Case Study

On
“Aftab Auto Mobiles Limited”
Topic: Finance and Accounting Division
Course code: BBA-3323

Course title: Business Policy and Strategy

Prepared for: Prepared by:

MD: Masum Billah Dipock Mondal
Senior Lecturer
Northern University, Bangladesh.

Department of Business Administration

Northern University, Bangladesh

Date of submission: 25TH March, 2010

25TH March, 2010
To
MD: Masum Billah
Course Teacher
Business Policy and Strategy
Department of Business Administration
Northern University, Bangladesh.
Subject: Case study on “Aftab Auto Mobile Limited”

Dear Sir,

We, the student of Business Policy and Strategy course are here by presenting you
our case study on “Aftab Auto Mobile Limited”. It is a great pleasure for us to
present you the Report as a requirement of the course.
This is to bring to your kind notice that it is our great pleasure to submit the Case
Study on the above captioned subject to accomplish the purpose of 25TH as a part
of the course requirement of Policy and Strategy. To prepare this case study we
have tried to maintain your guidelines from several discussions. The whole
experience of this Case Study enable us to bridge the gap between classroom and
real life situation to a great content. Here, we want to declare that, the Case Study
is uniquely prepared by us and we would be happy to provide further clarification
regarding this Case Study whenever necessary. We have tried our level best to
submit this Case Study within the short time.

Hope our effort on writing this Case Study could serve you as an actual source of
information. Thanking you for providing us with such opportunity.

Thank you.
Sincerely,
 Acknowledgement

We the students of Northern University Bangladesh completing 10th Semester are

working for several days to prepare the term paper for “Business policy and strategy” as a
course requirement. All students of our group give their time and effort to prepare the
case solution. Alal, Humayun, Sazzdul, Moumita participate in the Case Study. Ripon
also With us There is no doubt that our Report would become a batter on with their help.
We would like to thank the entire student who helped a lot in preparing the Report.

Last but not least overriding debt goes to MD: Masum Billah lecturer, sir for giving us
this grateful opportunity to work on such an important subject. This would definitely help
us to build and develop ourselves as a team player in the future. Besides this he has also
guided us through the total Report. So we are very grateful to him.
 Introduction

Aftab Automobiles Ltd, a sister concern of NAVANA Group mainly a vehicle

assembling and small parts manufacturing company. The company has been successfully
assembling TOYOTA & HINO vehicles for Bangladesh market since 1982, recently
lunched HINO -Mini bus.

Company has gone through an extensive BMRE and as a result of that Paints and Battery
units were established. It has a great IT and R&D department. R&D department related to
parts design, shape size and its proper function or any difficulty then again check and
rectify. We started this department in full fledged research and development work with
assistance of experience research experts and Engineers.
 Ratio Analysis of Aftab auto mobile limited

RATIO ANALYSIS OF
AFTAB AUTO MOBILE LIMITED
Name of Ratio 2003 2006 2009
1.Current Ratio= 622839161 1515231793 2001267812
Current Assets 599967714 1089431023 1506436479
Current Liabilities = 1.04 times = 1.39 times = 1.33 times
2.Quick Ratio/Acid Test Ratio= 622839161 - 1515231793 - 2001267812 -
Current Assets – Inventories 223982606 610258716 737517274
Current Liabilities 599967714 1089431023 1506436474
= 0.66 times = 0.83 times = 0.84 times
3. Fixed Assets Turnover = 1257281932 1553133796 2124637706
Sales 157248610 250393892 437616084
Net Fixed Assets = 8.00 times = 6.20 times = 4.86 times
4. Total Assets Turnover = 1257281932 1553133796 2124637706
Sales 757116324 1765625685 2438883896
Total Assets = 1.66 times = 0.88 times = 0.87 times
5. Debt Ratio = 17100000+22871447 1106531023 1533364403
Total Liabilities 757116324 1765625685 2438883896
Total Assets = 0.052 = 0.63 = .630
6. Times Interest Earned Ratio = 64950230 47078893 125312761
Earning Before Interest & Taxes 27790260 44319538 90846346
Interest Charges = 2.34 times = 1.055 times = 1.38 times
7. Net Profit Margin = 49359695 48216533 316616692
Net Income 1257281932 1553133796 2124637706
Sales = 0.04 = 0.27 = 0.15
 1. Current Ratio: Current ratio says that in 2006 current ratio is high than 2003 and
2009. It means that Aftab Automobiles Ltd. Can repay the total liabilities with the
current asset by 1.04, 1.39 and 1.33 times.
2. Quick Ratio: It shows the company can meat up the current liability with the
current asset in hand by 0.66, 0.83 and 0.84 times.
3. Fixed Assets Turnover: It shows that company’s sales recover the fixed asset by
8, 6.20 and 4.86 times.
4. Total Assets Turnover: It shows that company’s sales recover the Total asset by
1.66, 0.88 and 0.87 times.
5. Debt Ratio: It shows that company’s Total asset recover the Total Debt by 0.052,
0.63 and 0.63 times.
6. Times Interest Earned Ratio: It shows that company’s Earnings recover the
Total interest expenses by 2.34, 1.05 and 1.38 times.
7. Net Profit Margin: It shows that company’s Net income recover the Sales by
0.04, 0.27 and 0.15 times.

Cash Flow Analysis of Aftab auto mobile limited

2003: In this year the company purchase additional fixed asset of Tk. 97934811
Net cash flow of the company is Tk. 29438922.

2006: In this year the company purchase fixed asset of Tk. 30531889 Net cash
flow of the company is Tk. (9947154).

2009: In this year the company purchases Property, Plant and Equipment of Tk.
22385001 Net cash inflow of the company is Tk. (265362413).
 Strategy of Aftab Automobiles Ltd.

A company’s strategy consists of the set of competitive moves and business

approaches that management is employing to run the company.
Aftab Automobiles Ltd. Use Functional- level Strategy .Because Functional-Level
Strategy Focus on improving the effectiveness of operations within a company’s

 Manufacturing
 Marketing
 Finance and Accounting
 Materials management
 Research and Development
 Human Resources Etc.
Conclusion
Aftab Automobiles Ltd. is one of the leading industry in automobile sector
of our country. Its ratio analysis shows that in 2009 the entire ratio is not so
good regarding to year 2003 and 2006. Otherwise the entire ratio is
moderate.
The company looks forward for considering expansion of the assembling
unit and modernization of the Body Building unit to drive maximum
financial benefits for the shareholder.