Ratio Shree Renuka Sugars LTD 2

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD
CHAPTER-1 INTRODUCTION
OVERVIEW OF SUGAR INDUSTRY:
India is one of the largest consumer and second largest producer of sugar in the world. With 516 sugar mills operating in India during SY 2008P in different parts of the country the Indian sugar industry has !een a focal point for socio"economic de#elopment in the rural areas$ %he sugar industry in India is highly fragmented$ %here is a large num!er of small sugar mills located in #arious parts of the countries$ In SY 2008 a total of 516 sugar factories crushed cane for an a#erage of 152 days$ &ooperati#e mills largely operate in 'aharashtra (u)arat *ttar Pradesh and +arnata,a$ In addition there are a num!er of players in the unorganised segment producing gur and khandsari, which are less refined forms and act as a su!stitute$
Seshadripuram Institute of &ommerce - 'anagement
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Sugarcane Acreage
Pr!"uc#$!n:
%he sugar industry in India uses only sugarcane as input hence sugarcane acreage and production is a ,ey factor in determining sugar production for the year$ %he area under sugarcane culti#ation has gradually increased o#er the years mainly due to the di#ersion of land !y the farmers from other crops to sugarcane for economic reasons$ Sugar mills ha#e !een largely esta!lished in large sugarcane growing states li,e *ttar Pradesh 'aharashtra .ndhra Pradesh +arnata,a (u)arat and %amil /adu$ %hese si0 states together account for 80"102 of the sugarcane produced in India$ .ccordingly the leading sugar producing states are *ttar Pradesh 'aharashtra %amil /adu (u)arat .ndhra Pradesh and +arnata,a accounting for 85"152 of the total sugar produced in India$ In SY 2008P these states accounted for a!out 102 of the total sugarcane production in India with 'aharashtra and *ttar Pradesh leading with 232 and 452 respecti#ely of the total sugarcane production and for a!out 122 of total sugar production in India again with 'aharashtra and *ttar Pradesh leading with 432 and 282 respecti#ely of the total sugar produced in India$
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Sugar C%c&e:
Process of Sugar Cycle Sugar industry typically follows a cycle which spans o#er a period of fi#e to se#en year$ 6igher sugarcane and higher sugar production results in a fall in sugar prices which in turn result in non"payment of dues to farmers$ %his compels the farmers to switch to other crops there!y causing a shortage of sugarcane which in turn lead to an increase in sugarcane prices and there!y increases profits$ Since prices of sugarcane ha#e increased farmers now switch !ac, to sugarcane production which in turn leads to a fall in sugar prices$
INTRODUCTION TO FINANCE:
Seshadripuram Institute of &ommerce - 'anagement Page 4
7inance is the life!lood and central ner#e system of any !usiness organi8ation$ %his !ecause of the modern money oriented economy$ 9ust as circulation of !lood is necessary in the human !ody to maintain life finance is #ery essential to the !usiness organi8ation for smooth running of the !usiness$ 7inance is one of the !asic foundations of all ,inds of economic acti#ities$ It is the master ,ey which pro#ides access to all the sources for !eing employed in manufacturing and merchandising acti#ities $%he importance of 7inancial 'anagement cannot !e denied$ In e#ery organi8ation where funds are in#ol#ed sound 7inancial 'anagement is indispensa!le$ :fficient management of any !usiness enterprise is closely lin,ed with efficient management of its finance$ DEFINITION OF FINANCE: ;ay ($9</:S and =ean =udley o!ser#e that the word finance comes from >atin word ?7inis@ in simple word 7inance is the economics and accounting$ :conomics is proper utili8ation of scare resources and accounting is ,eeping a record of thing$ +enneth 'idglay and ;onald Aurns state B7inance is the process of organi8ing the flow of funds so that a !usiness firm carry out its o!)ecti#es in the most efficient manner and meet its o!ligations as they fall due$C
SCOPE OF FINANCE:
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*ntil the middle of the century the scope of finance was simply that of rising of funds from #arious sources and loo,ing after the legal and accounting relationship !etween the company and the suppliers of #arious sources of funds$ 6owe#er se#eral technological inno#ations and impro#ements widening mar,eting operation strong corporate structure etc$ too, place in 1150@s ha#e since reduced the popularity of traditional approach finance$ %he scope of finance function is as wide as the periphery of finance$ It concentrates primarily on more money management and different au0iliaries which are incidental to it$ 7or effecti#e money management the different resources of !usiness enterprises must !e mo!ili8ed$ %he finance penetrates all the acti#ities irrespecti#e of whether they relate to product pricing e0pansion and re"organi8ation and in fact anything which needs finance$
I'PORTANCE OF FINANCE:
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%he importance of finance is one of the important areas of the management$ It is the management of monetary affairs of the organi8ation$ It considered as that administration area or set of administration function which relate to arrangement of cash and credit so that the organi8ation may ha#e the means to carry out its o!)ecti#e$ So it is rightly said B7inance is the life !lood of the Ausiness :conomyC 7inance is a #ery important tool for the organi8ation for its smooth wor,ing$ Without of finance neither a !usiness can !e started nor successfully run$ Pro#ision of sufficient funds at the reDuired time is the ,ey of success of a !usiness$ .s a matter of fact finance may !e said to !e a circulatory system of the economic !ody$ . !usiness needs the finance at e#ery stage of its operation$ Some of the operation or stage where the finance is reDuired for the organi8ation isE 7or starting of a !usiness 7or operating of a !usiness 7or e0pansion and moderni8ation of a !usiness
7or closing up or liDuidation of the !usiness$
A(OUT THE SU()ECT: %he preparation of financial statements is not the end aim$ %he purpose of preparing the statement is to use them for decision ma,ing$ %he
statement !ecomes further planning and forecasting$ .n opinion is formed in respect to the financial conditions and concern$ %he analysis of these statements in#ol#es their decision according to similar groups and arranged in desired form$ %he interpretation in#ol#es the e0pansion of financial facts in a simplified manner$ %he financial statement analysis is largely a study of relationship among the #arious financial factors as shown !y different statement are an attempt to determined the significance and meaning of the financial statement data so that the forecast may !e made !y prospects for future earning a!ility to pay interest and delete maturities F!oth current and long termG and profita!ility of a sound di#idend policy$ %he analysis and interpretation !eing out the mystery !ehind the figures in financial statement$ %he interpretation includes the comparisons of the smaller figures at different time different figures at the same point of time$
INTRODUCTION: :#ery organi8ation irrespecti#e of si8e and mission may !e #iewed as a financial entity$ 'anagement of the organi8ation particularly a !usiness firm is confronted with issues and decision li,e the following which ha#e important financial implicationE
What ,ind of plant and machinery should the firm !uyH 6ow should it raise financeH 6ow much should it in#est in in#entoriesH What should !e its credit policyH 6ow should it gauge and monitor its financial performanceH
'EANING OF RATIO ANALYSIS: ;atio is the relationship !etween two accounting num!ers$ It is one of the effecti#e tools of financial analysis$ It indicates the relationship of accounting aspect li,e profit and profit and sales incomes and e0penses current assets and lia!ilities etc$ with each other and reflects the soundness of concern$ ;atio .nalysis is the techniDue of the computation of num!er of accounting ratios from the data deri#ed from the financial statements and comparing those with the ideal or standard ratios or the pre#ious year@s ratios or the ratios of other similar concerns$ It is a techniDue of comparati#e analysis in which current year ratios are compared with the past or other organi8ations which are in similar line of operations so as to ascertain the financial soundness of the concern$
USERS *$n#ere+#e" ,ar#$e+-: 1. SHAREHOLDERS Some shareholders are interested in the performance of the company$ %hey want to )udge the long term sol#ency position return capital employed and earnings per share of a company$
/. ANALYST ADVISOR : %hey ad#ise the present and potential in#estors a!out their !uy or sell and lending decisions !y re#iewing all financial characteristics and ma,e inter firm comparisons$ 0. TA1 AUTORITIES : %hey are the financial rate to )udge the relia!ility of financial information presented !y the assesses$
I'PORTANCE OF RATIO ANALYSIS: ;atio .nalysis stands for the process of determining and presenting the relationship of items and groups of items in the financial statements$ It is an important techniDue of financial analysis$ It is an important techniDue of financial analysis$ It is a way !y which financial sta!ility and health of a concern can !e )udged$ %he following are the main points of importance of ;atio .nalysisE
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1)
.ccounting ratios re#eal the financial positions of a concern$ %his helps the !an,s insurance companies and other financial institutions in lending and ma,ing in#estments decisions$
2)
;atio .nalysis is an instrument for diagnosing the financial health or condition of a !usiness$ 7inancial analysts can diagonise the financial condition of an enterprise through ratio analysis$ %hey e#aluate the important aspects of the conduct of a !usiness li,e liDuidity sol#ency capital gearing profita!ility etc$
3)
.ccounting ratios simplify summaries and systemati8e the accounting figures in order to ma,e them more understanda!le and in lucid form$ %hey highlight the interrelationship which e0ists !etween #arious segments of the !usiness as e0pressed !y accounting statements$
4)
;atio .nalysis is an in#alua!le aid to the management in the efficient discharge of its !asic functions of forecasting planning communications controlled$ ;atios are a useful instrument of management control particularly in the areas of sales and costs$
5)
;atios are #ery helpful in esta!lishing standard costing system and !udgetary control$
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LI'ITATIONS OF RATIO ANALYSIS:

1)
;atios are calculated from the data found in the financial statements$ %he 7inancial statements suffer from a num!er of limitations$ %hat means the ratio deri#ed from the financial statements are also su!)ected to those limitations$
2)
7inancial analysis is !ased on ratio analysis will gi#e miss leading results if the effects of change in price le#el are not ta,en into account in the compilation of ratio analysis$
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3)
;atio alone is adeDuate for )udging the financial position of a !usiness$ %hey cannot !e ta,en as final as regards the financial position of a !usiness other things also ha#e to see$
4)
;atios gi#e )ust a fraction if information needed for )udging the financial soundness of a concern such the information o!tained from the ratios must !e used in con)unction with the information o!tained from others sources so as to )udge the financial soundness of a concern correctly$
5)
. ratio is hyper sensiti#e$ . new entry of a transaction can change its magnitude drastically$
STEPS INVOLVED IN RATIO ANALYSIS:
1.
Selection of rele#ant data from the financial statements depending upon the o!)ecti#e of the analysis$
2.
&alculating of appropriate ratios from the a!o#e data$ &omparision of calculated ratios with the ratios of the same firm in the past or the ratios de#eloped from pro)ected financial statements the ratios of some other firms of the comparision with the ratios of the industry to which the firm !elongs$
3.
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4.
%he ratio analysis in#ol#es the comparison for useful interpretation of the financial statements$ . single ratio in itself does not indicate fa#ora!le or unfa#ora!le conditions$ It should !e compared with some standards$
CHAPTER-/ RESEARCH DESIGN

INTRODUCTION: %he efficiency of the company is mainly measured !y its financial sta!ility$ It can !e assesses with the help of audited and certified financial statements$ ;atio .nalysis is an important tool for financial strength of the company$ ;atio analysis is the techniDue of analyses and interpretation of financial statement through calculation of a num!er accounting ratios from the financial statements for the purpose of comparisons of
accounting ratio with those of pre#ious year with those other concern engaged in similar line of acti#ities or with the standards to draw conclusion a!out the financial performance of the organisaton$ .nalyses and interpretation of #arious accounting ratio gi#e Fs,illed and e0perienced analystG a !etter understanding of the financial condition of the organi8ation through financial statement$ TITLE OF THE STUDY: %his pro)ect is su!mitted under the title 2RATIO ANALYSIS3 at Shree ;enu,a Sugars >td Aelgaum where a special preference is gi#en to ;atio .nalysis$
STATE'ENT OF PRO(LE': %he success and failure of the company depends on the financial results that the company has achie#ed during the period which will !e reflected in financial statements$ .nalysis and interpretation of financial statements of its regular e0ercise to re#iew the performance of the company the present study is underta,en to analyse the financial position of the concern$ i$e$ whether the concern is in profit or loss or in !rea, e#en$
O()ECTIVE OF THE STUDYE %o study and analyse financial statements of the concern$ %o identify the loops and finding techniDues to impro#e the same$ %o ,now the current assets and current lia!ilities structure of S;S>$
%o study and compare the financial performance of 6.> o#er the last fi#e years$ &ompetition of different accounting ratios to analyse the financial performance of concern for current year$ %o ,now the sol#ents of the firm and to decide a!out the long term liDuidity of the funds of the organi8ation$ %o suggest and recommend a proper techniDues for ;atio .nalysis of S;S>$
SCOPE OF THE STUDYE %he study has !een done to analyse the financial performance of S;S> for the period of 3years from 2005"2001$ %he study help in the learning of the financial statements as well as understanding the #arious components in#ol#ed in the analysis of the financial statements$ %he financial statement consists of Aalance Sheet Profit and >oss and Profit and >oss .ppropriation account$ %hrough this studying the financial statement of pre#ious 3years is analysed$
'ETHODOLOGY OF STUDY: %o get rele#ant data the correct result is necessary to conduct a research study in a 'ethodical way$ Important criteria for the #alidity of any research study lies in 'ethodology adopted !y it$ .s these was no primary data to !e collected only secondary data was used for research this secondary data is analysed for the pro)ect to !e carried out$
DATA COLLECTION AND ANALYSISE %he secondary data was collected such as annual reports and study report was set to purpose of calculating the ratios$ Aased on secondary data collected analysis was carried out using ;atio .nalysis as tool and the findings of the study where interpreted and recommendation were gi#en$
INFOR'ATION NEEDSE Aalance Sheet of 2005"06 2006"05 2005"08 2008"01 Profits and >oss accounts of 2005"06 2006"05 2005"08 2008"01 Wor,ing ;esults .nnual ;eports
LI'ITATIONS OF STUDYE
It has not !een possi!le to calculate all the ratios for the purpose of analysis due to non a#aila!ility of data$
%his !asically !een an academic study suffers from time and the cost constrains$
6ighly confidential matter could not !een procured due to ,nown and un,nown reasons$
7indings and conclusions are applica!le to this concern only and cannot !e generali8ed$
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CHAPTER-0 CO'PANY PROFILE:
A4!u# S5ree Renu6a Sugar+:
Shree ;enu,a Sugars >td FS;S>G is a transnational agri!usiness and !io energy corporation$ Shree ;enu,a Sugars >td was not !orn out of necessity !ut it was a result of a compelling #ision to emerge as the most efficient sugar processor and the largest mar,eter of sugar and ethanol in India to consolidate large renewa!le !usiness and to dri#e an inspiring !usiness model$
%he company was founded !y 'r.Naren"ra 'ur6u74$ and his mother 'r+.V$"%a 'ur6u74$ in 1118 not )ust dreamers !ut doers in their own right$
%he com!ination of dreamers and doers produced enriching results o#er the last decade$ %he company has emerged among the
most e0citing pro0ies of a con#entional Indian industry$ %he company has !een one of the largest and fastest growing sugar companies in India and now has e0posed its glo!al footprint with an entry in Ara8il through acDuisitions$
%he company is currently the 5 th largest sugar producers in the world leading manufacturer of sugar in India"the world@s largest sugar mar,et and one of the largest refiners glo!ally$
It operates 5 sugar mills in India with a total crushing capacity of 45000 tons crushed per day and two large port !ased sugar refineries with capacity 1$5 million tons per annum$
It has significant presence in South Ara8il the most cost"efficient and scala!le production area with a total cane crushing capacity of 13million tons at its 3 mills$
Shree ;enu,a Sugars >td has its corporate office in 'um!ai FIndiaG and headDuarters in Aelgaum in the state of +arnata,a FIndiaG$
Ke% (u+$ne++E Shree ;enu,a Sugars >td has integrated cane crushing capacities in India responsi!le for the production of" Sugar :thanol and Power$
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S5ree Renu6a Sugar+ L#" *SRSL- (u+$ne++ Seg7en#+: Shree ;enu,a Sugars >td !usiness operations can !e segregated into four segments as !elowE Sugar =i#ision =istillery =i#ision

&o"generation =i#ision and :ngineering$
S5ree Renu6a Sugar+ L#" V$+$!n:

B%o !ecome the most efficient processor of sugar and the largest mar,eter of sugar and ethanol in India$ %o !ecome one of the largest producers of sugar Fcane and refinedG renewa!le energy and !io"fuel FethanolG in IndiaC$
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ORGANISATIONAL CHART
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S#reng#5+ !8 S5ree Renu6a Sugar+ L#":
E9#en+$:e In#egra#$!nE e0tracting the
Shree ;enu,a Sugars is e0tensi#ely integrated
ma0imum #alue out of sugarcane through the processing of cane molasses and !agasse to produce sugar power and ethanol$ In 2005" 08 re#enues of the &ompany@s non"sugar !usiness increased from 152 in 2006"05 to282 in 2005"08 and its proportion in the !ottom" line enhanced from 282 to552 during the period
S#r!ng g&!4a& ,re+ence:
%he &ompany is the second largest e0porter of sugar from India with a presence in the 'iddle :ast South :ast .sia and :ast .frica among others$ %his e0port re#enue pro#ides the &ompany with an enhanced trade flow larger than its production acting as a consolidator and ena!ling it to capitalise on glo!al price as well as purchasing trends$
Pre8erre" +u,,&$er +#a#u+:
%he &ompany is a sugar ?supplier of choice@ across !rand"enhancing 'ultinational companies that produce car!onated soft drin,s fruit )uices chocolates !a!y foods and dairy products$ Its clients include reputed names li,e &oca &ola Pepsi I%& Aritannia /estle and &ad!ury among others.
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Succe++8u& ac;u$+$#$!n+:
%he &ompany scaled capacity !y acDuiring co"operati#e mills and leased production assets reducing direct and opportunity costs$ It acDuired a standalone ethanol plant of 100 +> e0panded to 400 +> to cater to the ethanol reDuirements of oil mar,eting companies F<'&G located in the coastal states of (oa 'aharashtra and +erala for e0ports$ %he &ompany also acDuired a strategic 532 sta,e in +A+ &hem" :ngineering P#t$ >td$ engaged in pro#iding turn,ey solutions F:P& contractsG in the field of distilleries ethanol plants and !iofuels$
Increa+$ng ca,ac$#$e+:
%he &ompany has relentlessly enhanced its capacity$ Since its IP< in <cto!er2005 its sugar capacity grew se#en"fold F5 000 %&= to 45 500 %&=G ethanol capacity 15"fold F60 +>P= to 350 +>P= to 100 +>P= !y 'arch 2001G and power capacity eight"fold F20 'W to158 'WG$
'!"era#$ng #5e $7,ac# !8 +ugar c%c&$ca&$#%:
%he &ompany is uniDue in consuming multiple feedstoc,s Fsugarcane and raw sugarG$ =uring the off"season it consumes raw sugar for con#ersion enhancing its asset utilisation and sustaining cash flows$
Su,er 8$9e" a++e# u#$&$<a#$!n:

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%he &ompany en)oys one of the industry@s highest capacity utilisation and asset turno#er ratios on the !ac, of a longer operating season higher sugar content a#aila!ility in cane and dual raw material capa!ility$ It produces 20 tons of sugar per %&= capacity as against the top four sugar companies !y mar,et capitalisation Fe0cluding S;S>G which produce 10 tons of sugar per %&= capacity$
Tec5n$ca& e9,er#$+e:
%he &ompany has tied up with %ate - >yle Industries P>& of *+ I a (AP 3$05" !illion organisation and one of :urope@s largest sugar refiners Ffor the &ompany@s refinery !usinessG$ %he international partner pro#ides a ro!ust technical e0pertise in refining$
In+#$#u#$!na& 8!cu+:
%he &ompany directly mar,ets sugar to institutional !uyers I a paradigm shift from the tradition of selling to wholesale agents and dealers$ %his has translated into a relati#ely large mar,et share an effecti#e hedge against price"dri#en ris,s$ %his has also rationalised wor,ing capital outlay and has reduced the &ompany@s dependence on sugar !ro,ers$
L!ca#$!na& a":an#age+:
%he &ompany en)oys a num!er of ad#antages on account of its South

Indian location$ It en)oys a longer crushing season Fo#er 200 days starting from <cto!er till 'ayG higher reco#ery F10"202 higher than that of other regionsG matured mar,et for cogeneration power as well as port pro0imity F160"200 ,msG$
E9ce&&en# 8ar7er re&a#$!n+5$,+:
7armer dues are cleared on time encouraging them to grow more sugarcane than switching to alternati#es$ Aeing shareholders farmers also en)oy a preferential sale and an attracti#e di#idend income$ %he &ompany en)oys the !enefit of healthy relationships with more than 5 000 farmers as shareholders$
Sea7&e++ +ugarcane c!&&ec#$!n ne#=!r6:
%he &ompany possesses a dedicated department to super#ise cane de#elopment and procurement$ It is engaged in organising the har#esting programme for desired cane Duantity and Duality to !e har#ested daily with adeDuate transportation to the mills$ Aesides it acDuires cane directly from the farmers without going through intermediaries$ SRSL I"en#$#%: Shree ;enu,a Sugars ltd$ FS;S>G defied con#ention to create a dynamic !usiness model in a challenging cyclical sector$ D$:er+$8$e" (u+$ne++: &on#ergence of three !usinesses in one organi8ation$ Sugar Aiofuels ;enewa!le energy$ Deca"e-!&" ,re+ence:
Possesses India@s largest sugar refining capacityF6 000%P=G
.ccounts for o#er 202 of India@s international sugar trade$ India@s leading fuel ethanol producer$
De8$n$#$:e nu74er+ a+ ,er Annua& Re,!r# />>?">@:
SRSL SRSL SUGAR CO' PANY BUSINESS Market Cane capitalization crushing Rs. capacit 62,572mn 35!!!"C# +oreign Cane ,ol-ing crushing 3!.54. / units
In$#$a#$:e+: India$ Pioneered the concept of leased sugar manufacturing assets in Popularised the concept of sugar refining as an independent !usiness #erticalE strengthened sugar refining technology$
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:merged as the first Indian sugar company to esta!lish a manufacturing footprint outside India$ :0ponentially increased the ethanol manufacturing capacity$
G&!4a&&%-8!cu+e" Ca,ac$#%: Shree ;enu,a Sugars was the only Indian company intent on concurrently !uilding sugar refining capacities to cater to the glo!al mar,et$ In#ested in ad#anced sugar refining technology to meet e0acting :* Duality parameters$ &reated India@s largest cumulati#e refining capacity F6 000 %P=G that is primarily port"!ased$ :ngaged in the commissioning of India@s largest refinery F4 000 %P=G in (u)aratE e0pected to !e commercial in 2010"11$
G&!4a& P!+$#$!n$ng: Shree ;enu,a Sugars !ecame India@s first company to acDuire a foreign sugar company$ %he company acDuired a sugar company in Ara8il the largest glo!al sugar producing and e0porting nation in return for the following !enefitsE
Securing ma)ority of its annual raw sugar feedstoc, reDuirement of 2 mn tonsF2010"11 onwardsG$
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Jalue"addition and profita!ility of its Indian refinery operations$ . first"hand insight into glo!al trends and opportunities in the sugar and ethanol segments$ G&!4a&$+e" '$n"+e#:
&reated a !usiness model deris,ed through a presence in sugar Ffrom caneG refining ethanol and co"generated power with technology that generates re#enue e#en in the a!sence of cane$
Stretched the #alue chain a step in !oth directions"cane culti#ation on 18 000 hectares through its Ara8ilian acDuisition at one end and Duality refined sulphurless sugar at the other$
:sta!lished a trading hu! in =u!ai to capitali8e on trade opportunities in the .sian region$ >e#eraged its rich ,nowledge to generate engineering and pro)ect management re#enues through its sta,e in +A+ &hem :ngineering P#t$ >td around 452 re#enue from glo!al assignmentsK ;s$2 500 mn order !oo, as on Septem!er 40 2001$
O:er:$e= !8 In"$an O,era#$!n+: 1G %he 5cane crushing units of Shree ;enu,a Sugars >td are located in the States of +arnata,a and 'aharashtra in India$ 2G *nits in +arnata,a 'unoli .thani 6a#alga (o,a, ;ai!ag$ 4G *nits in 'ahahrashtraE .rag ;atnapra!ha Panchagana$
3G ;ai!ag and .rag are operated on lease Panchagana is operated on A<<% for cogeneration and the remaining units are owned !y Shree ;enu,a Sugars >td$
5)
S;S> has 2 refining capacities on the east coast at 6aldia in West Aengal and on the west coast at +andla in (u)arat$
6G %he acDuisition of a ma)ority sta,e in +A+ &hem":ngineering P#t >td facilities turn,ey distillery solutions$
7)
ethanol and !io"fuel plant
%he company has also acDuired a 100+>P= distillery from =hanu,a Petrochem F+hopoli 'aharashtraG that con#erts rectified spirit into ethanol and increase its capacities to 400+>P=$
O:er:$e= !8 (ra<$& O,era#$!n+: 1G S;S> has acDuired two companies in Ara8ilE Jale do I#ai is wholly owned su!sidiary of S;S> S;S> owns 50$432 of ;enu,a do Ara8il SL. Fformerly :Duipa# .cucar e .lcoolG &om!ined crushing capacity of 14$6 million tonsFunder e0pansion to 15$5mn mtG
1) 2)
%otal inward in#est in Ara8il so far is *S= 450mn$ Shree ;enu,a is the second largest !uyer of raw sugar world"wide since 2001 and !uys 1002 of its reDuirements from Ara8il$
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S%nerg% !8 (ra<$& In:e+#7en# =$#5 A+$a De7an":
India South .sia and the 'iddle :ast are emerging of the largest sugar import mar,ets in the world with increasing challenges of land and water a#aila!ility$
SugarL:thanol sector in Ara8il has low operating cost high scala!ility and highly conduci#e climatic conditions$ .!ility to culti#ate significant portion of cane supply allows manufacturer to capture of #alue of the agriculture part of the !usiness$
(OARD LEVEL STRATEGIES AND PLANS: S;S> !elie#e in the 9ac, Welch@s saying B(ood Ausiness leaders create a #ision articulate the #ision passionately own the #ision relentlessly dri#e it to completionC 6ere is a proofE S;S> possess the largest capacities in sugar manufacture distillery and cogeneration per ton of cane crushed$ (oing ahead S;S> e0pect to commission India@s largest capacity in the shortest possi!le time across all #erticals$ Genera& S#ra#eg% U+e" F!r Secur$ng Ra= 'a#er$a&+:
1.
7acilitating sugarcane de#elopment and crop loans to enhance sugarcane planting in S;S> reser#e area$
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2$ .ligning farmer@s interest !y ma,ing them Shareholders in the company$ 4$ Paying on time irrespecti#e of pre#ailing industry cycle$ 3$ Pro#iding Duality seeds agri"inputs and fertili8er su!sidies to farmers$ 5$ .ssisting farmers to enhance yields$ 6$ :ducating farmers a!out cane ad#antages o#er other crops$ 5$ =e#eloping de#elopment$ 8$ :ncouraging commercial Aan,s and go#ernment agencies to pro#ide soft loans to sugarcane growers$
(.
irrigation
sources
and
other
forms
of
land
&reating
Shree
;enu,a
Sugars
=e#elopment
7oundation
Promoting education 6ealthcare and :ducating 7ramer life Duality RESULT: S;S> cane procurement has increased year on year since inception and S;S> drawal rate is now close to 1002$
S5ree Renu6a Sugar+ L#" Pr!"uc#+:

1.
Sugar: ;enu,a Sugars produces :&II grade refined sugar conforming to :* norms Fless than 35 I&*'S.G$ %he company@s phosphorisation process produces sulphurless sugar for direct consumption and industrial usage in :urope and .frica$ S;S>@s two integrated refineries are located in 'unoli and .thani$ 'a"5ur-#5e +ugar !8 c5!$ce:
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S;S> launched ?'adhur@ a sugar !rand for the retail mar,ets in /o#em!er 2005$ Within 4 years of its launch 'adhur has emerged as the fastest growing !rand in its category F&.(; 362G$
2.
P!=erE
S;S> produces power from !agasse Fsugar !y"productG for capti#e consumption and sale to the state grid$ Aesides this !agasse !ased cogeneration plant is eligi!le for car!on credit compensation under the +yoto product$ S;S>@s cogeneration capacity increases to 134 'W with e0porta!le surplus of 50 'W in the SY 2008"01$
3.
E#5an!&:
.lcohol is produced from molasses a !rown"coloured residue left after sugar e0traction from cane )uice$ %he alcohol can !e purified to produce fuel grade ethanol that can !e !lended with petrol$ In SY 2008"01 S;S>@s distillery capacity touched 140 +>P= F640 +>P= from molasses to ethanol and 400 +>P= from rectified spirit to ethanolG$
4.
($!-8er#$&$+er+:
%he residue products from distillery operations !lended with chemicals are sold as !io"fertilisers$
SRSLA+ C!7,e#$#$:e A":an#age+:

Ca,ac$#% gr!=#5: %he company multi"folded its capacity growing organically and inorganicallyE sugar producing capacity increased from 5 000 %&= to 45 000 %&=K sugar refining capacity grew to 6 000 %P=K ethanol producing capacity surged from 60 +>P= to 100 +>P=K capti#e power generation increased from 20 'W to 154 'W$ %he &ompany in#ested ;s$15 010 mn in asset creation o#er the fi#e years leading to 2008"01$ In#egra#e" ,&a%er: %he &ompany is completely integrated across the sugar #alue chain from cane culti#ation to sugar Ffrom caneG sugar refining ethanol and power$ 'ore than ;s$ 4 224 mn re#enues accrued
Page 44
from co"product !usinesses accounting for 132 of the &ompany@s re#enues$ F$nanc$a& +#reng#5: S;S>@s superior performance is #indicated !y its financialsE de!t"eDuity ratio stood at 0$62 strengthening its a!ility to !orrow and sustain growthK cash profit was a healthy ;s$ 2 111 mn in 2008"01 operating margin stood at 16$542 interest co#er was a strong 3$48 reflecting the company@s comforta!le de!t"ser#icing a!ility$ In!rgan$c Succe++: %he &ompany acDuired ;atnapra!ha Sugars >imited and (o,a, Sugars >imited leased four units and operated each profita!ility thereafter$ It acDuired a standalone 100 +> distillery$ In 2008"01 the &ompany acDuired a 1002 sta,e in J=I a Ara8ilian sugar and ethanol player$ N!n-c%c&$ca& 4u+$ne++ 7!"e&: %he &ompany@s multi feed stoc, capa!ility for its sugar and power !usiness facilitates asset utili8ation !eyond the sugar season and a continuous cash flow for the organi8ation$ %he &ompany refined 664 042 tons of raw sugar and sold 242 mn units of power in 2008"01$
E9ce&&ence a# S5ree Renu6a Sugar+ L#":

1.
O,era#$!n+: In a !usiness with di#erse manufacturing opportunities there is a premium on product process and capacity selection leading to competiti#eness$ Shree ;enu,a Sugars consciously selected to integrate sugar manufacture with downstream possi!ilities in its factories across 'aharashtra and +arnata,a$ It in#ested in
Page 43
integration within a year of inception emphasising its understanding of multi"product profita!ility$ %he &ompany processes co"products to generate ethanol power and !io" fertilisers$ <f its fi#e factories three possess integrated facilities while the rest are in the process of integration$
a.
Sugar: %he &ompany@s ten manufacturing units en)oy a cumulati#e capacity of 45 500 %&=$ 'ost of these units were situated near ports I the closest was port"!ased while the most distant was only 150 ,ms away " enhancing their fle0i!ility to address domestic and e0port mar,ets$ %he 'unoli and .thani raw sugar units F1 000 %P= eachG enhanced off"season asset utilisation while the &ompany commissioned a 2 000"%P= sugar refinery strategically located in the port"town of 6aldia to facilitate imports and enhance e0ports$ H$g5&$g5#+ />>B->?: .ll sugar manufacturing units achie#ed a near 1002 capacity utilisation$ %he &ompany a#eraged o#er 20 tons of sugar production per %&= of crushing capacity twice the industry standard$ 4- E#5an!&: :thanol will en)oy growing demand following an enhanced demand for ?green@ energy and an e0panding need for increased oil security amid depleting reser#es$ %he &ompany@s distilleries F600 +>P= going to 100 +>P=G con#ert molasses andLor )uice into ethanol for fuel and pota!le purposes$ H$g5&$g5#+ />>B->?
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It acDuired a 532 sta,e in +A+ :ngineering an ethanol technology company$ %he sta,e will !e increased to 652 in .ugust 2001$ It in#ested ;s$ 60 million in =hanu,a Petroleum F100 +>P=G which specialises in direct fuel ethanol production from rectified spirit$ Ou#&!!6: It redesigned its ethanol plants to fle0i!ly produce ethanol from molasses andLor sugarcane )uice depending on the relati#e prices of sugar and ethanol$ It is e0pected to increase its current capacity from 600 +>P= to 100 +>P= in SY 08"01$ c- C!-genera#$!n: In a power"intensi#e !usiness li,e sugar manufacture the sa#ing grace is the &ompany@s a!ility to generate power from sugar !y"product !agasse$ %he &ompany en)oys a 121 'W co"generation capacity lea#ing an adeDuate e0porta!le surplus of 50 'W$ %he !agasse"!ased co"generation units Dualify as a clean de#elopment mechanism pro)ect helping the &ompany earn car!on credits$ H$g5&$g5#+ />>B->?: %he e0port of power increased !y 4022 from 48 million units in 2006"05 to 154 million units in 2005I08$ Ou#&!!6: .n additional 30$5 'W will !e made operational during 2008"01$
1.
Cane 'anage7en#:
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In a !usiness where the growing space is finite and the options #aried the &ompany is reDuired to consistently demonstrate cane #ia!ility at all times$ %o incenti#ise sugarcane planting and protect the sugarcane acreage in its command areas the &ompany remunerates farmers higher than the S'P$ %he &ompany is fa#oura!ly locatedK its manufacturing units are located in southwest India a region that en)oys a high cane reco#eryK !esides the state en)oys a crushing season of si0"se#en months against four"fi#e months in other sugar producing regions$ %he conseDuent #ia!ility in growing cane translates into enhanced a#aila!ility for the &ompany leading to related economies of scale and conseDuent growth$ Aesides !oth states of the &ompany@s presence do not ha#e State .dministered Prices FS.PG of cane$ %he &ompany underta,es #arious cane de#elopment initiati#es and pro#ides crop loans to augment cane production in its #arious command areas$ It also pro#ides numerous other agroinputs and fertiliser su!sidies to encourage sugarcane production$ =edicated cane procurement teams manage cane procurement$ %he &ompany purchases sugarcane directly from farmers eliminating intermediaries$ Its har#esting programme is !ased on crop age #ariety and maturity for desired cane Duantity and Duality leading to streamlined procurement$ &ane managers issue cutting orders or har#esting permits !ased on date"wise cum pre"har#esting maturity sur#eys$ H$g5&$g5#+ />>B->?: %he &ompany@s cane crushing increased 512 from2 502 200 tons in 2006"05 to 3 624 550 tons in 2005" 08$
2.
Far7er Re&a#$!n+5$,+: In a !usiness where the raw material supplier en)oys the fle0i!ility to mar,et produce to another !uyer or shift focus to alternati#e crops there is a premium on the need to graduate a transaction to a relationship of mutual sustaina!le !enefit$ %he !uilding !loc, of growth at Shree ;enu,a Sugars is trusted farmer relationships$ <#er the years this trust has translated into a willingness to grow cane in good years and !ad leading to increased crushing in e#ery single year of the last fi#e years$ %his distincti#e company"farmer relationship is enshrined in a paradigm understandingE at the &ompany farmers are not )ust treated as #endors !ut partners$ %here is a !road realisation that if growth is to !e sustaina!le one will need the other$ %his ine#ita!ility has !een most #isi!ly manifested in a large num!er of farmers I accounting for a significant 12 of the &ompany@s eDuity " !eing shareholders$ %his trust has !een manifested in #arious other initiati#es underta,en !y the &ompanyE &oordination and management of cane har#est and transportation sa#ing farmers@ effort time and money$
:ducation of farmers in cane economics o#er competing crops$
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=e#elopment of small irrigation sources on a collecti#e !asis to widen acreage under culti#ation$
&lose wor,ing with commercial !an,s and go#ernment agencies to pro#ide soft loans to sugarcane growers$
%he &ompany also formed a trust I Shree ;enu,a Sugars =e#elopment 7oundation I to promote sustaina!le education healthcare and holistic well!eing of farmers and the local community$
1.
'ar6e#$ng: In a !usiness where the &ompany mar,ets di#erse products across different customer segments there is a need to identify the nature of the customer with the o!)ecti#e to enhance organisational #alue$ Shree ;enu,a Sugars mar,ets around 252 of its sugar to institutional !uyers 52 to retail stores and the rest to domestic and international customers through spot trading$ %he &ompany accounts for 202 of the country@s ethanol mar,et$ It entered into a three"year agreement with ma)or oil mar,eting companies to supply 215 million litres at an agreed price of ;s$ 21$50 per litre$
H$g5&$g5#+ />>B->?: :thanol supply to customers in four states F+arnata,a .ndhra Pradesh (oa and +eralaG$ Pac,aged sugar mar,eting through retail !rands li,e Aig Aa8aar and 'etro$
Ou#&!!6: %he &ompany intends to enhance its mar,et share of the fuel ethanol mar,et$ . proprietary !rand of refined sugar will !e launched for the retail mar,et$
1.
CUALITY: In a !usiness where the raw material is drawn from di#erse points it is imperati#e to produce an end product of consistently high Duality at all times$ Shree ;enu,a Sugars has in#ested consistently and comprehensi#ely in Duality management$ %he &ompany complies with stringent Duality guidelines demanded !y clients$ Aesides its plants processes and practices are periodically inspected for Duality standards$ %he &ompany has standardised operating procedures across its owned and leased units leading to a high le#el of operational consistency$ H$g5&$g5#+ />>B->?: %he &ompany applied for 6.&&P certification$ It@s reduced the sugar re)ection rate to !elow 0$52 of the aggregate sugar sold$ Ou#&!!6: (oing ahead the &ompany see,s to enhance Duality standards$
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C!r,!ra#e S!c$a& Re+,!n+$4$&$#%:

Shree ;enu,a Sugars !elie#es in superior performance lin,ed to a spirit of prosperity"sharing with sta,eholders I underlining its approach to corporate social responsi!ility$ %o institutionalise this approach the &ompany created Shree ;enu,a Sugars =e#elopment 7oundation a trust wor,ing in the field of education healthcare and hygiene$ %o ser#e the !roader interests of its employees and their families the &ompany created a trust called Shree ;enu,a Sugars :mployee Welfare %rust to ser#ice education health recreation financial and social reDuirements$ %hese trusts en)oy their respecti#e corpus enhancing accounta!ility$ &ollecti#ely these trusts own 3$812 of the &ompany@s eDuity generating a precious di#idend income for onward deployment$
E"uca#$!n: %he &ompany created schools for the children of cane har#esters who tra#el a long distance during the cane har#esting period$ %hese elementary schools FSakhar ShalaG are functional near most of our units$ %he 7oundation also runs primary schools with an emphasis on good teaching staff and facilities for Duality education$ Scholarships were pro#ided to deser#ing students especially the girl child$
Hea&#5care: Primary healthcare facilities were made a#aila!le at all plant locations supported !y Dualified doctors and state"of"the" art eDuipment$ . focus on first"aid and timely ailment diagnosis facilitated effecti#e medical support$ . speciality multi"!ed hospital is !eing planned for the Aurlatti #illage in .thani %alu,
Page 31
FAelgaum districtG to cater to the rural population$ 6ealth chec,"up camps were organised Duarterly attended !y employees and local resident$
H%g$ene an" en:$r!n7en#: Safe drin,ing water was pro#ided free to employees$ :n#ironment protection was prioritised$ %he local forest department wor,ed with the &ompany to create green !elts in the plant #icinity$ Jillage camps were conducted for children and adults to enhance the awareness of hygiene and en#ironment protection$ . large land area was dedicated to the production of !io"fertilisers of the distillery effluent ensuring 1002 !io" degradation and waste recycling contri!uting to the green re#olution$ %he &ompany donated !udgeted funds to #arious educational art and cultural institutes as well as to rele#ant initiati#es around the factory area$
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'ILESTONES:
1118 1111 2000 2001 2002 2004 2003 2005 2006 .cDuistions of the assets of /i8am Sugars >td$ &ommencement of production at 'unoli$ &ommencement of 11$2 'W cogeneration plant at 'unoli$ Start of 60 +>P= distillery at 'unoli$ :sta!lishments of 250 %P= sugar refinery at 'unoli$ >easing of first co"operati#e mill$ S;S> IP< launched$ .cDuisition of (reenfield pro)ect at .thaniF+arnata,aG .cDuisition of sugar mill in Sindh,heda and relocated to 6a#alga F+arnata,aG$ 2005 2008 2001 2010 .cDuisition of +A+ &hem :ngineering P#t >td$ &ommissioning of 2000 %P= port"!ased refinery at 6aldia &ommissioning of a cogeneration plant in Panchganga cooperati#e sugar mill$ .cDuisition of 1002 sta,e in :Duipa# .cucar .lcool SL. F/ow renamed as ;enu,a do Ara8il SL.G
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CHAPTER-D DATA ANALYSIS AND INTERPRETATION

LICUIDITY RATIO:
>iDuidity ratio measures the a!ility of firm to meet current o!ligations$ In fact analysis liDuidity needs the presentation of cash !udget and fund flow statement !ut liDuidity ratios !y esta!lishing relation !etween cash and other current assets to current o!ligations pro#ide a Duic, measure of liDuidity$ . firm should ensure that it does not ha#e e0cess of liDuidity$ %his failure of company to meet its o!ligations due to lac, of sufficient of liDuidity will results in credit worthiness loss of creditor@s confidence or e#en legal tangles results in the closure of company$ %he firm@s fund will !e unnecessarily tied up in current assets$ %herefore it is necessary to stri,e a proper highly liDuidity and lac, of liDuidity$
I'PORTANT LICUIDITY RATIOS: 1$ &*;;:/% ;.%I< 2$ >IM*I= ;.%I<

3.
.AS<>*%: >IM*I= ;.%I<
3$ I/J:/%<;Y %< W<;+I/( &.PI%.> ;.%I<
1.
Curren# ra#$!:
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&urrent ;atio is a measure of the firm@s short term sol#ency$ It Curren# A++e#+ CURRENT RATIO N """"""""""""""""""""""""" Curren# L$a4$&$#%
indicates the a#aila!ility of current assets in rupees for e#ery current lia!ility$ It is the relationship !etween total current assets to current lia!ility of the firm$ %he ratio greater than one means that the firm has more current assets than claims against them a current ratio of 2E1 is considered as satisfactory$
Ta4&e N!.1: Ta4&e +5!=$ng Curren# Ra#$! Year Curren# A++e#+ Curren# L$a4$&$#% Curren# Ra#$! />>E 2061$81 1518$81 1$15 />>F 1865$31 1245$25 1$51 />>B 2018$55 1212$01 1$66 />>? 4432$3 2155$28 1$54 />>@ 15011$65 1341$46 1$81
All amounts in million Indian Rupees .
C5ar# N!. 1
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Gra,5 S5!=$ng Curren# A++e#+ an" Curren# L$a4$&$#%
Gra,5 =$#5 %ear an" curren# ra#$!:
Ana&%+$+: 7rom the a!o#e ta!le it is e#ident that all the years of current ratio is less than the e0pected standard ratio 2E1 In#er,re#a#$!n: 7rom the a!o#e graph current ratio of the year 2001 is satisfactory when compared to other current ratios of pre#ious year which has maintained more than 1E1 proportion !ut less than the standard ratio 2E1$
Page 36
2.
L$;u$" Ra#$!:
%he Standard Muic, ;atio is 1E1$ If liDuid ratio is less than standard ratio it can !e concluded that the concern is not liDuid$ Aut if an organi8ation had greater Muic, ;atio than Standard ;atio of 1E1 it can !e concluded that concern is liDuid$ It can pay"off its short"term lia!ilities out of it@s Duic,ly reali8e assets without any difficult$ Aecause the liDuid assets is greater than liDuid lia!ilities is greater than Standard Muic, ;atio$ It shows the Muic, ;atio is increasing e#ery year in company$ L$;u$" A++e#+ LICUID RATIO N """""""""""""""""""""""""""" Curren# L$a4$&$#%
Ta4&e n!./: Year L$;u$" A++e#+ Curren# L$a4$&$#% L$;u$" Ra#$! Ta4&e +5!=$ng L$;u$" Ra#$!
All amounts in million Indian Rupees
/>>E 148$45 1581$81 0$52
/>>F 534$66 1245$25 0$60
/>>B 1016$88 1212$01 0$84
/>>? 1354$42 2155$28 0$65
/>>@ 5056$36 1341$46 0$53
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C5ar# N!. /: Gra,5 S5!=$ng L$;u$" A++e#+ an" Curren# L$a4$&$#%
Gra,5 =$#5 Year an" L$;u$" Ra#$!:
Ana&%+$+: %he >iDuid ;atio of 1E1 indicates a highly sol#ent position$ .s per the a!o#e ta!le >iDuid ;atios of all the year is less than 1E1 proportion$ In#er,re#a#$!n: 7rom the a!o#e graph the liDuid ratios of the year 2005 is 0$52 which shows further increment of >iDuid ratio upto 0$84 in the year 2005 which is the highest liDuid ratio of all the 3years$ .nd in 2008 there is decline of
>iDuid ;atio tending to 0$65 !ut in 2001 there is increase in >iDuid ;atio upto 0$53 times
3.
A4+!&u#e L$;u$" Ra#$!:

%his ratio is also ,nown as super Duic, ratio$ %his ratio considers only the .!solute >iDuidity a#aila!le with the firm$ %he cash the !an, !alance and mar,eta!le securities are considered as highly liDuid assets$ If the highly liDuid assets are too much in relation to the current lia!ility than it may affect the profita!ility of the firm as these assets are the most unproducti#e assets of all$ *Ca+5G(an6GS5!r# #er7 $n:e+#7en#+A4+!&u#e L$;u$"$#% N """""""""""""""""""""""""""""""""""""""""""""""""""""" Ra#$! Curren# L$a4$&$#$e+
Ta4&e N!.0: Ta4&e S5!=$ng A4+!&u#e L$;u$" Ra#$!

Page 31
Year A4+!&u#e L$;u$" A++e#+ Curren# L$a4$&$#$e+ A4+!&u#e L$;u$" Ra#$!
/>>E F/B.>/
/>>F 1B1.FF
/>>B 0>F.B1
/>>? 100.?F /1BE./? >.>F
/>>@ /1>/.?0 @D0@.0F >.//
1B?1.?@ 1/0E./E 1/1/.>@ >.0E >.10 >./E
C5ar# N!.0: Gra,5 S5!=$ng A4+!&u#e L$;u$" A++e#+ an" Curren# L$a4$&$#%
Gra,5 =$#5 %ear an" A4+!&u#e L$;u$" Ra#$!:
Page 50
Ana&%+$+: 7rom the a!o#e ta!le one can #isuali8e that none of the years ha#e .!solute >iDuid ;atio to meet the reDuired Standard ;atio 1E2 In#er,re#a#$!n: Ay seeing the graph a!o#e one can interpret the .!solute >iDuidity ;atio of the organi8ation which is not satisfactory in any of the years$
4.
In:en#!r% #! W!r6$ng Ca,$#a& Ra#$!:

In order to ascertain that there is no o#er stoc,ing the ratio of in#entory to wor,ing capital is calculated$ It is calculated !yE In:en#!r% In:en#!r% #! W!r6$ng Ca,$#a& N """"""""""""""""""""""""" W!r6$ng Ca,$#a&
Ta4&e N!.D: Ta4&e S5!=$ng In:en#!r% #! W!r6$ng Ca,$#a& Ra#$!:

. All amounts in million Indian Rupees
Page 51
C5ar# N!.D: Gra,5 S5!=$ng In:en#!r% an" W!r6$ng Ca,$#a&
Year
/>>E
/>>F 1121$84 640$12
/>>B 1001$61 806$38
/>>? 1861$08 1165$12
/>>@ 10024$21 5660$41
In:en#!r% 1124$36 W!r6$ng Ca,$#a& In:en#!r% 3$01 #! WC 251$12
1$58
1$23
1$60
1$408
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Gra,5 S5!=$ng In:en#!r% #! W!r6$ng Ca,$#a& Ra#$!:
Ana&%+$+: Ideal In#entory to Wor,ing &apital ;atio 1E1 e0cept 2005 all other conseDuent year from 2005 to 2001 has maintained more than unity !ut less than 2E1 which is good for organi8ation$ In#er,re#a#$!n: 7rom the a!o#e (raph we can conclude that all the years has good in#entory to wor,ing capital ratio !ut in the year 2005 In#entory to Wor,ing &apital ratio is 3$01times which is high compared to other years$
LEVERAGE RATIO:
>e#erage or capital ratios are those ratios which measure the relati#e interest of lenders and proprietors in a !usiness organi8ation$ %hese ratios indicate the long"term sol#ency position of an organi8ation$ %hese ratios help the management in the proper administration of the capital$ . company should ha#e a short term as well as long term financial position$ &ompany financial or capital structure ratios are calculated !y these short term and long term financial position$ %hese ratios indicate
mi0 of funds pro#ided to owners and lenders$ .s a rule this ratio should !e an appropriate mi0 of department and owners eDuity in financing company@s assets$
'!+# C!77!n&% u+e" Le:erage Ra#$!+ are:

1.
Sol#ency ;atio
2$ Proprietary ;atio 4$ 7i0ed .ssets to /et Worth ;atio 3$ &urrent .ssets to /et Worth ;atio 5$ &urrent >ia!ility to /et Worth ;atio 6$ %otal >ia!ility to %otal .ssets
1. S!&:enc% Ra#$!: Sol#ency ratio is the ratio !etween the total assets and total lia!ility of the concern$ It means the a!ility of the concern to meet its total lia!ility of its concern$ %hough no ideal sol#ency ratio of a concern has !een esta!lished one can say higher the sol#ency ratio of a concern the financial position and lower the sol#ency ratio the wea,er is it financial position$ T!#a& A++e#+ S!&:enc% ra#$! N """""""""""""""""""""""" T!#a& L$a4$&$#%
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Ta4&e N!.E: Ta4&e +5!=$ng S!&:enc% Ra#$!

C5ar# N!.E: Gra,5 S5!=$ng S!&:enc% Ra#$!:
Ana&%+$+: 7rom the a!o#e ta!le sol#ency ratio of 2005 and 2008 !earing 0$61 and 0$64 is considered to !e good when compared to other years$ In#er,re#a#$!n: %he sol#ency ratio indicates the a!ility of the concern to meet its lia!ility out of its %otal .ssets$ In last fi#e years sol#ency ratio of the concern is Year T!#a& A++e#+ T!#a& L$a4$&$#% S!&:enc% Ra#$! />>E 1351$21 4424$61 0$341 />>F 2518$32 5225$83 0$451 />>B 5564$43 11231$33 0$610 />>? 10052$55 18101$43 0$542 />>@ 22118$38 45145$53 0$641
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fa#oura!le$ %he sol#ency ratio of 2005 and 2001 is 0$61 and 0$64 which is said to !e good for a concern$
2.
Pr!,r$e#ar% Ra#$!: %he proprietary ratio is an inde0 of the amount of proprietary fund in#ested in %otal .ssets of a concern$ It is also indicates the proportion !etween owned capital and loaned capital$ In addition it indicates the relati#e ris, of the owners and the creditors of the company$ 6igher the proprietary ratio the stronger is the financial position of the concern and lower the proprietary ratio the wea,er is the financial position of an enterprise$ . ratio of 5E1 is considered ideal$ Ne# W!r#5 Pr!,r$e#ar% Ra#$! H """""""""""""""""""" T!#a& A++e#+ Ta4&e N!.F: Ta4&e S5!=$ng Pr!,r$e#ar% Ra#$!
Year Ne# W!r#5 T!#a& A++e#+ Pr!,r$e#ar% Ra#$!
/>>E 645$18 1351$21 0$34
/>>F 2223$34 2518$32 0$85
/>>B 4455$33 5564$43 0$34
/>>? 6411$32 10052$55 0$64
/>>@ 12631$14 22118$38 0$53
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C5ar# N!. F: Gra,5 S5!=$ng Pr!,r$e#ar% Ra#$!
Ana&%+$+: 7rom the a!o#e ta!le we can #isuali8e that the year 2006 has maintained higher proprietary ratio of 0$85times compared to other years$ In#er,re#a#$!n: 7rom the a!o#e graph we can conclude that the company has maintained higher Proprietary ;atio in the year 2006 that is 0$85times compared to other 3years$ .nd it is said that higher the Proprietary ;atio stronger is the financial position of the company$
3.
F$9e" A++e#+ #! Ne# W!r#5 Ra#$!: %he 7i0ed .ssets to /et Worth ;atio indicates that the proportion of fi0ed assets financed !y the owners or proprietors$ In other words it indicates as to e0tent the owners ha#e in#ested funds on the fi0ed assets which constitute the main structure of the !usiness$ %he ideal fi0ed assets to net worth ratio for an industrial underta,ing is 652 that is the fi0ed assets should not !e constitute more than 652 of the proprietor@s fund$
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F$9e" A++e#+ F$9e" A++e#+ #! Ne# W!r#5 Ra#$! N """""""""""""""""""""" Ne# W!r#5
Ta4&e N!.B: Ta4&e S5!=$ng F$9e" A++e#+ #! Ne# W!r#5 Ra#$!

C5ar# N!.B: Gra,5 S5!=$ng F$9e" A++e#+ #! Ne# W!r#5 Ra#$!
Ana&%+$+:
Year F$9e" A++e#+ Ne# W!r#5 F$9e" A++e#+ #! Ne# W!r#5 Ra#$!
/>>E 1053$14 645$18 1$65
/>>F 1114$52 2223$34 0$546
/>>B 5624$04 4455$33 1$653
/>>? 6111$56 6411$32 1$08
/>>@ 12568$56 12631$14 0$133
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%he a!o#e ta!le shows the proportion of 7i0ed .ssets to /et Worth ;atio which is fluctuating e#ery year$ In#er,re#a#$!n: %he a!o#e graph shows that the year 2005 2005 and 2008 has 1$65 1$65 and 1$08 times of 7i0ed .ssets to /et Worth which is good for enterprise compared to 2006 and 2001@s ratio of 0$54 and 0$11times$
4.
Curren# A++e#+ #! Ne# W!r#5 Ra#$!: %his ratio indicates proportion of the current assets financed !y the owner$ %here is no standard current asset to net worth ratio we can say that if this ratio is high the financial strength of the concern is good and if this ratio is low the financial position of the concern is wea,$ Curren# A++e#+ Curren# Ra#$! #! Ne# W!r#5 Ra#$! N """"""""""""""""""""""" Ne# W!r#5 Ta4&e N!.?: Ta4&e S5!=$ng Curren# A++e#+ #! Ne# W!r#5 Ra#$!:
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C5ar# N!.?: Gra,5 S5!=$ng Curren# A++e#+ #! Ne# W!r#5 Ra#$!
Ana&%+$+: 7rom the a!o#e ta!le we can conclude the proportion of &urrent .ssets to /et Worth in years 2005 and 2001 is satisfactory when compared to other years$ In#er,re#a#$!n: 6igher the current assets to net worth ratio higher will !e financial strength of the concern$ .s per a!o#e graph 2005 has maintained Year Curren# />>E 2061$81 />>F 1865$31 2223$34 0$84 />>B 2018$55 4455$33 0$60 />>? 4432$3 6411$32 0$52 />>@ 15011$65 12631$14 1$45
A++e#+ Ne# W!r#5 645$18 Curren# 4$24 A++e#+ #! Ne# W!r#5
4$24times of &urrent .ssets to /et Worth ratio and 2001 has maintained 1$45times of &urrent .ssets to /et Worth ratio$
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5.
Curren# L$a4$&$#% #! Ne# W!r#5 Ra#$!: %he ratio indicates the relati#e contri!ution of the short term creditors and owners in the capital of an enterprise$ %he desira!le le#el set for this ratio is 44$44$ If the actual ratio were #ery high it would mean that the lia!ility !ase of the concern would not pro#ided an adeDuate co#er for the long term creditors$ %hat means it would not !e difficult for the concern to long term fund$ Curren# L$a4$&$#% Curren# L$a4$&$#% #! Ne# W!r#5 H """"""""""""""""""""""""""" Ne# W!r#5
Ta4&e n!.@: Ta4&e S5!=$ng Curren# L$a4$&$#% #! Ne# W!r#5 Ra#$!

C5ar# N!.@: Year Curren# L$a4$&$#% Ne# W!r#5 Curren# L$a4$&$#% #! Ne# W!r#5 645$18 2$51 2223$34 0$55 4455$33 0$46 6411$32 0$44 12631$14 0$53 />>E 1581$81 />>F 1245$25 />>B 1212$01 />>? 2155$28 />>@ 1341$46
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Gra,5 S5!=$ng Curren# L$a4$&$#% #! Ne# W!r#5 Ra#$!
Ana&%+$+: %he a!o#e ta!le indicates &urrent >ia!ility to /et Worth ratio which is decreasing from year to year$ We can see a gradual raise in 2001 with 0$55times$ In#er,re#a#$!n: %he a!o#e graph indicates the proportion of &urrent >ia!ility to /et Worth in which the ratio of 2005 to 2001 are 2$51 0$55 0$46 0$44and 0$53 out of which 2005@s &urrent >ia!ility to /et Worth is more compared to other 3years$
6.
T!#a& L$a4$&$#% #! T!#a& A++e#+ Ra#$!: <ne may li,e including &urrent >ia!ility on the ground that they are important determinants of company@s financial ris, since they represent o!ligations and pressure on company and restrict its acti#ities$ %hus to assess the proportion of total funds short term and long term pro#ided !y outsiders to finance total assets$ T!#a& L$a4$&$#% T!#a& L$a4$&$#% #! T!#a& A++e#+ H """""""""""""""""""""""" T!#a& A++e#+
Ta4&e N!.1>: Ta4&e S5!=$ng T!#a& L$a4$&$#$e+ #! T!#a& A++e#+ Ra#$!

All amounts in million Indian Rupees.
C5ar# N!. 1>: Gra,5 S5!=$ng T!#a& L$a4$&$#% #! T!#a& A++e#+
Ana&%+$+: 7rom the a!o#e ta!le we can conclude that the proportion of %otal >ia!ility and %otal .ssets in 2006 is more when compared to other years of proportion$
Year T!#a& L$a4$&$#$e+ T!#a& A++e#+ TL #! TA
/>>E 4424$61
/>>F 5225$83
/>>B 11231$33
/>>? 18101$43
/>>@ 45145$53
1351$21
2518$32
5564$43
10052$55
22118$38
2$25
2$581
1$33
1$855
1$562
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In#er,re#a#$!n: %he ratio indicates the proportions of total funds short and long term pro#ided !y outsiders to finance %otal .ssets$ %he ratio calculated a!o#e indicates that the year 2006 has higher rate of proportion 2$58 times compared to other years$
ACTIVITY RATIOS:
7unds of the creditors and owners are in#ested in #arious assets to generate sales and profit$ %hese ratios are employed to e#aluate the efficiency with the company manager and utili8e its assets$ %hese ratios are also called as %urno#er ratios they indicate the speeds with assets are !eing con#erted or %urno#er into Sales$ .cti#ity ratio thus in#ol#e relationship !etween sales to assets$ . proper !alance !etween sales and assets generally reflects that assets are managed well$ Se#eral .cti#ity ;atios are calculated to )udge effecti#eness of assets utilisation$ S!7e !8 #5e Ac#$:$#% Ra#$!+ are: 1$ &ash %urno#er ratio 2$ In#entory %urno#er ratio 4$ Wor,ing &apital %urno#er ;atio 3$ =e!tors %urno#er ;atio
5.
&urrent .ssets %urno#er ;atio
6$ 7i0ed .ssets %urno#er ;atio 5$ %otal .ssets %urno#er ;atio 8$ 7i0ed .ssets to /et Worth 1$ /et Sales to /et Worth
1.
Ca+5 Turn!:er Ra#$!: &ash %urno#er ratio or cash #elocity is the ratio !etween cash and turno#er or sales$ %his ratio indicates the e0tent of which cash resources are utili8ed !y the enterpriseK it is also helpful in determining the liDuidity of a company$ %he ideal &ash %urno#er ratio is 10E1 as suchK &ash %urno#er ratio of 10E1 or more indicates the utilsation of cash resources of the enterprise$ In addition less than 10E1 indicates that the cash resources of the enterprise are not effecti#ely utili8ed$ Ne# Sa&e+ Ca+5 Turn!:er Ra#$! N """"""""""""""""" Ca+5 Ta4&e N!.11: Ta4&e S5!=$ng Ca+5 Turn!:er Ra#$!
Year Ne# Sa&e+ Ca+5 Ca+5 Turn!:er Ra#$!
/>>E 6412$35 625$02 10$115
/>>F 8015$85 151$66 36$61
/>>B 5424$61 406$51 24$85
/>>? 18231$61 144$86 146$25
/>>@ 22432$15 2102$84 10$62
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C5ar# N!. 11: Gra,5 S5!=$ng Ca+5 Turn!:er ra#$!
Ana&%+$+: %he a!o#e ta!le indicates &ash %urno#er ;atioK the year 2008 has satisfactory &ash %urno#er ;atio compared to others$ In#er,re#a#$!n: %he ideal &ash %urno#er ;atio is 10E1 in the a!o#e graph we can see all the years of &ash %urno#er ;atio has maintained more than the standard ratio 10E1 which is a good sign for a firm$
2.
In:en#!r% Turn!:er Ra#$!: . considera!le amount of a company@s capital may !e tied up in the financing of raw materials wor,"in"progress and finished goods$ It is important to ensure that the le#el of Stoc,s is ,ept as low as possi!le consistent with the need to fulfill customer@s order in time$ If the in#entory turno#er ratio has decreased from past it means that either in#entory is growing or sales are dropping$ In
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addition to that if a firm has a turno#er that is slower than for its industry then there may !e o!solete goods on hand$ <r in#entory stoc,s may !e high$ COGS In:en#!r% Turn!:er Ra#$! N """"""""""""""""""""" A:erage S#!c6
Ta4&e N!.1/: Ta4&e S5!=$ng In:en#!r% Turn!:er Ra#$!

C5ar# N!. 1/: Gra,5 S5!=$ng In:en#!r% Turn!:er Ra#$!
Ana&%+$+:
Year COGS A:g. S#!c6 In:en#!r% Turn!:er Ra#$!
/>>E 1585$60 1122$635 1$51
/>>F 2160$81 1061$56 2$04
/>>B 1581$18 1345$48 1$10
/>>? 8038$65 5136$13 1$45
/>>@ 1535$34 10024$21 0$15
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7rom the a!o#e ta!le we can #isuali8e that in the year 2006 !earing In#entory %urno#er ;atio of 2$04 times has maintained the highest turno#er ratio compared to other years$ In#er,re#a#$!n: 7rom the a!o#e &hart we can conclude in the year 2006 in#entory turno#er ratio !eing 2$04 times whereas in the year 2001 the in#entory ratio is 0$15 times$ /oteE It is said that if In#entory %urno#er ;atio has decreased from past it means that either In#entory is growing or sales is dropping$
3.
W!r6$ng Ca,$#a& Turn!:er Ra#$!: %he wor,ing capital turno#er ratio is the ratio that e0presses the relationship !etween wor,ing capital and net sales$ Wor,ing &apital is the e0cess of &urrent .ssets o#er &urrent >ia!ility$ %his ratio indicates the efficient or inefficient utilisation of Wor,ing &apital of an enterprise$ %here is no ideal or standard wor,ing capital turno#er ratio$ %he wor,ing capital ratio is generally e0pressed as a proportion and can !e calculated using the following formula$ Ne# Sa&e+ W!r6$ng Ca,$#a& Turn!:er N """""""""""""""""""""""""""""""""""" Ra#$! *A:erage W!r6$ng Ca,$#a&-
Ta4&e N!.10: Ta4&e S5!=$ng W!r6$ng Ca,$#a& Turn!:er Ra#$!

C5ar# N!. 10: Gra,5 S5!=$ng W!r6$ng Ca,$#a& Turn!:er Ra#$!
Ana&%+$+: 7rom the a!o#e ta!le we can #isuali8e that in the year 2001 has a least Wor,ing &apital %urno#er ;atio of 0$20 times when compared to the highest Wor,ing &apital %urno#er ;atio of 4$12 times in the year 2005$ In#er,re#a#$!n: 7rom the a!o#e graph it can !e concluded that in the year 2001 the wor,ing capital turno#er ratio is of 0$2 times whereas in the year 2005 has the highest Wor,ing &apital %urno#er ;atio of 4$12 times$ .nd in the year 2006 2005 and 2008 has respecti#e Wor,ing &apital %urno#er ;atio of 4 times 1$61 times and 1$82 times$
Year COGS A:g. WC WCTR
/>>E 1585$60 355$08 4$12
/>>F 2160$81 518$46 4$00
/>>B 1581$18 186$8 1$610
/>>? 8038$65 3314$51 1$82
/>>@ 1535$34 5660$41 0$20
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4.
De4#!r+ Turn!:er Ra#$!: %he de!tor@s turno#er ratio is also ,nown as the accounts recei#a!le turno#er ratio and it is the ratio that e0presses the relationship !etween a#erage de!tors and sales$ . de!tor refers to sundry de!tors plus !ills recei#a!le$ 7urther de!tors mean gross de!tors i$e$ !efore deducting the !ad de!ts and reser#es for dou!tful de!ts$ Sales mean net credit sales i$e$ credit sales minus sales returns$ %he accounts recei#a!le ratio indicates the rate at which the amounts are collected from the de!tors$ It also indicates liDuidity of the concern$ %he de!tor@s turno#er ratio is generally e0pressed in rate$ It can !e calculated using the following formulaE Cre"$# Sa&e+ De4#!r+ Turn!:er Ra#$! N """"""""""""""""""""""""" A:erage De4#!r+ Ta4&e N!.1D: Ta4&e S5!=$ng De4#!r+ Turn!:er Ra#$!
C5ar# N!.1D:
Year Cr Sa&e+ A:g. De4#!r+ DTR
/>>E 6412$35 468$51 15$44
/>>F 8015$85 362$18 15$41
/>>B 5424$61 346$625 16$55
/>>? 18231$61 563$52 24$86
/>>@ 22432$15 1032$65 21$32

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Gra,5 S5!=$ng De4#!r+ Turn!:er Ra#$!
Ana&%+$+: 7rom the a!o#e ta!le we can see that in the year 2008 has the highest =e!tors %urno#er ;atio !earing 24$86 times$ In#er,re#a#$!n+: 7rom the graph we can conclude that the company has maintained satisfactory le#el !y maintaining the consistency ratios without much increase or decrease in the ratios$ In the year 2008 and 2001 has higher ratio of 24$86 times and 21$32 times respecti#ely$ 6igher the ratio the !etter will !e the position of the firm$
5.
Curren# A++e#+ Turn!:er Ra#$!: &urrent assets turno#er ratio indicates the company@s a!ility to generate the sales of rupee from current assets$ %his ratio is the relationship !etween the sales and current assets of the firm$ %here is no standard current assets turno#er ratio$ Yet the inference is the high current assets turno#er ratio indicates of !etter utilisation of current assets$ <n the other hand a low current assets turno#er ratio suggest that the current assets ha#e !een utili8e properly$ Ne# Sa&e+ Curren# A++e#+ Turn!:er Ra#$! N """"""""""""""""""""""" Curren# A++e#+
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Ta4&e NO.1E: Ta4&e S5!=$ng Curren# A++e#+ Turn!:er Ra#$!

C5ar# N!. 1E: Gra,5 S5!=$ng Curren# A++e#+ Turn!:er Ra#$!
Ana&%+$+: 7rom the a!o#e ta!le we can conclude that there is proper utilisation of current assets in the year 2006 and 2008 when compared to other years$ In#er,re#a#$!n:
Year Ne# Sa&e+ Curren# A++e#+ CATR
/>>E 6412$35 2061$81
/>>F 8015$85 1865$31
/>>B 5424$61 2018$55
/>>? 18231$61 4432$3
/>>@ 22432$15 15011$65
4$10
3$21
4$62
5$35
1$40
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%he ratio shows how much the company a!le to generate the sales from the amount of current assets$ In the year 2008 company generated the sales of 5$35 which were more when compared with other year$ .nd in 2001 the company generate 1$40 times of sales which is less compare to other year$
6.
F$9e" A++e#+ Turn!:er Ra#$!: %his ratio e0plains the relationship !etween the costs of goods sold and fi0ed assets$ It e0plains the efficiency with which fi0ed assets ha#e !een used in utilisation of fi0ed assets and !etter profits$ %he fi0ed assets calculated after deduction of depreciation$ %he standard fi0ed assets turno#er ratio is 5 times$ %herefore a fi0ed turno#er ratio of 5 times more indicates !etter utilisation of fi0ed assets$ Ne# Sa&e+ F$9e" A++e#+ Turn!:er Ra#$! N """""""""""""""""""""" F$9e" A++e#+
Ta4&e N!.1F: Ta4&e S5!=$ng F$9e" A++e#+ Turn!:er Ra#$!
Page 54
C5ar# N!.1F: Gra,5 S5!=$ng F$9e" A++e#+ Turn!:er Ra#$!
Ana&%+$+: 7rom the a!o#e ta!le one can analyse that in the year 2005 and 2006 the 7i0ed .ssets %urno#er ratio is high which means the 7i0ed .ssets are used well in the organi8ation$ In#er,re#a#$!n: 7rom the a!o#e graph we can #isualise in the year 2005 and 2006 has good 7i0ed .ssets %urno#er ;atio of 6$05 and 6$51 !ut following
Year Ne# Sa&e+ F$9e" A++e#+ FATR
/>>E 6412$35 1053$14
/>>F 8015$85 1114$52
/>>B 5424$61 5624$04
/>>? 18231$61 6111$56
/>>@ 22432$15 12568$56
6$05
6$51
1$40
2$64
1$55
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conseDuent years of 2005 2008 and 2001 had least 7i0ed .sset %urno#er ;atio compared to 2005 and 2006$
7.
T!#a& A++e# Turn!:er Ra#$!: %otal assets turno#er ratio refers to the company@s a!ility to generating the sale from all financial sources committed to total assets$ %he assets include net fi0ed assets and current assets$ %he greater the ratio of turno#er or con#ersion the more efficient is the utilisation$ %he ideal of turno#er ratio is sales should !e least two times the #alue of assets$ Ne# Sa&e+ T!#a& A++e#+ Turn!:er Ra#$! N """"""""""""""""""" T!#a& A++e#+
Ta4&e N!.1B: Ta4&e S5!=$ng T!#a& A++e#+ Turn!:er Ra#$!

. All amounts in million Indian Rupees.
Year Ne# Sa&e+ T!#a& A++e#+ TATR
/>>E 6412$35 1351$21
/>>F 8015$85 2518$32
/>>B 5424$61 5564$43
/>>? 18231$61 10052$55
/>>@ 22432$15 22118$38
3$480
4$083
0$134
1$810
0$151
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C5ar# N!.1B: Gra,5 S5!=$ng T!#a& A++e#+ Turn!:er Ra#$!
Ana&%+$+: 7rom the a!o#e ta!le we can conclude that the year 2005 has 3$48 times of total assets turno#er ratio which is satisfactory compared to other year$ In#er,re#a#$!n: %he total assets turno#er ratio indicates the company@s a!ility to produce the #olume of sale for a gi#en amount of %otal .ssets$ .nd it says that higher the ratio is higher the utilisation of assets$ %he total assets turno#er ratios of 2005 to 2001 are 3$48 4$08 0$13 1$81 and 0$15 out of which the year 2005 has more turno#er ratio compared to other years$
/.
Ne# Sa&e+ #! Ne# W!r#5: /et sales to net worth ratio are the ratio !etween sales and net worth$ %his ratio is the good inde0 of the utilisation of the owner@s fund$ It also indicates whether there is o#er trading or under trading$ In addition it indicates whether there is o#er capitali8ation or under capitali8ation$ Ne# Sa&e+ Ne# Sa&e+ #! Ne# W!r#5 N """""""""""""""""" Ne# W!r#5
Page 56
Ta4&e N!.1?: Ta4&e S5!=$ng Ne# Sa&e+ #! Ne# W!r#5 Ra#$!

C5ar# N!.1?: Gra,5 S5!=$ng Ne# Sa&e+ #! Ne# W!r#5 Ra#$!
Ana&%+$+: 7rom the a!o#e ta!le we can conclude the proportion of /et Sales to /et Worth of each year is deducting from year to year$ In#er,re#a#$!n: Year />>E />>F 8015$85 2223$34 />>B 5424$61 4455$33 />>? 18231$61 6411$32 />>@ 22432$15 12631$14
Ne# Sa&e+ 6412$35 Ne# W!r#5 645$18
NS #! NW
10$04
4$60
2$181
2$85
1$565
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/et Sales to /et Worth ratio indicates whether there is o#er capitaliastion or under capitalisation$ It ser#es as a guide in the proper administration of a company$ %he proportion of /et Sales to /et Worth ratio has !een declining from 10$04 to 4$60 4$60 to 2$18 in 2005 to 2005 respecti#e years and also we can see the decline in /et Sales to /et Worth ratio from 2$85 to 1$56 in 2008 to 2001$
PROFITA(ILITY RATIO:
. &ompany should earn profit to sur#i#e and grow o#er a long period$ Profit is essential !ut it would wrong to assume that e#ery action ta,en !y the management of a company should !e aimed at ma0imi8ation of profit irrespecti#e of social conseDuences$ . profit is the difference !etween the re#enue and e0penses o#er a period of time Fusually one yearG$ Profit is ultimate ?output@ of the company and it will ha#e no future if it will fail to ma,e sufficient profit$ %herefore a financial manager should continuously e#aluate the efficiency of the company$ Aeside the management of the company creditors and owners are also interested in the profita!ility of the company$ &reditors want to get repayment of principle regularly$ <wners want to get reDuire rate of interest for their in#estment$ %his possi!le only when company earns profit regularly$ T5e Pr!8$#a4&e Ra#$!+ are: 1$ (ross Profit ;atio
2.
/et Profit ;atio
4$ <perating :0penses ;atio 3$ .dministrati#e :0penses ;atio

5$ Selling and =istri!ution ;atio 6$ :arning Per Share 5$ ;eturn on In#estment 8$ ;eturn on Share 6olders 7und 1$ ;eturn on %otal asset employed 10$;eturn on &apital :mployed
1.
Gr!++ ,r!8$# ra#$!: %he (ross profit margin reflects the efficiency with which the management produces each unit of product$ %his ratio indicates the a#erage spread !etween the costs of goods sold and the sales re#enue$ When we su!tract the gross profit from 100 percent we o!tain ratio of goods sold to sales$ Aoth these ratios show profit related to sales after deduction of production costs and indicates the relationship !etween production cost and selling prices$ Gr!++ Pr!8$# Gr!++ Pr!8$# Ra#$! H """""""""""""""""" I 1>> Sa&e+ Ta4&e N!.1@: Ta4&e S5!=$ng Gr!++ Pr!8$# Ra#$!
Page 51
C5ar# N!.1@: Gra,5 S5!=$ng Gr!++ Pr!8$# Ra#$!
Ana&%+$+: %he a!o#e ta!le is showing (ross Profit ;atio$ Year 2008 has least (ross Profit ;atio$ .nd the year 2001 has comparati#ely a good (ross Profit ;atio$ In#er,re#a#$!n: 7rom the a!o#e graph one can conclude in the year 2001 has good (ross profit ratio compared to 2008 which has least (ross profit ratio whereas Year Gr!++ Pr!8$# Sa&e+ GJP Ra#$!
/>>E 3606$85
/>>F 5855$03
/>>B 5543$51
/>>? 10114$02
/>>@ 20513$53
6412$35 52$062
8015$85 54$032
5424$61 58$402
18231$61 55$852
22432$15 14$052
(ross profit ratio for the year 2005 2006 and 2005 is in incrementing proportion from 52$062 to 54$032 and from 54$032 to 58$402$ /. Ne# Pr!8$# Ra#$!: /et profit is o!tained when <perating :0penses interest and ta0es are su!tracted from gross profit$ /et profit margin esta!lishes a relationship !etween net profit and sales indicates management@s efficiency manufacturing administration and selling the product$ %his ratio is o#erall measures of the company@s a!ility to turn each rupee sales into net profit$ Ne# Pr!8$# Ne# Pr!8$# Ra#$! H """""""""""""""" I 1>> Sa&e+ Ta4&e N!./>: Ta4&e S5!=$ng Ne# Pr!8$# Ra#$!
Year Ne# Pr!8$# Sa&e+ NJP Ra#$!
/>>E 443$64
/>>F 555$80
/>>B 533$44
/>>? 125$86
/>>@ 1345$11
6412$35 5$242
8015$85 6$142
5424$61 5$342
18231$61 5$082
22432$15 6$322
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C5ar# N!. />: Gra,5 S5!=$ng Ne# Pr!8$# Ra#$!
Ana&%+$+: 7rom the a!o#e ta!le we can analyse that the year 2005 has a good /et profit$ %he year 2008 has relati#ely low net profit$ In#er,re#a#$!n: We can see that the graph showing /et Profit has a freDuent raise in the conseDuent years of 2005 2006 and 2005 with raise in 5$242 to 5$342$ Aut had a least /et Profit in the year 2008$
0. O,era#$ng E9,en+e+ Ra#$!: &ost of sales includes direct cost of goods sold as well as other operating e0penses which ha#e matching relationship with sale$ It e0cludes incomes and e0penses which ha#e no !earing on production and sales i$e$ non operating incomes and e0penses as interest and di#idend recei#ed on in#estments interest paid on long term loans and de!entures profit or loss on of fi0ed assets or long term in#estment$ %he operating ratio indicates the efficiency of the management in the conduct of the !usiness$
. low operating ratio is an indication of the operating efficiency of the !usiness$ <n the other hand a high operating is an indication of the operating efficiency of the !usiness$ %his ratio should !e analysed further to throw lights of efficiency pre#ailing in different elements of total cost$
O,era#$ng e9,en+e+ G COGS O,era#$ng E9,en+e+ Ra#$! N """""""""""""""""""""""""""""""""""""" I 1>> Ne# Sa&e+
Ta4&e N!./1: Ta4&e S5!=$ng O,era#$ng E9,en+e+ Ra#$!
Page 84
Year
/>>E
/>>F
/>>B
/>>?
/>>@
O,era#$ng E9,en+e+
2022$33
2311$41
2111$54
1221$32
4085$35
Sa&e+
6412$35
8015$85
5424$61
18231$61
22432$15
OER
41$642
41$182
28$842
50$555
14$812
C5ar# N!. /1: Gra,5 S5!=$ng O,era#$ng E9,en+e+ Ra#$!
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Ana&%+$+: 7rom the a!o#e ta!le we can analyse that the year 2001 has least operating e0penses ratio and the year 2008 has high operating e0penses compared to other years$ In#er,re#a#$!n: It is said that higher the operating ratio lower will !e the /et Profit ratio$ %he year 2001 had least operating e0penses ratio of 14$812 which in turn yield high net profit ratio of 6$322$
4.
A"7$n$+#ra#$:e e9,en+e+ Ra#$!: It refers to all e0penses which are incurred for the general administration of the concern $:0amples of administrati#e e0penses are office salaries office rent printing and stationary postage and telegrams$ It is e0pressed as followsE A"7$n$+#ra#$:e e9,en+e+
A"7$n$+#ra#$:e e9,en+e+ ra#$! N """"""""""""""""""""""""""""""""""" I 1>> Ne# Sa&e+
Ta4&e N!.//: Ta4&e S5!=$ng A"7$n$+#ra#$:e E9,en+e+ Ra#$!
Page 85
C5ar# N!.//: Gra,5 S5!=$ng A"7$n$+#ra#$:e E9,en+e+ Ra#$!
Ana&%+$+: %he a!o#e ta!le shows .dministrati#e e0penses ratio$ %he year 2005 has least administrati#e e0penses ratio of 1$182$ .nd in the year 2005 has 2$102 In#er,re#a#$!n: We can interpret from the a!o#e graph the year 2005 !earing Year A"7$n. E9,. Sa&e+ AER 6412$35 1$182 8015$85 1$662 5424$61 2$102 18231$61 2$142 22432$15 1$6452 />>E 55$16 />>F 144$34 />>B 212$52 />>? 481$50 />>@ 465$55
.dministrati#e e0penses ratio of 2$102 has 5424$61mn of sales o#er

212$52mn administrati#e e0penses leading to highest administrati#e e0penses compared to other years$
5.
Se&&$ng an" D$+#r$4u#$!n e9,en+e+ ra#$!: It refers to all those e0penses incurred for the selling and distri!ution of goods$ :0amples of this are ad#ertisement cash discount allowed carriage outwards etc$ It is e0pressed as followsE Se&&$ng an" D$+#4An e9,en+e+
Se&&$ng an" D$+#4An e9,en+e+ ra#$! N """"""""""""""""""""""""""""""""""""""" I 1>> Ne# Sa&e+
Ta4&e N!./0: Ta4&e S5!=$ng Se&&$ng an" D$+#r$4u#$!n O:er5ea" Ra#$!

Year Se&&$ng an" D$+#r$4u#$!n Sa&e+ Se&&$ng an" D$+#r$4u#$!n Ra#$!
/>>E 138$58
/>>F 341$58
/>>B 220$52
/>>? 522$55
/>>@ 415$04
6412$35 2$422
8015$85 5$482
5424$61 4$0142
18231$68 4$1622
22432$15 1$312
Page 85
C5ar# N!./0: Gra,5 S5!=$ng Se&&$ng an" D$+#r$4u#$!n E9,en+e+ Ra#$!
Ana&%+$+: 7rom the a!o#e analytical ta!le we can o!ser#e there are high selling and distri!ution e0penses ratio in the year 2006 with 5$482 and least ratio in the year 2001 with 1$312$ In#er,re#a#$!n: %he graph of the year 2005 has the selling and distri!ution ratio of 2$422 which has increased to 5$482 in 2001$ Aut has a fall in 2005 with 4$0142 and again rise of 4$1622 in 2008 and had a least ratio of 1$312 in 2001$
6.
Earn$ng Per S5are: %he :PS is one of the important measures of economic performance of a corporate entity$ %he flow of capital to the companies under the present imperfect capital mar,et conditions would !e made on the e#aluation of :PS$ . higher :PS means !etter capital producti#ity$ :PS is one of the most important ratios which measures the net profit earned per
Page 88
share$ :PS is one of the ma)or factors affecting the di#idend policy of the firm and the mar,et prices of the company$ . steady growth in :PS year after year indicates a good trac, of profita!ility$ :PS is computed !y di#iding the net profit after ta0 and di#idend to preference shareholders$ Ne# Pr!8$# a8#er #a9 EPS N """"""""""""""""""""""""""""""" N!. !8 E;u$#% S5are+
Ta4&e N!./D: Ta4&e S5!=$ng Earn$ng Per S5are
C5ar# N!./D: Gra,5 S5!=$ng Earn$ng Per S5are
Ana&%+$+:
Year Earn$ng Per S5are
/>>E 24$51
/>>F 24$18
/>>B 21$03
/>>? 2$58
/>>@ 3$11
Page 81
7rom the a!o#e ta!le 2006 !ears 24$18 :PS compared to 2008@s :PS had least :PS !earing 2$58 In#er,re#a#$!n: . higher :PS means !etter &apital Producti#ity$ In the Year 2006 :PS recorded to !e 24$18 which showed !etter capital producti#ity compared to other ratios whereas 2008 showed less capital producti#ity with 2$58 as :PS$
7.
Re#urn !n In:e+#7en#: %he strategic aim of a !usiness enterprise is to earn a return on capital$ If in any particular case the return in the long"run is not satisfactory then the deficiency should !e corrected or the acti#ity !e a!andoned for a more fa#oura!le one$ %he rate of return on in#estment is determined !y di#iding net profit or income !y the capital employed or in#estment made to achie#e that profit$ It is calculated as followsE NJP 4e8!re In#ere+# an" #a9e+ Re#urn !n In:e+#7en# H """""""""""""""""""""""""""""""""""""""""" I 1>> T!#a& Ca,$#a& E7,&!%e"
Ta4&e N!./E: Ta4&e S5!=$ng Re#urn !n In:e+#7en#+ Ra#$!
Page 10
C5ar# N!./E: Gra,5 S5!=$ng Re#urn !n In:e+#7en#
Ana&%+$+: 7rom the a!o#e analytical ta!le we can conclude the year 2005 has highest ;eturn on In#estment !earing 56$182 and least ;eturn on In#estment at the year 2001 !earing 15$2162 In#er,re#a#$!n: 7rom the a!o#e graph we can conclude that the year 2005 has higher ;eturn on In#estment of 56$182 with 645$18mn of total capital employed whereas 2001 !earing had 15$2162 of ;eturn on In#estment Year NJP 4e8!re Ta9 T!#a& Ca,$#a& E7,&!%e" ROI 56$182 44$512 24$222 15$562 15$2162 645$18 2223$34 4455$33 6411$32 12631$14 />>E 310$52 />>F 535$54 />>B 551$11 />>? 1145$01 />>@ 2156$35
with 12 631$14mn of total capital employed$

/.
Re#urn !n S5are5!&"er+ Fun": %his ratio e0presses the net profit in terms of the eDuity shareholders funds$ %his ratio is an important yardstic, of performance for eDuity shareholders since it indicates the return on the funds employed !y them$ 6owe#er this measure is !ased on the historical net worth and will !e high for old plants and low for new plants$ NJP a8#er $n#ere+# an" #a9 Re#urn !n S5are5!&"er+ Fun" H """"""""""""""""""""""""""""""""""""" I 1>> S5are5!&"er+ Fun"
Ta4&e N!./F: Ta4&e S5!=$ng Re#urn !n S5are H!&"er+ Fun"+ Ra#$!

Year
/>>E
/>>F 562$50
/>>B 533$44
/>>? 535$35
/>>@ 1345$11
NJR a8#er 305$43 Ta9 SHF Re#urn !n SHF 645$18 64$122
2223$34 25$212
4455$33 16$212
6411$32 11$632
12631$14 11$452
Page 12
C5ar# N!./F: Gra,5 S5!=$ng Re#urn !n S5are H!&"er+ Fun"
Ana&%+$+: 7rom the a!o#e analytical ta!le the year 2005 has higher ;eturn on Shareholders 7und &ompared to 2001 which has least ;eturn on Shareholders 7und$ In#er,re#a#$!n: 7rom the a!o#e graph we can #isualise the year 2005@s Shareholders 7und contri!uting to 645$18mn with ;eturn on Shareholders 7und of 64$122 which shows greater sign of ;eturn on Shareholders 7und compared to other years$
(.
Re#urn !n T!#a& A++e#+ Ra#$!: %he ;eturn on total assets measures the profita!ility of company$ %he return on assets is calculated !y esta!lishing the relationship !etween the profit and the total assets employed to earn that profit$ %hus the return on total assets measures the o#erall efficiency of the management in generating profit gi#en le#el of assets at its disposal$ EAT G In#ere+# Re#urn !n T!#a& A++e#+ Ra#$! N """""""""""""""""""""""" I 1>> T!#a& A++e#+
Page 14
Ta4&e N!./B: Ta4&e S5!=$ng Re#urn !n T!#a& A++e#+ Ra#$!

C5ar# N!. /B: Gra,5 S5!=$ng Re#urn !n T!#a& A++e#+ Ra#$!
Ana&%+$+: %he a!o#e ta!le indicates the return on %otal assets of the year 2005 is more when compared to others$ Year />>E />>F 562$50 2518$32 21$652 />>B 533$44 5564$43 5$012 />>? 535$35 10052$55 5$302 />>@ 1345$11 22118$38 6$232
EATGIn#ere+# 305$43 T!#a& A++e#+ Re#urn On T!#a& A++e#+ 1351$21 25$112
Page 13
In#er,re#a#$!n: 7rom the a!o#e graph we can conclude that ;eturn on %otal .ssets in the year 2005 is more constituting to 25$112 as company has maintained less total assets compared to other years and least ;eturn on %otal .ssets in the year 2001 constituting to 6$232
1!.
Re#urn !n Ca,$#a& E7,&!%e" Ra#$!: ;eturn on capital employed is the ratio of ad)usted net profit to capital employed in percentage$ %he return on ?&apital :mployedC may !e !ased on gross capital or net capital employed$ 7ormulation for calculation of return on capital employed is as followsE PAT Re#urn !n Ca,$#a& E7,&!%e" Ra#$! H """""""""""""""""""""""""" I 1>> Ca,$#a& E7,&!%e"
Ta4&e N!./?: Ta4&e S5!=$ng Re#urn !n Ca,$#a& E7,&!%e" Ra#$!
Page 15
C5ar# N!./?: Gra,5 S5!=$ng Re#urn !n Ca,$#a& E7,&!%e"
Ana&%+$+: %he a!o#e ta!le represents the capital employed ratio$ %he ta!le clearly shows capital is properly employed e0cept in 2008 and 2001 which has got least ratio$ %he year 2005 shows good capital employment$ In#er,re#a#$!n: 7rom the a!o#e graph one can interpret that the year 2005 has good Year PAT Ca,$#a& />>E 305$43 645$18 />>F 562$50 2223$34 25$212 />>B 533$44 4455$33 16$2122 />>? 535$35 6411$32 11$6312 />>@ 1345$11 12631$14 11$4512
E7,&!%e" Re#urn On 64$122 Ca,$#a& E7,&!%e"
capital employment with highest ratio of 64$122$ Year 2008 and 2001 has least ratio 0f 11$632 and 11$452 respecti#ely$
Page 16
CHAPTER-E FINDINGSK SUGGESTION AND CONCLUSIONS

%he current ratio for the year 2005 is 1$15 which increased to 1$51 in 2006 and again there is a rise of current ratio in the year 2005 upto 1$66 !ut in 2008 there is slight decline of current ratio tending to 1$54 and at the year 2001 has the highest ratio of 1$81 compared to other pre#ious year current ratios$
%he liDuid assets and current lia!ility of S;S> in the year 2005 is satisfactory as it has maintained liDuid ratio of 0$84 times which is close to 1E1 standard ratio$ Whereas in the year 2005 the liDuid ratio has least proportion of 0$52 times$ Aut we can o!ser#e there is increment of liDuid ratio from 0$52 to 0$60 and 0$60 to 0$84 in respecti#e years of 2006 and 2005$
When we analyse the data and graphs of a!solute liDuid ratio of S;S> necessary steps has to !e ta,en to increase current lia!ility inorder to maintain the norms of a!solute liDuid ratio of 1E2$ %he company has maintained good in#entory to wor,ing capital ratio with all ratios !eing more than ideal ratio 1E1$
Page 15
%he sol#ency ratio indicates the a!ility of the concern to meet its lia!ility out of its total assets$ 6igher the sol#ency ratio !etter will !e the financial position$ 6ere the company has good sol#ency ratio in 2005 and 2001 with 0$61 and 0$64times$
We can see that proprietary ratio in the year 2006 ha#ing a ratio of 0$85 times is considered to !e a sound capital structure for the company$ .s it is said that the proprietary ratio tending to unity is considered to !e the stronger financial position of the company$ It is said that a fi0ed assets turno#er ratio of 5 times more indicates !etter utilisation of fi0ed assets$ .nd from the graph of fi0ed assets turno#er ratio we can see !etter utilisation of fi0ed assets in the year 2005 and 2006 as it has 6$05 times and 6$51 times of fi0ed assets turno#er ratio$ %he fi0ed assets to net worth ratio is said to !e satisfactory in the year 2005 2005 and 2008 compared to 2006 and 2001$ .s those 4years had maintained more than unity #alue compared to 0$54 and 0$11 in 2006 and 2001 respecti#e years$
. current asset to net worth ratio throws a light on financial strength of the concern$ 6igher the current assets to net worth ratio higher will !e financial strength of the concern$ %he company has maintained current asset to net worth ratio to the mar, in 2005and 2001 when compared to other years$
%he a!o#e ta!le indicates current lia!ility to net worth ratio which is decreasing from year to year$
%he total lia!ility to total assets gi#es an idea of total funds short term and long term pro#ided !y outsiders to finance total assets here the company shows higher rate of proportion of total lia!ility to total assets in the year 2006 with 2$58 times$
%he more cash turno#er ratio indicates the effecti#e utilisation of cash resources of the enterprise$ %he company has maintained more than the standard ratio 10E1 in all the years$ It has !een successful in effecti#e utilisation of cash resources of enterprise$ Ay loo,ing at analytical ta!le and chart of in#entory ratio it is found that in the year 2001 &<(S is less compared to past years and a#erage stoc, has !een increase compared to past years$ Whereas in the year 2006 has a highest record of sales with an in#entory turno#er ratio of 2$04 times$ %he wor,ing capital turno#er ratio of S;S> in the years of 2005 2008 and 2001 had least wor,ing capital turno#er ratio of 1$61 1$82 and 0$2 times$ .nd the highest wor,ing capital turno#er ratio recorded at the year 2005 and 2006 were 4$12times and 4times respecti#ely$
%he higher the de!tor@s turno#er ratio is considered to !e a sound financial position$ %he S;S> has maintained its consistency to ,eep the de!tors turno#er ratio at its pea,$ In the year 2008 and 2001 has a sound ratio of 24$86 times and 21$32 times respecti#ely$
Page 11
%he current assets turno#er ratio of the company represents the sales from the amount of current assets$ In S;S> the 2001 sales has !een generated more with current assets turno#er ratio of 5$35 times with net sales of 18231$61mn which is the good sign of utilisation of current assets whereas we can see least utilisation of current assets at the year 2001 with current assets turno#er ratio of 1$40 times$
%he total assets turno#er ratio indicates the company@s a!ility to produce the #olume of sale for a gi#en amount of total assets$ %he company has maintained 3$48 total assets turno#er ratio in the year 2005 which is more compared to other years %.%; "4$08 0$13 1$81 and 0$151$ %he year 2005 has utili8ed the assets effecti#ely compare to other year$
. net sale to net worth ratio indicates whether there is o#er capitalisation or under capitalisation$ It ser#es as a guide in the proper administration of a company$ We can see decline in ratio from 2005 to 2005 with 10$04 to 2$181 decline and increase in ratio from 2$18 to 2$85 in 2005 to 2008 and again decline in 2008 to 2001 from 2$85 to 1$565 times$
%he gross profit ratio of the S;S> has !een in good position as we can see there is increase in gross profit ratio from 2005 to 2005 with gross profit ratio of 52$062 to 58$402 !ut there was a slight drop in gross profit ratio in the year 2008 tending to 55$852$ Aut had a greatest raise in gross profit in the year 2001 tending to 14$052$
Page 100
%he graph showing net profit of S;S> had recorded the highest net profit ratio at the year 2005 of 5$342 and also showed a sound net profit from the year 2005 to 2005 with net profit !eing increased from 5$242 to 5$342 and also we can o!ser#e a slight fall in net profit at the year 2008 tending to 5$082 and there is greatest increase in net profit with 6$322$
It is said that lower the operating ratio higher will !e the net profit ratio as we interpret the analytical ta!le we can find 2001 has least operating e0penses ratio of 14$812 which inturn yields the highest net profit ratio of 6$322$
%he administration e0penses ratio is !een increasing from 2005 to 2005 with 1$182 to 2$102$ Aut we can o!ser#e fall in administration e0penses ratio in conseDuent years of 2008 and 2001 with 2$142 to 1$6452$
Selling and distri!ution ratio is constantly fluctuating from 2005 to 2001 as we can see increase in ratio from 2005 to 2006 and again fall of ratio in 2005 and again raise in selling and distri!ution e0penses ratio in 2008 and finally showing least ratio in the year 2001$
%he :PS of 2005 2006 and 2005 is satisfactory with 24$51 24$18 and 21$03 respecti#ely$ Aut there is a decline in 2008@s and 2001@s
Page 101
:PS contri!uting only 2$58 and 3$11 respecti#ely$ It is said that a higher :PS means !etter capital producti#ity from the analytical ta!le and chart we can interpret that 2006 had !etter capital producti#ity as its :PS had a #alue of 24$18 times$ We can see S;S> has high ;<I at the year 2005 !earing 56$182 with less of total capital employed with 645$18mn compared to other years of capital employed which shows good ;<I position of the company$
Shree ;enu,a Sugars >td has good return on shareholders@ fund at the year 2005 with 64$122 with shareholders fund contri!uting around 645$18mn whereas other years shows gradual fall in return on shareholders@ funds from 25$212 to 11$452 w$r$t 2006 to 2001$
;eturn on total assets of S;S> is more in the year 2005 with 25$112 compared to other conseDuent year which contri!utes around 21$652 5$012 5$302 and 6$232 from 2006 to 2001$
%he company@s return on capital employed has a good percentage in all years with 64$122 in 2005K 25$212 in 2006K 16$215 in 2005 !ut ratio had !een declined in 2008 to 2001 from 11$632 to 11$452$ %he company@s return on capital employed is satisfactory$
Page 102
Page 104

Ratio Shree Renuka Sugars LTD 2

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ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

Seshadripuram Institute of &ommerce - 'anagement

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

Seshadripuram Institute of &ommerce - 'anagement

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

Seshadripuram Institute of &ommerce - 'anagement

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

Seshadripuram Institute of &ommerce - 'anagement

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

7or closing up or liDuidation of the !usiness$

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

Seshadripuram Institute of &ommerce - 'anagement

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

Seshadripuram Institute of &ommerce - 'anagement

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

LI'ITATIONS OF RATIO ANALYSIS:

Seshadripuram Institute of &ommerce - 'anagement

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

STEPS INVOLVED IN RATIO ANALYSIS:

Seshadripuram Institute of &ommerce - 'anagement

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

CHAPTER-/ RESEARCH DESIGN

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

Seshadripuram Institute of &ommerce - 'anagement

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

CHAPTER-0 CO'PANY PROFILE:

A4!u# S5ree Renu6a Sugar+:

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

Seshadripuram Institute of &ommerce - 'anagement

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

&o"generation =i#ision and :ngineering$

S5ree Renu6a Sugar+ L#" V$+$!n:

Seshadripuram Institute of &ommerce - 'anagement

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

Seshadripuram Institute of &ommerce - 'anagement

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

S#reng#5+ !8 S5ree Renu6a Sugar+ L#":

E9#en+$:e In#egra#$!nE e0tracting the

Shree ;enu,a Sugars is e0tensi#ely integrated

S#r!ng g&!4a& ,re+ence:

Pre8erre" +u,,&$er +#a#u+:

Seshadripuram Institute of &ommerce - 'anagement

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

'!"era#$ng #5e $7,ac# !8 +ugar c%c&$ca&$#%:

Su,er 8$9e" a++e# u#$&$<a#$!n:

Seshadripuram Institute of &ommerce - 'anagement

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

%he &ompany en)oys a num!er of ad#antages on account of its South

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

E9ce&&en# 8ar7er re&a#$!n+5$,+:

Sea7&e++ +ugarcane c!&&ec#$!n ne#=!r6:

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

Possesses India@s largest sugar refining capacityF6 000%P=G

De8$n$#$:e nu74er+ a+ ,er Annua& Re,!r# />>?">@:

Seshadripuram Institute of &ommerce - 'anagement

ANALYTICAL STUDY ON RATIO ANALYSIS AT SHREE RENUKA SUGARS LTD

Seshadripuram Institute of &ommerce - 'anagement

I'PORTANT LICUIDITY RATIOS: 1$ &;;:/% ;.%I< 2$ >IMI= ;.%I<

.AS<>%: >IMI= ;.%I<