10 - Deepika - Suzlon Energy

8/8/2019 10 - Deepika - Suzlon Energy

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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 fundsSecured loans 672.26 771.78 276.61 285.46

Unsecured loans 2,412.48 364.86 58.76 37.08

Total 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 - - - -

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

7,048.405,068.613,754.361,665.88

2,582.331,505.101,261.41 717.97

Total net current assets 4,466.073,563.512,492.95 947.91

- - - -

Total 4,849.95 3,157.62 1,252.11

Balancesheet

(in Rs.crores)

Mar '

08

Mar '

07

Mar '

06

Mar '

05

10,032.40

Less : accumulateddepreciation

Current assets, loans &advances

Less : current liabilities &provisions

Miscellaneous expenses notwritten

10,032.40


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Notes:

4,919.48 805.26 292.74 126.01

- - - -

Contingent liabilities 7,584.65 3,607.72 251.63 78.61

2877.65 2875.31 869.23

Book value of unquotedinvestments

Market value of quotedinvestments

Number of equitysharesoutstanding (Lacs)

14969.34


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Profit and Loss Account

Income

Operating income 6,942.245,380.373,788.461,917.50

Expenses

Material consumed 4,274.96 3,265.142,295.66 1,147.99

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

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

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 2,568.441,777.861,182.49 626.95

(in Rscrores)

Mar '08

Mar '07

Mar '06

Mar '05

Manufacturing expenses

Depreciation

Tax charges


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Interpretation

1. Liquidity or Short term Solvency Ratio

A .Current Ratio:-

Ratios 2005 2006 2007 2008

Current Ratio 2.32 2.98 3.37 2.73

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

Formula:

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

1 2 3 4 5

1

2

3

4

Current Ratio

CurrentRatio


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B .Quick Ratio:-

Ratios 2005 2006 2007 2008

Quick Ratio 1.56 2.05 2.4 2.12

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

Formula:

Interpretation: The ratio has been increasing for three years but it dropped in 2008. The ratio issatisfactory because it is more than the ideal ratio. The Current liabilities have increased and Currentassets also increased but after deducting the inventory in ratio is little bit decreased. In 2007 the ratio is2.40 and in 2008 it becomes 2.12.

1 2 3 4 5

1

2

2

3

3

Quick Ratio

QuickRatio


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C .Debt-Equity Ratio:-

Ratios 2005 2006 2007 2008

Debt-Equity Ratio 0.44 0.13 0.33 0.46

D .Proprietary Ratio:-

Importance:It indicates the relationship between the long term loans and share holders funds. So it ismuch important in the view of invester. It gives the information about the relation between the ownersfunds to the share holders funds. Theres no ideal ratio.

Formula:

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

1 2 3 4 5

Debt-Equity Ratio

Debt-EquityRatio


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Ratios 2005 2006 2007 2008

Proprietary Ratio 0.84 0.9 0.94 0.97

E .Interest Coverage Ratio:-

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

Formula:

Interpretation: The ratio has been gradually increasing over the years and is satisfactory because it isless than 1. In 2007 net worth of the company is 4550.46cr and 2008 it becomes 9722.79. In 2007 theFixed assets are 4849.95cr and in 2008 it is 10032.40. As you see the amount of Fixed Assets and NetWorth is increasing in a proportionate rate, thats why the ratio becomes 0.97 from 0.94.

1 2 3 4 5

1

1

1

1

Proprietary Ratio

ProprietaryRatio


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Ratios 2005 2006 2007 2008

Interest Coverage Ratio 9.26 15.88 11.09 10.44

2. Activity Ratio or Turnover Ratio:-

A .Inventory Turnover Ratio:-

Importance: Shows the relation between the interest to be paid and profits, the ratio is low weve to payoff the loans in order to retain profits.

Formula:

Interpretation: There is a increase in PBT from 1119.58 to 1506.96 and increase in Fixed interestcharges 101.47 in 2007 and 139.61 in 2008 due to which there is a change in the ratio. In 2007 the ratiois 11.09 its decreased to 10.44 in 2008.

1 2 3 4 5

5

10

15

20

Interest Coverage Ratio

Interest

CoverageRatio


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Ratios 2005 2006 2007 2008

Inventory Turnover Ratio 3.96 3.56 3.96 4.7

B .Inventory Holding Period:-

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

Formula:

Interpretation : The Cost of good sold is increased from 3232.47 to 4226.99 and the Average stockremains 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.

1 2 3 4

1

2

2

33

4

4

5

5

Stock Turnover


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Ratios 2005 2006 2007 2008

Inventory Holding Period 90.90 101.12 90.90 76.59

C. Working Capital Turnover Ratio:-

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

Formula:

Interpretation: Due to increase in the Stock Turnover ratio, the holding period days have decreasedwhich is good for the company. In 2007 the holding period is 90.90 and In 2008 it becomes to 76.59.

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

1 2 3 4 5

20

40

60

80

100

120

Inventory Holding Period (days

InventoryHoldingPeriod (days)


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Ratios 2005 2006 2007 2008

Working Capital Turnover Ratio 2.08 1.55 1.54 1.58

D .Fixed Assets Turnover Ratio:-

Formula:

Interpretation: There is a increase in the sales from 5380.37 to 6926.01 and increase in the Work inCapital from 3492.63 to 4372.42. As compared to the last year the proportion of work in capital and netsales is slightly changed thats why the ratio is increased little bit.

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

1 2 3 4 5

1

2

2

3

Working Capital Turnover R

WorkingCapital

TurnoverRatio


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Ratios 2005 2006 2007 2008

Fixed Assets Turnover Ratio 9.44 10.53 10.36 9.65

4 .Profitability Ratio:-

A .Gross Profit Ratio

Formula:

Interpretation: There is a increase in the company sales which is good sign for a company. And increasein fixed assets from 481.18 to 646.85 in 2008, which effects the ratio. In 2008 the ratio is 10.36 and in2008 it becomes 9.65.

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

Formula:

1 2 3 4 5

2

4

6

8

10

12

Fixed Assets Turnover Ratio

Fixed AssetsTurnoverRatio


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Ratios 2005 2006 2007 2008

Gross Profit Ratio 22.17 23.54 21.78 21.85

B. Net Profit Ratio

Ratios 2005 2006 2007 2008

Net Profit Ratio 18.62 21.28 19.41 20.09

C .Operating Ratio:-

Ratios 2005 2006 2007 2008

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

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

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

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

Formula:

1 2 3 4 5

5

10

15

20

25

Gross Profit Ratio

Gross ProfitRatio


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Operating Ratio 24.2 24.75 23.14 23.09

D .Earning Per Share:-

Interpretation: For calculating the Operating Ratio we have to add the operating expenses in Cost ofGoods 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.

Importance: It is useful for the long term investors. From the past earning investers make decisions. Noideal ratio.

Formula:

1 2 3 4 5

5

10

15

20

2530

Operating Ratio

OperatingRatio


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Ratios 2005 2006 2007 2008

Earning Per Share 42.8 28.57 37.65 9.31

Interpretation: In Year 2007 the company EPS is 37.65 its decreased to 9.31 in 2008. The profit wasdecreased due to financial crises in the market in 2008.

1 2 3 4 5

10

20

30

40

50

Earning Per Shares Ratio

Earning PerSharesRatio


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Documents

10 - Deepika - Suzlon Energy