Balance sheet

(in Rs.
crores)
Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05

Sources of funds
Owner's fund
Equity share capital 299.39 287.76 287.53 86.92
Share application money - 0.02 - -
Preference share capital - - 15 115
Reserves & surplus 6,648.27 3,425.53 2,519.72 727.65

Loan funds
Secured loans 672.26 771.78 276.61 285.46
Unsecured loans 2,412.48 364.86 58.76 37.08
Total 10,032.40 4,849.95 3,157.62 1,252.11

Uses of funds
Fixed assets
Gross block 779.2 567.04 400.41 217.88
Less : revaluation reserve - - - -

Less : accumulated depreciation 266.98 178.57 104.73 57.61

Net block 512.22 388.47 295.68 160.27
Capital work-in-progress 134.63 92.71 76.25 17.93
Investments 4,919.48 805.26 292.74 126.01

Net current assets

Current assets, loans & advances 7,048.40 5,068.61 3,754.36 1,665.88

Less : current liabilities &
provisions 2,582.33 1,505.10 1,261.41 717.97
Total net current assets 4,466.07 3,563.51 2,492.95 947.91
Miscellaneous expenses not
written - - - -
Total 10,032.40 4,849.95 3,157.62 1,252.11

Notes:
Book value of unquoted
investments 4,919.48 805.26 292.74 126.01
Market value of quoted
investments - - - -
Contingent liabilities 7,584.65 3,607.72 251.63 78.61
Number of equity
sharesoutstanding (Lacs) 14969.34 2877.65 2875.31 869.23
Profit and Loss Account
(in Rs
crores)
Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05

Income
Operating income 6,942.24 5,380.37 3,788.46 1,917.50

Expenses
Material consumed 4,274.96 3,265.14 2,295.66 1,147.99
Manufacturing expenses  386.68 288.3 263.96 20.48
Personnel expenses 139.34 111.46 62.96 35.32
Selling expenses 384.4 327.42 167.98 177.45
Adminstrative expenses 153.75 142.51 60.08 72.08
Expenses capitalised - - - -
Cost of sales 5,339.13 4,134.83 2,850.64 1,453.32
Operating profit 1,603.11 1,245.54 937.82 464.18
Other recurring income 109.38 86.25 69.28 22.96
Adjusted PBDIT 1,712.49 1,331.79 1,007.10 487.15
Financial expenses 142.14 104.03 56.93 43.65
Depreciation  86.21 73.49 45.87 38.97
Other write offs - - - 0.06
Adjusted PBT 1,484.14 1,154.27 904.3 404.47
Tax charges  89.95 69.4 81.43 30.92
Adjusted PAT 1,394.19 1,084.87 822.87 373.55
Non recurring items -128.35 -34.69 -1.64 -12.32
Other non cash adjustments -0.13 10.96 -0.04 0.24
Reported net profit 1,265.71 1,061.14 821.19 361.47
Earnigs before appropriation 2,743.57 1,943.63 1,348.14 668.1
Equity dividend 149.69 143.88 143.76 34.78
Preference dividend - 1.5 1.51 1.51
Dividend tax 25.44 20.39 20.38 4.87
Retained earnings 2,568.44 1,777.86 1,182.49 626.95
 Interpretation

1. Liquidity or Short term Solvency Ratio

A .Current Ratio:-

Importance: It indicates the firms short term solvency position. A ratio of 2:1 is considered as ideal. If
the ratio is less than one the firm faces problems in meeting its short term obligations. Hence it is so
important for every organization.

Formula:

Ratios 2005 2006 2007 2008

Current Ratio 2.32 2.98 3.37 2.73

Current Ratio
4
3.5
3
2.5 Current Ratio
2
1.5
1
0.5
0
1 2 3 4 5

Interpretation: The Ratio is satisfactory because it is more than 2:1. But it has been fluctuating over
the years. The Current Assets of the company have increased from 4994.61 to 6954.47 and Current
liabilities are increased from 1501.98 to 2582.05 by which the ratio is decreased as compare to the last
year. In 2007 the ratio is 3.37 and in 2008 it becomes 2.73.
B .Quick Ratio:-

Importance: As stock may not be converted in to cash quickly we can not measure the firm’s efficiency
in meeting its obligations. Quick ratio is more accurate method than Current ratio and is more useful.
The ideal ratio is 1:1.

Formula:

Ratios 2005 2006 2007 2008

Quick Ratio 1.56 2.05 2.4 2.12

Quick Ratio
3
2.5
2
Quick Ratio
1.5
1
0.5
0
1 2 3 4 5

Interpretation: The ratio has been increasing for three years but it dropped in 2008. The ratio is
satisfactory because it is more than the ideal ratio. The Current liabilities have increased and Current
assets also increased but after deducting the inventory in ratio is little bit decreased. In 2007 the ratio is
2.40 and in 2008 it becomes 2.12.
C .Debt-Equity Ratio:-

Importance: It indicates the relationship between the long term loans and share holders funds. So it is
much important in the view of invester. It gives the information about the relation between the owners
funds to the share holders funds. There’s no ideal ratio.

Formula:

Ratios 2005 2006 2007 2008

Debt-Equity Ratio 0.44 0.13 0.33 0.46

Debt-Equity Ratio
0.5
0.45
0.4
0.35
0.3 Debt-Equity Ratio
0.25
0.2
0.15
0.1
0.05
0
1 2 3 4 5

Interpretation: The ratio is satisfactory because it is less the 2:1. There is a 2 times increased in share
holders funds as compared to the last year and Rs 1948.1cr increase in long term debt, which effect the
ratio. In 2007 the ratio is 0.33 and in 2008 it becomes 0.46.
D .Proprietary Ratio:-

Importance: It indicates relation between the assets and its long term debts and other investments.

Formula:

Ratios 2005 2006 2007 2008

Proprietary Ratio 0.84 0.9 0.94 0.97

Proprietary Ratio
1

0.95

0.9 Proprietary Ratio

0.85

0.8

0.75
1 2 3 4 5

Interpretation: The ratio has been gradually increasing over the years and is satisfactory because it is
less than 1. In 2007 net worth of the company is 4550.46cr and 2008 it becomes 9722.79. In 2007 the
Fixed assets are 4849.95cr and in 2008 it is 10032.40. As you see the amount of Fixed Assets and Net
Worth is increasing in a proportionate rate, that’s why the ratio becomes 0.97 from 0.94.
E .Interest Coverage Ratio:-

Importance: Shows the relation between the interest to be paid and profits, the ratio is low we’ve to pay
off the loans in order to retain profits.

Formula:

Ratios 2005 2006 2007 2008

Interest Coverage Ratio 9.26 15.88 11.09 10.44

Interest Coverage Ratio

18
16
14
12
Interest Coverage Ratio
10
8
6
4
2
0
1 2 3 4 5

Interpretation: There is a increase in PBT from 1119.58 to 1506.96 and increase in Fixed interest
charges 101.47 in 2007 and 139.61 in 2008 due to which there is a change in the ratio. In 2007 the ratio
is 11.09 its decreased to 10.44 in 2008.
2. Activity Ratio or Turnover Ratio:-
A .Inventory Turnover Ratio:-

Importance: By determining this ratio we can know the cost of goods sold, with this we can restrict
our CGS.

Formula:

Ratios 2005 2006 2007 2008

Inventory Turnover Ratio 3.96 3.56 3.96 4.7

Stock Turnover
5
4.5
4
3.5
3
2.5
2
1.5
1
0.5
0
1 2 3 4

Interpretation : The Cost of good sold is increased from 3232.47 to 4226.99 and the Average stock
remains higher as compared to the last year which have effect on the ratio. In 2007 the ratio was 3.96
and it increased to 4.70.
B .Inventory Holding Period:-

Importance: As it dealing with the stock remained in the godown to be sold the cost will go on increase
, hence by this ratio we can know and can increase our efforts of sales and decrease this ratio.

Formula:

Ratios 2005 2006 2007 2008

Inventory Holding Period 90.90 101.12 90.90 76.59

Inventory Holding Period (days)

120

100

80 Inventory Holding Period

(days)
60

40

20

0
1 2 3 4 5

Interpretation: Due to increase in the Stock Turnover ratio, the holding period days have decreased
which is good for the company. In 2007 the holding period is 90.90 and In 2008 it becomes to 76.59.
C. Working Capital Turnover Ratio:-

Importance: Explains about the net sales in relation to current assets and liabilities, which can
determine the target of sales.

Formula:

Ratios 2005 2006 2007 2008

Working Capital Turnover Ratio 2.08 1.55 1.54 1.58

Working Capital Turnover Ratio

2.5

1.5 Working Capital

Turnover Ratio

0.5

0
1 2 3 4 5

Interpretation: There is a increase in the sales from 5380.37 to 6926.01 and increase in the Work in
Capital from 3492.63 to 4372.42. As compared to the last year the proportion of work in capital and
net sales is slightly changed that’s why the ratio is increased little bit.
D .Fixed Assets Turnover Ratio:-

Importance: It gives us details about the turn over/ profit with the given fixed assets (efficiency of
fixed assets utilization)

Formula:

Ratios 2005 2006 2007 2008

Fixed Assets Turnover Ratio 9.44 10.53 10.36 9.65

Fixed Assets Turnover Ratio

10.8
10.6
10.4
10.2
Fixed Assets Turnover
10 Ratio
9.8
9.6
9.4
9.2
9
8.8
1 2 3 4 5

Interpretation: There is a increase in the company sales which is good sign for a company. And
increase in fixed assets from 481.18 to 646.85 in 2008, which effects the ratio. In 2008 the ratio is
10.36 and in 2008 it becomes 9.65.
4 .Profitability Ratio:-
A .Gross Profit Ratio

Importance: It tells about the profit due to sales, so that we can put efforts to increase profits.

Formula:

Ratios 2005 2006 2007 2008

Gross Profit Ratio 22.17 23.54 21.78 21.85

Gross Profit Ratio

24
23.5
23
22.5 Gross Profit Ratio
22
21.5
21
20.5
1 2 3 4 5

Interpretation: The Gross Profit is increased by 52cr and Sales are increased by 1045cr which effects
the ratio. The ratio is 21.78 in 2007 and 21.85 in 2008.

B. Net Profit Ratio

Importance: It tells about the profit due to sales, so that we can put efforts to increase profits.

Formula: Net Profit Ratio = (Net Profit/ Sales)* 100

Ratios 2005 2006 2007 2008

Net Profit Ratio 18.62 21.28 19.41 20.09

Interpretation: There is slight increase in Net profit ratio in 2008 which is a good sign for the
company.

C .Operating Ratio:-

Importance: By this ratio we can control our operating expenses.

Formula:

Ratios 2005 2006 2007 2008

Operating Ratio 24.2 24.75 23.14 23.09

Operating Ratio
25
24.5
24
Operating Ratio
23.5
23
22.5
22
1 2 3 4 5

Interpretation: For calculating the Operating Ratio we have to add the operating expenses in Cost of
Goods Sold. The operating expenses have increased slightly which decreased the ratio. Last year the
ratio is 23.14 and in 2008 it becomes to 23.09.
D .Earning Per Share:-

Importance: It is useful for the long term investors. From the past earning investers make decisions. No
ideal ratio.

Formula:

Ratios 2005 2006 2007 2008

Earning Per Share 42.8 28.57 37.65 9.31

Earning Per Shares Ratio

45
40
35
30 Earning Per Shares
25 Ratio
20
15
10
5
0
1 2 3 4 5

Interpretation: In Year 2007 the company EPS is 37.65 it’s decreased to 9.31 in 2008. The profit was
decreased due to financial crises in the market in 2008.