LIQUIDITY RATIO :

CURRENT RATIO

YEAR CURRENTASSET

CURRENT LIABILITY

CURRENT RATIO

2007 3,74,84,949 4,02,37,510 0.9315

2008 10,55,71,900 11,06,45,470 O,954

2009 13,69,81,394 14,46,19,730 0.947

ANALYSIS

From the above data it is clear that 2008 year the company has more current asset when compare to 2007& 2009. Year. Higher the current ratio indicates firm’s ability to meet its current obligation without any difficulty.

Here debtors constitute 51% of sales, therefore company’s funds locked up in debtors. More over the current liabilities have been increasing from previous year, but company lacks sufficient amount of funds to invest in current asset.

INFERENCES: as a rule, the current ratio with 2:1 (or) more is considere satisfactory position of the firm. From the above graph we can determined the company is not at the satisfactory position, that is it is less than the actual standard, but company started

YEAR 2007 2008 20090

0.2

0.4

0.6

0.8

1

1.2

0

0.9315 0.954000000000001

0.947

CURRENT RATIO

CURRENT RATIO

its operation in 2006 during beginning days company’s expences are more than the current asset. So company should concentrate on reducing the liabilities and to increase their satisfactory position.

QUICK RATIO

YEAR QUICK ASSET

CURRENT LIABILITY

QUICK RATIO

2007 2,27,48,273 4,02,37,510 0.562

2008 73216011 11,06,45,470 0.661

2009 70116359 14,46,19730 0.484

ANALYSIS

The above table clearly showing hcht’s quick ratio are moving towards fluctuating trend .

During the year 2007 the ratios are 0.562 and it increases to 0.661 in 2008 but again it was

decrease to 0.484. With this we can easily say that current position of company is not

satisfactory because the investment in current asset has been decreased from previous year.

Interpretation:

here standard quick ratio is 1:1 and looking at the actual it is very low in the 3 year. Since the quick ratio is less than the standard , here we can assume that the company is not investing in the quick asset , rather it is concentrating on the other current asset.

YEAR

2007 2008 2009 TOATL

QUICK RATIO

0 0.562000000000001

0.661000000000006

0.484 1.70699999999999

0.10.30.50.70.91.11.31.51.7

QUICK RATIO

Axis Title

LEVERAGE RATIO

DEBT EQUITY EATIO

YEAR DEBT EQUITY RATIO

2007 2,94,68,693 1,80,79000 1.63

2008 6,40,86,233 6,05,55,500 1.05

2009 5,52,13,536 14,83,47,590 0.372

ANALYSIS

This ratio is determined to assertain the sound ness of the company , in general lower the debt equity ratio , the higher the degree of protection enjoyed by the creditors,

From the above table we determined that , in the year 2009 which is showing lower debt equity ratio i,e 0.372 compare to previous two years. And company has increased their equity than the previous year. Now the company is enjoying degree of protection

2007 2008 2009 TOTAL

Debt equity ratio ratio

1.63 1.05 0.372000000000001

3.05

0.250.751.251.752.252.753.25

Debt equity ratio ratio

Axis Title

INTERPRETATION:

From the analysis table we interpret that during the year 2008-09the debt equity ratio is very low compare to previous year. Company is having more equity & so company is enjoying high degree of protection.

DEBT ASSET RATIO

Yea debt asset Ratio

2007 29,468,693 7,56,90,120 0.389

2008 6,40,86,233 200,194,556 0.32

2009 5,52,13,536 29,90,62,491 0.184

Analysis

From the table showing that, during the year 2009 the debt asset ratio is very low I.e. o.184 when compare to past years , it clearly indicates that the company’s asset have been increasing continuously compare to previous years.

1 2 3

year 2007 2008 2009 NaN

Ratio 0.389000000000001

0.320000000000001

0.184 NaN

DEBT ASSET RATIO

Axis Title

INFERENCES:

According to standard debt asset ratio should be 1:2 or lower . but from the above analysis we interpret that it has lower than ratio 1. So company’s asset are increasing due to the heavy investment in debtors and fixed asset compare to previous year. So assets are more than the debt .we these interpretation we can say that company ‘s having sufficient financial resource.

Interest coverage ratio

year EBIT INTEREST CHARGES

RATIO

2007 -8155371 1,10,7,740 -7.36

2008 -18683887 46,43,227 -4.02

2009 -8009738 68,48,082 -1.16

ANALYSIS :

A HIGH interest coverage ratio means that the firms ability to meet its interest burden even if earnings before interest and taxes suffer a considerable decline.

Since the company was come into existence in 2006, during beginning year of 2007 the company earnings showing negative trend it is lesser than the interest charges because huge amount of expenditures incurred in the beginning of the years , since company slowly recovering their losses. Now the current interest coverage ratio is -1.16 which is lower than the previous years. since company still running under losses. Now the company is not under satisfactory level .

2007 2008 2009 TOTAL

-7.36

-4.02

-1.16

-12.44

RATIO

Turn over ratio

Inventory turnover ratio

year Cost of goods sold

Average inventory

Ratio

2007 2,19,84,292 74,33,259 2.95

2008 8,20,34,738 2,44,90,550

3.34

2009 14,41,82,840 4,96,05,462

2.90

Analysis :

the inventory turnover ratio measures the how fast the inventory is moving through the firm, and generating sales. The above table shows that during the year 2008 the inventory turnover ratio was higher I,e 2.90 compare to 2009 and 2007 . but the current 2009 inventory ratio is declining compare to the year 2008. Which Leeds to company is not maintaining their inventory efficient

Inventory turn over ratio

INTERPRETION:

The above graph showing that in the year 2008-09 inventory turnover ratio is lower than compare to previous years. so company is not maintaining their inventory properly.

INVENTO

RY TURN O

VER R

ATIO

Y

EAR2009

20082007

TOTA

L02468

10

Series2Series1

Debtors turn over ratio

years Net sales Average debtors

Ratio

2007 1,90,41,980 1,24,82,644 3.05 times

2008 7,10,30,735 2,39,90,550 2.96 times

2009 12,80.55,582 3,39,22,753 3.775times

Analysis

This ratio shows how many times sundry debtors turn over during the year.

From the above given information during the year 2009 showing highest ratio I,e 3.775 times sundry debtors turn over compare to past two year . so we can say that higher the debtors turnover , the greater the efficiency of the management.

INTERPRETION:

The above graph showing that in the year 2008-09 inventory

AVERAGE

COLLECTION PERIOD

YEAR

2007 2008 2009 TOTAL

0

119 123 96

338

AVERSGE COLLECTION PERIOD

turnover ratio is lower than compare to previous years. so company is not maintaining their inventory properly.

Average collection period

year No of days in a year

Debtor turnover ratio

Collection periods

2007 365 3.05 119

2008 365 2.96 123

2009 365 3.775 96

ANALYSISTHE average collection period represents the number of days worth of credit sales that is locked in sundry debtorsDebtors . from the above table we determined that , in the year 2009 the average collection period is very less i.e 96 days compare to previous year. It shows the collections of dues is very fast compare to past two years. Lesser the collection period higher will be the efficiency of the company .

Interpretation

The above graph indicates that in the year 2009 the collection period was very low I,e 96 days compare to previous years. the standard collection period is 30 days to 60 days . so company’s collection period was more than the standard period . so company’s financial efficiency is not satisfactory.

AVERAGE

COLLECTION PERIOD

YEAR

2007 2008 2009 TOTAL

0

119 123 96

338

AVERSGE COLLECTION PERIOD

Fixed asset turnover ratio

year Net sales Total fixed asset Ratio

2006-07 19,041,980 382,05,275 O.498

2007-08 7,09,13,388 945,22,656 0.75

2008-09 12,80,55,582 16,20,91,097 0.80

ANALYSIS:

This ratio measures the efficiency and profit earning capacity of the firm. The above table showing fluctuating trend. During the year 2008-09 the fixed aset ratio increased to 0.80 which was higher than the previous years . but according to the standard the minimum fixed asset ratio should be more than 1. But company’s ratio is less than the standard ratio.

1 2 3

fixed asset turnover ratio year

2007 2008 2009

fixed asset turnover ratio ratio

0.498000000000001

0.750000000000002

0.8

Fixes asset turnover ratio

Axis Title

INTERPRETATION:

From the above analysis we interpret that the company’s fixed asset turnover ratio is less than the standard , so company’s is not utilizing fixed asset properly.

Working capital turn over ratio

year Net sales Net working capital

Ratio

2007 1,90,41,980 -2,76,2561 -6.89

2008 7,09,13,388 -5,419,348 -13.08

2009 12,80,55,582 -90,92,217 -14.08

Analysis : this ratio shows the number of times working captal is turned over in a stated period. The above table is showing negative trend I,e -6.89,-13.08,-14.08 with this we determined that company is not investing funds in the working capital.

year 2007 2008 2009 total0

5

10

15

20

25

30

35

0

-6.89-13.08 -14.08

-34.05

Series1 Series2

Interpretation: According to standard, higher the ratio, greater will be the profit. But from the above analysis we interpret that the company is lacking in the investment in current asset. So company current working capital position is unfavorable.

PROFITABILITY RATIOS.

GROSS PROFIT RATIO

year Gross profit Net sale ratio

2007 -81,55,371 1,90,41,980 -42.82%

2008 -1,86,82,887 7,09,13,388 -26.34%

2009 -80,09,738 12,80,55,582 -6.25%

Analysis:

Gross profit ratio is prepared to measure the efficiency of the production as well as pricing. The above table showing that company is moving under negative trend . in the year 2009 the gross profit ratio is – 6.25%. by analysisng net sales it has been increasing rapidly. But stil company has not recovered their losses and expenditure. So company is not in the satisfactory level.

2007 2008 2009 TOTAL

-42.82%

-26.34%

-6.35%

-75.51%

GROSS PROFIT RATIO RATIO

Interpretation

From the above graph we determined that in the year 2009 the company is slowly recovering their losses from past two year.

According to the standard higher the gross profit ratio it is favorable. Since from past three years the company is not earning any profit , so company ‘s financial position is unfavorable.

Net profit ratio:

Year Net earnings Net sale Ratio

2007 -93,43,111 1,90,41,980 -49.06%

2008 -2,34,33,444 7,09,13,388 -33.04%

2009 -1,50,23,820 12,80,55,582 -11.7%

Analysis:

Net profit ratio shows the earning left for share holders as a percentage of net sale. It measures the over all efficiency of production, administration, selling , finance, pricing . etc…

From the above table we determined that company is not earning any profit because huge expenditure incurred on the machinery, and manufacturing of products. From the past three years the company slowly recovering their losses but it fails to make profit since three years. so company’s financial position is unfavorable.

Inference

From the graph we interpret that since three years the company is not earning profit . so

company’s financial position is unfavorable.

2007 2008 2009 total-49.06%

-33.04

-11.70%

93.8

NET PROFIT RATIO RATIO

NET PROFIT RATIO RATIO

Proprietary ratio

year Share holders fund

Total tangible asset

Ratio

2007 1,80,79000 7,56,90,220 0.23

2008 6,05,55,500 200,194,556 0.30

2009 14,83,47,590 29,90,62,491 049

Analysis :

The proprietary ratio establishes the relationship betweenshareholders funds to total assets. It determines the long-term solvency ofthe firm. This ratio indicates the extent to which the assets of the companycan be lost without affecting the interest of the company

it indicates the share of proprietary fund against each rupee investment and focuses attention on the general financial strength of the company. By Analyzing these table there is constant increase in the fixed asset since three year. In the year 2009 proprietary ratio is 0.49 which is more than the past two years. now the present financial position of the company is favorable.

Proprietary ratio

2007 2008 2009 total

proprietary ratio RATIO 0.23 0.3 0.49 1.02

0.1

0.3

0.5

0.7

0.9

1.1

proprietary ratio

Inference :

According to the standard proprietary ratio should be 1:3. By the above graph we interpret that financial solvency of the company is favourable.

Return on equity :

year Equity earning

Average equity

Ratio

2008 -18682887 39317250 -47.5%

2009 -800,9738 104451545 -7.6%

Analysis:

From the above table we determined that company’s earning moving towards negative trend . In the year 2009 return on equity is -7.6% . company is insufficient to generate revenue .so company has to recover all its expenditure in order to provide good return.

2008 2009 total0

0.1

0.2

0.3

0.4

0.5

0.6

-47.5%

-7.6%

-55.1%

return to equity ratio

Interpretation:

From the above graph we interpret that the company is insufficient to provide good equity return.

Return on total asset

year Net profit after tax

Total asset Ratio

2007 -93,43,111 7,56,90,220 -0.12

2008 -2,34,33,444 200,194,556 -0.11

2009 -1,50,23,820 29,90,62,491 -0.05

This ratio between net profit and total asset. The ratio indicates the return on total asset in the form of profits

With these analysis ,we determined that there is an increase in fixed asset compare to previous years. but stil the company has not been recovered their expenditure . so company is not earning any profit.

At present return asset is -0.05 which is lower than the past years. so company is slowly recovering their losses .

2007 2008 2009 TOTAL

-0.12 -0.11-0.05

-0.28

RETURN ON TOTAL ASSET RATIORETURN ON TOTAL ASSET RATIO

Interpretation :

from the above graph we interpret that company’s total assets are increasing from past two years but company has not been generating sufficient revenue towards the total asset..

Earning power ratio

year EBIT AVERAGE TOTAL ASSET

RATIO

2007 -81,55,371 4,86,02681 -16.78%

2008 -1,86,82,887 13,78,92,388 -13.54%

2009 -800,9,738 24,95,78,523 -3.2%

ANALYSIS;

Earning power is a measure of business performance which is not affected by interest charges and tax burden. It abstracts away the effect of capital structure and tax factors and focus on operating performance.

Since the company is not earning profits from past three years , because huge amount of money blocked in expenditure side . but there is an increase in the total asset since three years. but according to the accounting standard rule higher the earning power ratio greater will be companies strength.

-16.78%-13.54%

-3.20%

Earning power ratio ratioearning power ratio ratio

Solvency ratio

year Total liabilities to outsider

Total asset Ratio

2007 40,247510 75,690,221 53%

2008 110,991,249 200,194,556 55.4%

2009 14,60,63,611 29,90,62,491 48.8%

Analysis

This ratio indicates the relatioship between the total liabilitiesto outsiders to total asset of the firm. Generally lower the ratio of liabilities to total asset , more satisfactory or stable is the long term solvency position.

Looking at the above table , it is clear that the solvency ratio in the year of 2007, 2008, 2009 it is 53% , 55.4%& 48.8%. here in both the year 2007&2008 the ratios are considerably high. But in 2009 it has decreased to 48.8% , but it is still very high , therefore company should concentrate on to reduce the outside liabilities.

20072008

2009total

0%

20%

40%

60%

80%

100%

120%

140%

160%

53.00% 55.40%48.80%

157.20%

solvency ratio ratio

Interpretation :

Generally , lower the ratio of total liabilities, more satisfactory or stable is the long term solvency position of the firm. With the above graph we can interpret that in the year 2008-09 the solvency position is 48.80% which is low compare to last two years. but according to standard, the company’s solvency is very high . so company should reduce the current liabilities.