BHARAT HEAVY ELECTRICALS LIMITED

FINANCIAL STATEMENTS ANALYSIS OF

BHARAT HEAVY ELECTRICALS LIMITED
(BHEL)

A
PROJECT REPORT
Submitted to the faculty of Commerce & Business Administrative
in the partial fulfillment of the requirement for the Degree of
Bachelor of Commerce

HPU University
SUBMITTED BY:

HEMLATA
CLASS : B.Com 6th Sem
CLASS ROLL NO. : C3-15-45
UNIV. ROLL NO.: 3113MNO1170029

UNDER THE SUPERVISION OF :

PROF. RAKESH KAPOOR

DEPARTMENT OF COMMERCE
VGC MANDI (H.P.)
April 2016

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PRFEACE
As the world is growing rapidly, the businesses are also moving to become the huge one. And
by that result, more and more people want to become a master in these businesses. The main
purpose in the finance field is to know how the financial analysis is done. We all know that
finance is the blood of any business and without it no business can run. Financial analysis of
a company is very difficult and the most important task and by doing this I am able to know
the whole financial position and financial structure of the company.

Simply by looking at how much cash a company has does not provide enough information.
The financial statements need to be analyzed to measure a companys performance and to
compare it with other firms in the same industry. The resulting information is intended to be
useful to owners, potential investors, creditors, analysts, and others as the analysis evaluates
the past performance, future potential and financial position of the firm.

This report is an analysis of financial statements of BHEL. This report has been prepared
with an objective to develop analytical skills required to interpret the information (explicit as
well as implicit) provided by the financial statements and to measure the companys
performance during the past few years. The financial statements are analyzed using
traditional evaluation techniques such as horizontal analysis, vertical analysis and trend
analysis. Sincere attempts have been made to make this report error free but if any errors and
omissions are found then I apologize for that.

Hemlata

ACKNOWLEDGEMENT
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This is a great opportunity as well as great honor to submit this Project to you, I am firstly
thanks to my college to give me this kind of course outline and makes me grateful by doing
this project.

I sincerely thank all who have contributed to success this Report. Firstly I thanks to our Prof.
Rakesh Kapoor for makes us able to doing this kind of work and giving us new experience.
And help us a lot whenever we needed. He also provides an important data and makes us to
understand the terms and theory of Finance as well as gives us guidance.

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CERTIFICATE

It is certified that project report Financial Statement Analysis of

B.H.E.L., Submitted by Hemlata in partial fulfillment of the requirement
for the Degree of B.Com from HP University, embodies original work and has
been done under my supervision.

Dated

Signature of Guide

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CHAPTERS

FINANCIAL STATEMENTS:
Financial statements primarily comprise two basic statements:
1. The position statements of the balance sheet.
2. The income statements or the profit and loss account.
Accounting principles specify that a complete set of financial statements must
include:
1. A balance sheet
2. An income statement
3. A statement of change in owners accounts.
4. A statement of changes in financial position.
BALANCE SHEET:
The balance sheet is one of the important statements
depicting the financial strength of concern. It shows the properties that are
owned on one hand and on the other hand the sources of the assets owned by the
concern and all the liabilities and claims it owes to owners and outsiders. The
balance sheet is prepared on a particular date. The right hand shows properties
and assets and the left hand shows liabilities.
INCOME STATEMENT OR PROFIT AND LOSS ACCOUNT:
Income statement is prepared to determine the operation position of the
concern. It is a statement of revenues. The income statement may be prepared in
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the form of manufacturing account to find out the cost of the production in the
form of trading accounts to determine gross profit or loss, in the form of profit
and loss account to determine net profit or net loss.
STATEMENT OF CHANGES IN OWNERS EQUITY:
The term owners equity refers in the claims of the owners of the
business against the assets of the firm. It consist of two elements.
1. Paid up share capital i.e. the initial amount of funds invested by the
shareholders.
2. Retained earnings/reserves and surplus representing undistributed profits.
The statement of changes in owners equity simply shows
the beginning balance of each owners equity account, the reasons of
increases and decreases in each, and its ending balance. However, in most
cases the owners equity account changes significantly in retain earnings
and hence the statement of changes in owners equity becomes merely a
statement of retained earnings.
STATEMENT OF CHANGES IN FINANCIAL POSITION:
The basic financial statement i.e. the balance sheet and profit and loss
account and income statement of a business reveals the net effect of various
transactions on the operational position of the company. But there are many
transactions that do not operate through profit and loss account. Those for a
better understanding another statement of changes in financial position has to be
prepared to show the changes in assets and liabilities from the end of another
point of time. The statement of changes in financial position may take any of the
two forms. They are:
Funds statements
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Cash flow statements

ANALYSIS AND INTERPRETATION OF FINANCIAL STATEMENTS:
Analysis and interpretation of financial statements are and attempt
to determine the significance and meaning of the financial statement data as so
that a forecast can be made of the prospects for future earnings ability to pay
interest, debt and maturities (current and long term) and profitability of a sound
dividend policy.
Financial analysis main function is pinpointing of the strengths
and weaknesses of a business concerns by regrouping and analysis of figure
contained in financial statements by making comparisons of various component
and by examine their content. The financial manager uses this as the basis to
plan future financial requirements by means of forecasting and budgeting
procedures.
The analysis of and interpretation of financial statements represents
the lost of the four measure steps of accounting viz.
Analysis of each transaction to determine the accounts to debited and
credited and the measurements and the valuation of each transactions to
determine the amounts involved.
Recording of the information in the journals. Summarization in largest
and preparation of work sheet.
Preparation of financial statements.
Analysis and interpretation of financial statements results in the
presentation of information that assets business managers, creditors and
investors. This requires a clear understanding of monitoring item of the
items.
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The analysis must group that represents sound and unsound

relationships reflected by the financial statements. Those, the data is more
maintain full and it is placed in better perspective when it is provision and by
means of measurement, its relationship with others is established in terms of if
relative significance and it is ranked in terms of its relative significance. One
can achieve this by comparisons made between related items in the statements
series of years.

TOOLS OF FINANCIAL ANALYSIS USED IN THE STUDY:

MEANING OF COMPARATIVE STATEMENT:
The comparative financial statements are the statements of the
financial position of different periods; the elements of financial positions are
then in a comparative form to give idea of financial position of two or more
periods. The comparative statement may show:
Absolute figures
Changes in absolute figures i.e. increase or decrease in absolute figures.
Absolute data in terms of percentage.
Increase or decrease in terms of percentage.
COMPARATIVE BALACE SHEET:
It is a statement of financial position of a business at a specific
movement of time. It represents all assets owned by the business at a particular
movement of time and the claims of the owners and outsiders against those
assets at the time. It is a way they shape the financial condition of the business
at that time.
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The important distinction between an income statement and

balance sheet is that the income statement is for a period where as balance sheet
is on a particular date.
COMPARATIVE INCOME STATEMENT:
The comparative income statement gives the results of the
operation of a business. The comparative income statement gives an idea of the
program of a business over a period of time. The changes in absolute data in
money values and percentages can be determined to analyze the profitability of
the business.
USES AND IMPORTANCE OF FINANCIAL STATEMENTS:
The financial statements are mirrors which reflect the financial position and
operating strengths or weaknesses of the concern. These statements are useful
to management, investors, creditors, bankers, workers, government and public
at large. George O May points of the following measure used of financial
statements:
As a basis for taxation.
As a basis for price or rate regulation
As a guide to the value of investment already made
As a basis for granting credit.
LIMITATIONS OF FINANCIAL STATEMENTS:
Financial statements are essentially interim reports and hence
cannot be final because the actual gain or loss of a business can
be determined only efface it has put down its shutters.

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They tend to give an appearance if finality and accuracy,

because they are expressed in exact money amount. Any value
to the amounts presented in the statement depends on the value
standards of the person dealing with them.

The balance sheet loses its functions as an index of current

economic realities due to the fact the financial statements are
compiled on the basis of historical costs while there is a market
decline in the value of the monitoring unit and the resultant rise
in prices. The problem has become more important especially
during the war and the post war period.
They do not give effort to many factors, which have a hearing
on financial conditions and operating results because they
cannot be stated in terms of money and are qualitative in nature.
Such factors are reputation and prestige of the business with the
public its credit rating the efficiency and loyalty of its
employees and integrity of the management.
Due to these limitations it is said that financial statements dont
show the financial conditions of the business rather they show,
the position of financial accounting for a business.
PARTIES INTERESTED IN FINANCIAL STATEMENTS:
Now a days the ownership of capital of many public companies
has become truly board based due to dispersal of shareholding, hence, the public
in general evinces interest in the financial statements. Apart from the
shareholders there are other persons and bodies who are also interested in
financial results disclosed by the annual reports of the companies. As already
mentioned, such persons and bodies include:
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1. Potential investors
2. Creditors, potential suppliers or other doing business with the company.
3. Debenture holders
4. Credit institutions like bankers.
5. Employee customers who wish to make along standing contact with the
company.
6. Economic and investment analysis
7. Members.

TREND ANALYSIS:
Trend percentages:
The method of trend percentages in useful analytical device
for the management since y substitution of percentage for large amounts, the
clarity and readability are achieved.
Trend percentages are immensely helpful in making
comparative study of the final statements for several years. The method of
calculating trend percentages involves the calculation of percentage relationship
that each item bears to the same item in the base year. The earliest year may be
taken as base year. Each item of the base year is taken as 100 and on the basis
the percentage for each of the item of each year is calculated.
Least Square Method:
This method is widely used in practised. It is a mathematical
method and with the help of a trend line fitted to the data in such a manner by
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using the actual figures of the study period, we have to calculate the trend
values for these periods. Based on this value we can easily forecast the values of
the future period. The method of least square may be used either to fit a straight
line trend or a parabolic trend. The straight line is represented by the equation
Y(C)=A+B(X).
ANALYSIS AND INTERPRETATION OF FINANCIAL STATEMENT:
An attempt has been made to analyze and interpret the
financial statements of BHEL for the period of 2007-2010. These statements
were prepared on the basis of the data in the balance sheets and profit and loss
accounts of the BHEL for the above period.

RATIO ANALYSIS:
A ratio is a simple mathematical expression. It is a number
expressed in terms of another number, expressing the quantitative relationship
between the two, ratio analysis is the technique of interpretation of financial
statements with the help of various meaningful ratios. Ratios do not add to any
information that is already available, but they show the relationship between
two items in a more meaningful way.
Ratio analysis is a very important tool of financial analysis.
It is the process of establishing a significant relationship between the items of
financial statements to provide a meaningful understanding of the performance
and financial position of the firm. They help us to draw certain conclusions.
Comparison with related facts is the basis of ratio analysis. Ratios may be used
for comparison in any of the following ways.
1. Comparison of a firm with its own performance in the past.
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2. Comparison of one firm with its own performance in the past.

3. Comparison of one firm with another firm in the industry.
4. Comparison of one firm with the industry as a whole.
5. Comparison of an achieved performance with pre-determined standards.
6. Comparison of one department of a concern with other departments.

TYPES OF RATIOS
Liquidity ratio
Capital structure/leverage ratio
Profitability ratio
Activity ratio.

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1.5 Application of available Tools & Techniques for Financial

Analysis of a Company
Financial Analysis is defined as being the process of identifying financial strength and
weakness of a business by establishing relationship between the elements of balance sheet
and income statement. The information pertaining to the financial statements is of great
importance through which interpretation and analysis is made. It is through the process of
financial analysis that the key performance indicators, such as, liquidity solvency,
profitability as well as the efficiency of operations of a business entity may be ascertained,
while short term and long term prospects of a business may be evaluated. Thus, identifying
the weakness, the intent is to arrive at recommendations as well as forecasts for the future of
a business entity.
Financial analysis focuses on the financial statements, as they are a disclosure of a financial
performance of a business entity. A Financial Statement is an organized collection of data
according to logical and consistentaccounting procedures. Its purpose is to convey an
understanding of some financial aspects of a business firm. It may show assets position at
a moment of time as in the case of balance sheet, or may reveal a series of activities over a
given period of times, as in the case of an income statement.
Since there is recurring need to evaluate the past performance, present financial position, the
position of liquidity and to assist in forecasting the future prospects of the organization,
various financial statements are to be examined in order that the forecast on the earnings may
be made and the progress of the company be ascertained.
The financial statements are: INCOME STATEMENT, BALANCE SHEET, STATEMENT
OF EARNINGS, STATEMENT OF CHANGES IN FINANCIAL POSITION AND THE
CASH FLOW STATEMENT. The income statement, having been termed as profit and loss
account is the most useful financial statement to enlighten what has happened to the business
between the specified time intervals while showing, revenues, expenses gains and
losses. Balance sheet is a statement which shows the financial position of a business at
certain point of time. The distinction between income statement and the balance sheet is that
the former is for a period and the latter indicates the financial position on a particular date.
However, on the basis of financial statements, the objective of financial analysis is to
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draw informationto facilitate decision making, to evaluate the strength and the weakness of a
business, to determine the earning capacity, to provide insights on liquidity, solvency and
profitability and to decide the future prospects of a business entity.
There are various types of Financial analysis. They are briefly mentioned herein:
External analysis: The external analysis is done on the basis of published financial
statements by those who do not have access to the accountinginformation, such
as, stock holders, banks, creditors, and the general public.
Internal Analysis: This type of analysis is done by finance and accountingdepartment. The
objective of such analysis is to provide the information to the top management, while
assisting in the decision making process.
Short term Analysis: It is concerned with the working capital analysis. It involves the
analysis of both current assets and current liabilities, so that the cash position (liquidity) may
be determined.
Horizontal Analysis: The comparative financial statements are an example of horizontal
analysis, as it involves analysis of financial statements for a number of years. Horizontal
analysis is also regarded as Dynamic Analysis.
Vertical Analysis: it is performed when financial ratios are to be calculated for one year only.
It is also called as static analysis.
An assortment of techniques is employed in analyzing financial statements. They
are: COMPARATIVE FINANCIAL STATEMENTS, STATEMENT OF CHANGES IN
WORKING CAPITAL, COMMON SIZE BALANCE SHEETS AND INCOME
STATEMENTS, TREND ANALYSIS AND RATIO ANALYSIS.
Comparative Financial Statements: It is an important method of analysis which is used to
make comparison between two financial statements. Being a technique of horizontal analysis
and applicable to both financial statements, income statement and balance sheet, it provides
meaningful information when compared to the similar data of prior periods. The comparative
statement of income statements enables to review the operational performance and to draw
conclusions, whereas the balance sheets, presenting a change in the financial position during
the period, show the effects of operations on the assets and liabilities. Thus, the absolute
change from one period to another may be determined.
Statement of Changes in Working Capital: The objective of this analysis is to extract
the information relating to working capital. The amount of net working capital is determined
by deducting the total of current liabilities from the total of current assets. The statement of
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changes in working capital provides theinformation in relation to working capital between

two financial periods.
Common Size Statements: The figures of financial statements are converted to percentages.
It is performed by taking the total balance sheet as 100. The balance sheet items are expressed
as the ratio of each asset to total assets and the ratio of each liability to total liabilities. Thus,
it shows the relation of each component to the whole - Hence, the name common size.
Trend Analysis: It is an important tool of horizontal analysis. Under this analysis, ratios of
different items of the financial statements for various periods are calculated and the
comparison is made accordingly. The analysis over the prior years indicates the trend or
direction. Trend analysis is a useful tool to know whether the financial health of a business
entity is improving in the course of time or it is deteriorating.
Ratio Analysis: The most popular way to analyze the financial statements is computing
ratios. It is an important and widely used tool of analysis of financial statements. While
developing a meaningful relationship between the individual items or group of items of
balance sheets and income statements, it highlights the key performance indicators, such
as, LIQUIDITY, SOLVENCY AND PROFITABILITY of a business entity. The tool of
ratio analysis performs in a way that it makes the process of comprehension of financial
statements simpler, at the same time, it reveals a lot about the changes in the financial
condition of a business entity.
It must be noted that Financial analysis is a continuous process being applicable to every
business to evaluate its past performance and current financial position. It is useful in various
situations to provide managers the information that is needed for critical decisions. The
process of financial analysis provides theinformation about the ability of a business entity to
earn income while sustaining both short term and long term growth.

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CHAPTER - I
INTRODUCTION
Analysis means establishing a meaningful relationship between
various items of the two financial statements with each other in such a way that
a conclusion is being drawn. By financial statements by means of two
statements
Profit and loss account or Income Statement
Balance Sheet or Position Statement
These are prepared at the end of a given period of time. They are
the indicators of profitability and financial soundness of the business concern.
The term financial analysis is also known as analysis and interpretation of
financial statements. It refers to the establishing meaningful relationship
between various items of the two financial statements i.e. Income statement and
Position statement. It determines financial strength and weakness of the firm.
Analysis of financial statements is an attempt to assess the efficiency and
performance of an enterprise. Thus, the analysis and interpretation of financial
statements is very essential to measure the efficiency, profitability , financial
soundness and future prospects of the business units. Financial analysis serves
the following purposes.
Measuring the Profitability
The main objective of a business is to earn a satisfactory return on
the funds invested in it. Financial analysis helps in ascertaining whether
adequate profits are being earned on the capital invested in the business or not.
It also helps in knowing the capacity to pay the interest.

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Indicating the trend of achievements

Financial statements of the previous years can be compared and
the trend regarding various expenses, purchases, sales, gross profits and net
profit etc can be ascertained. Value of assets and liabilities can be compared and
the future prospects of the business can be envisaged.
Assessing the growth potential of the business
The trend and other analysis of the business provides information
indicating the growth potential of the business.
Comparative position in relation to other firms
The purpose of financial statements analysis is to help the
management to make a comparative study of the profitability of various firms,
engaged in similar businesses. Such comparison also helps the management to
study the position of their firm in respect of sales expenses, profitability and
utilising capital, etc.
Assess overall financial strength
The purpose of financial analysis is to assess the financial
strength of the business. Analysis also helps in taking decisions, whether funds
required for the purchase of the new machines and equipments are provided
from internal sources of the business or not if yes, how much? And also to
assess how much funds have been received from external sources.

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COMPANY VISION,MISSION and OBJECTIVE

VISION:
A world class, innovation, competitive and profitable
engineering enterprise providing total business solutions.
MISSION:
To be the leading engineering enterprise providing quality
products system and services in the field of energy, transportation,
industry, infrastructure and other potential areas.
VALUES:
1. Meeting commitments made to external and internal
customers.
2. Faster learning, creativity and speed of response.
3. Respect for dignity and potential of individuals.
4. Loyalty and pride of the company.
5. Team playing.
6. Zeal to excel.
7. Integrity and fairness in all matters.

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OBJECTIVES
GROWTH:
To ensure a steady growth by enhancing the competitive edge of
BHEL in exiting business, new areas and international operation so as to fulfil
national expectations from BHEL.
PROFITABILITY:
To provide a reasonable and adequate return on capital employed,
primarily through improvements in operational efficiency, capacity utilization
and productivity and generate adequate internal resources to finance the
company growth. Confidence in providing increased value for this money
through international standards of product, quality, performance and superior
customer services.

TECHNOLOGY:
To achieve technology excellence in operations by development of
indigenous technologies to and efficient absorption and adaptation of imported
technologies to suit business needs and priorities and provide a competitive
advantage of the company.
IMAGE:
To fulfil the expectation which stock holders like government as
own employees, customers and the country at large have from BHEL.

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SHAREHOLDING PATTERN OF BHEL

Shareholding Pattern - Bharat Heavy Electricals Ltd.

Holder's Name

No of Shares

% Share Holding

1543452000

63.06%

ForeignInstitutions

394269174

16.11%

FinancialInstitutions

382565498

15.63%

GeneralPublic

53758971

2.2%

NBanksMutualFunds

41888066

1.71%

OtherCompanies

23226795

0.95%

Others

4577534

0.19%

ForeignNRI

3861962

0.16%

Promoters

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CHAPTER- II
COMPANY PROFILE
BHARAT HEAVY ELECTRICALS LIMITED
The vital role played by the BHEL today in the country is the mark of
it continuous efforts to improve the service in the nation by consultancy,
manufacturing and offering services in power sector.

This success story of BHEL however goes back to 1956 when its first
plant was set up in BHOPAL. Three more major plants followed in
HARIDWAR, HYDERABAD and THIRUCHIRAPALLI flowed this. These
plants have been the core of BHELS efforts to grow and diversify and become
one of the most integrated power and industrial equipment manufacturers in the
world. The company now has 14 manufacturing units,8 service centres and 4
power sector regional centres, besides project sites spread all over India and
abroad.

BHEL manufactures over 180 products under 30 major product groups

and meets the needs of core sector like power, industry, transmission, defence,
telecommunications, oil business etc. Its products have established an enviable
reputation for high quality and reliability. This is due to the emphasis placed all
along on design, engineering and manufacturing to international standards by
acquiring and adopting some of the best technologies developed in its own
R&D centres. BHEL has acquired ISO 9000 certification for environments.

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BHEL caters to the needs of different sectors by designing and manufacturing

according to the need of its client in power sector.
PRODUCTS OF BHEL
BHEL manufactures a wide range of power plant equipments and also caters
to the industry sector.
1. Gas turbines
2. Steam turbines
3. Compressors
4. Turbo generators.
5. Pumps
6. Pulverizes
7. Switchgears
8. Oil rigs
9. Electrics for urban transportation system
10.Telecommunication.

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CHAPTER - III
ABOUT MY PROJECT:
The finance function form production, marketing and other
functions. Yet the function themselves can be readily identified. The function of
raising funds, inverting them in assets and distributing returns earned from
assets to shareholder respectively. The finance functions are:
Investment or long term asset mix decision
Financing or capital mix decision
Dividend or profit allocation decision
Liquidity or short term asset mix decision.
OBJECTIVES OF THE STUDY:
1. To calculate the important financial ratio of the organization as a part of
the ratio analysis thereby to understand the change and treads in the firm
financial position.
2. To access the performance of the BHEL on the basis of earnings and also
to evaluate the solvency position of the company.
3. To identify the financial strengths and weaknesses of the organization.
4. To give appropriate suggestion to the investors. To help them to make
over,
5. Informed decision.

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SCOPE OF THE STUDY:

The scope and period of the study is restricted to the following.
1. The scope is limited to the operation in the BHEL.
2. The information obtained from the primary and secondary data was
limited to the BHEL
3. The key information performance indicated is taken from 2007-2010.
4. The profit and loss, the balance sheet was on the last 3 years.
5. Comparison analysis was done in comparison of the sister units.
LIMITATIONS OF STUDY:
1. The study is confined to a period of last 3 years.
2.

As most of the data is from secondary sources, hence the accuracy is

limited.

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CHAPTER -IV
FINANCIAL STATEMENTS OF BHEL

Balance Sheet of BHEL

Parameter

MAR'15

MAR'14

YoY

( Cr.)

( Cr.)

%Change

489.52

489.52

0.00%

Total Reserves

33,595.08

32,557.53

3.19%

Shareholder's Funds

34,084.60

33,047.05

3.14%

Long-Term Borrowings

0.00

0.00

0.00%

Secured Loans

0.00

0.00

0.00%

Unsecured Loans

61.00

104.77

-41.78%

Deferred Tax Assets / Liabilities

-2,220.73

-1,968.95

12.79%

Other Long Term Liabilities

4,657.18

5,835.26

-20.19%

Long Term Trade Payables

701.66

764.91

-8.27%

Long Term Provisions

12,664.67

15,503.88

-18.31%

Total Non-Current Liabilities

15,863.78

20,239.87

-21.62%

Trade Payables

8,798.94

8,717.84

0.93%

Other Current Liabilities

9,123.31

11,445.32

-20.29%

EQUITY AND LIABILITIES

Share Capital
Share Warrants & Outstandings

Current Liabilities

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Short Term Borrowings

0.00

2,550.00

-100.00%

Short Term Provisions

4,285.23

2,829.59

51.44%

Total Current Liabilities

22,207.48

25,542.75

-13.06%

Total Liabilities

72,155.86

78,829.67

-8.47%

Non-Current Assets

0.00

0.00

0.00%

Gross Block

12,588.80

12,050.49

4.47%

Less: Accumulated Depreciation

8,450.53

7,360.39

14.81%

Less: Impairment of Assets

0.00

0.00

0.00%

Net Block

4,138.27

4,690.10

-11.77%

Lease Adjustment A/c

2.25

2.84

-20.77%

Capital Work in Progress

500.50

622.01

-19.54%

Intangible assets under development

17.30

20.11

-13.97%

Pre-operative Expenses pending

0.00

0.00

0.00%

Assets in transit

0.00

0.00

0.00%

Non Current Investments

417.67

420.17

-0.59%

Long Term Loans & Advances

18,542.16

21,055.28

-11.94%

Other Non Current Assets

0.17

0.32

-46.88%

Total Non-Current Assets

23,618.32

26,810.83

-11.91%

Currents Investments

0.00

0.00

0.00%

Inventories

10,101.66

9,797.55

3.10%

Sundry Debtors

26,223.50

28,071.92

-6.58%

ASSETS

Current Assets Loans & Advances

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BHARAT HEAVY ELECTRICALS LIMITED

Cash and Bank

9,812.70

11,872.93

-17.35%

Other Current Assets

176.96

254.47

-30.46%

Short Term Loans and Advances

2,222.72

2,021.97

9.93%

Total Current Assets

48,537.54

52,018.84

-6.69%

Net Current Assets (Including Current Investments)

26,330.06

26,476.09

-0.55%

Total Current Assets Excluding Current Investments

48,537.54

52,018.84

-6.69%

Miscellaneous Expenses not written off

0.00

0.00

0.00%

Total Assets

72,155.86

78,829.67

-8.47%

Contingent Liabilities

10,305.34

10,460.62

-1.48%

Total Debt

117.83

2,722.45

-95.67%

Book Value (in )

139.26

135.02

3.14%

Adjusted Book Value (in )

139.26

135.02

3.14%

View last 5 years Financial Summary

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BHARAT HEAVY ELECTRICALS LIMITED

Profit & Loss A/c of BHEL

Parameter

MAR'15

MAR'14

( Cr.)

( Cr.)

Change %

Gross Sales

31,104.00

40,451.60

-23.11%

Less :Inter divisional transfers

0.00

0.00

0.00%

Less: Sales Returns

0.00

0.00

0.00%

Less: Excise

1,145.58

1,627.87

-29.63%

Net Sales

29,958.42

38,823.73

-22.83%

Increase/Decrease in Stock

-338.04

1,053.65

-132.08%

Raw Materials Consumed

13,703.99

17,141.26

-20.05%

Power & Fuel Cost

554.57

603.52

-8.11%

Employee Cost

5,447.91

5,930.68

-8.14%

Other Manufacturing Expenses

4,410.43

5,291.14

-16.64%

General and Administration Expenses

457.60

475.49

-3.76%

Selling and Distribution Expenses

345.14

405.70

-14.93%

Miscellaneous Expenses

4,980.99

4,683.81

6.34%

Expenses Capitalised

0.00

0.00

0.00%

Total Expenditure

29,562.59

35,585.25

-16.92%

PBIDT (Excl OI)

395.83

3,238.48

-87.78%

Other Income

2,913.15

2,891.37

0.75%

Operating Profit

3,308.98

6,129.85

-46.02%

Interest

91.65

132.63

-30.90%

EXPENDITURE:

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BHARAT HEAVY ELECTRICALS LIMITED

PBDT

3,217.33

5,997.22

-46.35%

Depreciation

1,077.32

982.92

9.60%

Profit Before Taxation & Exceptional Items

2,140.01

5,014.30

-57.32%

Exceptional Income / Expenses

0.00

0.00

0.00%

Profit Before Tax

2,140.01

5,014.30

-57.32%

Provision for Tax

720.72

1,553.52

-53.61%

PAT

1,419.29

3,460.78

-58.99%

Extraordinary Items

0.00

0.00

0.00%

Adj to Profit After Tax

0.00

-81.25

100.00%

Profit Balance B/F

1,171.25

1,102.12

6.27%

Appropriations

2,590.54

4,481.65

-42.20%

Equity Dividend (%)

58.00

141.50

-59.01%

Earnings Per Share (in )

5.80

14.14

-58.99%

Book Value (in )

139.26

135.02

3.14%

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BHARAT HEAVY ELECTRICALS LIMITED

CASH FLOW STATEMENT

Parameter

MAR'15

MAR'14

( Cr.)

( Cr.)

Net Profit Before Taxes

2,140.01

5,014.30

-57.32%

Adjustments for Expenses & Provisions

1,511.09

2,169.17

-30.34%

Adjustments for Liabilities & Assets

-1,845.72

-534.03

-245.62%

Cash Flow from operating activities

775.48

4,518.14

-82.84%

Cash Flow from investing activities

464.31

-168.07

376.26%

Cash Flow from financing activities

-3,300.02

-209.19

-1477.52%

Effect of exchange fluctuation on translation reserve 0.00

0.00

0.00%

Net increase/(decrease) in cash and cash equivalents

-2,060.23

4,140.88

-149.75%

Opening Cash & Cash Equivalents

11,872.93

7,732.05

53.55%

Cash & Cash Equivalent on Amalgamation / Take

over / Merger

0.00

0.00

0.00%

Cash & Cash Equivalent of Subsidiaries under

liquidations

0.00

0.00

0.00%

Translation adjustment on reserves / op cash balalces

0.00
frgn subsidiaries

0.00

0.00%

Effect of Foreign Exchange Fluctuations

0.00

0.00

0.00%

Closing Cash & Cash Equivalent

9,812.70

11,872.93

-17.35%

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Change %

BHARAT HEAVY ELECTRICALS LIMITED

Ratio Analysis
Parameter

MAR'15

MAR'14

Earnings Per Share (Rs)

5.80

14.14

DPS(Rs)

1.16

2.83

Book NAV/Share(Rs)

139.26

135.02

Yield on Advances

0.00

0.00

Yield on Investments

0.00

0.00

Cost of Liabilities

0.00

0.00

NIM

0.00

0.00

Interest Spread

0.00

0.00

ROA(%)

1.88

4.42

ROE(%)

4.23

10.90

ROCE(%)

6.38

15.20

Cost Income Ratio

0.00

0.00

Core Cost Income Ratio

0.00

0.00

Operating Costs to Assets

0.00

0.00

Tier 1 ratio

0.00

0.00

Tier 2 ratio

0.00

0.00

Operational & Financial Ratios:

Margin Ratios:

Performance Ratios:

Efficiency Ratios:

Capitalisation Ratios:

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BHARAT HEAVY ELECTRICALS LIMITED

CAR

0.00

0.00

PER(x)

40.52

13.92

PCE(x)

23.03

10.84

Price / Book(x)

1.69

1.46

Yield(%)

0.49

1.44

EV / Net Sales(x)

1.60

1.01

EV / Core EBITDA(x)

14.45

6.37

EV / EBIT(x)

21.42

7.58

EV / CE(x)

0.66

0.49

M Cap / Sales

1.92

1.24

Core Operating Income Growth

-30.90

5.88

Operating Profit Growth

-46.02

-41.68

Net Profit Growth

-58.99

-47.68

BVPS Growth

3.14

8.55

Advances Growth

0.00

0.00

EPS Growth(%)

-58.99

-47.68

Loans / Deposits(x)

0.00

0.00

Total Debt / Equity(x)

0.00

0.00

Current Ratio(x)

0.00

0.00

Quick Ratio(x)

0.00

0.00

Valuation Parameters:

Growth Ratio:

Liquidity Ratios:

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BHARAT HEAVY ELECTRICALS LIMITED

Total Debt / Mcap(x)

0.00

0.00

Net NPA in Rs. Million

0.00

0.00

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BHARAT HEAVY ELECTRICALS LIMITED

CHAPTER -V
CONCLUSIONS AND OBSERVATION:
1. The current ratio of BHEL is decreasing year by year . In the year 20002001 it was 2.41 and during the year 2008-2009 it has gone down to 1.2
later in the next financial year 2009-2010 it has gone up to 1.46, so the
company should concentrate effectively on the management of Current
Assets and Current Liabilities.
2. The Net Working Capital of BHEL is good for almost in range for each
and every year. It is always in the ideal ratio for every organization.
3. The BHEL is using the moving average method in valuation of stock.
4. The debtors constitute nearly 50% of the Total Current Assets. For the
Company it is difficult to manage the accounts receivables. The company
should collect debts as quickly as possible.
5. The company has to exercise cost of control and cost of reduction
techniques to increase its profitability.
6. The debtors turn over ratio in 2005-2006 is 1.97. the ratio has increased
than previous years except for 2003-2004, which had 2.10. the decreasing
ratio shows the inefficient management. They should concentrate more on
the collection of the debts.
7. The return on investment ratio of the BHEL is 59.40 in 2005-2006. It has
increased when compared to previous years ratios. It is beneficial to
investors who are interested to know the profits earned by the company.
8. The investment in loans and advances should be minimized to possible
extent.
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BHARAT HEAVY ELECTRICALS LIMITED

9. Effective internal control system should be established. So that it can

have control over all aspects of the company.

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BHARAT HEAVY ELECTRICALS LIMITED

BIBILOGRAPHY:
http://www.bhel.com/financial_information/index.php
http://www.studyfinance.com/lessons/workcap
www.bizsearchpapers.com
http://www.antiessays.com/free-essays/9076.html
http://www.bhelhyderabad.com/bhel_hyderabad_unit.htm
http://en.wikipedia.org/wiki/Bharat_Heavy_Electricals_Limited
Financial Management I M Pandey.
Accounting for Managers-Jelsy Joseph Kuppapally.
Financial statement analysis - Gokul Sinha.

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