. When the compare to the other companies.

4.2) Quick Liquid / Acid Test Ratio:Quick ratio is used as a measure of the companys ability to meet its current obligations. Since bank over draft is secured by the inventories, the other current assets must be sufficient to meet other current liabilities. This ratio is also called quick ratio or acid test ratio. It establishes the relationship between Liquid assets are those which can be converted in to cash without any loss or delay. All current assets, expecting stock and prepaid expenses, are considered to be liquid assets. Liquid liabilities are those liabilities which are payable immediately. All current liabilities, excepting Bank over draft, are considered to be liquid liabilities.

Table no: 4.2 Table showing Comparative Liquid ratio:

company Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar

Liquid assets 10383.78 3837.9 3655.37 192.16 6.09

Liquid liabilities 8667.2 2449.2 2307.55 173.93 0.83

Ratios 1.198 1.567 1.585 1.105 7.337

A quick ratio of 1:1 is considered to be satisfactory, it takes in to account only liquid assets whose realized value is almost certain. A firm 1:1 quick ratio is expected to be able discharge all its current obligations.

Chart no: 4.2 The chart showing Comparative Liquid ratio:

Liquid Ratios
Liquid Ratios

7.337 1.567 Maruti Udyog Ltd 1.585 Mahindra & Mahindra

1.198 Tata Motors

1.105 Hindustan Motors Toyota Kirloskar

Interpretation:

This chart showing quick ratio of 1:1 indicates highly solvent position. 2.78:1. this ratio serves as a supplement to the current ratio in analysing liquidity. Toyota kirloskar Ltd quick ratio 7.337:1 it indicates highly solvent position when the compare to the other companies. Hindustan Motors it indicates 1.105 low liquidity ratio when the compare to the other companies.

4.3) Absolute Liquid / Super Quick Ratio:It is the ratio of absolute liquid assets to quick liabilities. However, for calculation purposes, it is taken as ratio of absolute liquid assets to current liabilities. Absolute liquid assets include cash in hand, cash at bank and short-term or temporary investments. Absolute Liquid assets Current Liabilities

Absolute Liquid assets = cash in hand + cash at bank + short-term investments

Table No: 4.3 Table showing Comparative absolute liquid ratio

Company

Cash and Bank

Short-term investment

Current Liabilities

Ratio

Tata motors Maruti Udyog Mahindra & Mahindra Hindustan Motors Toyota Kirloskar motors Ltd

2397.31 324 861.23 13.78 0.33

4910.27 5180.7 4215.06 71.79 1

8667.2 0.843 2449.2 2.247 2307.55 2.199 173.93 0.492 0.83 1.602

The companys absolute liquid ratio is 0.64:1 and an ideal ratio is 0.5:1 it means that more than 50% of current assets are highly liquid. Hence the companys liquidity position can be able to meet uncertainties in payment obligations of short-term liabilities.

Chart No: 4.3 Chart showing comparative Absolute liquid ratio

Absolute liquid Ratio


Absolute liquid Ratio

2.247 0.843 Tata motors Maruti Udyog

2.199 0.492 Mahindra & Mahindra Hindustan Motors

1.602

Toyota Kirloskar motors Ltd

Interpretation: This chart showing Maruti Udyog Ltd is more than the liquid liabilities (2.247) when the company showing good performance when the compare to the other companies that is 2.2:1 hence the company liquidity position can be able to meet full payment obligations of shortterm liabilities. Hindustan Motors low liquid ratio shows 0.492:1 it means that more than 50% of current assets are highly liquid. Hence the company liquidity position can be able to meet Uncertainties in payment obligations of short-term liabilities, when the compare to the other companies.

Profitability Ratios
The profitability ratios are to help assessing the adequacy of profit earned by the company and also to discover whether profitability is increasing or declining. The profitability of the firm is the net result of a large number of policies and decisions. The profitability ratios show the combined effects of liquidity, asset management and debt management on operating results. Profitability ratios are measured with reference to sales, capital employed, total asset employed, shareholders funds etc.

4.4) Gross profit margin:The ratio measures the gross profit margin on the total net sales made by the company. The gross profit represents the excess of sales proceeds during the period under observation over their cost, before taking into account administration, selling and distribution and financing changes. The ratio measures the efficiency of the companys operations and this can also be compared with the previous years results to ascertain to ascertain the efficiency.

( or )

Table No: 4.4 The table showing Comparative Gross Profit Ratio company Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar 66.96 3.77 704.66 5.94 9.502 63.468 Gross profit 3228.78 3071.2 1645.43 Sales 28529.4 17891.6 11281.73 Ratios 11.317 17.165 14.58

Chart No: 4.4 Chart shows comparative Gross Profit Ratio

Gross profit Ratios


Gross profit Ratios

63.468 17.165 Maruti Udyog Ltd 14.58 Mahindra & Mahindra

11.317 Tata Motors

9.502 Hindustan Motors Toyota Kirloskar

Interpretation: A high margin enables all operating expenses to be covered and provides a reasonable return to the shareholders. In order to keep the ratio high, management has to minimize cost of goods sold and improve sale performance.

From the above table it clearly shows that the gross profit ratio of Toyota kirloskar is 63.468
has been increased when compared to other companies. Selling and distribution and financing changes. The ratio measures the efficiency of the companys operations and this can also be compared to the other company results to ascertain to ascertain the efficiency.

4.5) Net profit margin ratio


The ratio is designed to focus-attention on the net profit margin arising from business operations before intrest and tax is deducted. The convention is to express profit after tax and intrest as percentage of sales. A drawback is that the percentage which results varies depending on the sources employed to finance business activity. Intrest is charged above the line while dividends are deducted below the line. It is for this reason that net profit i.e., earning before intrest and tax (EBIT) is used this ratio reflects net profit margin on the total sales after deducting all expenses but before deducting intrest and taxation. This ratio measures the efficiency of operation of the company. The net profit is arrived at form gross profit after deducting administration, selling and distribution expenses. The non-operating incomes and expenses are ignored in computation of net profit before tax, depreciation and intrest. This ratio could be compared with that of the previous years and with that of competitors to determine the trend in net profit margins of the company and its performance in the industry.

Table No: 4.5 The table showing Comparative Net profit margin ratio:

Company Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar Ltd

Net profit before intrest and Tax Sales 3654.39 3130.8 1733.02 86.99 3.77 28529.4 17891.6 11281.73 704.66 5.94

Ratios 12.81 17.499 15.36 12.34 63.468

Chart No: 4.5 Chart shows comparative Net Profit Ratio

Net Profit Margin Ratio


Net Profit Margin Ratio

63.468 12.81 Tata Motors 17.499 15.36 12.34 Hindustan Motors Toyota Kirloskar Ltd

Maruti Mahindra & Udyog Ltd Mahindra

Interpretation: It is a measure of overall profitability of the firm. The higher ratio. The greater would be the return to the shareholders and vice versa. A net profit margin of 10% is considered normal this ratio is very useful to control cost and to increase the sales.

The Toyota kirloskar Ltd 63.468 the higher ratio the greater would be the return to the shareholders, Hindustan motors (12.34) shows the lower net profit margin when the compare to the other companies.

4.6) Cash Profit Ratio


The cash profit ratio is a more reliable indicator of performance where there are sharp fluctuation in the profit before tax and net profit from year to year owing to difference in depreciation changed. Cash profit ratio evaluates the efficiency of operations in terms of cash generation and is not affected by the method of depreciation charged. It also facilitate interfirm comparison of performance since different methods of depreciations may be adopted by different companies.

Cash profit = Net profit + Depreciation

Table No: 4.6 The Table showing Comparative Cash profit ratio:

company Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar

Net Profit 2028.92 1730.8

Depreciation 652.31 568.2

Sales 28529.4 17891.6

Ratios 9.4 12.85

1103.37

238.66

11281.73

11.90

30.84

21.15

704.66

7.38

2.48

0.09

5.94

43.26

Chart No: 4.6 Chart shows comparative Cash Profit ratio.

Cash Profit Ratios


Cash Profit Ratios

43.26 9.4 Tata Motors 12.85 Maruti Udyog Ltd 11.9 Mahindra & Mahindra 7.38 Hindustan Motors Toyota Kirloskar

Interpretation: Cash profit ratio the Toyota kirloskar company (43.26) will show the higher cash profit margin when compare to the other companies. It is better position, Hindustan Motors low cash profit margin when compare to the other companies. that is (7.38) when increase cash sales comes in better position. Cash profit ratio evaluates the efficiency of operations in terms of cash generation and is not affected by the method of depreciation charged. It also facilitate inter-firm comparison of performance since different methods of depreciations may be adopted by different companies.

4.7) Return on Total Asset:-

The profitability of the firm is measured by establishing relation of net profit with the total
assets of the organization. This ratio indicates the efficiency of utilization of assets in generating revenue.

Table No: 4.7 The Table showing Comparative Return on Total Asset Ratio:

Company Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar Ltd

Net profit after Tax 2028.92 1730.8 1103.37 30.84 2.48

Total assets 14120.02 9315.6 6937.13 260.37 5.28

Ratios 14.37 18.58 15.90 11.84 46.97

Chart No: 4.7 Chart shows comparative Return on Total Assets ratio.

Return on Total Assets


Return on Total Assets

46.97 14.37 Tata Motors 18.58 15.9 11.84 Hindustan Motors Toyota Kirloskar Ltd

Maruti Mahindra & Udyog Ltd Mahindra

Interpretation: Return on total assets the Toyota kirloskar Ltd is higher Return46.97 and then compare to the other companies Hindustan motors is low return (11.84). when the compare to the other companies.

The profitability of the firm is measured by establishing relation of net profit with the total
assets of the organization. This ratio indicates the efficiency of utilization of assets in generating revenue.

4.8) Return on Shareholders Funds (or) Funds on Net worth:-

This ratio expresses the net profit in terms of the equity shareholders funds. This ratios is an important yardstick of performance for equity shareholders since it indicates the return on the fund employed by them. However, this measures is based on the historical net worth and will be high for old plants and low for new plants.

Net worth = Equity capital + Reserves and Surplus

Table No: 4.8 The Table showing Comparative Funds on Net worth Ratio:
company Net Profit after intrest and tax Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar 2.22 0.05 5.23 42.04 30.84 161.26 -29.08 23.33 935.31 239.07 4111 21.50 1879.43 1705.01 385.54 144.5 Equity capital Reserves & surplus 7453.96 8270.9 23.97 20.26 Ratios

Chart No: 4.8 Chart shows comparative Funds on net worth ratio.

Funds on Net worth Ratios


Funds on Net worth Ratios

42.04 23.97 20.26 21.5 23.33

Tata Motors

Maruti Udyog Ltd

Mahindra & Mahindra

Hindustan Motors

Toyota Kirloskar

Interpretation: This cart showing Funds on net worth ratio shows Toyota kirloskar is high ratio (42.04) compare to the other companies Maruti Udyog company is low( 20.26) Funds on net worth. This ratio is an important yardstick of performance for equity shareholders since it indicates the return on the fund employed by them. This measures is based on the historical net worth and will be high for old plants and low for new plants.

4.9) Operating Ratio

This ratio establishes the relationship between operating cost and sales

Operating cost = Cost of Goods Sold + Operating Expenses

Table No: 4.9 The Table showing Comparative operating Ratio:

company

Sales

Cost of Goods sold

Operating Expenses

Ratios

Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar

28529.4 17891.6

29461.85 19115.5

25807.46 15984.7

193.73 196.18

11281.73

12069.38

10336.36

198.60

704.66

822.16

735.17

221.00

5.94

6.61

2.84

159.09

Chart No: 4.9 Chart shows comparative Operating ratio:

Operating Ratios
Operating Ratios

193.73

196.18

198.6

221 159.09

Tata Motors

Maruti Udyog Ltd

Mahindra & Mahindra

Hindustan Motors

Toyota Kirloskar

Interpretation:

This chart shows the operating ratio the overall operating efficiency of the business. Hindustan Motors High operating ratio 221% is undesirable as it leaves a small portion of income to meet other non- operating expenses like interest on loans when the compare to the other companies. A low ratio is better and reflects the efficiency of the management. The Toyota kirloskar Ltd 159.09 % lower the ratio, the higher would be the profitability. When the compare to the other companies.

4.10) Operating Profit Ratio

Operating profit ratio studies the relationship between operating profit (EBIT Earning Before Intrest and Tax) and sales. The purpose of this ratio is to find out the amount of operating profit for each rupee of sales.

Operating profit = Gross profit - Operating Expenses

Table No: 4.10 The Table showing Comparative operating Profit Ratio:

Company Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar

Sales 28529.4 17891.6 11281.73

Operating Profit 3654.39 3130.8 1733.02

Ratios 12.81 17.50 15.36

704.66 5.94

86.99 3.77

12.34 63.46

Chart No: 4.10 Chart shows comparative Operating Profit ratio:

Operating Profit Ratio


Operating Profit Ratio

63.46 12.81 Tata Motors 17.5 Maruti Udyog Ltd 15.36 Mahindra & Mahindra 12.34 Hindustan Motors Toyota Kirloskar

Interpretation: A high ratio is an indicator of the operational efficiency of the Toyota kirloskar (63.46) and Hindustan Motors (12.34) a low ratio stands for operational inefficiency of the firm, when the compare to the other companies. The purpose of this ratio is to find out the amount of operating profit for each rupee of sales.

4.11) Expenses Ratio:-

This ratio studies the relationship between factory expenses and sales. this ratio shows the manufacturing efficiency of the organization.

Table No: 4.11 The Table showing Comparative Expenses Ratio

company Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar

Factory Expenses 25807.46 15984.7

Sales 28529.4 17891.6

Ratios 90.46 89.34

10336.36

11281.73

91.62

735.17

704.66

104.32

2.84

5.94

47.81

Chart No: 4.11 Chart shows comparative Factory Expenses ratio:

Factory Expenses Ratio


Factory Expenses Ratio

90.46

89.34

91.62

104.32 47.81

Tata Motors

Maruti Udyog Ltd

Mahindra & Mahindra

Hindustan Motors

Toyota Kirloskar

Interpretation:

Factory expenses ratio pay the highest expenses Hindustan Motors (104.32) and then compare to the other companies. the lowest expenses pay Toyota kirloskar (47.81) company when compare to the other companies. The manufacturing efficiency of the organization high expenses is low profit earn, low expenses will give you the higher profit.

4.12) Stock Turnover Ratio:

This ratio establishes the relationship between cost of goods sold and average value of inventory of stock. The purpose of this ratio is to show the number of times the inventory of a firm is rotated in a year. It gives an indication of the efficiency of inventory management.

Table No: 4.12 The Table showing Comparative Stock Turnover Ratio:

company Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar

Sales 28529.4 17891.6 11281.73 704.66 5.94

Inventories

Ratios

2421.83 1178.01 1038.00 1723.66 1084.11 1040.64 82.05 0 858.82 0

Chart No: 4.12 Chart shows comparative Stock Turnover ratio:

Stock Turnover Ratio


Stock Turnover Ratio

1723.66 1178.01 1040.64 858.82 0 Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar

Interpretation: This chart showing A high inventory turnover ratio Maruti Udyog Ltd (1723.66) is an index of efficient inventory management and a low ratio Toyota kirloskar Ltd (0) stands for inefficient inventory management. A low ratio also implies that the firm has excess stock in relation to production and sales, When the compare to the other companies.

Combined Ratios
The ratio which is calculated by taking one item or one group of item from Trading Profit and Loss account and another item or the group of another item is taken from Balance sheet is called mixed ratio.

4.13) Return on Shareholders Equity:

This ratio shows the relationship between net profit after taxes and shareholders equity. It reveals the rate of return on owners funds. This ratio is also known Return on Net worth.

Table No: 4.13 The Table showing Comparative Return on share holders equity ratio

company Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar

Net profit after tax 2028.92 1730.8 1103.37

Shareholders Equity Ratios 150 100 115 13.526 17.308 9.59

30.84 2.48

0 0

0 0

Chart No: 4.13 Chart shows comparative Return on share holders equity ratio:

Return on Shareholders Eqity


Return on Shareholders Eqity

13.526

17.308 9.59 0 0 Toyota Kirloskar

Tata Motors

Maruti Udyog Ltd

Mahindra & Mahindra

Hindustan Motors

Interpretation:

This chart showing Return on share holders equity ratio maximum return on Maruti Udyog Ltd (17.308) will give you the equity share holders it is improve the company reputation and intrest to invest this company. But Hindustan Motors and Toyota kirloskar Ltd Return on equity shareholders is (0) the future market condition shareholders cannot intrest to invest this companies. It is affect on company growth rate, When the compare to the other companies.

4.14) Return on Total Resources:


This ratio shows the relationship between net profit after taxes and total assets. It reveals the rate of return on total assets. This ratio is also known Net profit to total assets.

Return on Total Resources

Table No: 4.14 The Table showing Comparative Return on Total Resources ratio:

company Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar

Net profit after tax Total assets 2028.92 1730.8 1103.37 30.84 2.48

Ratios

14120.02 14.369 9315.6 18.579 6937.13 16.294 260.37 11.844 5.28 46.969

Chart No: 4.14 Chart shows comparative Return on Total Resources ratio:

Return on Total Resources Ratio


Return on Total Resources Ratios

46.969 14.369 Tata Motors 18.579 Maruti Udyog Ltd 16.294 Mahindra & Mahindra 11.844 Hindustan Motors Toyota Kirloskar

Interpretation:

This chart shows Return on total asset ratio the highest return Toyota kirloskar (46.969) and then compare to the other companies. the lowest return Hindustan Motors (11.844). It reveals the rate of return on total assets. This ratio shows the relationship between net profit after taxes and total assets.

4.15) Intrest coverage ratio:

This ratio shows the relationship between net profit before intrest and tax and intrest.

Table No: 4.15 The Table showing Comparative Intrest coverage Ratio:

company

Net profit before Intrest intrest and Tax

Ratios

Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar

3654.39 3130.8 1733.02 86.99 3.77

425.61

858.62

59.6 5253.02 87.59 1978.55 20.03 0 434.29 0

Chart No: 4.15 Chart shows comparative Intrest coverage ratio:

Intrest coverage Ratio


Intrest coverage Ratio

5253.02 858.62 Tata Motors Maruti Udyog Ltd 1978.55 434.29 Mahindra & Mahindra Hindustan Motors 0 Toyota Kirloskar

Interpretation: This chart shows Intrest coverage ratio Maruti Udyog Ltd (5253.02) pay the highest intrest rate to the current liabilities is high because profitability position is low, when the compare to the other companies. Toyota kirloskar Ltd doesnt pay any intrest because the current liabilities is low (0) the company more profit earn, when the compare to the other companies.

4.16) Dividend payout ratio:


This ratio shows the relationship between dividend per equity share and earning per share.

Dividend payout ratio

Table No: 4.16 The Table showing Comparative Dividend Payout Ratio:

company

Dividend per equity Earnings per share share

Ratio

Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar

578.43 144.5 282.61

50.52 1144.9 59.03 244.79 44.54 634.51

0 0

1.91 4960

0 0

Chart No: 4.16 Chart shows comparative Dividend Payout ratio:

Dividend payout ratio


Dividend payout ratio

1144.9 634.51 244.79 Tata Motors Maruti Udyog Ltd Mahindra & Mahindra 0 Hindustan Motors 0 Toyota Kirloskar

Interpretation: This chart shows Dividend payout ratio Tata Motors pay maximum Dividend (1144.9) pay to the equity shareholders equity share holders computation to invest this company the company growth rate is stabilize, Hindustan Motors and Toyota kirloskar didnt pay any dividend it is earn more profit but equity shareholders con not intrest to invest this companies. When the compare to the other companies.

4.17) Earnings per share:

This ratio shows the relationship between net profit after taxes and preference dividend and number of equity shares. This ratio is also known earning per share.

Table No: 4.17 The Table showing Comparative Earnings per Share ratio:

Company Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar

Earnings per share 50.52 59.03 44.54 1.91 4960

Chart No: 4.17 Chart shows comparative Earnings Per share ratio:

Earning per share


Earning per share

4960

50.52 Tata Motors

59.03 Maruti Udyog Ltd

44.54 Mahindra & Mahindra

1.91 Hindustan Motors Toyota Kirloskar

Interpretation: This chart shows Earnings per share for the Toyota kirloskar (4960) shareholders will earn maximum earning per share, it is share holders benefit the future market basis easy to invest this company. Hindustan Motors is only 1.91 % earn the shareholders it is low. But the future market investor not easy to invest this company, it is difficult to collect the money. When the compare to other companies

4.18) Debt equity ratio


Debt equity ratio shows the relationship between borrower funds and owners fund the purpose of this ratio is to shown the extent of the firms dependences on external liabilities. In order to calculate its ratio. The required components are external liabilities and owners equity. External liability includes both long-term as well as short-term borrowings. The term owners funds includes equity share capital, preference share capital. Reserves and surplus, but excludes past accumulated losses such preliminary expenses, discount on issue of share or debentures, underwriting commission and profit and loss account debt balanced etc. since there are two approaches to work out this ratio.

Table No: 4.18 The Table showing Comparative debt equity ratio:

Company Tata Motors Maruti Udyog Ltd Mahindra & Mahindra Hindustan Motors Toyota Kirloskar

Total debt 6280.52 900.2

Equity 7839.5 8415.4

Ratio 0.80 0.107 0.59 0.97 0

2587.06 4350.07 128.19 0 132.18 5.28

Chart No: 4.18 Chart shows comparative Debt equity ratio:

Debt equity Ratio


Debt equity Ratio

0.8 0.107 Tata Motors Maruti Udyog Ltd

0.97 0.59 0 Mahindra & Mahindra Hindustan Motors Toyota Kirloskar

Interpretation:

From the above chart showing For analysing the capital structure, debt-equity ratio gives an idea about the relative share of funds of outside and owners invested in the business. The ratio of long term debt of equity is generally regarded as safe if it is 2:1. Debt is the easy to sources of fund equity and debt is equal proportion Hindustan motors is 0.97:1 is debt portion, Toyota kirloskar debt is zero 0:1 only equity is there in this company. When the compare to the other companies.

Chapter - 5 Findings

FINDINGS This study has been undertaken at Automobile Companies to analyze the financial performance of the company by using Ratio analysis technique where the last five years Balance sheet and Profit and loss account were considered for analyzing various financial ratios. The major findings with respect to the study are stated below:

Though the current ratio of Toyota kirloskar Motors is highly solved position. And then compare to the other companies, the Tata motors current ratio is low when the Compare to the other companies.

A quick ratio of 1:1 indicates highly solvent position. Maruti Udyog Ltd is low liquid solvent position this ratio serves as a supplement to the current ratio in analysing liquidity, compare to the other companies Toyota kirloskar is highly liquid solvent position when compare to the other companies.

The companys absolute liquid ratio Maruti Udyog Ltd is high and Hindustan Motors is Low ratio shows when the compare to the other companies. Gross profit margin ratio A high margin enables the Toyota kirloskar is high and Hindustan Motors is low ratio shows when the compare to the other companies. Net profit margin ratio It is a measure of overall profitability of the firm. The higher ratio. The greater would be the return to the shareholders and vice versa. A net profit margin of 10% is considered normal this ratio is very useful to control cost and to increase the sales. The Toyota kirloskar Ltd the higher ratio the greater would be the return to the shareholders, Hindustan motors shows the lower ratio. Return on total assets the Toyota kirloskar Ltd is higher Return and then compare to the other companies Hindustan motors is low return.

Funds on net worth ratio shows Toyota kirloskar is high ratio compare to the other companies Maruti Udyog company is low Funds on net worth.

The operating ratio shows the overall operating efficiency of the business. High operating ratio is undesirable as it leaves a small portion of income to meet other nonoperating expenses like interest on loans. A low ratio is better and reflects the efficiency of the management. The lower the ratio, the higher would be the profitability. Operating profit ratio a high ratio is an indicator of the operational efficiency of the Toyota kirloskar and Hindustan Motors inefficiency of the firm. a low ratio stands for operational

Factory expenses ratio pay the highest expenses Hindustan Motors. and then compare to the other companies. The lowest expenses pay Toyota kirloskar company when compare to the other companies. A high inventory turnover ratio is an index of efficient inventory management and a low ratio stands for inefficient inventory management. A low ratio also implies that the firm has excess stock in relation to production and sales. Return on share holders equity ratio maximum return on Maruti Udyog Ltd. And then compare to the other companies Intrest coverage ratio Maruti Udyog Ltd pay the highest intrest and compare to the other companies Toyota kirloskar (0) cannot pay in any intrest. Dividend payout ratio Tata Motors pay maximum Dividend when compare to the other companies. Earnings per share for shareholders Toyota kirloskar will give you the maximum earning per share when compare to other company and Hindustan Motors. will give low earning per share. Debt-equity ratio equal proportion of the company Hindustan Motors. Toyota kirloskar is no debt when the compare to the other companies.

SUGGESTIONs

SUGGESTIONS This study has been undertaken at Automobile Companies to analyze the financial performance of the company by using Ratio analysis technique where the last five years Balance sheet and Profit and loss account were considered for analyzing various financial ratios. Necessary steps should be taken by the Toyota kirloskar Ltd Company to increase operating ratio, stock turnover ratio, Return on shareholders ratio and Dividend payout ratio to improve company reputation and future market growth and equity share holders easy to invest this company. When the compare to the other companies.

The Toyota kirloskar Ltd Should Decrease the Factory Expenses ratio, Intrest coverage ratio and Debt equity ratio, the expenses reduce the profitability will be increase, Intrest coverage ratio will be decrease the barrowing money and total debt reduce or taken the secured loan is better, because the intrest rate is low when Increase the profitability. Debt equity ratio should be decreased the equal proportion of debt and equity is preferable. When compare to the other companies.

Necessary steps should be taken by the Maruti Udyog Ltd company to increase Quick ratio is used as a measure of the companys ability to meet its current obligations. The other current assets must be sufficient to meet other current liabilities. It establishes the relationship between Liquid assets are those which can be converted in to cash without any loss or delay. Liquid liabilities are those liabilities which are payable immediately. The company should be decreased Funds on net worth ratio This ratio is an important yardstick of performance for equity shareholders since it indicates the return on the fund employed by them. This measures is based on the historical net worth and will be high for old plants and low for new plants. When compare to the other companies.

Necessary steps should be taken by the Mahindra and Mahindra company to we have any ratios increase or decrease is not necessary when compare to the other companies it is medium position should be increase the profit position in future market computation.

Necessary steps should be taken by the Hindustan Motor company to increase Net profit ratio, cash profit ratio, Return on total asset ratio, operating ratio and dividend payout ratio the company sales increase the profit also increase and it is increase the cash sales when come the cash profit, operating profit increase the sales also increase. Dividend payout ratio increased by the equity share holders invest to the company The company Should Decrease by Absolute liquid ratio, return on total Resources and Earning per share the company take the debt proportion must and should be increased, it is comes better position . When compare to the other companies

Necessary steps should be taken by the Tata Motors company to increase current ratio and gross profit ratio, the current assets are more than the current liabilities is better position the company must do to increase the current assets, the Gross profit ratio will be increased by sales are also maximum level to sell the products and company Gross profit ratio increased. This company only increases these two ratio the company reputation and profitability position is increase. And it comes in a better position and computation to the other companies. When compare to the other companies

CONCLUSION

CONCLUSION This study has been undertaken at Automobile Companies to analyze the financial performance of the company by using Ratio analysis technique where the last five years Balance sheet and Profit and loss account were considered for analyzing various financial ratios. Automobile companies is a very reputed company for manufacturing world renowned Toyota kirloskar Ltd net profit ratio is higher than the compare to the other companies Innovation of new products, maintaining the good quality of the products and active involvement of the company personnel with the entire activities made it reputed across the country as well as around the world.

During the project work the office staffs have been found very co-operative in providing necessary information related to the project.

From the entire study it is found that the company should take necessary measures to improve few areas like- Cost management, cash and inventory management and investment decisions. In order to improve the overall performance, the management must take all possible steps, review and modify various policies, cash budgets and inventory status by using sound information management system to enable management to have a close control over the various operations. The automobile Industry day by day face the competitiveness. And other country manufacturer new technology and low cost will face in future market condition.

BIBLIOGRAPHY

BIBLIOGRAPHY 1. Reference Books: RAVI M. KISHORE Financial Management (6th Edition)

Khan Jain Financial Management Accounting (4th Edition)

SHASHI K. GUPTA R.K. SHARMA NEETI GUPTA Financial Management (Second Edition) 2. Websites: www.Automobli Industry.com www.Tatamotor.com www.MarutiUdyog.com www.M&M.com www.Hindmotor.com www.Tayotamotor india.com www.google.com www.yahoo.com

3. Annual Reports: Financial assessment year 2004, 2005, 2006, 2007, 2008.Balance sheet and profit and loss account.

Annexure

Mahindra and Mahindra Balance sheet SOURCES OF FUNDS : Share Capital Reserves Total Total Shareholders Funds Secured Loans Unsecured Loans Total Debt Total Liabilities APPLICATION OF FUNDS : Gross Block Less : Accumulated Depreciation Less:Impairment of Assets Net Block Lease Adjustment Capital Work in Progress Investments Current Assets, Loans & Advances Inventories Sundry Debtors Cash and Bank Loans and Advances Total Current Assets Less : Current Liabilities and Provisions Current Liabilities Provisions Total Current Liabilities Net Current Assets Miscellaneous Expenses not written off Deferred Tax Assets Deferred Tax Liability Net Deferred Tax Total Assets Contingent Liabilities 2008 239.07 4111 4350.07 617.26 1969.8 2587.06 6937.13 2007 238.03 3314.88 3552.91 106.65 1529.35 1636 5188.91 2006 233.4 2675.47 2908.87 216.67 666.71 883.38 3792.25 2005 111.65 1874.88 1986.53 336.82 715.8 1052.62 3039.15 2004 116.01 1659.02 1775.03 485.23 244.58 729.81 2504.84

3656.13 1841.68 0 1814.45 0 546.45 4215.06 1084.11 1004.88 861.23 705.15 3655.37 2307.55 943.46 3251.01 404.36 13.53 161.04 217.76 -56.72 6937.13 479.04

3229.69 1639.12 0 1590.57 0 280.6 2237.46 878.48 700.89 1326.07 842.73 3748.17 1950.22 715.43 2665.65 1082.52 17.55 168.77 188.56 -19.79 5188.91 367.6

2885.52 1510.26 0 1375.26 0 179.19 1669.08 878.74 637.97 730.31 502.04 2749.06 1520.84 530.8 2051.64 697.42 18.05 43.64 190.39 -146.75 3792.25 454.33

2699.71 1335.56 0 1364.15 0 110.73 1189.79 759.97 511.53 623.98 404.08 2299.56 1260.01 499.7 1759.71 539.85 24.38 39.03 228.78 -189.75 3039.15 386.31

2520.86 1167.67 0 1353.19 0 38.41 1111.15 500.13 400.48 233.32 391.01 1524.94 1009.86 319.38 1329.24 195.7 9.64 29.48 232.73 -203.25 2504.84 407.21

profit and loss account 2008 INCOME : Sales Turnover Excise Duty Net Sales Other Income Stock Adjustments Total Income EXPENDITURE : Raw Materials Power & Fuel Cost Employee Cost Other Manufacturing Expenses Selling and Administration Expenses Miscellaneous Expenses Less: Pre-operative Expenses Capitalised Total Expenditure Operating Profit Interest Gross Profit Depreciation Profit Before Tax Tax Fringe Benefit tax Deferred Tax Reported Net Profit Extraordinary Items Adjusted Net Profit P & L Balance brought forward Appropriations P & L Balance carried down 12866.3 1584.57 11281.73 638.54 149.11 12069.38 2007 11183.5 1334.64 9848.86 590.13 6.41 10445.4 2006 9241.73 1136.5 8105.23 493.22 103.2 8701.65 2005 7647.8 1054.82 6592.98 226.55 174.05 6993.58 2004 5886.31 955.43 4930.88 205.2 21.43 5157.51

7875.02 91.33 845.77 208.61 1076.73 285.39 46.49 10336.36 1733.02 87.59 1645.43 238.66 1406.77 278.75 0 24.65 1103.37 150.06 953.31 2125.08 452.97 2775.48

6834.34 65.19 660.1 186.86 844.28 253.85 47.1 8797.52 1647.88 19.8 1628.08 209.59 1418.49 365.73 0 -15.63 1068.39 93.42 974.97 1475.75 419.06 2125.08

5816.97 57.46 544.99 156.65 633.83 191.81 26.53 7375.18 1326.47 26.96 1299.51 200.01 1099.5 285.4 0 -43 857.1 174.87 682.23 996.4 377.75 1475.75

4776.69 52.64 457.41 134.45 417.6 258.17 31.84 6065.12 928.46 30.24 898.22 184.05 714.17 215 0 -13.5 512.67 8.96 503.71 742.84 259.11 996.4

3374.3 45.64 412.43 99.95 332.63 228.02 15.78 4477.19 680.32 76.93 603.39 165.2 438.19 63.5 0 26.15 348.54 24.39 324.15 423.94 29.64 742.84

Dividend Preference Dividend Equity Dividend % Earnings Per Share-Unit Curr Earnings Per Share(Adj)-Unit Curr Book Value-Unit Curr

282.61 0 115 44.54 44.54 181.44

282.23 0 115 43.1 43.1 148.72

243.97 0 100 35.26 35.26 124.06

150.81 0 130 44.02 22.01 176.64

104.41 0 90 28.89 14.45 151.72

Maruti udyog Ltd SOURCES OF FUNDS : Share Capital Reserves Total Total Shareholders Funds Secured Loans Unsecured Loans Total Debt Total Liabilities APPLICATION OF FUNDS : Gross Block Less : Accumulated Depreciation Less:Impairment of Assets Net Block Lease Adjustment Capital Work in Progress Investments Current Assets, Loans & Advances Inventories Sundry Debtors Cash and Bank Loans and Advances Total Current Assets Less : Current Liabilities and Provisions Current Liabilities Provisions Total Current Liabilities Net Current Assets Miscellaneous Expenses not written off Deferred Tax Assets Deferred Tax Liability Net Deferred Tax Total Assets Contingent Liabilities 2008 144.5 8270.9 8415.4 0.1 900.1 900.2 9315.6 2007 144.5 6709.4 6853.9 63.5 567.3 630.8 7484.7

Balance sheet 2006 144.5 5308.1 5452.6 71.7 0 71.7 5524.3 2005 144.5 4234.3 4378.8 307.6 0 307.6 4686.4 2004 144.5 3446.7 3591.2 311.9 0 311.9 3903.1

7285.3 3988.8 0 3296.5 0 736.3 5180.7 1038 655.5 324 1820.4 3837.9 2449.2 1116.5 3565.7 272.2 0 99.6 269.7 -170.1 9315.6 2016.3

6146.8 3487.1 0 2659.7 0 250.7 3409.2 701.4 747.4 1422.8 1533.4 4405 2011 1061.4 3072.4 1332.6 0 110.1 277.6 -167.5 7484.7 1684.4

4954.6 3259.4 0 1695.2 0 92 2051.2 881.2 646.1 1401.6 812 3740.9 1505.8 471.3 1977.1 1763.8 0 121.1 199 -77.9 5524.3 881.4

5053.1 3179.4 0 1873.7 0 42.1 1516.6 666.6 599.5 1029.4 676.5 2972 1218.8 389.2 1608 1364 0 125.4 235.4 -110 4686.4 1051.4

4566.7 2735.9 0 1830.8 0 74.9 1677.3 439.8 689.4 240.2 649.5 2018.9 1211.4 320.4 1531.8 487.1 16.3 125.5 308.8 -183.3 3903.1 1297.3

profit and loss account


INCOME : Sales Turnover Excise Duty Net Sales Other Income Stock Adjustments Total Income EXPENDITURE : Raw Materials Power & Fuel Cost Employee Cost Other Manufacturing Expenses Selling and Administration Expenses Miscellaneous Expenses Less: Pre-operative Expenses Capitalised Total Expenditure Operating Profit Interest Gross Profit Depreciation Profit Before Tax Tax Fringe Benefit tax Deferred Tax Reported Net Profit Extraordinary Items Adjusted Net Profit Adjst. below Net Profit P & L Balance brought forward Statutory Appropriations Appropriations P & L Balance carried down 2008 21025.2 3133.6 17891.6 887.6 336.3 19115.5 2007 17205.9 2509.6 14696.3 598.4 -243.1 15051.6 2006 14753.1 2737.2 12015.9 429.2 236 12681.1 2005 13335.7 2411.9 10923.8 403.2 141.7 11468.7 2004 11047.4 1943 9104.4 377.6 3.2 9485.2

13791.5 147.3 346.83 197.8 1145.35 355.92 0 15984.7 3130.8 59.6 3071.2 568.2 2503 759.8 9.8 2.6 1730.8 25.79 1705.01 0 5637.3 0 342.4 7025.7

10739 97.4 266.29 153.5 941.67 264.94 0 12462.8 2588.8 37.6 2551.2 271.4 2279.8 621.4 6.7 89.7 1562 26.71 1535.29 -8.8 4393.9 0 309.8 5637.3

9335.6 57.2 211.45 141.3 668.56 211.19 0 10625.3 2055.8 20.4 2035.4 285.4 1750 587.3 5.7 -32.1 1189.1 -7.97 1197.07 0 3442.1 0 237.3 4393.9

8563.2 58.1 191.46 92.7 580.01 185.53 0 9671 1797.7 36 1761.7 456.8 1304.9 524.6 0 -73.3 853.6 -6.5 860.1 0 2757.4 0 168.9 3442.1

6973.3 95.8 293.76 71.1 536.44 206.7 0 8177.1 1308.1 43.4 1264.7 494.9 769.8 251.5 0 -23.8 542.1 -79.72 621.82 0 2335.9 0 120.6 2757.4

Dividend Preference Dividend Equity Dividend % Earnings Per Share-Unit Curr Earnings Per Share(Adj)-Unit Curr Book Value-Unit Curr

144.5 0 100 59.03 59.03 291.19

130 0 90 53.29 53.29 237.16

101.1 0 70 40.65 40.65 188.67

57.8 0 40 29.25 29.25 151.52

43.3 0 30 18.56 18.56 124.26

Tata motors Balance sheet SOURCES OF FUNDS : Share Capital Reserves Total Total Shareholders Funds Secured Loans Unsecured Loans Total Debt Total Liabilities 2008 385.54 7453.96 7839.5 2461.99 3818.53 6280.52 2007 385.41 6484.34 6869.75 2022.04 1987.1 4009.14 2006 382.87 5154.2 5537.07 822.76 2114.08 2936.84 8473.91 2005 361.79 3749.6 4111.39 489.81 2005.61 2495.42 6606.81 2004 353 3236.77 3589.77 942.65 317.12 1259.77 4849.54

14120.02 10878.89

APPLICATION OF FUNDS : Gross Block 10830.83 8775.8 Less : Accumulated Depreciation 5443.52 4894.54 Less:Impairment of Assets 0 0 Net Block 5387.31 3881.26 Lease Adjustment 0 0 Capital Work in Progress 5064.96 2513.32 Investments 4910.27 2477 Current Assets, Loans & Advances Inventories 2421.83 2500.95 Sundry Debtors 1130.73 782.18 Cash and Bank 2397.31 826.76 Loans and Advances 4433.91 6402.16 Total Current Assets 10383.78 10512.05 Less : Current Liabilities and Provisions Current Liabilities 8667.2 6363.68 Provisions 1989.43 1364.32 Total Current Liabilities 10656.63 7728 Net Current Assets -272.85 2784.05 Miscellaneous Expenses not written off 6.05 10.09 Deferred Tax Assets 397.45 176.6 Deferred Tax Liability 1373.17 963.43 Net Deferred Tax -975.72 -786.83 Total Assets Contingent Liabilities 14120.02 10878.89 2953.57 2527.78

7971.55 4401.51 0 3570.04 0 951.19 2015.15 2012.24 716.6 1119.43 5639.54 9487.81 5726.82 1215.04 6941.86 2545.95 14.12 150.75 773.29 -622.54 8473.91 1558.65

6611.95 3454.28 0 3157.67 0 538.84 2912.06 1601.36 798.58 2005.04 2681.05 7086.03 5414.61 1126.06 6540.67 545.36 18.16 102.69 667.97 -565.28 6606.81 1102.68

5985.4 3023.69 0 2961.71 0 286.09 3056.77 1147.44 614.99 770.49 1162.78 3695.7 4228.13 430.64 4658.77 -963.07 22.19 135.06 649.21 -514.15 4849.54 839.45

profit and loss account


2008 INCOME : Sales Turnover Excise Duty Net Sales Other Income Stock Adjustments Total Income EXPENDITURE : Raw Materials Power & Fuel Cost Employee Cost Other Manufacturing Expenses Selling and Administration Expenses Miscellaneous Expenses Less: Pre-operative Expenses Capitalised Total Expenditure Operating Profit Interest Gross Profit Depreciation Profit Before Tax Tax Fringe Benefit tax Deferred Tax Reported Net Profit Extraordinary Items Adjusted Net Profit Adjst. below Net Profit P & L Balance brought forward Statutory Appropriations Appropriations P & L Balance carried down 2007 2006 2005 2004

32885.03 31611.21 23673.43 20152.03 15165.85 4355.63 4425.44 3380.13 3063.44 2270.3 28529.4 27185.77 20293.3 17088.59 12895.55 972.93 574.11 693.92 560.29 427.79 -40.48 349.68 256.91 144 -141.98 29461.85 28109.56 21244.13 17792.88 13181.36

20190.19 19374.93 14263.86 11929.48 325.19 327.41 258.51 237.81 1534.41 1361.2 1141.48 1037.93 1847.43 1618.68 1251.02 1017.11 1442.91 1322.88 985.74 795.03 1598.73 1153.53 784.56 673.78 1131.4 577.05 308.85 218.13

8341.39 214.52 879.49 722.95 645.73 644.75 144.89

25807.46 24581.58 18376.32 15473.01 11303.94 3654.39 425.61 3228.78 652.31 2576.47 139.01 7 401.54 2028.92 149.49 1879.43 0 1013.83 0 1659.68 1383.07 3527.98 368.51 3159.47 586.29 2573.18 476 6.5 177.22 1913.46 37.4 1876.06 0 776.76 0 1676.39 1013.83 2867.81 293.49 2574.32 520.94 2053.38 363.35 19 142.15 1528.88 145.42 1383.46 0 585.6 0 1337.72 776.76 2319.87 217.81 2102.06 450.16 1651.9 363.82 0 51.13 1236.95 24.77 1212.18 0 365.8 0 1017.15 585.6 1877.42 202.48 1674.94 382.6 1292.34 96 0 386 810.34 -29.95 840.29 0 123.71 0 568.25 365.8

Dividend Preference Dividend Equity Dividend % Earnings Per Share-Unit Curr Earnings Per Share(Adj)-Unit Curr Book Value-Unit Curr

578.43 0 150 50.52 48.93 202.68

578.07 0 150 47.1 45.61 177.57

497.94 19.94 130 37.59 36.4 143.93

452.19 0 125 32.44 31.42 113.64

282.11 0 80 21.93 21.24 101.69

Hindustan Motors SOURCES OF FUNDS : Share Capital Reserves Total Total Shareholders Funds Secured Loans Unsecured Loans Total Debt Total Liabilities APPLICATION OF FUNDS : Gross Block Less : Accumulated Depreciation Less:Impairment of Assets Net Block Lease Adjustment Capital Work in Progress Investments Current Assets, Loans & Advances Inventories Sundry Debtors Cash and Bank Loans and Advances Total Current Assets Less : Current Liabilities and Provisions Current Liabilities Provisions Total Current Liabilities Net Current Assets Miscellaneous Expenses not written off Deferred Tax Assets Deferred Tax Liability Net Deferred Tax Total Assets Contingent Liabilities

Balance sheet

161.26 -29.08 132.18 63.07 65.12 128.19 260.37

161.26 -57.87 103.39 123.21 72.58 195.79 299.18

161.26 -70.02 91.24 116.02 44.98 161 252.24

161.26 -26.24 135.02 97.29 68.89 166.18 301.2

161.26 -87.4 73.86 309.94 63.46 373.4 447.26

486.02 321.78 0 164.24 0 5.58 71.79 82.05 45.62 13.78 50.71 192.16 173.93 8.68 182.61 9.55 9.21 0 0 0 260.37 162.45

487.29 301.62 0 185.67 0 1.81 70.61 102.76 38.66 63.27 50.86 255.55 204.97 9.69 214.66 40.89 0.2 0 0 0 299.18 46.29

479.53 280.28 0 199.25 0 0.33 70.25 85.87 51.33 8.87 50.71 196.78 209.37 7.34 216.71 -19.93 2.34 0 0 0 252.24 223.62

470.21 265.55 0 204.66 0 0.32 70.57 79.52 42.6 57.23 56.43 235.78 211.28 6.21 217.49 18.29 7.36 0 0 0 301.2 235.33

749.95 431.13 0 318.82 0 0.28 1.5 158.34 97.84 15.68 54.13 325.99 244.89 0 244.89 81.1 4.27 41.29 0 41.29 447.26 147.93

profit and loss account 2008 INCOME : Sales Turnover Excise Duty Net Sales Other Income Stock Adjustments Total Income EXPENDITURE : Raw Materials Power & Fuel Cost Employee Cost Other Manufacturing Expenses Selling and Administration Expenses Miscellaneous Expenses Less: Pre-operative Expenses Capitalised Total Expenditure Operating Profit Interest Gross Profit Depreciation Profit Before Tax Tax Fringe Benefit tax Deferred Tax Reported Net Profit Extraordinary Items Adjusted Net Profit Adjst. below Net Profit P & L Balance brought forward Statutory Appropriations Appropriations P & L Balance carried down 853.01 148.35 704.66 118.98 -1.48 822.16 2007 806.37 139.86 666.51 81.96 9.45 757.92 2006 553.05 97.03 456.02 14.21 -1.03 469.2 2005 1352.13 237.3 1114.83 206.5 -17.79 1303.54 2004 858.88 81.07 777.81 9.83 -18.02 769.62

489.03 13.65 85.41 18.12 87.8 41.21 0.05 735.17 86.99 20.03 66.96 21.15 45.81 14.32 0.65 0 30.84 85.29 -54.45 0 -73.15 0 0 -42.31

491.27 16.15 68.5 19.09 84.49 25.69 0.02 705.17 52.75 16.73 36.02 23.23 12.79 -1.1 0.59 0 13.3 70.57 -57.27 0 -86.45 0 0 -73.15

324.83 12.61 50.83 14.05 57.33 19.77 0.02 479.4 -10.2 8.84 -19.04 18 -37.04 5.82 0.83 0 -43.69 7.2 -50.89 0 -43.88 0 -1.12 -86.45

698.13 29.62 135.31 41.91 119.39 77.71 0.69 1101.38 202.16 48.34 153.82 51.06 102.76 -0.03 0.3 41.29 61.2 126.49 -65.29 0 -105.08 0 0 -43.88

470.02 23.13 108.33 30.55 96.19 44.96 0.11 773.07 -3.45 55.35 -58.8 41.2 -100 -0.01 0 -19.05 -80.94 1.75 -82.69 0 -24.14 0 0 -105.08

Dividend Preference Dividend Equity Dividend % Earnings Per Share-Unit Curr Earnings Per Share(Adj)-Unit Curr Book Value-Unit Curr

0 0 0 1.91 1.91 7.58

0 0 0 0.82 0.82 5.67

0 0 0 0 0 4.85

0 0 0 3.04 3.04 7.56

0 0 0 0 0 3.76

Toyota kirloskar balance sheet

SOURCES OF FUNDS : Share Capital Reserves Total Total Shareholders Funds Secured Loans Unsecured Loans Total Debt Total Liabilities APPLICATION OF FUNDS : Gross Block Less : Accumulated Depreciation Less:Impairment of Assets Net Block Lease Adjustment Capital Work in Progress Investments Current Assets, Loans & Advances Inventories Sundry Debtors Cash and Bank Loans and Advances Total Current Assets Less : Current Liabilities and Provisions Current Liabilities Provisions Total Current Liabilities Net Current Assets Miscellaneous Expenses not written off Deferred Tax Assets Deferred Tax Liability Net Deferred Tax Total Assets Contingent Liabilities

0.05 5.23 5.28 0 0 0 5.28

0.05 2.75 2.8 0 0 0 2.8

0.05 2.64 2.69 0 0 0 2.69

0.57 0.21 0 0.36 0 0 1 0 3.85 0.33 1.91 6.09 0.83 1.36 2.19 3.9 0 0.02 0 0.02 5.28 0.07

0.42 0.12 0 0.3 0 0 2.5 0 0.58 0.12 0.18 0.88 0.73 0.15 0.88 0 0 0.01 0.01 0 2.8 0

0.18 0.09 0 0.09 0 0 2.5 0 0.65 0.07 0.09 0.81 0.64 0.07 0.71 0.1 0 0.01 0.01 0 2.69 0

profit and loss account


2008 INCOME : Sales Turnover Excise Duty Net Sales Other Income Stock Adjustments Total Income EXPENDITURE : Raw Materials Power & Fuel Cost Employee Cost Other Manufacturing Expenses Selling and Administration Expenses Miscellaneous Expenses Less: Pre-operative Expenses Capitalised Total Expenditure Operating Profit Interest Gross Profit Depreciation Profit Before Tax Tax Fringe Benefit tax Deferred Tax Reported Net Profit Extraordinary Items Adjusted Net Profit Adjst. below Net Profit P & L Balance brought forward Statutory Appropriations Appropriations P & L Balance carried down 5.94 0 5.94 0.67 0 6.61 2007 0.75 0 0.75 0.39 0 1.14 2006 0.23 0 0.23 0.44 0 0.67

0 0.03 0.71 0.02 2.04 0.04 0 2.84 3.77 0 3.77 0.09 3.68 1.19 0.03 -0.02 2.48 0.26 2.22 0 0.25 0 0 2.73

0 0.04 0.6 0.03 0.24 0 0 0.91 0.23 0 0.23 0.04 0.19 0.06 0.01 0.01 0.11 0 0.11 0 0.14 0 0 0.25

0 0.03 0.33 0.02 0.13 0.05 0 0.56 0.11 0 0.11 0.03 0.08 0.04 0 -0.01 0.05 0 0.05 0 0.09 0 0 0.14

Dividend Preference Dividend Equity Dividend % Earnings Per Share-Unit Curr Earnings Per Share(Adj)-Unit Curr Book Value-Unit Curr

0 0 0 4960 NA 10560

0 0 0 220 NA 5600

0 0 0 100 NA 5380

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